Corporate philanthropy is a case where businesses take action to improve the communities around them and society in general. This could include donations of things like medical equipment to nearby hospitals, supporting the nurturing of talent, offering support to educational programs that benefit the community and fundraising for a good cause. Businesses that engage in corporate philanthropy enjoy several advantages that stem from their actions to the communities. Below are some of the advantages a business can get for supporting the community through philanthropy.
Support from the community and market creation
Offering support to projects that help the community to achieve different goals brings people closer to the business and creates a positive relationship between the two. The community is made to feel part of the business due to the inclusion brought by these philanthropic projects. Therefore, they will always respond by giving support to the products sold by the company, which translates to market creation. Businesses that invest in nearby communities boost their sales and are guaranteed to have a stronger base of customers. Additionally, offering support to communities leads to greater economic success, so with the purchasing power earned they are able to contribute to the growth of the business.
More confidence in the business
Philanthropy convinces the communities targeted that they are considered a vital part of the business, and in this spirit, they feel more secure using the products offered by the business. Therefore, giving to the society helps by allowing the company to enjoy more support in whatever products it sells. It creates a market and reinforces the support received from the communities. In a market where there are many competing businesses, this is one of the ways a business can create an image for itself.
Market development through reputation
As River Cohen cites, reputation can make or break a business. A good reputation is cultivated and this means spending both on refining products as well as buying the trust of the market through things like philanthropy. To develop a market, a company can come up with philanthropic projects that help by raising its reputation and trust among buyers and the market in general. It is the easiest way to beat competition and to reiterate the mission statement of a business by touching on values the community considers vital for its growth and prosperity.
However, despite the benefits that come with corporate philanthropy, there are things that businesses should beware of to avoid plunging into a crisis. First, supporting philanthropic projects is time consuming and costly. The business has to also make huge decisions every day, which could interfere with its operations if the process is not monitored well. Excessive focus on philanthropy could hamper the goals set by the business, which in turn could delay the implementation of vital projects that can enhance growth. Ensure you have a set plan that should be followed while running philanthropic projects and the business will reap the benefits that come with giving back to the society.