''Every time you use your Discover Card, we'll make a donation to America's relief efforts, until we reach our goal of 5 million dollars.'' So announces a full-page advertisement in national magazines that also lists the goods and services -- from greens fees to grills -- that can be purchased with Discover's brand of plastic.
''Manhattan Auto Group offers help after WTC tragedy,'' reads the headline of a newspaper advertorial that says the company will donate $100 from each vehicle sold during the rest of the year to the Twin Towers Fund.
''Help Them As You Help Yourself,'' said an ad for a health-club chain. It promised to donate October's new-member fees to the New York Police & Fire Widows' & Children's Benefit Fund.
In the wake of Sept. 11, companies have scrambled to figure out the proper way to market their products. Many have chosen an approach already popular during the holidays: promising to donate a percentage of sales to charity.
It appears to be a win-win proposition. Charities receive money and ad promotion; companies get their reputations burnished and earn higher profits. But there is a loser: the misled customer.
Companies act as if they are making noble sacrifices. But it's consumers' money they're giving away. Firms use a charity link to lure them into buying, then keep most of the new revenue.
Discover is asking the public to buy something with their card so it can pass on a small portion to charity. Wouldn't it be more of a ''help'' for Discover to suggest that cardholders give up a round on the links and send the green fees directly to the relief fund?
Make the distinction
''We are corporate citizens of New York, and it is important for us to give back to the community,'' explains Manhattan Auto Group's president in its ad. Yet, as community-oriented as the firm may be, this offer is not for Manhattan as much as it is for Manhattan Auto Group. That's OK, but companies should not delude the public about their intentions.
It is the same disingenuous message being delivered by the current carmaker ads that position their new 0% financing as a way ''to get America rolling'' when they're first and foremost an attempt to get their own businesses rolling.
And it may sound generous for a health club to donate a full month's membership fee of all new members. But in subscription businesses, the real money comes from subsequent fees. So, the $99 ''donation'' is really a marketing investment against future revenues.
A good idea, generally
Cause marketing is part of an effort by companies to align philanthropy with corporate objectives. It generally has been a positive development, making social responsibility more central to the mission of business, and growing the financial pie for the charitable sector. The idea is that companies can do ''good'' and do ''well.'' The problem is when they hype the ''good'' and downplay the ''well.''
The percentage-of-sales model was popularized by American Express in 1984 to support the rehabilitation of the Statue of Liberty. AmEx donated 1 cent for every transaction, resulting in a gift of $1.7 million.
Seventeen years later, it's still a penny. American Express' Charge for the Cure campaign supports the Susan G. Komen Breast Cancer Foundation. For every American Express purchase at participating merchants in September and October, the company donated 1 cent -- up to $500,000.
That maximum-donation cap is another disturbing aspect of these programs. If sales end up being short of the mark, the company gets to advertise a big number without donating that amount. If sales surpass it, the company keeps the excess profit.
But if a company is going to take bows for being charitable through a cause-marketing promotion, it should be willing to donate a significant percentage of revenues, minus costs. For example, People magazine is selling ''FDNY'' caps and contributing 100% of the profits to a fire-relief fund. The ad gives an address if a reader just wants to donate without a purchase.
If companies make such a big deal about their good works, they should give away more of the money earned through such promotions -- or tone down the lofty rhetoric.
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