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February 06, 2008

The Product (Red) Campaign Shakes Off Criticism

A year after the rock star Bono began the campaign known as Product (Red), which takes a cut of sales from popular consumer goods and funnels the money to the Global Fund to Fight AIDS, malaria, and tuberculosis in Africa, the results are in — Red and its corporate partners have contributed more than $59-million to the charity. But The New York Times reports that not everyone is cheering.

Some critics of this consumer-driven approach say that there is too little transparency and that efforts like Red are crowding out traditional philanthropic activity. Ben Davis, of San Francisco, who created a Red parody online known as “Buy(Less),” thinks that people should give directly to nonprofits that support AIDS programs in Africa. “Increased consumption in America can’t be the only way to solve Africa’s problem,” Mr. Davis said.

Others wonder whether the campaign is more concerned with advertising than with supporting programs in Africa.

Partner companies pay Red a licensing fee to label one or more of their products “(RED)” and then pay a portion of the sales from those products to the Global Fund. In return, the companies are able to market themselves as socially conscious in hopes of increasing sales. Neither Red nor the companies would disclose revenue or total contributions by company or product. Tamsin Smith, president of Red, emphasizes that “Red is not a charity; it’s a business.”

Despite the controversy over the Red campaign’s approach to philanthropy, beneficiary groups such as the Treatment and Research AIDS Center, in Kigali, Rwanda — which has received $22-million — say that the money from Red has made a real difference. Anita Asiimwe, the center’s managing director said, “The money we get from Red through the Global Fund is helping to save lives. That’s the important thing.”

Red’s contributions make up less than 2 percent of the Global Fund’s total, yet the organization is the fund’s 15th-largest donor, ahead of Russia, China, Saudi Arabia, and Switzerland.

For more on the Product (Red) campaign, read The Chronicle of Philanthropy’s coverage, including an article on charity marketing deals and a transcript of an online discussion about the effort.

(Free registration is required to view the Times article, and a paid subscription or short-term pass is required to view the Chronicle article. Access to the Chronicle discussion transcript is free.)