Long a useful spot for prompting impulse purchases like a Kitkat and the latest issue of National Enquirer (or maybe that’s just me), the grocery checkout has also become a key component of in-store fundraising.
Many trips to the grocery store now end with customers being asked by a cashier if they’d like to round up their grocery bill to the nearest dollar to support this charity or that one, or perhaps receive an icon (paper balloons are popular) to write their name on and stick to the wall to show they’ve made a charitable donation.
And if customers don’t find those tactics appealing, they could always just drop some spare change into the marked donation box sitting beside the cash register.
Some stores are even eliminating or reducing the tricky checkout “ask” by inviting people to donate via pin pad or touchscreen, which research suggests can increase both participation and donation amount.
In the U.S., for example, discount retailer Kmart reportedly increased the amount raised by its Thanks and Giving checkout program–which has been providing funding for St. Jude Children’s Research Hospital since 2006–by US$10 million over two years, in part by employing a pin-pad ask.
While they are typically nominal amounts, often $1 or less, checkout donations can translate into big bucks for the charities they support.
According to research from the U.S.-based Cause Marketing Forum, America’s top 77 checkout campaigns raised a combined US$388 million in 2014.
Yet such programs can be tricky for retailers to implement, creating as much customer annoyance as they do goodwill. A 2013 study conducted by Ipsos Reid, on behalf of Toronto marketing firm Public, found 44% of consumer respondents felt pressured when asked to donate at the checkout; and 62% said they disagreed with stores asking for donations in this manner.
There’s even a term for the practice: “guilt giving.” Your wallet is already open, so what’s an extra dollar or two to help a good cause? “The downfall of some of the programs is that they end up being the last taste customers have walking out of the store, and it’s not a particularly positive one,” says Phillip Haid, co-founder and CEO of Public, which has developed successful checkout donation programs for clients including Winners and Indigo.
At Newfoundland-based grocery chain Colemans, part of the secret to running successful at-cash donation programs is choosing which charities to support. Judy Bennett, who oversees public relations for Colemans, says her company is inundated with requests from different groups that want to team up on programs.
“It’s overwhelming,” she says. But it makes sense to limit the number–and frequency–of the programs you promote in your store.
According to a recent Canadian Grocer poll, 58% of respondents said the key to running successful checkout donation programs in their store is limiting the frequency, holding only a couple of checkout donation programs annually to avoid consumer fatigue.
Colemans has opted to stick with just two primary causes: it supports the Janeway Children’s Health and Rehabilitation Centre, in St. John’s, from March to June; and also operates a year-round program called “Food for Friends” to benefit food banks in the province.
Colemans has been supporting the Janeway program for more than 20 years, raising an average of $5,000 a year through the sale of paper Janeway “balloon” icons.
Bennett says the two programs continue to attract donations because of the combination of customer familiarity and a clear understanding of where donations are going.
One of the keys to their continued success, she says, is ensuring that cashiers are familiar with the programs and can articulate to customers how they work.
“You don’t just want them to stand there and say, ‘Can I have $2?’ ” she says. “The cashier needs to be well-trained as to what the program is all about and how much money we’ve donated in the past. Many of our cashiers are able to say, ‘We’ve donated over $80,000 to the Janeway in the past 20 years.’ They need to be informed so they can inform the customer.”
Tammy Averill, marketing manager with Victoria-based Country Grocer, shares another approach that helps communicate insights about partner charities to customers. The seven- store chain typically gets representatives from whatever charity it’s working with to share stories with managers about how it has benefited the intended recipients.
These stories are then relayed to front-line staff to use in soliciting customer donations. “It gives [our managers] a better understanding of why we’re doing it, [which] they can then communicate to their teams,” says Averill. “Otherwise, it’s just a memo going out and [employees] not really understanding what the organization does.”
Like Colemans, Country Grocer tries to limit its charitable efforts to a couple of key initiatives per year, running them in the spring and fall in an effort to reduce customer fatigue. One of its key efforts is for the Help Fill a Dream charity, which works to fulfil the dreams of seriously ill Vancouver Island children.
Heading into its fifth year, the program has raised more than $50,000 within Country Grocer stores through the sale of floral “dream bouquets” by a local grower, as well as shirts and Christmas trees.
Country Grocer encourages friendly competition among its stores by rewarding employees at the store that raises the most money with small gifts, such as a Tim Hortons gift card or a bouquet of flowers, therefore helping foster employee engagement.
The company also provides customers with updates on collected donation amounts through its weekly flyer and on social media.
“I think that’s important, so that customers are not just giving their $2 and never seeing where it goes,” says Averill. “They really appreciate the followup on where their money is going.”
The notion of transparency plays a big part in how shoppers feel about checkout donation programs; many people are uncertain about where their contribution actually goes. In a story earlier this year, CBC TV newsmagazine Marketplace reported some customers are rethinking their attitude toward checkout donations because of the lack of transparency about how the funds raised are being allocated.
The accompanying story on CBC.ca garnered 791 comments before the thread was closed. Many posters disagreed with the practice, with some dismissing it as the “biggest scam ever.” One wrote: “Enough already with the list of requests at the cash register.”
Yet the continued success of checkout donation programs suggests they are here to stay. The Grocery Foundation, a Canadian not-for-profit, for example, says it has donated more than $75 million to various child welfare-focused charities through ongoing programs such as Toonies for Tummies, which counts grocery retailers such as Metro Ontario, Highland Farms, Longo’s, Mike Dean’s Super Foods and Sobeys among its partners.
For its part, Public is committed to creating programs that make consumers feel good about giving while also creating a business benefit for participating companies.
In a recent white paper called “Wrong Ask. Right Time,” the company said the best transactions offer some kind of value exchange. “Rather than it being a straight-up, old- school charity approach, which is, ‘Hey give money to this worthwhile charity,’ we’re more interested in saying, ‘How do you actually create a real reciprocal benefit so that the consumer wins, the charity wins and the business wins?’ ” says Haid.
How can a grocer create this triple-win situation?
Haid suggests re-engineering the charitable donation so it becomes more of a quid pro quo for consumers, possibly through incentives such as an opportunity for donators to win their next purchase, a $2-off coupon or a coupon book.
“[The consumer] might say, ‘I’m happy I donated $20 today because I got some great stuff in return and these brands are doing great stuff to try to make my community better,’ ” he says. “That requires a different mindset than just, ‘Hey, give to a great cause.’ ”
And yet in the end it is, literally, all for a good cause.
TOP 4 WAYS TO IMPROVE YOUR CHECKOUT DONATION PROGRAM
SPREAD THE MESSAGE THROUGHOUT THE STORE
Public co-founder and CEO, Phillip Haid, says one of the main problems with at-checkout programs is they put a lot of the onus on cashiers to encourage consumers to donate.
“They are asking all day long, ‘Would you like to add a dollar to your bill?’ Just by the law of averages you’re going to get a ton of ‘No’s.’ That can be quite dispiriting,” he says.
To encourage donations, Haid suggests making shoppers aware of the program before they hit the checkout. Inform and intrigue them, letting them know if there’s some form of reward for donating. Signage and the in-store PA system are good ways to spread the message throughout the store.
For example, Public recently worked on a sunshine-themed promotion for a fashion retailer.
Upbeat, “sunny” music played over the in-store PA, which also announced each time an in-store donation was made. Stickers telling shoppers they looked wonderful in their outfit were also placed on mirrors in the changerooms, along with information on how they could spread some cheer of their own by donating at the cash register.
Ideally, says Haid, “By the time customers get to the cash register, they’re asking the sales associate about the program as opposed to the other way around.”
TRANSPARENCY IS KING
There’s room for improvement when it comes to companies explaining the social impact of campaigns to consumers, says Haid.
“All the customer really knows most of the time is that they’re giving a buck and it’s going to a cause. They don’t really know what’s happened with that money.” That can breed cynicism for some people. Haid says grocers can eliminate some customer distrust simply by informing them how the proceeds from a fundraising effort will be used.
He suggests defining what the money raised can buy and attach a relatable value to the donations–something very few stores do.
For example, will a house be built, or a certain number of breakfasts be served in schools once a certain fundraising amount has been reached?
“If your program generates a million dollars or $200,000, what do you want to cause to happen with that money?” says Haid.
Simply saying, ‘Give to a good cause’ is no longer enough to rally some consumers, says Haid.
However, a simple money-off coupon or the chance to win their next purchase can often be enough of an incentive to get customers to donate, while providing an added bonus of driving repeat business.
“Chances are, if a customer comes back into the store, they’re likely going to buy something,” says Haid. It’s such an obvious win-win for customer and grocer.
According to Cause Marketing Forum’s 2015 America’s Charity Checkout Champions report, one-third of companies surveyed cited using some form of incentive in their checkout donation campaigns. The report said the added perks make it easier for salespeople to ask customers to donate.
PERSONALIZE AT POS
Tammy Averill, marketing manager at Country Grocer, says her company includes information on local people who have benefited from its charitable causes on its point-of-sale material.
Familiarity can inspire people to donate, she says.
“A lot of times people will be in shopping and say, ‘Oh, that’s Patty and her daughter Sarah that have been helped,’ ” she says. “It just helps get the ball rolling.”
This article originally appeared at CanadianGrocer.com.