Industries Bouncing Back
Here are some industries that are making a comeback after being hit hard by the recession.
Biggest Holders of US Debt
See who owns the most U.S. government debt.
Romantic Luxury Homes
Romance, like beauty, is often in the eye of the beholder.

ABOUT THIS BLOG

It's a make-it or break it time for retailers. The holiday selling season is always a critical time for retailers, but this year this may be even more true. With several retailers already falling victim to a drop in consumer spending, and filing for bankruptcy, retailers will be navigating through some tricky waters. Consumers are strapped for cash due to high energy and food prices, and unemployment is rising. The recent credit crunch has made it more challenging for retailers and consumers to borrow.

This blog will look at the winners and losers in the retail space. Who has the right strategy to capture consumer dollars? It also will look for trends in consumer spending and how that will impact the economy.

Stay up to date with the Holiday Central

We’ll send the latest "Holiday Central" posts directly to you

Subscribe to this RSS feed

How to use RSS?

SuperSaturday: Cause Related Marketing The Design of Future?

Published: Monday, 30 Jul 2007 | 1:45 PM ET

Text Size

By: Margaret Brennan
CNBC Reporter

This past weekend, I attended the annual SuperSaturday event in Water Mill, New York. Well-known in the fashion world and to vacationers in the Hamptons, this is essentially a high-end tag sale/sample sale of designer goods to raise money for the Ovarian Cancer Research Fund.

Each year Donna Karan underwrites the event along with InStyle Magazine and a slew of celebrities (Kelly Ripa, Mandy Moore, etc.) attend to shop the brand names. What struck me this year was the new corporate involvement of retailers like QVC (owned by Liberty Interactive Group [LINTA Loading... () ] and Bluefly [BFLY Loading... () ]as resale channels for the excess inventory from the fundraiser.

Here's how SuperSaturday works: Designers like Diane von Furstenberg, Donna Karan, Hugo Boss, etc. price their products at 50-80% off retail and sell them at the SuperSaturday event to customers who pay $400-600 for a ticket to access the outdoor fundraiser. Rather than keep the proceeds, 100% of the money raised goes to the Ovarian Cancer Research Fund. The designer's company gets the benefit from donating the apparel via writing it off as a charitable donation of their products. This way the designer wins by keeping their brands on desirable backs (celebrities and affluent influencers) while also getting a tax benefit.

Here's what's different this year: SuperSaturday now has a national scope. Liberty Interactive Group's QVC channel broadcast live from Super Saturday to help sell the donated items. Anything left over from Saturday's event (designer shoes, bags, clothes and beauty products) will not be handed over to homeless shelters (as it had been in the past) but instead those items will have a charitable second-life online at online retailer Bluefly.com. By Wednesday or Thursday this week, Bluefly will dedicate a portion of their Web site to the SuperSaturday resale. Bluefly will funnel the proceeds to the Ovarian Cancer Research fund and charge the buyer the standard tax and shipping fees (depending on just how much you buy, this charge has got to be less than the $400-600 Hamptonites paid for access.)

What's the value? Beyond marketing of the Bluefly name and visibility at the high-profile event itself, cause-related marketing has become a powerful tool these days to help leverage product sales. While Bluefly won't take a profit from the charity-related items, they hope to build traffic to the site and lift sales of non-charitable items.

Bluefly's Head of Content and Communications Monica Halpert was onsite at the event in Water Mill (dressed up in festive blue wig!) and told me that the online retailer expects the resale to "contribute beyond what the event raised, which last year was over $2.4 Million." Halpert says Bluefly saw the partnership as a good opportunity to open the event to national audiences who couldn't attend.

While that sum will go to the Ovarian Cancer Fund, Bluefly could use the halo effect that may come from that traffic in order to boost overall sales. The company can use both the traffic and sales boost. The company will report second quarter 2007 financial results at the close of market on August 8.

What's interesting to me is that cause-related marketing seems to be changing shape. SuperSaturday -- like event concepts are far more effective in fundraising than simply cause related products (Breast Cancer Yoplait yogurt, similar products) that only give a portion of sales to charity. Cause-related marketing is not just the realm of pink ribbon endorsed yogurt and t-shirts anymore. I've written here about designer Joan Hornig and her luxury jewelry line that goes 100% to charity (not simply the 10% to charity that the cause-related product lines often give.) Be prepared to see SuperSaturday go national in other cities and for other charities to copy this model.

When it comes to the high-end shopper or product, this is a niche that has strong potential to leverage a brand and to leverage overall sales. As Joan Hornig said to me, could a 2% hedge fund fee that goes to charity be far away?

Questions? Comments?