Friday, March 16, 2007

"Why the Grouse about the RED campaign?"

An article of the same name ran in the Huffingtonpost a few days ago. RED, if you haven't heard, is a scheme whereby major retailers design special product lines that are either red or have some sort of red related thing on them and donate the profits to the Global Fund. It's Red, or RED, because red is the color of the AIDS ribbon. RED is supposed to supply funding to fight AIDS.

In the article in question the author makes, among his many assertions, two claims: 1) that a continual supply of money will be a better way to fund AIDS support than other types of giving and 2) that RED is already really successful since it's raised $25 million dollars.

Advertising Age put the figure at $10 Million, but lets be charitable and say that the $25 Million dollar amount is correct. The author also states that RED has only been operational for five months, which is strange because I remember it being announced over a year ago. Maybe it was announced then but only put into operation later. So, ok, RED has been in place for five months and has generated $25 million dollars.

$25 million dollars sounds like a lot and no doubt makes some difference, but the Global Fund's total yearly disbursements, the amount of money they give a year, is $6 Billion dollars, making RED's contribution to that less than one half of one percent. If anything, the number of disbursements shows that the idea that other types of giving aren't sustainable is not true in the least.

But that's a yearly figure and RED has only supposedly been operational for five months. Dividing five months into $25 Million gives us $5 million a month, so over the course of twelve months, if sales continue at the same pace, RED will generate $60 Million dollars, or one percent of the Global Fund's yearly disbursement.

But in all likelihood that money won't go directly into disbursements, and not because of some sort of bureaucratic thing; the Global Fund Against Aids, Malaria, and Tuberculosis, is a straight up charity that doesn't funnel money away. The reason is that this, unless I haven't read the fine print somewhere about how RED operates, money will probably be invested or added to some sort of interest baring arrangement in order to sustainably generate money for the fund.
This isn't some sort of failing, it's just a safe way to ensure that the money you get at the moment isn't used up all at once, thereby leaving you high and dry the next year.

Total commitments to the Fund are $10 Billion.

Let's say, though that every penny that RED gives is immediately given to AIDS projects. It will no doubt help; looking through the Aids programs is looks like $60 million will fund about four new projects, on top of the 188 large, small, and medium programs that are out there.

Point is, the influence of RED, while present, is being grossly exagerrated as a force to sustainably fight AIDs. But there's another problem.

I think that RED is pretty much just a marketing ploy. It' the latest thing that will catch on for a little while then will fade when interest in this socially responsable buying wanes, when RED isn't as cool or hip as it used to be. What will remain after that is the positive image given to the corporations that participated in RED, potentially bolstering their sales, and the other donors to the Global Fund, who will no doubt keep funding it in ways which beat RED by 99 to 1.

1 comment:

Renegade Eye said...

Really interesting post about a subject not often talked about on the left.