August 2000 - Strategic Philanthropy

By John Loheit (Datacard)

Strategic Philanthropy. Say it a few times, and you are sure to become tongue-tied. But those who understand and make use of it are not only able to say it but have also seen very positive results from this approach to community involvement. In a nutshell, strategic philanthropy is the marriage of one or more of a company"s products or services with a public cause where both the company and the cause benefit from the relationship.

General Mills has been doing this for some time and has seen very positive results in terms of brand-cause relationships. Examples of their successes are the Yoplait Yogurt and "The Race for the Cure" and "Box Tops for Education" (which raised $9.5 million for schools) and food donations to Second Harvest (which would be the equivalent of 1 1/2 trailer loads a day). Recently they have joined with public television and the literacy campaign by underwriting the children"s show "Between the Lions".

At the July CVC program meeting, Mr. David Nasby, Director of Community Affairs for General Mills, Inc. and Vice President of the General Mills Foundation, addressed a group of about 30 people from the Minneapolis Corporate Volunteerism Council and its member organizations to discuss this topic in more detail. Mr. Nasby has been a member of several community-based boards and most recently served three years as Chairman of the Board for the Second Harvest Food Bank.

The General Mills strategic philanthropy goal statement has two parts:

1. To position General Mills brands as good corporate citizens in the minds of consumers and key opinion leaders

2. To show our connection with issues and causes that consumers care about, thereby increasing consumer preference for our brands.

Statistics that Mr. Nasby shared suggest why strategic philanthropy can be so important to an organization:

• 42% of consumers are influenced by companies that contribute to the community
• 31% of consumers are influenced when employees of companies are involved in the community

Mr. Nasby said that one of the problems that General Mills faces is that consumers don"t "buy a box of General Mills," they buy a box of Wheaties or a container of Yoplait Yogurt. General Mills, through strategic philanthropy, works to bridge the consumer awareness between the end product and the parent company.

At one point during his presentation, Mr. Nasby asked the rhetorical question: "If we are talking about strategic philanthropy in the year 2000, does that mean we haven"t been doing it for the last 20 years?" His answer was "No." In fact, many organizations have been involved in strategic philanthropy, they just have not necessarily put this label on it. The alignment of brands with community-based causes can be seen in many places. Organizations like McDonald"s and the Ronald McDonald House, Target and St. Joseph"s Children"s Hospital, KARE11 Television and Toys for Tots or the "11 Who Care" are all examples of strategic philanthropy at work in our community.

Mr. Nasby also suggested that, in general, we aren"t careful enough with the way we speak about our community involvement. Many people say that they are investing in their communities, but what does it really mean to "invest" in your community? A typical community event can reap personal rewards for individuals involved and can have some residual effect on the organization. If the community event is more strategically positioned with a product from that individual"s company, a long-term relationship could develop that benefits not only the volunteers and the non-profit for that specific event but the company and the non-profit over a longer period of time.

Some of Mr. Nasby"s key points were:

• Align your community involvement with brands in your business to create a clear bond between them in the minds of your consumers.
• Work with business units and product management teams to develop long-term goals and plans for the brands relationship to the community activity. The General Mills rule of thumb is a three year commitment on the part of the brand to support the cause.
• Develop a financial partnership between the foundation side of your organization and the business side of your organization to ensure a committed effort is put forth by all involved.
• Try to avoid promotion-based relationships that are short term and really don"t build a strong relationship between the brand and the event.

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