I’ve been surprised by some of the criticism flying around the Product (Red) campaign and a seeming lack of marketing understanding to the hits being leveled.
Advertising Age in March fired a critical shot that said the celebrity-fueled effort – which has marketers contributing a portion of sales from consumer products to the Africa uber-charity the Global Fund – had raised only $18M while spending an estimated $100M on advertising. That claim, which continues to be cited in articles about the campaign, came only a few months after the Red campaign began in the U.S., and a year after its London launch. The Red campaign disputed the article and said the figures were more like $50M on ads, and $25M raised.
As Ad Age pointed out in its initial article, private sector donations to the global fund totaled $5M from ’02-’05. The New York Timesreported this week that the Red campaign has brought more than $59M to the Global Fund in a little more than a year, a huge increase that has funded treatment facilities and bought HIV/AIDS drugs in places like Rwanda.
Motorola, Gap, Dell and American Express are among the companies pledging percentages and set dollar amounts ($5 from a Product (Red) Motorola phone sale, for example) to the campaign.
The companies buy advertising to tout the products and pay a license fee to the Red campaign. Yes, they are promoting themselves. But they are also doing some good with the resulting revenue. Should they be crucified for that? And why the hang-up on ad spending (especially from Ad Age)? [Ad Age later admitted it didn’t account for the PR value of the campaign’s marketing efforts and said the $100M figure was based on three estimates by “media experts.”]
Looking at Red through the lens of short-term profit/loss doesn’t provide the full picture, but don’t think for a minute profit isn’t the point. It is. From its onset, the effort was conceived as a long-term project with the hope that more companies would set up similar programs that would both contribute money and make consumers more aware. As co-founder Bobby Shriver noted in an op-ed to Ad Age following its critical story:
“Any company worth its weight in salt knows it doesn’t exist to give away money. Red gives our partners a way to do good and turn a profit doing so. So if you’re going to look at our marketing partners’ marketing expenditures, shouldn’t you take into account the full return on investment? We think so.”
The Times noted critics are saying companies should just donate money to the Global Fund, or any other charity, rather than market their products and give only a portion of their sales. Some say the campaign is taking the place of other philanthropic activity, or is not operating with enough transparency.
That criticism makes zero sense – from a corporate or charity standpoint – to this blogger. The point was to get consumer dollars re-routed to charity and raise some awareness of the Global Fund's efforts. It's a PR campaign that makes money. Red partners have bought a lot of ads, sure. But those ads have fueled interest, sales, awareness and attention for both the campaign and its backers – at the expense of the marketers, themselves. Vanity Fair had a Red issue with co-founder Bono (is there a more effective celebrity spokesman on the planet?) as guest editor of the magazine, which focused almost entirely on Africa. He performed similar duties for a day at the U.K. Independent newspaper.
There’s no question Bono is an egomaniac, but from what I’ve read about the guy, he’d be the first to tell you that. The Red campaign is a high-profile endeavor with celebrity pitchmen and mega brands (and egos) behind it. But there’s no reason to apologize for that.
As Tasmin Smith, president of Red who formerly led Gap’s government affairs dept., told the Times: “Red is not a charity, it’s a business.”