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Bachelor of Business Administration Faculty of Business, Economics and Policy Studies UNIVERSITI BRUNEI DARUSSALAM
and philanthropic responsibilities (being a good corporate citizen, contributing resources to the community and society by improving the quality and standard of living). It is important to note that the economic performance, the first level, is the foundation of the three other responsibilities. If the company does not achieve favorable economic performance, then the following three responsibilities become questionable and debatable. As mentioned earlier, RED is a life saving charitable campaign. Hence, involving in this type of marketing event means the organizations are achieving and fulfilling all the four components of social corporate responsibilities. They pursuit business profit, in legal ways, taking justice and fairness into account, and being a good corporate citizen by contributing fund to the Global Fund for life saving purposes.
Cause-Related Marketing
It is one of the many marketing activities in which an agreement is made between profit making business entities and non-profit oriented organizations, working together to raise fund for a particular cause or purpose, which in the case of Product (RED), is the prevention and treatment of HIV/AIDS in South Africa. Participation in this type of cause-related marketing event circulates the cycle which benefits everybody. The organizations philanthropic responsibilities (the highest level on the CSR pyramid) achieved, letting the public (current and potential consumers) know that the corporation is socially responsible and is interested in the same causes as its consumers. This will have positive effects on the corporate reputation of the organization, which will in turn attract more potential consumers, increasing the market share, hence having increased revenue which again, can be contributed to the Global Fund.
Sustainability
It is the latest theory for social responsibility. It is the idea which suggests that business organizations which are more socially responsible will eventually outperform their peers, rivals or competitors by focusing on the worlds social problem and seeing them as the business opportunities to generate more profit and at the same time, help build the world into a better place to live in.
so unless Gap made amendments to its operation policy regarding the exploitation of labor or any other unethical conduct, its participation in RED will not be seen as its real self commitment towards its corporate social responsibility. The consumers, the public should be aware of the companies conduct to know the intentions behind their involvement in cause-related marketing; whether it is pure commitment towards CSR or image spit-shining acts by some clever marketers. So when making a purchasing decision, they would not be misled by the falsely emphasized company image.
There are various types of technology that have contributed to the media coverage, marketing efforts, and public discussion of the RED campaign. Firstly, (Product) RED promotes its product range with a cause-marketing campaign, in which, (product) RED ties the marketing of a brand, company, product or service directly, e.g. GAP, Armani, Apple iPhone, to a social cause HIV awareness and AIDS prevention. Most causemarketing campaigns provide for a social cause by donating a proportion of sales to a specific body, for which in this case is Global Fund. Moreover, (Product) RED uses the INTEGRATED MARKETING COMMUNICATIONS (IMC) technology for its marketing campaign. The IMC involves the utilization of all the elements of the marketing mix, which specifically includes the product, the price, the place, and the promotion. As mentioned, (Product) RED ties its marketing to particular brands and companies.
These participating companies, in turn, negotiate how to put on the price of its RED editions to the market. The participating companies also collaborate with (Product) RED to anticipate where to launch, promote and sell the products. (Product) REDs marketing strategy also makes full use of both the Internet-based social media and the Offline social media. Via the Internet-based social media, the impact of consumer-to-consumer communications has been greatly magnified. (Product) REDs promotion had been made and spread among consumers very much quickly through the Internet, in networking sites, blogs, etc. As for the offline social Media, (Product) RED have successfully managed to advertise and promote on channels of traditional print (newspaper, magazine), mail order, public relations, industry relations, billboard, radio, and television. Associating (Product) RED with the popular culture and icons, such as U2s Bono and Oprah Winfrey had further contributed to the products promotion and marketing.
amount given to the Global Fund by the private sector over the previous four years (Valley, 2007). Furthermore, AdAge cited no source to the $100 million claim to (Product) REDs marketing campaign expenses. Based on Bobby Shriver (2007), the biggest spender launching RED products was the clothing company Gap (advertising budget $7.8m). Also, RED sources
suggest that even the total spent on advertising on (Product) RED which includes RED firms such as Apple, Motorola, Converse sneakers and Giorgio Armani, etc, was less than a third of the $100m cited in the AdAge magazine.
In addition to the point above, (Product) RED is principled on profit- motivated giving. To demonstrate this, lets assume a typical consumer was given a hundred dollars and was offered a choice to give it up solely for donation, or to purchase a product which supports a certain cause. As humans, we are driven by incentives; hence, a typical consumer would choose to spend his one hundred dollars for that which he can actually obtain something in return. In the end, a typical consumer would be motivated to purchase a product which support a certain cause in favour of solely giving up his money for donation. (Product) RED sells its products based mainly in this concept. (Product) RED encourages consumers awareness to the AIDS in Africa, while at the same time allowing easier participation from the consumers (supporters) of the cause. Bobby Shriver (2007) has stated that 99 per cent of funds raised by the (Product) RED go directly to life-saving schemes. These life-saving schemes had put 160,000 Africans on lifesaving anti-retroviral, orphans were fed and kept in schools in Swaziland, and a national HIV treatment -prevention programme has begun in Rwanda. Also, people who became aware of crises through RED's marketing have increased their charitable giving. (Bobby Shriver, 2007) (Product) Red have also managed to concert political pressure with its constant advertising exposure of the message that "6,500 Africans died needlessly yesterday of a preventable and treatable disease" being a key part. This had resulted to the US Congress agreeing to a record $724m donation to the Global Fund for 2007. Last but not the least, more product names and brands incorporate the REDs vision into its new products. This means that as new products are created to meet the demands of consumers, a sustainable flow of part of the profit goes out to the Global Fund. The campaign is less likely to
lose supporters, since new products will continue to interests brand and product conscious consumers.
Reference:
http://www.sustainabilitydictionary.com/ http://www.mallenbaker.net/csr/definition.php http://nonprofit.about.com/od/fundraising/a/causemarketing.htm http://www.joinred.com/Learn.aspx http://www.independent.co.uk/news/world/politics/the-big-question-does-the-red-campaignhelp-big-western-brands-more-than-africa-439425.html http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6W45-4W1SGJC1&_user=10&_coverDate=08%2F31%2F2009&_rdoc=1&_fmt=high&_orig=search&_sort=d&_ docanchor=&view=c&_searchStrId=1197014839&_rerunOrigin=google&_acct=C000050221& _version=1&_urlVersion=0&_userid=10&md5=cb04b54467d97d7670498189e138b85d http://redback.adroit.net/~appa/images/article/103_Promotional%20Products%20Feature.pdf http://www.buzzle.com/articles/promotional-advertising/