Julie Cordua, VP of Marketing at the charity (RED), reacted to our recent opinion pieces, that spotlighted the amounts raised by the RED charity in 2006, by calling us up and then dropping us some details to correct us by mail. Here’s her response to this and this post on PSFK plus read further for our follow up questions and her answers:
JULIE: As we discussed, I want to provide corrections to a few of the inaccuracies in the article posted today at http://www.psfk.com/2007/02/more_questions_.html.
You stated: “We highlighted last week the dismal amount of funds raised by the RED campaign in 2006 ($11m).”
Correction: In its first nine months (March – December 2006 in the UK and just October – December, 2006 in the US), (RED) generated more than $20 million dollars to the Global Fund.
Background: Our partner companies close their books at the end of the quarter which either ends Dec. 31 or at the end of their fiscal quarter. At that time, they are able to calculate total sales and total contributions. Therefore, the money in hand at the Global Fund on Dec. 31, 2006 does not fully reflect the total amount raised in a given year.
You stated: “all the marketing activity behind RED made you aware of the brand, not the underlying message of plight in Africa”
Correction: We’ve conducted brand research to gauge awareness and understanding of the concept. In the US, 20% of the US is aware of (RED) and aware of the underlying cause behind it.
Correct list of partners: Gap, Motorola, Converse, Emporio Armani, Apple and American Express (UK Only)
Additional facts:
(RED) has generated a mechanism for our partner companies to give more money to a single cause than they have ever before in a given year.
$20M to the Global Fund to is nearly 4 times the amount of private sector contributions that the fund has received since it was founded in 2002. And, this was raised in just nine months.
PIERS: Thanks… How much was spent on the total marketing budget for RED in 2006 by the partners?
JULIE: Hi Piers – each partner determines their own marketing budget that is appropriate to their target consumer so it varies by partner. We centrally don’t have a total amount that was spent from the partners.
PIERS: ok. so, let’s say $350m was spent on marketing. Doesn’t $20 seem a small figure in comparison?
JULIE: I can’t quantify the total amount spent on marketing across partners, although $350M is quite high if you evaluate — using publicly available information — the total spend of any of these companies in a given year. Either way, there are a couple of important points to consider:
1) (RED) has generated a mechanism for our partner companies to give more money to a single cause than they have ever before in a given year.
2) This model is designed to create a sustainable flow of dollars to the fund, year over year. This can only be done if it makes good business sense for the companies that are participating. If it doesn’t make business sense, there is not a reason for companies to continue participation over an extended period of time. That would mean that you then get a one time donation vs. a consistent flow of dollars to the fund.
3) Also, it is important to put the $20M in context – this is 4 times more than private corporations have given to the Global Fund since its inception in 2002. And, it was generated in just nine months.
What do you guys think?
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First and foremost good on her for getting in contact and engaging in conversation – not a lot of campaign officials would have…
Maybe you can ask if she can find out the magic figure to the oferall marketing spend – I’m sure they would like to know as well in terms of equating impact, wouldn’t they?
PSFK making waves… fan-bloody-tastic!
March 1st, 2007 at 9:17 am
Piers, For once I think you are wrong, the companies would have spent those budgets anyway, with the red campaign or without it. They have just used red as a hook on a brand campaign. They have positioned themselves as caring sharing brands with their consumers. It would be interesting to see
. How the campaign has increased footfall and purchases of non red branded products
. Whether consumers brought the alignment, do they believe the brands are doing some good?
It is what many brands are doing, outsourcing , in this case good deeds to a specialist then leveraging the goodwill. For these services they are willing to pay a price.
The question for RED is should they be charging the affiliated companies more for the pleasure?
March 1st, 2007 at 9:41 am
Cause marketing is such a new category and there are so many different approaches yet to uncover.
That said, this experimental strategy unfortunately, did not work. Then again, there were ways that it could’ve worked better…
March 1st, 2007 at 11:43 am
“20% of the US is aware of (RED) and aware of the underlying cause behind it”
So that can be read as 80% of the US are not aware?
March 1st, 2007 at 11:54 am
Great thread, I have been following your posts on it and recently wrote about it on my blog as well. In a nutshell, I think the campaign will be successful in getting a wider range of consumers in the west to contribute in a small way to the global fight against Aids. The real question is whether you see Product Red as taking a piece of the same pie of global charitable donations – or whether you see the campaign as a way to simply make the pie bigger …
March 1st, 2007 at 1:08 pm
It’s an interesting debate. I got a Red Amex, mainly because I had friends working on the account at Mother if I am being really honest rather than a sense of charity. The whole Red campaign left me a bit cold – blacking up Kate Moss for the front cover of the Independent, ads with stylish African warrior women to tempt me to get a new credit card…
I understand that Aids in Africa is an important topic, but it just isn’t top of my charity list. I think that the whole approach was geared towards superficial fashionistas (oh and I think that the amount raised is a total joke!)
March 1st, 2007 at 2:04 pm
its a bit stupid publishing your rant. red regardless if it hasnt been suscceffull has at least contributed to the awareness
March 1st, 2007 at 8:19 pm
Great comments everyone. We’re not saying that RED is bad, we’re just questioning it’s effectiveness.
Tania, it wasn’t a rant. she gave me info to change the website. I asked a couple of questions back. it was a PR exercise on their behalf, we haven’t published a personal email or something.
March 2nd, 2007 at 10:42 am
I think that raising dollars that would have otherwise been spent elsewhere and raising awareness, (even if it were 10%!) makes this a good thing, regardless the disparities of lopsided marketing budgets or general public awareness.
March 2nd, 2007 at 11:35 am
It’s an interesting campaign for sure. Regardless of anything anyone says it achieved both objectives it seems to have set out to achieve – GAP branding and exposure for the plight in Africa. Effectiveness aside (my personal thoughts are that this succeeded on ROI – return on “influence” but not expectation) – it certainly got people talking about a very real problem. I think it’s important to note whilst GAP isn’t here to cure AIDS it is here to make money (and let’s face it they are doing a lot more than some).
March 2nd, 2007 at 4:06 pm
I think that the argument is an interesting one and yes these companies could do more by simply donating the cash on an ongoing basis, but that wouldn’t lend itself to consumer participation or engagement in the broader effort. And would rely on quite a bit of corporate altruism.
I think an interesting bit of data would be the number of consumers who know RED but don’t make the connection to any specific cause. It seems to me that GAP has been pushing RED to such a degree (likely in order to engender some emotional relationship with their brand) that they’ve actually grown to own the RED brand more so than the global fund in consumers minds.
Good for GAP for putting so much money behind it but probably bad for Africa and the cause that’s been drown out and disassociated from its intentions.
March 2nd, 2007 at 6:01 pm
I love this conversation. Good on ya for questioning!
“…. I agree,.. if you really think that by buying a bunch of stuff that’s connected to a cause is your way of donating,.. well then your missing the point. The point is to become aware of a cause and walk away with the desire and passion to want to learn more about how you can help. At least that’s what I hope happens.
So yeah,.. saying you bought a hoody from the GAP,.. or idUnited doesn’t make you a philanthropist : )….”
March 3rd, 2007 at 4:41 pm
This is a brilliant and needed discussion!
Last week we launched http://buylesscrap.org/ with the hope of directing greater attention to the efficacy of cause-related marketing overall.
I’m warmed to see PSFK ask (RED) tougher questions and it verifies the need for greater transparency to see (RED)’s non-substantive public relations response.
(RED)’s PR spokesperson likes to repeat: “(RED) has generated a mechanism for our partner companies to give more money to a single cause than they have ever before in a given year.” That doesn’t give (RED) a free pass. Consumers should have the right to know the full story and to make more informed buying choices based on real and complete data.
March 5th, 2007 at 9:33 am
http://adage.com/article?article_id=115287
March 5th, 2007 at 9:46 am
first of all, (red) is not a charity. it is a commercial venture with a portion of the profits going to The Global Fund, not to (red). it doesn’t have to be massive to be successful. hundreds of thousands of individuals alive because of the two projects funded, one in Rwanda and one in Swaziland, is measurement of the success, measurements much more valuable than you will find on any spreadsheet.
as for buylesscrap, sounds good. but people are going to buy clothing, phones, shoes, ipods, get American Express cards anyway, and to provide them with an option to willingly contribute to The Global Fund is smart commerce. the people that give directly are still going to buy products, and to belittle and parody a good venture to make a point to directly contribute to the causes of choice is really quite sad and immature . . . i hoped you could be much bigger than this. the teens and twenties who contribute thru sites like this will still wear their Abercrombie and Fitch, GAP and ipod brands, Chuck Taylor Converses, “crap” that is a part of our culture and fashion. watch and see.
i wish you the best, but this was a confrontation that should have been better researched before going public. it’s a matter of integrity, using numbers you can back up with sources and even contacting the source (red) or the sources that are accusing them. it will set a precedence on how you are viewed in the future, let alone how seriously you are taken in the future as well.
sammi fredenburg
seattle washington
March 5th, 2007 at 10:47 pm