Charity funding: How charities can compete with purpose-led brands

The rise of purpose-led brands in recent years is broadly a positive thing — but it has had one unexpected consequence. People are struggling to see the distinction between charities and the private sector. That’s an existential, long-term problem when it comes to charities fundraising and, ultimately, surviving.

Purpose-led brands know how to articulate their purpose

Purpose-led companies are clearly not a fad — a huge number of companies have good causes at the centre of their brand purpose and reason for existing. For many companies, it’s become the focus of every part of their operations and it has given them a strong brand identity. Think about Tony’s Chocolonely, Oatly or Dove. That’s led to a virtuous cycle of purpose-driven capitalism.

The boundaries have blurred between the private and third sector

While not necessarily a problem in itself (doing good is still doing good), the issue is that consumers increasingly think of private sector companies as being the same as charities.

One eye-opening stat from the Charities Aid Foundation showed that in 2022, the average young person listed ‘buying an ethical product’ as their third most common way to get involved with a charity. An eye-opening 38% of respondents consider this to be philanthropy.

People think they’re doing good by consuming. And it’s probably worth pointing out that the buying and selling of more and more products is not going to be good for the planet.

The solution: charities need to build their brands

Brands talk loudly about their impact; charities need to too. The third sector simply has to up its game and articulate its purpose more effectively. That needs to be done through brand building, upping their communication game, and leveraging long-term, smart partnerships with brands.

We’re working on two digital solutions to help charities in this area. One is a social media toolkit that charities can use to improve their communications. The other is a pro-bono agency directory that will connect advertising, social media and digital agencies who are eager to take on more value-based work for free and the small charities who desperately need that marketing support.

For more information, read our full opinion piece on the topic.