Cause-Related Marketing

History

The term was first used by American Express in 1983 to describe its campaign to raise money for the restoration of the Statue of Liberty. The company donated 1 cent to the Statue of Liberty every time someone used their credit card, and $1 for every new card issued. Over $2 million was raised during the first four months, and, very soon, the number of new cardholders grew by 45 percent and card usage increased by 28 percent. CRM has continued to grow rapidly in the past decade. In recent years, the term has encompassed other cooperative activities involving business and charitable causes, harnessing the power of “doing well by doing good.”

In the United States, the birth of CRM can be traced back to one of the founding fathers, Benjamin Franklin, who in 1747 publicized a “scheme of the Philadelphia Lottery” to raise money for the defense of Philadelphia. Over 30,000 tickets were printed, and the money raised was used mostly for the creation of a militia and the [Page 63]construction of a fort, called the battery, on the Pennsylvania side of the Delaware River, just south of Philadelphia. Later, in an effort to raise money for the first public hospital in the United States, The Pennsylvania Hospital, in 1751, he came up with the new idea of combining public money with private donations, thus creating the first matching grant.

Moving ahead to the late 20th century, another notable CRM campaign occurred in 1976 through a partnership between the Marriott Corporation and the March of Dimes. Marriott's goal was to create a cost-effective media coverage and public relations campaign for its 200-acre family entertainment center, Marriott's Great America, in Santa Clara, California. The objective of March of Dimes, on the other hand, was to increase fund-raising by increasing the collection of pledges. The promotion was conducted in 67 cities throughout the western United States and was deemed to be a huge success for both organizations.

Another example of a CRM campaign was created by Rosica, Mulhern and Associates on behalf of Famous Amos cookies in 1979. The chairman and founder of the company, Wally Amos, spoke on behalf of the Literacy Volunteers of America, and gave back a percentage of the sales of his products to this cause. This cause-marketing tie-in was a “win–win” situation for both Famous Amos cookies and for maintaining visibility of the literacy programs.

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