Doing Good For Business' Sake
Those of you who have had the questionable honor of spending a lot of one on one time with me already know my feelings on this topic. For those of you lucky enough to have avoided such an occasion I'll try and summarize my views:
- As transparency into companies increases, the underlying tone and culture of those companies becomes more critical to its success
- Integrity, ethics, and social responsibility should be rewarded where in existence, strived for when needed, and demanded by management and the consumer
- The notion that "Doing Good is Good For Business" should be a core part of the business culture
- The consumer should accept that it is ok for a business to both do good and benefit from those actions at the same time
- With these elements in place, a great deal more funds can be made available, particularly for smaller charitable initiatives, than currently occurs through the donation/sponsorship environment
Let's start with a few simple universal truths.
Universal truth #1: Companies are in business to make money.
Universal truth #2: They are also filled with people who would like to make a difference.
Universal truth #3: If you can find a way to combine the first two truths you have the opportunity to create a great deal more funds to apply towards making a difference, and the incentive for the company to do so.
All too often we as consumers criticize anything which benefits a business (or person for that matter) while in the process of being charitable. There is this benchmark of pure altruism being applied. And while honorable that may be, there is only so much of that that a company can do before the impact on the bottom line issues a cease and desist order.
From my humble perspective, I would much rather see companies finding ways to leverage these efforts to sell more products or services. The flow of funds outside the company at that point has no finite end point.
Should we really care if the Pepsi Refresh project ends up selling more soda for them? If it does wouldn't that mean they'd be more likely to continue funding good initiatives? Do occasions occur when a company is using a charitable initiative as a sleight of hand tool to distract you from some less than savory facts? Of course, but is that really the norm?
Cynicism where big enterprise is concerned has spun out of control. Take them to task when warranted, but a company garnering benefit from a charitable activity should not be one of those times to be critical. It is in no ones best interests, particularly those who could be helped.
Cheers,
Matt Ridings - @techguerilla
5 Comments
I also wonder if part of the usual raking-the-company-over-the-coals is a matter of degrees. We are all skeptical of Pepsi's true altruism, but they are affecting real and documented change so we give them a pass. But if your brand just contributes "one cent for every dollar spent," for most of us we do the math and realize we can actually go down the street and buy elsewhere for ten cents less and give the money to a charity ourselves.
Good food for thought, Matt.
Bob Knorpp
Host of Ad Age Outlook
Host of The BeanCast
If Pepsi were to give one cent for every dollar spent that would actually be an *enormous* amount of money, does it matter if you could find it cheaper somewhere else? Does it matter if I give the margin to Pepsi and they give it to a charity vs. a Costco eating that margin for greater volume of sales? How many of us take that savings of .80 cents and go donate it? If Pepsi benefits then more power to them, at least that's what the logic side of my brain says. The emotional side says the same thing that most people feel "You just want me to think you're a good company so that I'll buy more stuff". Yet....the question becomes why don't we believe they actually *are* a good company? Does the fact that they benefit actually define that? I don't think it should. But it's a complex topic revolving around authenticity vs. what derives the most benefit to the social good. And in this instance it's very possible that those two things are at odds with one another.
Many thanks for the comments.
-Matt
I will ask, though, where have you heard the Pepsi criticism? Not doubting, but since I've not heard any from the general populace I was wondering if you had data I haven't seen. We just talked on Ad Age Outlook (episode 13) about the intense scrutiny that professionals are laying on brands these days via social venues. So I can imagine there is pretty vociferous dislike among marketers for the efforts. I'd like to know if the same is true of the average person.
As for the "enormous amount" you are right, but it's all a matter of perspective for a consumer. Logically speaking the "1 cent" promotion may actually give more than the entire spend of Pepsi Refresh. But I'd say the perception is that it's less, because it's not concentrating on the outcome as much as the process. All the consumer sees is the penny, not the constant stream of $50K checks.
I should reiterate, though, that I totally agree with your post. Just trying to tack on some additional thoughts for discussion.
Bob
As for the negative feedback, the most vocal I've heard revolves around the process. People don't like the notion of 'competing for charity dollars'. Pitting good organizations against each other basically. And they have a point. Just like competing for a speaking spot at SXSW has flaws (popularity/reach over quality for example).
And I'm glad we agree on what does make Pepsi Refresh such an innovative program. A focus on outcomes, rather than process, can make all the difference in acceptance.
Good stuff.
As an aside though, It is funny how charities have found that focusing on the problem rather that showing the solution increases donations, but how we would never suggest such a thing for a company. I don't know what this last comment really adds to the discussion, but interesting nonetheless. Charities would show birds doused in oil. Companies would show the pristine beaches they've cleaned. ;)
Bob
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