Opacity, philanthropy, and marketing

I recently read a piece in the Toronto Star that suggests there’s a problem with buying stuff a part of the price of which goes to charity.  The author makes and excellent point and makes plain a rather disturbing phenomenon, but she doesn’t go far enough.

There’s a marketing technique, called cause marketing, that gets you to buy stuff because a fraction of the price you pay goes to some worthy charity.  Sounds great: you get something you want, and so does some charity.

But Prof. Aradhna Krishna of University of Michigan has discovered through her research that the more you pay for cause-marketed goods, the less you’ll donate directly to the charity itself.  You can see that this can end up actually lowering the total funding available to charities.  This problem is exacerbated by the rather vague and opaque ways that the actual amounts given to charity are described.  In some case, the amount donated can amount to only a few percent of the price you pay for an item.  Basically, you can rarely tell how much of the money you spend to buy, say, a t-shirt will actually go to, say, support breast cancer research.  That opens the door for unscrupulous companies to make more profit by only giving a tiny fraction of the unit price to charity.

While Prof. Krishna explains the phenomenon very well, she doesn’t actually propose any easy fixes.  My spidey-design-sense got tingling, and I thought I should offer up some possibilities.

Government regulation.  It makes sense that if food producers are required to tell you how much sodium or fat is in the food you’re buying, they could also tell marketers that they have to specify exactly how much money is going to charity per unit sale.  But governments have been very slow in requiring nutritional labelling on food – in fact, labelling is still not as good as it should be.  If we start now, we might expect to address the cause-marketed goods in a couple of decades or more.

Do we really need to wait that long?

Protests to motivate government. The Occupy Wall Street movement seems to be doing rather well.  Perhaps we need to mobilize people to demand that governments act to deal with this matter.

I don’t see this happening any time soon.  We don’t want to dilute OWS by introducing other goals; OWS has pretty significant goals anyways.  And who’s going to hear a few people complaining about abuses in cause marketing, given the din over the gluttony of big banks and insurance companies?

Direct action and communication. This is, given current events, probably the best way forward.  One could put together, rather easily, an online movement that can include facebook, twitter, google+, and other social networks, as well as online petitions via avaaz or change.org, to begin to spread the word.  Find the right few people to champion it, and it will probably take off far faster than any other way.

But what word should one spread on this matter?

Should one advocate for an abolition of cause marketing?  No, of course not.  There are good instances of cause marketing – why should those efforts be eliminated? No, what is needed is a way to deal with the unscrupulous that doesn’t unnecessarily hinder the scrupulous.

Governments cannot help.  Scruples are in short supply there generally, and they work at a near glacial pace on any issue that doesn’t directly threaten their continued hold of power.  No, governments cannot be expected to work here.

But the grass roots approach could, I think, do the trick.

I think, the message that should be sent out is to boycott companies who do not engage in open and transparent cause marketing.  I think the message must contain the information that people need to spot an opaque cause marketing campaign, and the education to know that there are better ways of getting things done.  Like, for instance, buying a competitor’s product that is not cause marketed, but also then giving directly to a charity the amount that you would think should be donated.

The argument is simple: if we boycott those brands who practise opaque cause marketing, but not those who practise it openly and transparently, then we’ll actually exert pressure on the marketers to only practise it in an ethical and scrupulous way.  I see that as a win-win situation.

What about you? Have you got any other suggestions for improving how cause marketing is done?

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2 thoughts on “Opacity, philanthropy, and marketing

  1. “if we boycott those brands … then we’ll actually exert pressure on the marketers to only practise it in an ethical and scrupulous way.”

    Lets face it, marketing, like politics, is never going to be ethical and scupulous.

    The problem is that people are too easily influenced and manipulated. I show you a bottle of Pepsi next to a gorgeous woman, and you buy the Pepsi.

    People should be against all Marketing, because in the end, its their money that’s paying for it. And the marketing and colorful labels are not making the products any better. What should be done, IMO, is get rid of all marketing. By doing so, people could better choose the products they need (what your friends tell you is a good product vs what a corporation says) for less, and avoid being manipulated into thinking that they need to buy things that they actually dont.

    • Marketing isn’t necessarily unethical – it is so just because it never gained a tradition of ethical behaviour. (Ditto for politics.) Marketing is really about understanding what people want.

      If I saw a bottle of Pepsi next to a gorgeous woman, I’d buy a Pepsi and give it to the woman…. 🙂

      Just like everything that isn’t in some way regulated (like engineering, medicine, etc), the potential for abuse is made manifest. Good marketing can contribute positively to product development. Look at Apple & Google for instance. What’s needed for marketing is some serious regulation and a real code of ethics.

      The best reason for advocating for regulation in marketing is that decent people like you think it’s wrong.

      Also, remember – there’s a difference between marketing and advertising.

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