Buy a red T-shirt to fight AIDS. But does it really help?
When John Cortez went shopping for a T-shirt with a (RED) logo at a local Gap clothing store this weekend, he knew part of the proceeds would be sent to HIV-positive women and children in Africa.Skip to next paragraph
Subscribe Today to the Monitor
"I like the product, and it's a good cause, so I might as well buy it," says Mr. Cortez, explaining how he had "two good reasons" to spend his money at the Gap.
What he didn't know – and what Gap customers can't find out – is exactly how much money per item goes to Africa.
His experience hints at both the power for good and reasons for criticism of (RED), a high-profile campaign, partnering some of the world's most recognized brands like Gap with The Global Fund, an organization that grants money to fight diseases.
(RED), launched by rock star Bono and Bobby Shriver last year, has drawn praise for raising $25 million for AIDS medications in Africa, as well as some reservations about marketing costs and a lack of transparency. Such tensions are not uncommon within the rapidly growing business of cause-related marketing, which puts a corporation's advertising dollars behind a nonprofit's cause.
"There's a wide variety of cause-related marketing out there, and ... consumers need to ask the tough questions," says Mark Feldman, a Boston-based consultant who has worked in the field for more than a decade. "They have a right to know more of the details because the company is claiming an association with a cause."
Cause marketing is becoming a major force. Companies spent $1.34 billion on it last year in the US alone, up 20 percent over 2005, according to the IEG Sponsorship Report. Part of the reason: Eighty-four percent of Americans are likely to switch brands to help a cause, when price and quality are equal, according to a 2002 Cone Corporate Citizenship Study, an industry-based poll.
Among the more visible campaigns are the yellow bracelets that link Nike to the Lance Armstrong Foundation, which aims to fight against cancer, and Upromise, an education savings program that receives sponsorship from corporations including ExxonMobil.
(RED) aims to provide long-term support to The Global Fund through the sale of products carrying the (RED) brand. Apple sells a (RED) iPod, American Express offers a (RED) credit card, and Gap has an entire line of (RED) clothing and accessories.
The companies get some of the profits, and the chance to be tied to a cause as well as the celebrities behind it, including Oprah Winfrey, director Steven Spielberg, and photographer Annie Leibovitz. In exchange, (RED) gets these companies to market the cause and the products, and wins a share of the proceeds for The Global Fund.
"We hijacked marketing budgets that would normally have gone for good products, but now they're going for good products that will also bring money into Africa," says Tamsin Smith, president of (RED). "There are 10 miles of Gap windows in the United States. And for many weeks [those displays] were talking about AIDS in Africa."
Splashy advertising in top cities and publications has added to the campaign's impact – and raised some eyebrows. Last week, an Advertising Age article unfavorably contrasted the amount of money raised for Africa against "estimates as high as $100 million" spent by the companies on marketing.
(RED) says no dollar figure can really be placed on raising awareness about the 5,500 people dying of AIDS each day in Africa. It also rejects the $100 million figure as too high by tens of millions of dollars.
The person who believes he's the source of that number says it was merely an educated guess. "I floated something that has become truth that's not truth," says Ben Davis, head of a San Francisco-based communications firm.