Originally Published 2007-05-08 18:03:03
A colleague of mine who writes about iPod culture recently posted on the benefits of Project Red. The idea is largely the brainchild of Bono, the iconic vocalist from U2. I like the man, the idea, and the project quite a bit, and I've personally spent too much on a shirt from the gap in the name of said like. It was a gift, which served two purposes in my mind -- I channeled the dollars I was going to spend anyway, however small, into something good, and I pulled my previously unaware family member into the movement, however indirectly.
First, I have a few thoughts on the business side of Project Red. I don't remember how much my Project Red shirt from the gap cost me, but with the simple white tank top I bought for my female college-age cousin, it cost me about $50. I'm not sure I would have gone to the Gap at all to buy her gift -- my plan B was to drop some money on her Verizon plan and enclose the receipt in a birthday card. Along with something small and personal, like just the simple white tank top without any "red".
So a few pennies out of my would've-spent-that-money-anyway birthday present budget went to humanitarian efforts. Beautiful.
So everyone wins, right? Companies like American Express, The Gap, Motorola, Converse, and Apple have spent $100 million promoting Red products -- money they likely would've spent anyway on other marketing. And Project Red has generated $18 million in donations.
So, assuming that these are all products that would have been purchased anyway, we're just lifting a point or three off the top (Apple's red iPod is about 6% of gross, for instance, while Amex is only 1%) and donating it to a good cause. The corporations in question get some positive PR and a tax deduction (why do THEY get it? ugh). And we, as consumers, get to identify with the brand and feel good about ourselves. It is, perhaps, akin to un-athletic people sporting Nike gear because it makes them feel like Michael Jordan or Tiger Woods, but screw it. As consumers in a capitalist society, that's half the reason we purchase most of the goods and services we consume every day -- beginning with our car (talk about an extension of identity... I sometimes play the "what kind of car do you drive" guessing game on first dates to gauge how accurately my date has conveyed herself!) and ending with our socks (do you really need a Nike swoosh on your athletic socks? Are they really of different or better quality?).
So it's a good thing all around given a zero sum game. That's for certain. Any way that this can be duplicated in your own business, btw, can have a very powerful PR effect for you. I recall Mervyn's doing it years ago with their pledge to donate 5% of profits to public schools. I don't know if Target still does that (Target and Mervyn's were once the same company), but it's a nice move. Other methods of being a "good corporate citizen" have pretty profound effects from a PR standpoint. Starbucks and their commitment to providing health care to employees comes to mind, for instance, as does Costco's union-friendly habits. I wonder how the world would perceive Wal-mart if they had done any of these? (This is not to say that I endorse of despise any of these companies. I haven't studied the details enough to make that kind of call. I'm sure that every publicly traded for-profit organization has a skeleton or two in their closet.)
But back to Project Red. What about the possibility that consumers have made extra purchases because of the campaign? What if a measurable percentage of those $35 shirts and $300 iPods and RAZRs would not have been purchased at all without the rationalization in the consumer's head that "it's going to a good cause"?
Then it was a bad call. Enter BuyLessCrap.org, which urges consumers to not buy silly red shirts and instead donate their $35 directly to a number of reputable charities, including the benefactor of Project Red, The Global Fund. The idea being that the $35 is a heck of a lot better than the 70 cents The Gap would have given on your behalf.
I agree, although I submit that this is only true if consumers have spent more because of the Project Red angle. Other than that, I think that the campaign is a winner. I, for one, am glad I that a few pennies of the money I would've spent anyway on my cousin's birthday present went to someplace good. It all adds up.
Notable sources of this meme:
A ti(red) campaign: Bono feeds his ego, makes little difference
Oct 2006 article by Matt Diehl (pro-red)
Inc(RED)u(LESS) About Project (RED) -- see the comments on this one. A representative from the Gap even chimes in.
On 2007-09-03 23:23:12 Internet Marketing and Advertising said:
Internet Marketing and Advertising...
I couldn't understand some parts of this article, but it sounds interesting...