One might not have given it much thought, but the next time a consumer purchases an Impossible Whopper meal, they could be assisting a local student with their college tuition. Burger King, like many other brands—including Coca-Cola, Google, Microsoft, and Lockheed Martin—has incorporated scholarships into its marketing efforts.
Corporate America Invests Millions in Scholarships Amid $1.7 Trillion Student Debt Crisis, Building Goodwill and Brand Recognition
In a recent report by Fast Company, millions of dollars flow from corporate America into students' pockets. With student debt surpassing $1.7 trillion as of early 2024, students welcome any form of financial assistance, and scholarships remain a popular method of support. Despite average annual college costs exceeding $36,000, the typical scholarship amounts to approximately $7,800 per year, according to Bankrate data. Even significant scholarships may seem like a small contribution to some students.
However, this presents opportunities for companies to build goodwill and name recognition among younger consumers. Smaller businesses may also begin to adopt this strategy.
On the surface, giving money away seems to contradict most company goals, especially amid widespread cost-cutting and layoffs. However, some corporations take their scholarship programs seriously and have established parallel foundations to support them.
Katie Repici, executive director of the Burger King Foundation, explains, “I think of it as a way to serve our communities, as a way of giving back.” The Burger King Foundation, a nonprofit founded in 2005 to honor cofounder Jim McLamore's support of education, awards roughly 4,000 scholarships of varied amounts each year, totaling around 50,000 over the last few decades.
Coupon and "round-up" campaigns, where customers can round up their purchase price to the nearest dollar to support the program, provide the majority of the program's funding, raising millions annually. This initiative is supported by approximately 6,700 Burger King stores nationwide, ensuring that funds raised by each shop benefit scholars in their local community.
Repici states that the money rounded up at local Burger Kings goes toward local students' scholarships. Over the years, this approach has proven effective, with students across the country receiving at least $1,000 in scholarships. The program is open to all applicants.
Repici adds, “It’s blossomed into a really lovely cause.”
Scholarships are not exclusive to large corporations. Medium-sized businesses like Cards Against Humanity also offer scholarship programs. Their Science Ambassador Scholarship provides full-tuition scholarships for women and nonbinary students in science, technology, engineering, or math, aiming to improve the public's perception of scientists.
Maria Ranahan, the executive director, notes, “To date, we’ve awarded nine full-tuition scholarships, given out over $50,000 in one-time tuition stipends, and created a vast network of women and non-binary STEM students and professionals.” While the scholarship has a marketing component, it primarily supports collaborations and passion projects.
Ranahan says, “Perhaps it contributes to the long-term success of our company, but to us, projects like the Science Ambassador Scholarship and our other charitable endeavors are a big part of the purpose of building a successful company with a wide audience.”
Corporate Scholarships Address Student Debt Crisis, Build Goodwill Among Gen Z, Says Expert
The concept of using scholarships as a marketing tool may seem impure, but Cait Lamberton, a marketing professor at the University of Pennsylvania and co-editor of the Journal of Marketing, believes it is preferable for some corporate funds to benefit needy students.
Lamberton points out, “Increasingly, consumers expect corporations to pick up some pieces where other social services are failing,” referring to the student debt crisis. She emphasizes that firms should respond to societal vulnerabilities without exacerbating them.
Regarding corporate scholarships, Lamberton asserts, "Firms are responding to a vulnerability [the student debt crisis] in a way that may reduce that vulnerability over the long term." Thus, these programs benefit society, even if tied to marketing and public relations efforts aimed at connecting with the college-aged cohort, Gen Z.
While the effectiveness of these initiatives in establishing that connection is uncertain, it likely doesn't hurt, especially for firms that have faced PR challenges or alienated younger consumers. "For free money, people will set aside their emotional concerns," Lamberton observes.
ScholarshipOwl Empowers Small Businesses to Use Scholarships as a Marketing Strategy to Reach Gen Z
Though big brands have long used corporate scholarship programs, similar initiatives may become more common among small firms. ScholarshipOwl, a startup that connects brands and students to find scholarship opportunities, is increasingly working with small businesses to create and promote scholarships and reach Gen Z seeking college finance.
David Tabachnikov, CEO of ScholarshipOwl, explains, “We help students win scholarships, and help brands win the next generation of customers.” He notes that the complexities of creating, promoting, and managing scholarships have hindered smaller organizations. However, new tools and services like ScholarshipOwl simplify the process.
Tabachnikov suggests that small businesses, like a local car wash, can now create scholarships as easily as Google ads or Facebook marketing campaigns. Platforms like ScholarshipOwl enable small businesses to establish scholarship programs with minimal awards, without needing extensive legal or marketing resources. As a result, more firms are likely to adopt scholarships as a marketing strategy.
Looking ahead, Tabachnikov believes that the ability to generate scholarships can benefit small firms, especially those aiming to connect with Generation Z, a challenging consumer demographic to reach. He notes, “Brands don’t really have a way to reach them. They aren’t watching TV, they’re browsing with ad blockers . . . and yet, they’re the biggest future consumer segment. The brands that catch them? They gain customers for a very long time.”
"Scholarships are one of the few ways to actually reach them,” he concludes.
