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Cause Marketing Getting Back On Track

Media Post, September 19, 2013

By Aaron Baar

After a sharp drop-off in sponsoring cause-related events and programs last year, marketers are getting back on board with supporting charitable activities.

According to IEG, sponsorship spending on causes is expected to reach nearly $1.8 billion this year, up 4.8% over 2012’s levels. That is a significant increase over the 1.2% growth from 2011 to 2012. Last year’s relatively small increase can be attributed to two overriding factors: the Susan G. Komen Foundation controversy over cutting grants to Planned Parenthood chapters and Hurricane Sandy, says Jim Andrews, senior vice president and content director at IEG.

“Some [companies] may have gotten a little skittish, significantly in the latter part of the year,” Andrews tells Marketing Daily. “In the wake of Sandy, many just diverted dollars into pure philanthropy. It diverted dollars from cause events into straight donations.”

Though growing, cause marketing’s 4.8% growth trails the projected 5.5% growth for the overall sponsorship industry, and lags sports (6% growth) and entertainment (5.1%). It is higher than sponsorship of associations and membership organizations (4%), the arts (3.3%) and festivals, fairs and annual events (2.9%).

By category, retail and financial services are the most active sectors sponsoring causes, in part because of the transactional nature of their business (particularly retail) and, in the case of financial services, to improve their image.

“Retail in general, particularly department stores, have always been active in supporting community causes,” Andrews says. “It’s the nature of the retail segment to be involved.”

Among individual companies, Bank of America led the list of cause marketing sponsors (18% of causes reported BoA as a sponsor), followed by Coca-Cola (14%) and Wells Fargo (13%).