The millennial generation has received plenty of grief over the years; they’ve been called entitled, impatient, self-assured and lazy. Despite all the negativity, brands are finding millennials increasingly influential when it comes to purchasing power.
According to a Pew Research Center analysis of U.S. Census Bureau data, the millennial generation is expected to overtake the workforce by 2020 and will have the largest bucket of disposable income – which means brands should be paying attention.
Brand loyalty has been difficult to achieve with this group of consumers, but cause marketing is helping bridge the gap and create a stronger affinity. A Daymon Worldwide study shows less than 30 percent of millennials buy the same brand, compared to 35 percent of Generation X. While this shows it might be tough to earn brand loyalty, those who do may have a customer for life.
Millennials specifically look for brands to invest in causes and communities they care about (such as the original pioneer, TOMS), which is different from the Generation X approach. Generation X purchases brands based on name value (top of mind and big-box), as opposed to how millennials are now purchasing on community values. Fifty percent of millennials are value driven and will support, or boycott, a brand based on their perception of a controversial or social issue (2017 Edelman Earned Brand Study). Many millennial consumers see purchases as investments – they want to invest in high-quality products but also invest in companies whose social responsibilities align with their own.
Another aspect to consider is that today’s brand loyalty isn’t one-way. Brand loyalty is now defined not only as customers’ loyalty to brands but to brands’ investment and loyalty to their customer base and their values. Sprout Social’s 2018 research shows that about two-thirds of consumers consider it important for brands to take public stands on social and political issues. Millennials, the pocketbooks of the future, want to know they are making purchases from companies who support causes they care about or at least causes they can get behind.
Top Reasons to Invest in Cause Marketing:
- Establish trust with consumers
- Build goodwill
- Show your brand’s personality and values through action, not just words
From shoes and eyeglasses to gum and books, the buy one to give one model (or one for one) is prevalent in new consumer product companies. When consumers purchase one product, the brand will donate that same product to someone in need, which aligns well with millennial consumers’ desire to do good in the world through their purchases. Part of the attraction to this model for brands (aside from positively impacting the community) is building brand awareness. This business model lends itself well to social media buzz while also establishing trust and building loyalty with consumers – especially those interested in your principals.
Ways to Utilize Cause Marketing
- Fundraising – offer to match donations your consumers make for a cause aligned with your brand.
- Facilitate volunteer efforts with your employees and encourage others to join.
- Donations (cash or in-kind) can raise awareness.
- Partner with local non-profits to start a mentorship program.
- Develop scholarship programs with contests to increase social engagement.
That being said, cause marketing doesn’t work for every brand. When it doesn’t fit, consumers know. Millennials are quick to point out when brands are insincere or miss the mark (like Pepsi’s oversimplified, tone-deaf ad showing how a beverage can stop a protest, and more recently, Facebook not taking responsibility for their actions that prioritized company growth over user safety). For cause marketing to work, it requires a delicate balance between your brand’s values and consumer attitudes – not just for your bottom line – but to positively impact the communities served.