On Tuesday, May 5, 2015, at INTA’s Annual Meeting, a group of non-profit organization leaders and members gathered to discuss various topics of interest to non-profits. Two presenters from the American Cancer Society shared many practical points and addressed some of the issues faced by non-profits as they fundraise for their organization’s activities.
One of the discussion points included the topic of Cause Marketing—defined for a for-profit company as conducting a promotion for which a portion of the proceeds benefits a specific charity. Who hasn’t heard of promotions like these? For example, you might see a sign in your neighborhood that says: “This Friday is Help the Community Night! $2.00 from each pizza purchased at Bill’s Diner will be given to ABC Charity.” ABC wants the proceeds and is more than willing to allow this use of its mark. In theory it’s a simple promotion, but in reality it opens up a minefield of issues.
Counsel should be consulted in these instances, as the issues that might arise are many and varied. Does the use of the mark comply with state regulations and consumer protection laws? Does the marketing involve endorsement by ABC of Bill’s Diner? Claims of superiority are to be avoided, and the ads should disclose that Bill’s Diner has paid a fee for the use of the mark. Exclusivity arrangements by ABC should also be avoided. In these situations, clear disclosures are required, such as the portion of the price being given to the charity (e.g., the dollar amount, the percentage of the purchase price, etc.), the time frame of the promotion and whether there are any limits—e.g., a maximum—on the donations.
In addition, a written license agreement should be in place between ABC and Bill’s Diner covering issues such as quality control, liability, how the charity’s mark is to be used, any disclaimers that are to be used and characterization of the payment as a royalty. These agreements can be quite complex, depending upon the nature of the collaborative event between the parties.
A presentation like this is one more reason not to miss the INTA Annual Meeting. INTA’s 2016 Annual Meeting will be taking place in Orlando, Florida, so save the date today!