Charitable giving has been one of the biggest casualties in the economic downturn of the past several years, except, it would appear, at restaurants.
According to the Association of Fundraising Professionals’ “2009 State of Fundraising Survey,” 46 percent of charities in the United States raised less money in 2009 than in 2008. Also, a recent report by the Center on Wealth and Philanthropy at Boston College found that individual charitable giving fell 4.9 percent, from $228.5 billion in 2008 to $217.3 billion in 2009.
Yet dozens of restaurant companies recently reported that their cause-marketing strategies held steady or improved in the past year, and many executives continue to value “social return on investment” as a key component to their overall marketing ROI.
Still going strong
Many restaurant chains, such as Bojangles’ Famous Chicken n’ Biscuits, have met or exceeded their goals for longstanding fundraisers. Randy Poindexter, Bojangles’ senior vice president of marketing, said companies like his let customers make donations to causes in small increments, such as by trading a $1 donation for a paper shamrock displayed at Bojangles.
“We have a very loyal customer base, and our transactions are stable and haven’t really declined during the downturn,” Poindexter said. “People may have cut back on personal donations to charity, but a $1 or $5 donation opportunity is usually something they can still do.”
In March Bojangles raised a record $220,470 for the Muscular Dystrophy Association through its annual Shamrocks Against Dystrophy promotion. The company estimates that sum would let about 275 children with muscular dystrophy attend MDA summer camps in their communities this year. The donation total represents a 65-percent increase over the prior year, Poindexter said.
Nearly all the chains’ 430 restaurants participate in annual efforts for MDA, excluding those in the North Carolina markets of Winston-Salem and Greensboro, Poindexter said. That’s because those units have a long-standing partnership with St. Jude’s Children’s Hospital, and their most recent efforts netted a $65,000 total donation, a 52-percent increase from the year before.
Examples of the industry’s many similar fundraisers include the sale of pink paper stars at Hardee’s and Carl’s Jr. and pink buckets of chicken at KFC for breast cancer research, paper peppers at Chili’s for St. Jude’s, and paper lemons or basketballs at Applebee’s on behalf of Alex’s Lemonade Stand and The V Foundation.
Winning with a tie-in
For some restaurants, attaching a cause to an annual event creates a win-win situation by driving traffic to the brand and donations to a partner charity. Tropical Smoothie Café will run its fourth annual National Flip Flop Day June 18, where the first 500 guests wearing flip flops get a free Jetty Punch. Donations and proceeds from that day, as well as a campaign to drive online and mobile-phone giving, will benefit Camp Sunshine, a retreat in Maine for families with children suffering from life-threatening diseases.
Tropical Smoothie’s efforts last year garnered $270,000, enough to send 180 families to the camp, and it hopes to raise $325,000 this year, said vice president of marketing Barbara Valentino.
“Last year Camp Sunshine was concerned about raising money, and they had a better year than they’d ever anticipated,” Valentino said. “That tells me that during the recession, people reprioritized their lives.”
In fact, ongoing charitable efforts were one of three key initiatives for 2010 that were laid out during Tropical Smoothie’s traveling franchise convention road show. The other initiatives involved building catering and breakfast sales.
“It has to coincide with what works for franchisees’ businesses,” Valentino said. “They’ll schedule these fundraisers for slower times. This is a solid step-by-step program, and we rolled out a manual for it at our franchise convention road show to show that something we do is fundraising. There are a million other local-store marketing programs you can get involved with, but this is the one that we know weaves you into your community and also builds your sales.”
But annual fundraisers don’t always need to happen in the restaurants. Last month, Jack in the Box held its 20th annual charity golf tournament in Indian Wells, Calif., and raised $350,000 for Big Brothers Big Sisters, its national charity partner since 1998.
Industry involvement
Chains and independents without time or resources to plan a major philanthropy campaign still could participate in industrywide events with the scale to raise a lot of money, said operators at the “Winning Share of Heart” cause-marketing panel session at the National Restaurant Association Show held last month in Chicago.
Speaking from their experience with Share Our Strength’s Great American Dine Out, panelists touted industry fundraisers as a means to give back in an authentic way and to engage employees and guests.
Diana Hovey, senior vice president of marketing for Corner Bakery, said its program for SOS paid back in two ways. First, Corner Bakery offered guests a bounce-back coupon for a free Whoopie Pie for every donation to SOS and achieved a 32-percent redemption rate. But it also improved its scores on an employee loyalty survey.
“Our team members got behind hunger as an issue,” Hovey said.
Panelists Brian Foye, senior vice president of operations for The Capital Grille, and Ray Blanchette, chief executive of Joe’s Crab Shack franchisor Ignite Restaurant Group, said their companies’ efforts for Great American Dine Out carried over as well to their employees, many of whom now participate in days of service.
Operators can use philanthropy as a way to engage not only their employees but also their colleagues at other restaurants, said Mindy Segal, chef-owner of Hot Chocolate in Chicago and an organizer for Chicago’s annual SOS fundraiser.
“Everybody has a desire to help another person,” Segal said.
Contact Mark Brandau at mbrandau@nrn.com
