Lids and Caps for Kids
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Holmes Report

Lids and Caps for Kids

The marriage of Lids and Caps For Kids (CFK) represents the ability of a young, start-up company to significantly impact a similarly nascent nonprofit with tremendous growth potential

Paul Holmes

The marriage of Lids and Caps For Kids (CFK) represents the ability of a young, start-up company to significantly impact a similarly nascent nonprofit with tremendous growth potential.  The challenge for Cone, LLC in structuring a corporate sponsorship and creating a simple-to-implement cause-related marketing campaign was in recognizing that Lids’ business limitations were really not limitations at all.  Rather Cone saw an opportunity to develop and establish Lids’ company culture and to create the cause platform on which the young company could stand.  Achieving this would help Lids garner share of mind and heart with employees and consumers alike, ultimately adding the value and meaning that over the long-term would help to recruit and retain employees and keep customers returning to Lids.
Lids is the largest specialty hat retailer, with over 380 stores nationwide.  The target demographic for Lids is Generation Y, a large customer group of 12-17 year olds who are known to be socially conscious and brand aware.  To enhance the Lids brand and to engage employees in a meaningful cause commitment, the company entered into a sponsorship agreement with small national nonprofit CFK, an organization dedicated to raising the spirits of children with cancer.  The tremendous impact of this partnership could not have been predicted but, today, it can best be measured by the hundreds of children who face the struggles of cancer with a smile. 
CFK was created by Dr. Stephen Heinrich, a pediatric orthopedic surgeon in 1993.  Upon learning that one of his young cancer patients was an avid Auburn University fan, Dr. Heinrich worked to get a hat autographed by Auburn University football coach Terry Bowden and his father, Florida State University football coach, Bobby Bowden.  When Dr. Heinrich witnessed the joy that a simple hat could give to someone suffering from a life-threatening disease, he organized CFK to improve the spirits of young cancer patients nationwide.  The organization grew over the next eight years as people who learned about CFK volunteered to brighten the lives of children who spend much of their time in the hospital. 
Cone, Inc. has been Lids’ agency of record since 1998.  Cone felt strongly that a cause initiative would bolster the Lids brand and reach employees and teen customers in a new and compelling way.  While Lids recognized cause marketing as a tool to enhance its brand, the company continued to flinch from cause marketing because Lids did not have the resources to undertake a long-term, full-scale cause initiative.  Cone’s added value was in recognizing that Lids did not have to ‘break the bank’ to have an impact.
The 1999 Cone/Roper Teen Survey helped to support the idea that Lids’ foray into cause marketing would be a successful one.  The survey identified the effect that cause marketing has on teenagers.  Most importantly, the survey showed that a company’s involvement in causes influences teen buying habits.  Two-thirds of teens surveyed cited a company’s support for a cause they care about (66%) or a company’s donations to a good cause (66%) as very or somewhat important factors in their purchase decisions.  In addition, over half (55%) of teens surveyed would switch brands and two-thirds (64%) would switch retailers to one associated with a good cause, when price and quality are equal. 
At about the same time, Lids was approached by CFK for a donation of hats.  (One of the biggest challenges for CFK was obtaining new, soft fabric team hats at a low cost.)  After hearing the CFK story, Lids was immediately interested in making a one-time product donation.  Cone, however, recognized that CFK was an ideal partner for Lids and that it was just this type of organization that met Lids’ partnership criteria.  Not only would CFK benefit from access to Lids’ product, but Lids could also have a significant financial impact on a nonprofit wholly run by volunteers and with an annual operating budget in 1999 of $3,100.  As a retailer with high employee turnover, Lids constantly struggled with building value and loyalty with their staff.  Standing for an issue, impacting the lives of children and working with an organization who also understood the simple meaning of a hat was simply too perfect for Lids to pass up.  Thus, following numerous meetings and negotiations, Cone achieved the support of Lids’ management team and CFK’s Board of Directors to structure a cause partnership that fit the business needs, the culture and purpose of both organizations. 
  • To increase the awareness of CFK in order to recruit more hospital partners, sign-up more volunteers, and serve more children with cancer.
  • Increase the organization’s revenue to $50,000 within the first year
  • Engage customers and employees in the CFK/Lids partnership.
  • Raise awareness for Lids’ corporate citizenship through the company’s commitment to the CFK.
Cone created the “Touch A Life” fundraising campaign for summer 2000.  The month-long store event was kicked-off with professional football player Mark Brunell.  The fundraiser engaged employees and customers around the issue of childhood cancer. 
Customer component: Branded in-store and online promotional materials introduced CFK to Lids’ customers.  By donating $1 to CFK, customers received membership to Lids’ loyalty program, HeadFirst™.  POP donation boxes were also at the register.  Employees wore CFK branded hats and pins during the month-long promotion.  Customers also received a ‘thank you’ message card at the register after donating.
Headquarter employee component: At the company’s head office in Westwood, Massachusetts, employees contributed to the month-long celebration by hosting one event per week that would raise money for CFK.  These events included a bake sale, raffle and a sample merchandise sale.
Lids donated over 1,000 team hats directly to CFK and specially produced over 1,000 CFK branded hats.
  • Lids hosted CFK’s annual Board of Directors meeting in Boston, July 2000. 
  • Cone designed, drafted and produced marketing and press materials for CFK.  (50% of this work was contributed by Cone on a pro-bono basis.)
  • Cone structured the contract and managed the negotiations to finalize the Lids and CFK sponsorship agreement.
  • Cone President Jens Bang was invited to join the CFK Board of Directors.
  • Cone managed the fundraising registration process with the State Attorney General Offices.
  • The Touch a Life campaign raised over $126,000 dollars for CFK and far surpassed the goal of $50,000.
  • CFK was able to hire a full time staff person due to the increased operating budget.
  • Since the 2000 summer fundraiser, 5 more hospitals have joined CFK and at least 5 more are pending membership.  This translates to more than 500 new children having access to CFK hats each year.
  • Due to the success of the campaign and overwhelmingly positive feedback from customers, Lids continues to maintain donation boxes at registers nationwide.  This vehicle raised an additional $12,000 for CFK at the end of 2000.  CFK also conducted a holiday card sale that raised almost $5,000.
  • Two successful media events in Jacksonville and New Orleans reached over half a million people through local television and daily newspapers coverage.
  • CFK received the official support of numerous celebrities including Harry Connick, Jr., Lilly Tomlin, Britney Spears, Faith Hill and Tim McGraw.
  • CFK received the recent endorsements of two professional football players: Mark Brunell, Jacksonville Jaguars, and Jim Pyne, Cleveland Browns.
  • Lids vendors and several professional sports leagues/associations are considering official endorsements. 
  • Inspiring employee emails thanking the company for making a difference
  • Letters from children thanking CFK and Lids
  • Media results include: PR Week, St. Louis Dispatch, New Orleans Magazine, Times Picayune, Sports Trend, AdWeek, DNR, Corporate Philanthropy Report, Causes and Effects, PROMO Magazine.
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