Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, December 19, 1993 TAG: 9312150303
SECTION: BUSINESS PAGE: F1 EDITION: METRO
SOURCE: John Levin
DATELINE: LENGTH: Long
The tree is decorated with tags, each bearing the name, age and clothing sizes of a needy child. Customers are invited to donate Christmas gifts - purchased at Hills or elsewhere - for children who otherwise might not get anything. Working with the Salvation Army, the Canton, Mass.-based discount retailer last year collected about 22,000 such gifts.
"As far as sales go, it's hard to measure any impact," McMullen said. "But we've had compliments." Hills' Roanoke Valley customers will donate 300 gifts to the Salvation Army, he predicted.
Quincy's Family Steakhouses have a similar program, called the Wishing Tree. The Spartanburg, S.C., chain's Salem restaurant delivers to the Rescue Mission gifts donated by its patrons for underprivileged children. Between Thanksgiving and Christmas Eve, the local Quincy's annually collects about 350 gifts, among 135,000 at the chain's 213 restaurants.
"Customers seem pleased to see we're doing this," said Mark Dingee, general manager of the Salem Quincy's. He believes the promotion has a positive impact on sales "but I can't put a number to it."
Charles Capps does have a number, $2,595 to be precise. That's the amount the Wal-Mart Stores unit at Roanoke's Hunting Hills Plaza recently gave the Salvation Army. The money equaled an undisclosed portion of that store's sales between 7 and 10 a.m. on Nov. 26, the day after Thanksgiving.
Wal-Mart Stores Inc., the nation's largest retailer and often labeled as the predator of hometown merchants, softens its image by helping local charities. Each store's staff decided which charity gets the money. Last year for the entire chain, the amount totaled $2.6 million.
"I think it helps consumers to shop here knowing money is going to charity," Capps said. "I do know community involvement means a lot to people."
According to a new national study, supporting a charity or special cause is a powerful marketing tool, strong enough to prod consumers to switch brands and stores.
American Express introduced the concept of cause-related marketing a decade ago, donating a percentage of use of its credit cards to the national fund to restore the Statue of Liberty and Ellis Island.
The survey was conducted in August by Cone Communications, a Boston advertising agency, and Roper Starch Worldwide Inc., a New York marketing research firm. It found:
Cause-related marketing is acceptable and a good way to help solve social problems, according to 66 percent of the 1,981 adult Americans surveyed; 64 percent of them believe it ought to be a standard part of a company's activities and 84 percent said it polishes the corporate image.
78 percent of the respondents said they're more likely to buy products associated with a cause they care about, 66 percent would switch brands and 62 percent could switch stores provided they got equal price and quality.
A product associated with the right cause is worth a higher price, said 54 percent, with one-eighth of the people willing to pay as much as 10 percent more to support a cause they care about.
One-third of the respondents said that after price and quality, a company's "responsible business practices" are the most important factor in deciding whether to buy a brand.
A key finding, said Cone Communications spokeswoman Margaret Kaufmann, is that the group of consumers most likely to be influenced by cause-related ads are what marketers call "opinion leaders" - households with annual incomes over $50,000. The big spenders.
"In the 1980s, Americans were looking for luxury and prestige, and they aspired to brands that gave them that," said Ed Kellyer, executive vice president of Roper Starch Worldwide.
But "to succeed in the 1990s, brands will aspire to people. Products will have to meet not only the price and quality demands of consumers but their personal values as well," he said.
Cause-related marketing can be a short-term builder of sales, such as the special holiday promotions. But if customers feel a company is socially responsible, the impact can give it a long-term edge in retaining customers, Cone Communications said.
But that's assuming the consumer and company agree on a particular issue or cause. And if there's a change of disagreement, the results can be adverse, said Bill Thomasson, executive vice president of The Packett Group Inc., a Roanoke advertising agency. "People will walk with their dollars if they don't agree," he said.
Packett took such a risk in 1991, when it canceled its holiday party for clients, announcing in the midst of recession it would donate the celebration's budget to charity.
The company resumed the party last year, but asked guests to bring checks written to the Salvation Army. Continuing its new tradition, Packett's guests this month raised $1,750 for the charity, Thomasson said.
And what's it done for the agency's image?
"The first year we did it, we got a gratifying phone call from a man in Bedford who said he runs a small business and didn't need an advertising agency but said, `If I ever do, I'll call you.' "
by CNB