Pairing Charity with Neuroscience: How American Express Ignited Consumer Behavior by Donating to the Statue of Liberty
January 24, 2012 3 Comments
A new trend in marketing has developed over the last 30 years known as cause-marketing or cause-oriented marketing. This is the event which a for profit organization partners with a non-profit organization to promote awareness of a particular concern. Cause-Oriented Marketing began in the early 1980’s when American Express announced they would donate one penny for every American Express Card sale to the renovation of the Statue of Liberty; increasing card sales by 28%. Studies show consumers have an increased positive response to a company that collaborates with a non-profit also preferring those products with a logo of the charity. This also increases the consumers trust in the product or company. What marketers don’t know is giving to charity is a science.
Recent fMRI studies indicate our ability to give to charity is actually a science. Studies show activation between the cognitive areas of the brain contained in the cerebral cortex and the more developed goal oriented limbic system. One area of the brain in particular, the posterior superior temporal cortex (pSTC), closely associates itself with the part of the brain that acts for the intentional benefit another person, or people. In the study, subjects had a choice whether to keep $100 for themselves or donate $100 towards a charity. An increase in activity took place within the pSTC as well as the septal region (part of the brain associated with reward), for those who elected not to donate rather than keep the money. This may help explain why so many people are willing to help someone and so few are able to ask for help. The positive experience of contributing donating to charity is then associated with the product. The product is thus associated with consumers as being a trustful product.
Cause Marketing can have a reverse affect as well. Since the two companies are partners, actions from either one can have an impact on the other. For example, recently Smith Kline Beecham Health Care entered an agreement with the American Cancer Society (ACS), placing the ACS logo on nicotine patches in the “Partner’s Helping You Quit” campaign. The Attorney General’s from 12 states concluded that the partnership implied on the advertisement construed as the ACS’s endorsement of the nicotine patches thus misleading and confusing customers. The overall outcome was a settlement of $12 million from Smith Kline Beecham. The reverse can be true as well. Suppose you purchased an inferior product that has been associated with a non-profit. Since your negative experience is associated with the product, the same negative feelings attribute to the non-profit as well.
Cause marketing has the potential to bring awareness to a cause. High consumer confidence is a direct association with the non-profit. The neuro-mechanisms within the mind associate the positive feeling of helping and the reward we feel for doing so. Just be careful.
Pryor, M., Lockyer, B., Blumenthal, R., Ferren, J. M., Butterworth, R. A., Ryan, J., et al. (1999). What’s in a Non-Profit Name? Public Trust, Profit, and the Potential for Public Deception.
Tankersley, D., Stowe, J., & Huettel, S. (2007). Altruism is associated with an increased neural response to agency. Nature Neuroscience , 10 (2), 150 – 151.