How to Drive Meaningful Corporate Partnerships for Stakeholders
Raizor explores what makes a corporate sponsorship successful for all stakeholders
How to drive meaningful corporate partnerships forstakeholders
Fundamentally, what is the purpose of a company? My university lecturer would suggest it’s to advance shareholder wealth. Now this is a traditionally bleak outlook of commerce, reminiscent of the plunder and pillagedays of ‘80s private equity firms. Does it still ring true today? We hear a lotof chatter around corporate social responsibility, triple bottom lines, social enterprise and environmental social governance and a few other acronyms. All fantastic corporate lingo, but what does it actually mean and who does it serve?
Consumers are increasingly aligning their purchasingdecisions with brands they can associate with. This is particularly true foryounger demographics – Millennials and Zoomers. But a manifestation of this is often consumers bearing the cost of corporate plunder. Does it still serve its purpose? A great example is bringing my reduce, reuse and recycle bags to the supermarket. We now have a transfer of commerce from a traditional cost centre of plastic bags supplied to the shopper to a profit centre on more durable plastic and tote bags advertising our favourite beach scene. I don’t believe our groceries are any cheaper for it. A 2018 study from the Danish Ministry of Environment and Food suggests a Jute bags (plastic lined i.e. Trelise Cooperbag) needed to be re-used 24 times before the greenhouse gases frommanufacturing are less than using single-use plastic bags and 871 times for anet environmental impact (measuring everything from water use and ozone depletion to the release of toxins and greenhouse gases). Cynically, this could be considered “Green Washing” or corporate virtue signalling. But it may serve a purpose as a conscious reminder to the consumer that reducing our waste should be front of mind. Just don’t get me started on paper straws (can we all just agree we can drink from the cup?).
In order for a corporate fundraising opportunity to be sustainable, everyone has to win, indefinitely. Countdown and New World will continue their quest of environmental friendliness through the sale of jute bags and not offer free plastic alternatives as long as customers accept it andit doesn’t negatively impact their bottom line.
Creating long-term, fundraising partnerships
I remember selling Whittaker’s chocolate bars as a kid toraise money for school and it’s still around today. Whittaker’s supports charity fundraising through the House of Fundraising which has been around forover 30 years. Why? Because everybody wins. Whittaker’s is happy because more chocolate bars are being sold in bulk, consumers are happy because they get to purchase a chocolate bar at retail price, and fundraisers are happy because they are raising money.
We call this fundraising model ‘Spending Giving’.
However, the chocolate fundraiser is a tired product offering with a poor return on investment. it will cost you $560.80 to buy the minimum amount of bulk Whittaker’s chocolate bars - 432. Each bar sells for $2, giving you a profit of $0.70 per sale or a total net profit of $302.40. Great for raising money for a local footy team, but loftier fundraising goals makes this a weak spending giving model.
Chocolate is great, but so is ROI. So what’s an example of a sustainable corporate sponsorship?
We’ve grappled with this question at Raizor and tried to create partnerships the drive genuine win-outcomes. We believe our Insurance for Good (“I4G”) program in collaboration with Crombie Lockwood is a prime candidate. Any new business account signed up through the program donates 20% of Crombie Lockwood’s income back to charity. Crombie Lockwood still aim to win the account on commercial terms. If we close, everybody wins – Crombie Lockwood wins new business, the client improves their cover and / or saves money and charity benefits from a donation every year. As a by-product, retention rates are improved due to the impact created from the program. This is a low-risk solution for the corporate partner as a billboard you only pay for on success with even greater upside for charity.
We’ve positioned I4G as a fundraising tool for our charity partners. As a case study, one of our motivated champions has earned anannually recurring $20,000 this year. We’ve estimated this has taken about 20 dedicated hours of their time and success is now breeding success. Not a bad return on investment!
How can you construct corporate partnerships that advantage both companies in a triple bottom line outcome (people, profit and impact)? We believe having “skin in the game” and being rewarded based on the success of the partnership. This de-risks the relationship and creates motivation for successfor both parties. Overall, a corporate partnership with charity needs to be authentic and genuine holding each party responsible for success, both impact and financial. This creates long-term, beautiful partnerships that consumer scan get behind and increase stakeholder wealth - true symbiosis.