Consumers take notice when companies lead with socially responsible approaches, often viewing such businesses in higher regard and perceiving their products as greater in value.
Ninety-four percent of consumers believe companies need to do more than just earn profits — they expect them to give back to social causes in their communities and in the world at large.
Charitable donations have also proven to boost sales. They are so effective, in fact, that eCommerce giants like Amazon and eBay employ checkout contribution options as a strategy to keep customers from abandoning their carts. eBay reduced its rate of customer attrition by 67 percent simply by supporting nonprofits.
Retailers are not just looking to donate a percentage of profits to a charity or cause, either, but are also seeing it as a way to foster customer engagement. Brooklyn, New York-based technology accessories eCommerce company Casely established charitable giving as part of its core mission when it was founded in 2017 with the launch of its Every Case Counts initiative, which donates 5 percent of proceeds to a designated charity organization each month.
“This has helped grow the business and connect with other businesses,” said Jeremy Smith, who runs charitable outreach at Casely and operates as its head of product.
The addition of installment payment company Afterpay’s buy now, pay later (BNPL) offerings to Casely’s website in January also brought higher customer spend, with average order values rising 24 percent and conversion rates jumping to about 4 percent in the first few months. This figure has remained steady, according to Casely CEO Mark Stallings.
“Tying into social justice and allowing people to get behind the movement while also offering payment options that will allow them to plan their finances over the next four months, all combined, helped to grow our business long term,” Stallings said.
The Nonprofit Effect
Partnering with a nonprofit can reap benefits, as consumers seek out companies that support socially responsible causes and are more willing to buy their products over those of peer companies.
When COVID-19 was declared a pandemic in March, Casely teamed up with Westerly, Rhode Island-based Ivory Ella, an online for-profit retail company that donates a percentage of profits to organizations, including Save the Elephants. Together the companies designed and covered the costs of producing a phone case and a T-shirt for sale on Casely’s site, for which 100 percent of the proceeds will be donated to Project Sunshine, an organization supporting pediatric patients during COVID-19.
“When we reached out to them, they jumped into action quickly,” Smith said about working on the campaign with Ivory Ella, which they called #SpreadHope. “The partnership helped elevate the campaign and allowed us to connect with each other’s core group of customers — something we’d like to repeat with more companies for certain causes.”
Donating to a variety of charitable causes can expand customer reach for retailer engagement. Casely also recently partnered with HeadCount, a New York-based nonpartisan organization that promotes voter registration through music. The pair collaborated on the creation of a “VOTE” silicon card wallet, for which HeadCount will receive 5 percent of the proceeds as an Every Case Counts charity of the month.
Casely is mainly rooted in current social issues, including Black Lives Matter, LGBTQ rights and women’s causes.
“But like the market, and like the country, we are changing as well,” Smith said. “We spread our efforts as best we can at the time.”
A BNPL Loyalty Boost
Offering installment payment options at checkout can help customers support social causes by allowing them to achieve the more predictable cash flow necessary to afford these donations.
“We want our customers to have an option and a system in place to make a purchase, especially if they identify with us because of our mission, social issues and the charities we support,” Smith said.
Such an approach has helped the company gain customer loyalty and return visits.
“Consumers now are socially conscious and holding brands accountable,” he said. “I think we do a good job of being transparent and picking good organizations with good values that we believe in, and I think our customer base agrees with that, which helps us acquire and continue to have customers order more than once.”
A variety of nonprofits are in dire need of assistance during the pandemic, representing an opportunity for retailers to engage customers looking for ways to help. Casely has thus far raised $64,660 for pandemic-related causes, with such partners as the World Health Organization COVID-19 Response Fund receiving a donation of $13,297; Blessings in a Backpack, a nonprofit that helps feed children in the U.S., receiving $20,170; and Feeding America, the nation’s largest domestic hunger relief organization receiving $15,150. The company projects its total charitable giving will reach $200,000 by year end, up from $52,000 in 2019.
Smith said he predicts there will be a trend toward more charitable giving among retailers in a post-pandemic world.
“I think it’s very important for all brands to find their niche,” he said. “While charitable giving has always been a priority at Casely, we have made it even more of a focus to find brands to be part of our Every Case Counts initiative.”
Today’s consumers want to shop at merchants that meet their needs and support causes that resonate with them. This creates an opportunity for businesses not just to boost customer engagement and loyalty but also to make lasting charitable impacts. How retailers leverage social justice issues of concern to their customers can go a long way in developing lasting relationships that create positive brand awareness.