Strategic philanthropy involves companies partnering with non-profit organizations to help a worthy cause and increase brand awareness, which can benefit the company’s bottom line. This can be achieved through donations, providing resources, or forming long-term relationships. Companies must prioritize the charity’s benefits to avoid negative effects on public perception.
Strategic philanthropy is a business concept whereby companies take charitable actions and receive indirect financial benefits from these actions. The process usually involves a company entering into some sort of partnership, either on a project basis or on a long-term basis, with a non-profit organization. In the process of strategic philanthropy, the company is able to do good for society by using its funds or other resources to help a worthy cause. The tangible benefit of this action is that it increases brand awareness of the company and that the public can form a positive association with the company, both of which can help the company’s bottom line going forward.
Most of the big corporations are involved with different charitable causes. These companies can be important sources of funding for non-profit organizations, as they can provide the type of funding that non-profit organizations would not be able to secure elsewhere. While a business usually doesn’t need any other reason to help charitable causes other than a simple desire to help, it can secure some indirect benefits for its bottom line in the process. This is where the concept of strategic philanthropy comes into play.
To execute strategic philanthropy, a business must form some sort of relationship with a non-profit organization. This can happen simply when a company donates money to the nonprofit’s chosen cause. A company may also become more directly involved with a charity, providing valuable resources to the cause or even having their employees volunteer at an event. In some cases, a company may even form a long-term relationship with a non-profit group, acting as a corporate sponsor.
One of the most important aspects of marketing is brand awareness, and strategic philanthropy is an excellent way to achieve this. Brand awareness basically means that once a consumer learns about a particular company and feels comfortable with it, they are more likely to purchase goods or services from that company. A positive relationship with a worthy charity can certainly make consumers feel comfortable with a specific company.
As a result, the strategic philanthropy performed by a company can remain in the minds of consumers when they have to decide between different alternatives to meet their needs. In this way, not only does the business help a worthy cause, but the marketing related to the cause in turn helps sales and profits. Companies must ensure that they always put the charity’s benefits first in such deals, otherwise the effect on public perception could turn out to be the opposite of what was anticipated.
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