Ethics, Cyclones and Quakes
May 14th, 2008
Cyclone in Myanmar. Quake in China. Many dead. Not good.
Here is an article in yesterday’s Wall Street Journal titled, Does Being Ethical Pay? Companies Spend Huge Amounts Of Money To Be Socially Responsible. Do Consumers Reward Them For It? And How Much?.
The article reports a series of experiments that found that consumers will pay a small premium for ethically produced goods. But they will punish an unethically made product even more harshly by buying it only at a steep discount. These results are consistent with academic studies I have read on this topic.
In light of this devastation in Myanmar and China, what is your response to the following questions:
1. One way you can help brand your firm and do good at the same time, particularly if your firm does business in or with Asia, has Asian employees or clients or suppliers, any of which is highly likely given our locale in California, is reach out and show empathy by donating $$$ to victims in China and/or Myanmar. You could then in turn leverage this in other ways.
But who/what agency would you donate funds to to help these folks? Who is reliable? Who do you start with and how do you find this out? And do you donate in RMB or US dollars?
2. How would you broadcast your firm’s do-goodness in this regard, gently and humbly or other, to your various stakeholders so that they know you care and will remember you when they buy your product? What is your strategy?
No cop outs on the second question! That is, I would question your credibility and business savvy if you say, “Well, I am/my firm will be ‘above’ telling people about my firm’s good works and money donations to these regions in Asia. We won’t tell anyone about our do-goodness because that would be arrogant and will let our actions speak for us.” I don’t know one successful and profitable business run by people that took a marketing or strategy class that would take that approach to product or service differentiation, and be that selfless, particularly a public company that has to answer to shareholders about how they are spending their money.
Discuss.
By the way, here is a good blog from Chengdu, the mega-city in China that is 50 or so miles from the quake epicenter, Barking at the Sun. Said blog has some pretty good on-the-ground info re the quake and that region.
Entry Filed under: China, Pre-Departure, Beijing
7 Comments Add your own
1. Ty Mackey | May 14th, 2008 at 5:46 pm
Whenever someone brings up social responsibiilty I have to pimp my social responsibility paper.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=816425
Social responsibility is about so much more than letting your customers know how kind your firm is. It’s also about letting your investors know how kind your firm is.
2. Chris Carr | May 14th, 2008 at 6:55 pm
Nice. I agree, Ty. In fact, today in some cases, it seems to be the board and investors who wag the proverbial dog (firm) more so than customers!
Look forward to reading the paper.
3. Andrew Steen | May 15th, 2008 at 7:59 pm
If I were in charge of a huge company, then I would make donations in the form of building supplies. I would have to find out which supplies are acceptable, but donating materials instead of money may help ensure that the donation is used appropriately.
I would market my generosity by making a documentary of all the grateful recipients. I’d show them smiling and saying, “Thank you,” and using the materials I donated. Then I would put this video on u-tube and our company website, and also give a copy to the local news station and ask them to interview me about my generosity.
4. Ashley Drum | May 16th, 2008 at 8:53 pm
This is an interesting question because I often wonder how you help a country that doesn’t want, or accept, outside help (i.e. Myanmar). Is money really the answer? And if you send money, is it really going to help those in need or those higher up in the government? Those questions aside, I would have to donate money to American based agency because I trust that a higher percentage of donations make it to the hands of the victims and not the government (at least I hope!). These agency would include the American Red Cross or, being an architecture major, Architecture for Humanity.
As far as marketing, I would set up a program where my company would match all outside donations from the community. I would run commercials in the community or nationally depending on the size of my firm and ads in various media outlets. This shows the public that my company is reaching out to those in need without “tooting my own horn.” It is a call for the community to come together and donate what they can with the financial backing of my generous firm.
5. Joan Lindsey-Mullikin | May 17th, 2008 at 12:27 pm
Marketing? I can’t resist. Following is some of the current thinking on the subject for longer term brand building .
-Don’t approach any topic that is considered controversial for your company/industry. Head another direction.
For example, if you are an oil company do not do anything for the environment. It will backfire. An oil company would not want to go in and save the Pandas, waterways, or forests. Do something for safe driving- still related to oil (fuel) but won’t create criticism.
- Donate to causes related to your product line and it will become associated with your product line.
For example, many companies have become so affiliated with charities there is a one to one association. Avon became linked with breast cancer research. This was a good move considering most of their customers were woman at risk for breast cancer. At many breast cancer fund raisers Avon’s name was front and center.
-To get on the news maybe the companies could ask their customers to help the “victims of China.” by ……….
What promotions would you suggest here to get some good press? Any ideas? Going to the company website? Coupon?
6. Chris Carr | May 18th, 2008 at 12:08 pm
Good pointers, Joan.
Thanks for the check in.
7. Nic Marlin | May 27th, 2008 at 10:51 am
Responses to questions:
1. The first step in figuring out which organization is the best to donate to is doing some research. There are numerous websites dedicated to helping people choose which agencies or organizations are the best to donate to for the situation at hand. For instance, the website www.charitynavigator.org provides tips for how to donate wisely and provides options of which agencies are good to donate to specifically for the China and Myanmar crises. This website also rates these agencies based on a number of factors including their organizational efficiency and organizational capacity.
After doing the research, I would first see if there are reputable U.S. based non-profit agencies that are seeking contributions. Although having a low expense ratio and good rating is important, another factor to consider is the ability for the contribution to be a tax write-off and the reputation of the agency in the eyes of our customers. My final choices would be the Mercy Corps for the China earthquake crisis and the American Red Cross for the Myanmar crisis. These two companies had the highest ratings for their respective crisis and meet the other considerations I mentioned above.
2. I would partner with my public relations firm to create a good strategy to broadcast my company’s goodness. PR firms are pretty good with this kind of publicity. Surly the campaign would start with a newspaper publication or interview highlighting our company’s focus towards contributing to society and the world, and our commitment to inspiring others to do the same. We could even commit a couple pennies of each dollar of sales towards a certain cause, which after promotion would have customers directly related to the contribution they are making towards society from purchasing our products. This strategy has worked well for Starbucks with their Ethos Water and I’m sure it would work well for other companies.
Leave a Comment
Some HTML allowed:
<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>
Subscribe to the comments via RSS Feed