Cause-Related Marketing: Seeing RED and Pink

Exhibit A: The RED campaign, an incredibly successful cause-related marketing campaign started by Bono and Bobby Shriver, that encourages us to buy products to benefit aid programs in Africa.

Exhibit B: The BuyLessCrap campaign, which says RED is (RED)iculous and meaning(LESS).

Exhibit C: Think Before You Pink, which is another take on cause-marketing (in this case, breast-cancer-related).

I expect we’ll be seeing more cause-related-marketing and more subsequent consumer scrutiny in the months ahead, so let’s dig a little deeper into these campaigns.

The BuyLessCrap folks sent me a link to their campaign earlier this week. Their site states, “Shopping is not the solution. Buy (LESS). Give More.” My first reaction to the campaign was fairly negative for several reasons:

1.) Bashing consumerism in our country is a losing proposition. It alienates the vast majority of people, because most Americans like to buy things.
2.) Asking people to donate directly to charity INSTEAD of shopping seems like an unnecessary sacrifice. The message doesn’t feel inspirational, it feels scolding. Can’t I shop and give?
3.) While I believe people SHOULD give to charity directly, I don’t buy that cause-related marketing is REDiculous. It may not be “the” solution, but it’s an important piece of a solution to the fundraising picture. There are a few reasons it compliments fundraising efforts. It doesn’t require people to change their buying behavior. It gives people a way to give while they are doing a transaction they’d probably do anyway. It exposes new audiences to causes, because companies have a lot more marketing muscle than nonprofits do. Yes, companies benefit, but so do nonprofits.

So I asked buylesscrap about these issues, and their prompt answers surprised me a bit. Below is my email interview with Ben Davis of wpi, which put together the site. As we corresponded, I realized his aim is not so much anti-cause-marketing as it about urging more transparency in cause-related marketing, similar to Think Before You Pink. He said the RED campaign was not open about how it benefits its causes, and he wanted them to be more so. So I emailed RED, and within 90 minutes, they emailed me back lots of information that struck me as quite transparent. I’ve included their comments here, too. It’s a very interesting conversation, so read on… AND keep in mind what I think is what is not in dispute:

If you are doing any cause-related marketing, remember that transparency is essential. Tell donors how much of the money is going where, regularly, or they will think you’re hiding something.

Here is my Q&A with Ben.

Q: Who is your audience for this?

A: Our hope is that BUY (LESS) will be shared virally by anyone who has questions about the (RED) campaign and other cause-related marketing efforts...how much is spent, where the money really goes (CEO salaries, etc.) and how much makes it to the “cause.” We believe this covers a wide demographic. Reaction to the site has been immediate, positive, and expressed from diverse quarters. In addition, we want to stimulate a healthy discussion and exploration of the topic among thought-leaders. (Yourself included!)

Q: How did you choose the message?

A: It chose us. The idea of replacing the suffix (LESS) for (RED) hit me one day while being bombarded by (RED) advertising, and suddenly the vague discomfort with the campaign crystallized: SHOPPING IS NOT A SOLUTION. BUY (LESS). GIVE MORE. Some great and talented friends loved the idea and together we sharpened the focus and created BUY (LESS) and it’s viral site http://www.buylesscrap.org.

Q: Do you feel cause-related marketing has a place in the charitable giving spectrum, for people who simply like to buy things and feel good about it - but don’t donate to charity?

A: We support all forms of giving, including cause-related marketing. (And for the record, we love Bono, we think Oprah is great, we shop, we adore our iPods, and we want GAP--a San Francisco-based company--to do well.) It is our hope that with greater scrutiny, transparency, and possibly increased regulation, cause-related marketing can be less manipulative and can drive even greater and more certain levels of donations to charity. We do not think that shopping, however, should ever be considered a legitimate substitute for charitable giving. Just Give.

Q: Have you coordinated with the nonprofits featured on your site? What is their feeling on the campaign?

A: Frankly, we’ve not contacted them. We are interested to gauge their reaction and hope they provide one. Keep in mind, we are taking on giants, and all the money and power are pretty much aligned on the other side of this issue. We are hoping for the best, but bracing for a potentially negative and even hostile or litigious response from the vested interests. We are warmed, however, by the citizen-level response we received so far.

Q: What are your goals for the site - volume of donations, etc?

A:
1) To provide a means to give directly to charities without having to shop. We’ve set no specific goals for volume of donations, and in fact have no way to track actual donations resulting from our site.

2) To provoke discussion and change around cause-related marketing in order to refine and strengthen the model.

3) To encourage consumers to de-couple cause-related marketing (at least in terms of consumption) with charitable giving. Buying a $100 product is not the same as giving $100 to charity. Buy (LESS). Give more.

Q: The idea of transparency is interesting - are you familiar with thinkbeforeyoupink.org?

A: No. But thank you. We’ll look into it.

Q: Do you think there is a risk of the no-don’t-negative parts of the message which essentially attack consumerism and cause marketing distracting from the positive-give-transparency message? Or is the negative part needed so it goes viral with a smaller constituency that feels angry and will create pressure? Sounds from your answer to the audience question that it is the latter?

A: Another really good question and one we wrestled with. We were quite concerned with the negative aspects of BUY (LESS) and worked hard to make sure the underlying message was positive and constructive. The key players involved, Aaron Feiger of RomanticStatic, Debra Amador of MindfulPR, and myself are all overwhelmingly positive personalities and fully recognize the many pitfalls of negativity. Yet, without the hook--without parodying the (RED) campaign as a means to garner viral success and to stimulate discussion--we didn’t feel we would have an impact. A white paper on (RED) would go mostly un(READ). Sorry. We believe the site’s appeal will extend beyond an angry few. In fact, it already has. For all its celebrity backing and marketing might, (RED) leaves many people confused and full of nagging questions. Who benefits? How much money really reaches the cause? Is this intended as a substitute for charitable giving? Can we really consume our way to a cure? Is feeling good about shopping a healthy emotional response to human suffering? Am I being manipulated? Our biggest reason for plunging ahead despite the negative aspects, however, was our utter inability to get a straight answer—or really any substantive information at all--about what’s been spent on the (RED) Campaign. That alone made us realize that discussion and reform was needed.

On that note, I decided to ask RED myself, and here’s what Julie Cordua promptly replied:

The key to the (RED) proposition is results – delivering compelling products to people already in the market for everyday items; delivering business support for and awareness of the Global Fund; and delivering money to buy medicine for people dying of AIDS in Africa.

In our first nine months (March – December, 2006), (RED) generated more than $20M for the Global Fund ($18M has already been paid, GF is still receiving payments). This is four times more than the private sector has contributed to the Global Fund since the Fund was founded in 2002. (The $11M mentioned in the [BuyLessCrap] press release is inaccurate and based off of what checks were in the Fund by Dec. 31, 2006, not how much had been generated in that time. As you know, it takes time to close the books, finish calculations and cut checks at the end of the year.)

(RED) is built for long-term, sustainable impact. We believe engaging the world’s marketing powers and product designers, and putting them to work for those in desperate need is a smart way to break an issue that individual contributions alone cannot master.

A few specific points as related to [Ben’s] comments:

1) There were questions about how much money was given from each product. This was clearly stated from the day we launched (see press release) and is also communicated on partner sites or marketing information.

Clarification on partner contributions:

o Gap: 50% of gross profits

o Emporio Armani: 40% of gross profit, on average

o Converse: 5% - 15% of net sales

o Motorola: $17 per handset

o Apple: $10 per iPod Nano

o American Express: 1% of monthly bill (UK Only)

2) The question is who benefits and where does the money really go? All (RED) money flows directly to the Global Fund. You can always see updated figures of what money has come in here. To re-emphasize, the money raised by (RED) and partners to date (in just nine months) is four times the amount of private sector dollars they’ve received in the first five years of the fund.

3) It is important to note that the money is given by the company, NOT the consumer. For example, the RED NANO and the non-red Nano are the same price. When a consumer purchases a RED NANO, it doesn’t cost more, but it triggers the company to contribute $10 to the Fund. The (RED) products give consumers an option to make shopping choices that will make a difference. (RED) is one more tool for consumers to make a difference, it doesn’t replace other avenues such as volunteering, donating or lobbying your government. We think it is great to donate directly. But, if you need a t-shirt, an ipod or a phone, you know you can buy a (RED) one and even more money will go to the Fund.

In response to the site: Overall, we generally support anything that will drive more contributions to the Global Fund. However, it is unfortunate that this organization is working against another initiative vs. simply promoting the fact that you can contribute to the Global Fund at any time here. The overall total to the Global Fund will be larger with many campaigns focused on generating contributions vs. one campaign using its energy to work against another.

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Thanks Ben and Julie for all your responses. FYI there is still more over at Marketing Profs too.

Posted by on 03/02 at 02:50 PM

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Despite Criticism, (Red) Rocks

Recently I talked about how I work for a cause marketing agency and how much I like the cause marketing concept. So it grates on me a bit when so many people pick on (Product) Red. First it was Buy...
Tracked on: thoughts (64.14.68.29) at 2007 03 06 09:44:28

Comments

Katya:
As I said over at MarketingProfs Daily Fix blog—excellent post! Thank you for presenting such a well-written, thoughtful post. You’ve won a new reader and I appreciate the lengths you went to in order to cover both sides of the story .

Posted by CK on 03/02 at 09:35 PM

Good post. Thanks of administration for the given information!

Posted by Pola on 03/03 at 06:14 AM

The notion that the (LESS) campaign is working “against” the (RED) campaign - in the sense of causing fewer dollars to flow to it - seems mistaken to me.

There is very little overlap between the people who would be compelled by the two campaigns. It’s obvious that spending $100 on a sweater is not the same as donating $100 to charity. It’s not as though those who are shopping (RED) will suddenly become aware of this, and no longer buy sweaters. The people who see charity as a fashion statement aren’t the people (LESS) is targeting, and I can’t imagine that they’ll be affected by it.

But there are those who feel manipulated, and even disgusted, by the (RED) campaign. I think the (LESS) site is a great way to get them from “This charity stuff is a bunch of crap” to “Wait, I can hate the corporate manipulators and still do good - in fact, my charitable giving can help define my opposition to them!”

The goal is to get people to see giving as part of their identity. Providing an enemy provides an identity. Not a lot of people would argue that the Red Sox and Yankees are working against each others’ revenues.

Posted by Holden on 03/03 at 12:10 PM

I’ve been looking forward to reading your post on the (RED) campaign! It’s apparent that cause-marketers must make more of an effort to provide transparency and openness throughout their campaign. Eventhough profit percentages and donations were provided at the beginning of (RED) campaign, memories quickly fade.

It is a shame that Buy (LESS) is working against the millions of dollars already donated to Global Fund. The majority of the audience giving to the (RED) campaign is not the same target that would proactively seek to donate to other charities. They are not buying things to donate to Africa, they are buying things because they need/want them; if part of the proceeds go to charity, even better.

Buy (LESS) may be stealing potential donors from the (RED) campaign, and their contributions aren’t even being tracked. Buy (LESS) should sponsor several nonprofits on the their Web site with buttons to ‘donate now.’ That would provide a more positive message than merely bashing the (RED) campaign.

Julie Cordua’s comments offer clarification and transparency. (RED) isn’t manipulating consumers by withholding information - quite the opposite; the Buy (LESS) campaign just can’t seem to get the facts straight.

Thanks again, Katya- it will be interesting to watch the evolution of cause-marketing. Apparently, something must change to win consumer trust.

Posted by on 03/05 at 12:47 PM

Julie Cordua didn’t address the costs of marketing this campaign....CNN reported recently that the RED campaign spent over $100 Million in Marketing and has garnered $18 Million in donations thus far....is this ratio typical of corporate giving in such cause marketing campaigns? If, as Julie stated, all money goes to the fund...where did the $100 Million come from? The obvious question being, could you have gotten the $100 Million [or something more than $18 Million] to the Global Fund without the purchase of the stuff which generated the revenues??

Posted by on 03/08 at 04:01 PM

Remember, controversy stirs up much attention but good attention nonetheless.

“Good attention” to get us all thinking and say “What the heck. Whether I buy more (red) or buy (less), there are still kids dying in Africa everyday. I’ll buy (this) and skip my Starbucks, it all goes to the need out there.”

Bottomline, I think these 2 brilliant marketing campaigns (red & (less) work and does the job. End of story.

Posted by Dave Q on 03/09 at 10:51 PM

Great comments everyone. Thanks so much for continuing the discussion.

Posted by on 03/11 at 10:21 AM

I wrote a research paper on Product RED last winter.
It’s interesting that the Only company that did not jack up the price of their RED product is Apple… and that is the ONLY example given to show where the profits go.

All the other RED products (except Armani) cost more, so that the CONSUMER is making the donation- not the company.

Posted by on 03/28 at 10:58 AM

Erin -

Let’s get this straight: the consumer ALWAYS makes the donation, one way or another. All the costs that go into the clothes and marketing (that includes any “marketing” that consists of donating to the Global Fund) are paid for by the consumer, else profit wouldn’t be maximized.

And profit maximization is ALWAYS the goal, no matter how socially minded the company is. As a shareholder in Gap, I would have no interest in Gap donating to the Global Fund, no matter how much I support the Global Fund. I’d rather it just give that money to me (the shareholder), so I can donate it (or not) to whatever charity I want.

There is simply no reason for Gap to give to charity, as opposed to giving to its shareholders who can then give to charity or whatever else they want - no reason unless it means they can sell more expensive stuff or more stuff at the same price. In a scheme like this, the donor is the consumer, and the only question is how well that’s hidden.

Posted by Holden on 03/28 at 01:18 PM

Holden-

Thats what I have a problem with. The marketing campaign for RED is pushing this idea that consumers are forcing big companies to ‘give back’. but the companies aren’t giving anything. AND the only example given in this blog is the iPod. Apple is the only company that doesnt have jacked up prices on RED products.

I’m not saying that GAP should give to charity- GAP is saying that they should. It’s just f-ed up to go around using Dying people as a marketing tool to get more business.

that being said, RED has raised money for the Global Fund- but it’s raised WAY more money for GAP and it’s shareholders to go buy more yachts or jewlery or houses....

Most of the companies participating in RED will make MORE when you buy their RED product than when you buy their Normal Product.
So they’ve used the aids crisis to get your attention and money and that is disgusting. i dont think you should be allowed to dress up your business as a charity to raise profits for yourself.

Posted by on 04/12 at 11:20 AM

Well, I agree that there’s something disgusting about it. But it’s far from the only marketing campaign I could say this about ... at least this one will result on the other side in a tangible impact on people’s lives. Whether it’s worth it is debatable. I say that with most consumers as gullible as they are, the world is better off with the (RED) campaign than without it - though I want to be fighting at the same time to change the way consumers think. That’s why I think both (RED) and (LESS) are worthwhile.

(As an aside, I don’t know much about the Global Fund, but from what I’ve seen I think they are one of the better charities out there in this cause - it is really, really unusual to see “cause-related marketing” choose a charity whose impact is so direct.)

Posted by Holden on 04/14 at 01:26 PM