Charities try branded goods to beat slump

Branded goods may help charities recoup the Lottery-induced donations shortfall. But are they a long-term cure?

The Royal British Legion’s decision to launch its own “charity label” branded product may not get the likes of GMG Brands and Sony Music quaking in their corporate boots but it marks a significant turning point in charity marketing.

The Legion is pushing its famous poppy logo on supermarket and music store shelves throughout the UK – and potentially in Europe and the US – by launching a CD pop music collection. And it is also planning a branded whisky.

This is just the first phase, says controller of fundraising Michael Vernon-Powell, who hints that more products and services are likely to follow. The new brand name may be Poppy although this has not been confirmed. Whatever the charity decides on, it is confident that it will become “a household name”.

The effects of the National Lottery – contributions to charities fell by 6.6 per cent following its launch and they have been declining ever since – have forced charities to accept that they, like any business, have to give supporters something for their money.

Vernon-Powell recognises that it is no longer enough to rattle collection boxes in shopping centres – and he is extremely ambitious about the charity’s future strategy. “If you have Kellogg’s cornflakes, why not have Poppy cornflakes,” he says.

He is equally confident that other charities will follow suit. “They would be fools not to,” he adds. “Charities cannot be seen to take, take, take. You have got to give something back.” He warns, however, that only charities with well-known logos will be able to take advantage of branding. “I can only think of a handful,” he says.

As competition in the groceries and retail sector intensifies and manufacturers have excess capacity, a number are actually approaching charities with proposals to launch “charity label” goods, as the Legion was with the whisky and CD initiatives.

The CDs, produced by MasterTone Multi Media, will be available from September in a range of retail outlets, including music stores and supermarkets. Branded display units or sections carrying the poppy logo will be erected in-store.

Director of MasterTone Christopher Cary says the aim is to encourage people to buy the CDs for the brand, rather than the contents – a consumer decision which is unusual in the current music market. Chief executive Ray Santilli says the scheme will “turn the charity into a commercial business”, moving it away from the traditional function of appealing for donations.

Further down the line, a Legion-branded whisky will be produced by one of the UK’s leading distilleries, to be sold in supermarkets and off-licences, eventually moving into pubs and restaurants.

The charity also plans to use its Poppy scratchcards in the initiative. The scratchcards that don’t carry a cash prize will include discount vouchers to use against Legion branded products.

Though many charities run their own scratchcard games, only a few have introduced their own branded products. Both Cancer Research Campaign and Imperial Cancer Research Fund have their own-brand sun protection lotions, but these are an extension of their operation and have a more functional value.

Imperial Cancer’s SunSafe range is sold through Boots, Waitrose and the charity’s shops, while Cancer Research’s single product is available through Boots, Tesco, Superdrug, Sainsbury’s, Moss Chemists and its own outlets. Susan Osborne, spokeswoman for Cancer Research, says the charity increased distribution this year due to high demand and is now looking to broaden the range.

And as more and more charities embark on ambitious advertising and promotional initiatives, many are now recognising the role of the marketing director.

Cancer Research is creating the role of marketing and fundraising director for the first time in its 75-year history. Recently, it has also appointed a director of retail.

“We changed the role to acknowledge the fact that marketing is an important function for a leading charity like ours,” says Osborne. Cancer Research will also be taking above-the-line advertising far more seriously in the future, and is even considering TV advertising – a medium traditionally shunned by charities because of its high cost.

At the other end of the scale, even the smaller charities are becoming more marketing-focused. The National Autistic Society is the latest to create the post of director of marketing and fundraising.

Global Cancer Concern, a small operation which is launching a 25m appeal to create a worldwide medical training centre, is another charity that has woken up to the power of marketing. It is now discussing a through-the-line campaign with McCann-Erickson, CDP and EURO RSCG Wnek Gosper.

Agencies themselves are taking charities far more seriously. Saatchi & Saatchi recently launched what it claims is the first cause-related marketing unit within a UK ad agency, the Cause Connection.

The Legion may well be the first of many to move out of functional charity-related branded products and into “charity label” goods. And though it could be one answer to increased competition in the donation market, charities still have a long way to go before they find a solution to their long-term funding difficulties.

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