The New York Times reported yesterday that Product (RED) is about to start an online music service along with its other product lines (like Gap shirts, iPods and Dell computers). The re-appearance of Product (RED) in the news brings up some old questions. Is donating a portion of purchases to charity raising awareness about important causes or just allowing shallow consumers who idolize Bono to create the appearance of caring without any real commitment? Is it promoting the companies without real benefit to the charity? Should the companies redirect the money they are spending on marketing Product (RED) and actually give those funds to charity instead?
What is “Embedded Giving”?
A series of 2007 posts by Lucy Bernholz on the topic of “embedded giving” defines the practice this way: “Embedded giving is the (apparently) increasingly common practice of building a philanthropic gift into another, unrelated, financial transaction. For example, rounding up your phone bill to make a gift to charity. Or using your own grocery bag and donating the nickel that the store gives you to a local homeless shelter.” Her post included the observation that a charitable “surcharge” onto other purchases may encourage people to give without thinking about what they are really doing.
But here’s my question: Do we care whether people are intentionally being thoughtful and purposeful when they donate, so that if they buy Product (RED) for the social cachet instead of with the desire to stop the spread of AIDS in Africa, the charities should decline the proceeds?
Buy (LESS)
I once saw Tactical Philanthropy list “Buy (LESS) Crap!” as one of the “best of the Philanthropic Web.” Buy (LESS) critiques the model of Product (RED) on the grounds that it promotes consumerism and that buying stuff is not real charity. But does (RED) really suggest that we should buy more crap, as Buy (LESS) claims? Or merely that, if we are going to buy crap, like t-shirts, greeting cards and iPods, we can choose to buy an iPod where part of the purchase price will go to charity? Same iPod, same price, but more to charity. On their web site, (RED) explicitly states that the choice is between buying (RED) and buying non-(RED). Suggesting that (RED) makes us buy more crap is like suggesting that “Pulp Fiction” made us more violent. Are we really still blaming Quentin Tarantino for our violent society? We’re blaming (RED) for our consumerist culture?
“Tainted Money”
Years ago, as a new grant writer for a museum, I bemoaned to my boss the fact that a company whose practices I find to be socially irresponsible sponsors a major arts grant competition (hint: illip-Fay orris-May). Her reply: “There’s a saying in fundraising that ‘the only problem with tainted money is that there ‘taint enough.’”
“Indulgences Sold Here”??
Think those charities should turn the money down? I don’t. But–and this is the key–the charitable contributions can’t be used by anyone–a company, an individual, media, shareholders, charities or anyone else–as a way to deflect attention from wrongdoing in some other area. Corporations need to exercise social responsibility irrespective of their other charitable activities. Philanthropy can’t be used as an excuse or a shield, so that companies avoid all other scrutiny. (My former congressman once justified his acceptance of Phillip Morris campaign contributions by pointing out that they own Kraft, and Kraft gives a lot to charity. Ick.)
So we should applaud Yoplait and M&Ms, General Mills and ChapStick and the other 60 corporate partners that give money to Susan G. Komen (those people have this model down to a science) but that doesn’t mean no one should be looking at other aspects of those businesses and holding them accountable.
What do you think?
Do you own Product (RED)? Do you prefer companies that partner with charities? Do you feel confident that the charities who let their names be used are thoroughly vetting the companies before letting themselves be associated with that company? Thoughts and comments welcome.
Tags: charity, consumers, corporate philanthropy, corporate social responsibility, embedded giving, philanthropy, Product (RED)
July 1, 2008 at 10:13 pm |
Great post. The fact that Elvis Costello is going to produce content for the RED music service may be enough to pry me away from my Mac/iPhone/iPod/iTunes addiction and try something new. I enjoyed the discussion on “embedded giving,” which might also be called “sustainable giving” and I think RED has developed a great model of sustainable giving. One last thought: Many organizations turn down “Millip Phorris” money without going under. In fact, when they let their other donors know that they turned down a donation from a company whose products kill millions, those other donors may be moved to donate more.
Dan Durazo
http://www.dandurazo.com
July 1, 2008 at 11:05 pm |
[...] Jump to Comments In her blog The Philanthropic Family, Sharon Schneider discusses the merits of Product (RED) and its new music service, as well as the controversy over embedded [...]
July 2, 2008 at 10:31 pm |
I personally think that a promotion like Product (RED) is a positive overall. Those that are already engaged with various nonprofit causes will probably not go out and buy extra stuff just to give a portion to charity; they are already giving of themselves in time and/or money.
On the other hand, Product (RED) may open the eyes of people new to philanthropy of real needs in society. Some portion of these people could become more engaged in philanthropic causes.
I also wouldn’t be surprised if Product (RED) would give more $ to charity if it cancelled Product (RED) and simply gave its marketing budget to charity. But, over the long term, creating new philanthropists who are engaged with some cause(s) is a much more important result of these mass market campaigns.
I wonder if there are any studies on this kind of thing? And I guess the question really comes down to what is more important – the actual $ amount donated to causes or awareness/engagement? The answer to that question may be the key to this whole discussion.
July 3, 2008 at 3:30 am |
[...] Product (RED): Inspi(RED) or Ti(RED)? « The Philanthropic Family Sharon Schneider on whether it matters if philanthropic dollars are “tainted” or not. What do you think? Is philanthropy only good if it is pure? Or is the only problem with “tainted” money that there “taint enough of it”? (tags: philanthropy) [...]
July 3, 2008 at 8:46 am |
Thanks for your comments, Dan and Kevin.
Sustainability is such a big buzzword these days and there’s certainly something to be said for reducing dependence on donations and increasing “earned” revenue of this kind.
Kevin, your comment makes me think of Product (RED) as the marijuana of charity: it’s a gateway to bigger things. Ha!
July 4, 2008 at 12:33 am |
[...] Product (RED): Inspi(RED) or Ti(RED)? Money quote: “Is donating a portion of purchases to raising awareness about important causes or just allowing shallow consumers who idolize Bono to create the appearance of caring without any real commitment?” Don’t inauthentic and shallow people deserve SHARETHIS.addEntry({ title: “links for 2008-07-04″, url: “http://selfishgiving.com/cause-marketing-links/links-for-2008-07-04″ }); Posted in Cause Marketing Links | Comments (0) Post a comment or leave a trackback: Trackback URL. [...]
July 11, 2008 at 10:53 am |
[...] viewpoint expressed in this BusinessWeek article is the embodiment of the downside I described in my post last week on Product(RED). Companies should be applauded for their donations to worthy causes, but they should not be allowed [...]
October 30, 2008 at 10:27 am |
[...] of Philanthropy may not be exactly age-appropriate. And many of us have mixed feelings about buying products with some cause-marketing tie-in, wanting to support causes we care about but not wanting to send the message that consumerism is [...]
December 8, 2008 at 9:22 am |
[...] as an effective way to raise awareness about problems and the people working to address them (see earlier post and comments on Product(RED)), I’m more inclined to favor products that were produced by or reflect the experiences [...]
May 26, 2009 at 7:58 am |
[...] You’ve probably participated in embedded philanthropy. A few examples of embedded philanthropy from elsewhere in this blog: A mutual fund that donates a portion of their proceeds to charity; TOMs shoes that give a pair to a child for every pair you buy; and of course the grandaddy of them all, Product (RED). [...]
September 10, 2009 at 4:37 pm |
Hi! I was surfing and found your blog post… nice! I love your blog.
Cheers! Sandra. R.