When our panel of experts predicted the top trends for 2013, "giving back to the community" was on the short list, and for good reason: according to the National Restaurant Association, 52 percent of adults said they are likely to make a restaurant choice based on how much the establishment supports charitable activities.
Jersey Mike's is one brand that has excelled at philanthropy — founder/CEO Peter Cancro even wrote it into the original mission statement in the 1970s. For the past three years, the company has held its national Month of Giving in March, taking individual local causes and bundling them up. The event culminates on March 27, when Jersey Mike's will give 100 percent of its sales to 86 local charity partners.
QSRweb spoke with Rich Hope, chief marketing officer, about the rising trend, as well as the benefits of having a cause-related marketing program.
QSRweb: Do you see more philanthropy efforts in the industry than before?
Rich Hope: Looking around the industry, we do see more companies creating partnerships with great causes — that is good news for everyone as so many organizations, schools and others have experienced a decrease in funding over the last few years.
QSRweb: Despite busy schedules and tight budgets, why is this trend growing in the restaurant industry?
RH: Research has shown that consumers are drawn to cause-related marketing (CRM) programs. In 2011, 37 percent of all people said that they purchased a product associated with a cause and 75 percent say they purchased a brand because they supported a cause. Sixty-one percent will try a new brand if it is associated with a cause — especially one they care about.
QSRweb: How do you ingrain this principle into your system?
RH: It's a philosophy that Peter Cancro emphasizes with each and every store owner: support the community that supports you. Since 2010, locations throughout the country raised more than $5 million for local charities and distributed more than 500,000 free sub sandwiches to help numerous causes. This fervor for helping others has become a "must have" personality trait for prospective franchisees.
QSRweb: What are some of the benefits to having a philanthropic campaign?
RH: The more you give, the more you get. This may be the biggest mental hurdle you have to overcome to be truly successful at cause marketing. This is because we are used to a give-get society: We give our time to an employer and in return get a paycheck. We give our love to our significant other and expect love in return. In many cases, we tend to ration out our giving and expect something immediately in return. But that's just not how it works with cause marketing. You may not be able to always connect the giving with the getting, but I can assure you that you'll need to give and give generously without expectation before you begin to recognize the payback.
And believe me, it does start coming back. Since taking our individual local causes and bundling them up through a national Month of Giving, nothing but good has become of it. Our store sales and average unit volumes have been up, our system is growing faster than it ever has, and our brand awareness continues to expand.
QSRweb: Are there any disadvantages to a CRM program?
RH: Passion and execution are critical elements of any CRM program. If those are not in the equation, you are likely to disappoint your customers instead of wowing them.
QSRweb: Do you have any advice for a concept mulling such an effort?
RH: If you start a CRM program strictly to improve your business, you are likely to end up disappointed. Not that a well-executed CRM program won't build business – it will. But, as with most things in life, you get what you give. If you're going to constantly worry about every penny you give and continually try to measure ROI, failure is likely to be the result. Give first. Care about the cause. Help until it hurts. That's when it all starts coming back.
It's important to remember that passion can't be created for a promotion. It needs to be from the heart. When people become genuinely engaged in caring about a cause and committed to taking action and making a difference — that is when the magic happens. A less than authentic approach will do little to inspire the masses and will fail in the long run.
QSRweb: Outline one of your most successful campaigns and what made it work.
RH: In 2011, Jersey Mike's conducted a CRM program supporting Susan G. Komen for the Cure with a specific goal in mind: reach out to more women customers and bring our customer mix standing at 60 percent male to 40 percent female closer to 50/50. After the six-month campaign, in which Jersey Mike's raised more than $1.1 million for breast cancer research and to conduct mammograms for the poor, our male/female split changed significantly to 54 percent male to 46 percent female.
To bring awareness to the cause, we turned our stores pink, with cups, sub wrap and redesigned bags. In addition, franchisees donated 10 cents for every soft drink sold and the stores sold pink t-shirts, pink commemorative plastic cups and asked customers to join the cause by donating.
QSRweb: How do you achieve an ROI from a CRM program?
RH: There are many sound business reasons for developing a CRM program. Many important consumer groups, and indeed consumers as a whole, respond very positively to companies that support good causes. According to a blog by consulting group Alden Keene and Associates, cause marketing can directly enhance sponsor sales, help the company's public image and distinguish it from the competition; build employee morale; and heighten customer loyalty.
We recently conducted a study which found that 84 percent of heavy/medium Jersey Mike's users are aware of our cause-related programs. But the effect of a well-run program runs deeper than just brand awareness and increased revenue. It creates a company that people are proud to work for, it becomes a franchise that people want to be part of and it creates intangibles that are difficult to place a value on.
Read more about cause marketing.