03.Pros and cons of CRM
What are the advantages of CRM?
Michael Walsh, of Givewell, says that a good CRM partnership can improve a charity’s recognition among consumers. “To achieve name recognition is very expensive, and any cause-related marketing a charity can do that improves unprompted name recognition is obviously going to do better than other fundraising appeals,” he says.
Hailey Cavill says another advantage is that many causes need to raise awareness and educate the public. “A good example is breast cancer charities, such as the NBCF [National Breast Cancer Foundation]. I think they’ve been very smart recognising that with this disease women need to know how to take preventative measures. To reach those women you can either spend millions of dollars advertising in women’s magazines or you can align with companies that already have products that women are buying. It’s a perfect way to get your message out there and raise money at the same time.”
For companies, there’s increasing awareness that to be seen to be doing good is good for business. While many companies already donate funds to charities through foundations or workplace giving, CRM is a public way of communicating corporate social responsibility as well as having the opportunity to increase sales.
When CRM doesn’t work
Most of the experts we spoke to agree that there are two key issues to a good cause-related partnership — that it is long-standing and both the company and the charity have similar goals. If the company and the cause don’t have a good fit it’s usually the charity that comes off second best.
Michael Walsh says the main disadvantage of CRM is that the relationship between the charity and the company could be unequal. “If you have a company with a big budget and lots of expertise and then you have a charity that has a good brand but not as much in terms of resources, you’ve got an unequal relationship and the risk is that the charity sells itself too cheaply.”
While big national charities such as The Smith Family and the NBCF admit they are in a position to pick and choose which organisations they partner with, other charities may not be so fortunate.
The experts also agree that CRM won’t work for all charities. While causes that support children, breast cancer and the environment are always popular, lesser-known or what could be perceived as unappealing causes aren’t likely to be appearing on your supermarket shelves anytime soon.
Sue Anne Wallace, CEO of Fundraising Institute Australia, says that charities need to think carefully about choosing a partner. “If a charity loses its reputation either by something it does or by what its partner does, that reputation is harmed and could be irrevocably harmed. Reputation is the most precious thing a charity has.”
Hailey Cavill says that she sees a lot of companies choosing the wrong charity. ”Many are jumping on the green bandwagon right now just because it’s hot. I’ve had companies come to me wanting to do something environmental but when I’ve asked questions about their own practices they realise an environmental CRM would leave them open to public scrutiny. In the environmental space, walking the talk is critical.”