Many individual businesses and corporations “give back” to their specific industries and their communities because they feel it is the right thing to do and it reflects the leadership in the company. But did you know that “social responsibility” is worth money to your bottom line if handled correctly?
Social or environmental responsibility basically is how you use your money, time and influence to make the world a better place.
“Cause marketing” is a new term that goes hand-in-hand with “social and environmental responsibility,” according to an interview with Amy Fenton of The Nielsen Company.
According to an article published by Nielsen based on their research, “Corporate social responsibility, also referred to as corporate citizenship or conscious capitalism, has become a meaningful way brands can differentiate themselves—and a growing base of consumers are clamoring to pay for it. In fact, 55% of global respondents in a recent Nielsen survey say they’ll pay extra for products and services from companies that are committed to positive social and environmental impact. And when we look at how the perspectives vary between the sexes, we see that most of the differences show up in the causes that women care about, both in magnitude and ranking.”
But it isn’t enough just to “do good,” you must communicate those actions to your customers.
Fenton noted that brands that communicate their social and environmental engagement–compared to companies that either aren’t socially engaged or are not communicating it–on average have five times the revenue.
In other words, there is a sales lift from social responsibility engagement.
Fenton said this is a big opportunity for companies, but she also noted that social responsibility is becoming less of an option for companies. Customers are seeking out those companies that are socially responsible.
She said that there are socially responsible brands and products across all price ranges now, so small and large companies are competing in this area for customers.
Fenton stressed that there is an internal and external component to social responsibility. Internally, the company needs to determine how and why they should give back socially or environmentally, and externally the company must understand what their consumers are looking for in terms of social responsibility from the company’s products and categories.
The bottom line is that no matter how big or small your company is—whether you are a one-person practice or a huge company—you need to understand in social responsibility terms what is important to your customers and what is important to your company. You need to take action to be socially responsible, and you must communicate your actions to your customers.
For more information you can visit Nielsen.com.