#101 - 5 Reasons Your New Small Businesses Should Partner with a Charity

Show Notes

It may go without saying that when it comes to partnering with a charity, there are many good reasons to do so. But what about for a new startup or small business without a steady stream of income? Turns out it can be just as beneficial. 
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In this episode, Lori Vajda and Nola Boea are sharing multiple ways solopreneurs and startups can partner with and support social causes - even without high profit margins - all it takes is a little creative giving back.

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In This Episode You’ll Learn 

• According to research, 80% of Americans would switch brands (when they're equal in quality and price), to one that supports a charity.
• The different ways the nonprofit you choose can support your business and target audience.
• How to choose a charity for your business to partner with.
• 5 ways your business can support a nonprofit - beyond giving cash. 

Key points Lori and Nola are sharing in this episode:
(04:31:40) Three business benefits you might not have considered when partnering with a charity. 
(08:34.26) Four considerations for choosing which nonprofit your small business should support.
(11:44:04) Act local. From brand awareness to building strong customer relations, the benefits of partnering with a local non-profit.
(12:22:89) While financial donations are the most common way of giving, these five non-monitary alternatives make it easy for new businesses to donate to their favorite charity.

Resources 
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Transcript

[00:00:00] Lori: Partnering with a charity is a good way for a business to demonstrate social responsibility. And it's also a great way to increase visibility in a crowded marketplace. Which is an ideal combination if you're an established business making a profit and have the profit margin to make a donation. But what if you're a new business with little or no profit yet? That's the question we were wrestling with and thought you might be too. Stay tuned friends because we're ticking you along as we set out to find out how to partner with the charity, when you have no profits to speak of. In this episode, we are sharing the process that we've discovered and some next steps we're considering. All in the hopes of helping more startup businesses get creative about giving back.
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[00:00:50] Announcer: You're listening to the Sticky Brand Lab podcast, where times strapped professionals like you, learn how to create a business you love in as little as three hours a week.

[00:01:01] Nola: Getting a business started, even a side business, can be a struggle. So it may seem counterintuitive to suggest that as a startup business making little or no money, you also develop a strategy for giving to charity. However, for companies that do give back, whether that be through a donation of money, time or services, not only does your generosity help people in need, but it can also help you build goodwill for your brand. Well, friends, if this sounds good in theory to you, but you're already feeling overwhelmed just getting your business off the ground, and aren't sure you can add one more task to your to-do list, you've come to the right place.

[00:01:38] Lori: Yes. As a podcast that is still in its infancy, really talking about ourselves here, it might seem strange to suggest we not wait to choose a nonprofit partnership. Nola, you and I have been talking about this for a while.

[00:01:54] Nola: We sure have.

[00:01:55] Lori: We have, and we had kind of that mentality that you really had to have high profit margins before giving. And then we did an interview with Shannon Goldberg, founder of Izzy, a zero-waste beauty brand she started. That was a great episode for a variety of reasons, including the fact that not only did Shannon start a cosmetic line during COVID, in a highly competitive industry, but she did it with no formal education and sustainability. And while she was getting this business off the ground, she also had several charities on their website that the company was making a donation to. And that came up during our interview and we were talking to her and her philosophy was that no matter how small, it was still making a contribution. And for me, speaking for myself, that left a mark in my psyche, you know, when I was rationalizing, well, we don't have big profit margin, but here's somebody who's starting out in a very difficult time period. And she had identified the charities and why they meant something to her and set that up to give. And I thought, well, if she can do it, why can't we? And that really sparked a big discussion for us.

[00:03:17] Nola: It really did because she had said, well, it doesn't matter the size of the contribution. The contribution will grow as we grow. The point is, let's just do it. And that just seemed to be such an epiphany. let's just do this. It doesn't have to be pushed back to later. It's the act that makes a difference. It gets started from the get go.

[00:03:38] Lori: Absolutely. And friends, by the way, if you wanna hear that full story on the beauty line, as well as how she got going during COVID, we suggest checking out episode 93 on our website or wherever you listen to podcasts.

[00:03:56] Nola: Before we get into what a new business needs to consider before supporting a charity, especially when the business isn't highly profitable, consider this. According to research from the Cone Cause Evolution Study, 85% of consumers have a more positive image of a product or company when it supports a charity they care about. 83% of Americans wish more of the products and services they use would support charities. And 80% of Americans are likely to switch brands, when they're equal in quality and price, to one that supports a charity. So let's talk about a few of the benefits to businesses when they do donate.

[00:04:35] Lori: You know, I think for many people, myself included, as a business, our being co-founders, I really thought along the lines of profit margin and you're giving financially. So this really intrigues me when we're exploring some of the benefits.

[00:04:54] Nola: And I have about three of them for now, but there are many. And many ways to look at these benefits. First, when a business donates, it can help build brand awareness for your business. in fact, businesses that partner with the charity, they create a link between their business and the charity and that builds brand awareness really for both organizations.

[00:05:17] Lori: That's a really good point. And one of the things here we tend to think about that link as in tethered to the nonprofit. So one way to think about this is both literally and figuratively. Literally, from an SEO standpoint, when you have that give button on your website, along with their logo and they do the same, those back links support SEO for both the nonprofit and your business.

[00:05:50] Nola: Yeah, that's a good point.

[00:05:51] Lori: And then from a figurative, of course, it is the link between here's who we invest in. Here's who we believe in. And they believe in us as the business supporting them.

[00:06:06] Nola: It builds a strong association or affiliation, which is exactly why it can actually be in the reverse if you're not really closely aligned. In fact, I've heard of nonprofits sending back a sizeable corporate donation because they really did not want that affiliation.

[00:06:24] Lori: Wow. I think I'm very impressed with that nonprofit.

[00:06:29] Nola: I know. Well, speaking of alignment, number two, you can target your potential customers in your niche if you choose a charity that does align with your business. Often a business will choose a nonprofit based on say the size of the charity or the fact that it's just really well known and they wanna to be aligned with that. But by choosing a lesser-known charity that aligns with your brand, you might actually find it easier to reach your target customers. And in fact, by going smaller, think local versus national, I mean, there really is a big push to even buy locally, right. You're really wanting to support your community.

[00:07:11] Lori: You bring up a really good point because there was a time where the bigger known nonprofit that a business gave to that was thought to be more prestigious. But for younger generations, they're really looking at you as a business. Why are you giving to the charity that you're giving to? And they are really holding that explanation almost like an accountability to the business. Don't just give to give, give because there's a connection. And local businesses giving to local charities. That is really, really important.

[00:07:49] Nola: Exactly. That's a good point. Well, we already mentioned that by giving to a really well aligned organization that you can help build brand awareness, both for your business and that organization and that's awareness, but it can also help to build brand loyalty. Because again, studies show that more customers prefer buying from a business that demonstrates social responsibility and gives back to their communities.

[00:08:17] Lori: And you can give to a national named charity, but give at the local level. Ronald McDonald house is a really good example.

[00:08:27] Nola: That is a good example.

[00:08:29] Lori: So you could look for big name, but give local.

[00:08:33] Nola: Yep.

[00:08:34] Lori: So how do you decide which nonprofit your small business should support? That was the question Nola, you and I had. And I went to figure out that answer, not only for us, but figuring that it would help any listener who was starting a business. So I found four considerations that we'll be using for ourselves and that you, our friends listening, can use for your own business.

And the first one is, know your customers. For example. If your business focuses on sustainability, then it's likely that your ideal customer donates to charities that focus on sustainability. So when you're trying to figure out who to give to, look to your customers as the answer.

[00:09:22] Nola: Yes. Find out what their interests are. That's something you wanna do anyway, when you're thinking through your ideal client.

[00:09:29] Lori: Number two, know your why. Choose a nonprofit whose message aligns with your own company's voice, goals and aspirations. Using our podcast as an example, we have right on our website that our podcast is about empowering women to attain personal and professional satisfaction, creative autonomy, and financial independence through entrepreneurship. So it's likely that our ideal customer and our charity of choice are going to have those commonalities. They're going to be helping women. Have financial independence or change careers again, into entrepreneurship or something along those lines.

Number three, know your charity. Now this was something that I hadn't given much thought to. And maybe for you, Nola, this wasn't a surprise, but I didn't know that not every charity is eligible for tax breaks. Did you know that?

[00:10:31] Nola: I think they have to be a 5 0 1 C three, because that's the IRS revenue code.

[00:10:35] Lori: Okay. That makes a whole lot of sense. So friends, while the goal of giving doesn't have to be focused on the tax break, choosing a charity that does qualify can be beneficial for you as a business owner, because you can write off that donation and you know, that could be good for your business.

 And number four, do create a meaningful relationship with your nonprofit partner. Don't just give money. There are many ways. One way you can demonstrate support for your charity of choice is to mention them on your website. Doing so lets you demonstrate how their mission and goals align with your goals and values as a business.

[00:11:22] Nola: And I'm gonna interject something right here. I would recommend that you give directly to the charity. That really does create a meaningful relationship. There are some websites out there that are great, that aggregate giving to different charities, but all the charity gets is your donation. They do not know who you are. That website that conducts the transaction, you really end up becoming a customer of that vendor. You're not really developing a relationship with the charity. And for a lot of people, you know, individual donors, sometimes they want that anonymity. But when you're talking about a business and you want to develop that relationship and partnership with the charity, make the donation, make that connection, let them know who you are, okay?

[00:12:06] Lori: No, I think that's a really, really good and important point. That's why giving local can be better than giving national.

[00:12:14] Nola: Absolutely. And while that mostly pertains to cash donations, it doesn't have to be cash that you're giving. And in fact, while financial donations are usually the most common, it isn't the only way. So here, folks, are five ways that you can give that are not monetary.

First, I think we mentioned earlier, you can promote your favorite charity on your website, on your social media, on your email signature, mention them on your podcast. Just give them a shout out. That kind of awareness and promotion can go a long ways.

Number two, launch a charity drive. Think of a virtual collection jar. So it's not just, you're giving, you're getting your customer base to give as well. You're basically giving them donors when you do that.

[00:13:02] Lori: Excellent.

[00:13:03] Nola: Another one is charity sales. So think of, you know, you have a product line. And for anybody who purchases this product or purchases this product for a certain period of time, the proceeds of the sale will be given to a specific charity. So some people might think of that as cause marketing, but it's, making sure that the sale of a specific product proceeds are donated to the charity.

Another one are in-kind donations. That's when you're giving a product or a service. So in our case that could be recording mini podcasts on their behalf or doing some audio editing and giving them a statement of the value of what was just donated. Because whether you give cash or an in-kind donation, it's all considered revenue on their income statements.

[00:13:49] Lori: I did not know that.

[00:13:50] Nola: Yeah. So don't feel bad for not giving 'em cash. For them, it's very useful and it raises, their bottom line either way.

[00:13:57] Lori: That's great.

[00:13:57] Nola: And another way is to volunteer. Give your time and skills, it could be you showing up, you might teach or mentor some of the recipients or their beneficiaries. I mean, this is a model that Habitat for Humanity has been using.

[00:14:12] Lori: Oh yeah.

[00:14:13] Nola: For a long time. Right?

[00:14:15] Lori: Absolutely.

[00:14:16] Nola: So it can look many different ways.

[00:14:18] Lori: Yeah. So for us, we are now in the process of our next steps. And we are going to take all of the information that we've shared with you and plug that in to a strategy that we can develop. And we're gonna keep you posted, and we hope you keep us posted on your journey as well. So we can support giving.

[00:14:40] Nola: Yay. Absolutely. Well friends, thank you so much for listening to this episode. We hope it makes all the difference in you choosing a nonprofit partner so you can create your ideal business venture. If you found the information shared here today helpful, let us know by posting here where you're listening or on our Facebook page.

[00:14:59] Lori: Not sure how to turn your idea into a profitable side business? Contact us at stickybrandlab.com/contact. We'd be happy to help you.

[00:15:08] Nola: Be sure to come back next Tuesday and every Tuesday for another informative, inspiring and motivating episode. And remember. Action creates results. So tap into your desire to create a business and brand you love by taking 1% action every day. Small steps, big effects.

[OUT-TAKE]

Nola:  Or you want to get to know your cus — you know, nevermind.
[00:15:34] Lori: I was following you there. Yeah, you're doing great.