Sunday, March 18, 2007

$100 million in ads and still in the (Red)

In a recent post I mentioned CSR (Consumer Social Responsibility) as a long-term corporate strategy where companies will try to enhance their public image and increase consumer spending.

Clearly one of the most well advertised CSR campaign has been the Product (Red) Campaign which delivers high end products through companies like Gap, American Express, Apple, Motorolla and Converse.

On March 4, Mya Frazier of Ad Age wrote an article, "Costly RED Campaign Reaps Meager $18 million." Which criticized Product (Red) of spending $100 in advertising to raise only $18 million.

This has inspired a number of responses, including responses from Bob Shriver, Red CEO, and Richard Feachem the executive director of the Global Fund.

Yet Advertising Age is not the only whistle blower. The situation for many, like NYU economics professor William Easterly, is much larger, as many have recently been critical of foreign aid in Africa suggesting it supports a larger problem in Africa, which is government corruption, which hinders African countries from becoming democratic of achieving sustainable economic growth. (I instantly think of the movie The Constant Gardner)

Is criticism over the (Red) Campaign unnecessary criticism, and just a result of our critical culture? Or are these concerns legitimate?

Personally, in age of CSR, I think companies like Gap Inc. should back off from advertising their social responsibility by traditional ad means. Instead release press-releases and inform local activist groups of the project, and train company employees to be able to speak about the project. Using buzz marketing principles, this CSR campaign could potentially be very profitable and at the same time protect these companies from appearing as though they were exploiting disease and poverty to gain wealth, and spending 5 times as much to promote their campaign than they are able to donate.

I appreciate the Buy (Less) Crap campaign that encourages people simply to buy less and give instead of participating in these corporate campaigns which encourages consumption of unnecesary luxary products. And yet, I also acknowledge to power of large scale organizations to chanel the masses into opportunities to give big by everyone giving small. (It's like the money they made in Office Space by taking the rounded pennies and putting the money into one account).

It may be eutopian but I wish we could live with the mindset of the Buy (Less) Crap slogan: "Shopping is not a solution. Buy less. Give more."

You can also check out the Red Blog here.

(More here and here)

Related Tags: , , , , , , , , , , , , , , , , , ,


b13 said...

Didn't the red shirt in Star Trek always die?

Unknown said...

This letter was sent to Mr. Shriver more than a week ago. We await his reply. In the meantime, we welcome your thoughts.


Dear Mr. Shriver,

RED is an extraordinary and innovative endeavor founded and supported by some of our generation's most remarkable personalities, entrepreneurs, thinkers and leaders, as well as some of the world's most talented product designers and marketers -- giving RED products instant credibility and appeal with consumers. Clearly RED has the potential to do amazing good.

The recent questions about the effectiveness of RED's business model suggest that consumers, when buying certain RED products, cannot know exactly how much money makes it to charity. Additionally, there is the concern about how much money has been spent on advertising by RED's partners. Hence, RED is experiencing its first crisis as a brand: a lack of consumer confidence.

Perhaps it's time for RED to assert innovation and leadership once more -- rising to the challenge of hearing and addressing these consumer concerns head on. After all, RED is a new revenue model. It's only natural that it make smart, on-the-fly adjustments and improvements. And, as consumers we must grant RED the grace to wisely and openly adapt on its way to becoming a truly sustainable success.

It would seem that RED's first order of business is winning back consumer confidence. This can be accomplished in three bold, yet simple steps:

1) RED and its partners provide administrative transparency. Let consumers know exactly what has been spent, by whom, and on what. Just as non-profits must provide administrative accountings of how they spend our donations, let RED and its corporate partners be proud of their accomplishments and disclose the figures publicly. This will genuinely answer questions and address consumer concerns.

2) Adopt reformed contribution models that make clear how much money goes to The Global Fund with each purchase--replacing the current models that do not. Consumers require the confidence of knowing exactly how much money goes to charity with each purchase. Remove all doubt and include this information right on the price tag.

3) Make it possible and easy to donate to The Global Fund directly--without requiring a purchase--via clear web links and by installing informational kiosks and/or clearly marked ways to give at check-out counters in retail locations. Doing this would eliminate consumer confusion and cynicism about RED partners and their contributions. And, the links and kiosks would increase awareness about the African AIDS crisis and create a new and valuable stream of money to help save lives.

The immediate implementation of these steps would demonstrate RED's commitment to regaining, respecting and rewarding consumer trust. In addition, making these sensible changes would help establish a set of best practices for future cause-related marketing efforts that may pattern themselves on RED's success. This would create an even greater and lasting positive legacy for RED.

Ben Davis

Southern (in)Sanity said...

I think you're right. They could get the word out about the Red campaign without spending so much ($100 million?!?!??!) in advertising.

It would just mean a little WORK for employees and public relations people.

Paula said...

I really agree with your post. The whole (red) thing smacked of a public relations show.

I'm into buying less crap. We are supposed to be on our guard against all kinds of greed, Jesus said. He said our life didn't consist in the abundance of our possessions. I ponder that often.

jasdye said...

wow. really impressive post, strangey. it's got my wheels rolling on a bunch of different levels.

but seeing that open letter by the Buy (Less) people here ^^ is actually fascinating. it would sound like they're anti-consumerist. but their action points seem well-thought out and helpful to both the greater cause as well as the consumerists machine there. i guess if you can't beat 'em, have 'em effectively join a greater cause, eh?