Why (Product)Red is a Scam

February 9, 2007 · 22 comments

in Rants

Here is another supposedly good cause that angers me. The whole “RED” thing. My summary of it is a bunch of brands joined together, chose a color, custom tailored a product to sell to, spent millions on research, marketing, advertising, etc… and are donating a certain portion (of the profits) to prevent aids in Africa…

While I think curing AIDS is a big deal, I do not think that Curing AIDS is the intentions of the companies involved… I am guessing it is to build trust from the idiots who buy their shit and get free press from the news (by saying they are doing something good), as well as reach a new group of people who were not previously BUYING.

Here are some examples of how the gap is basically tricking the consumer:

So they gap says they are donating half the PROFITS to the global fund… which means they are actually making MORE from the sale of the RED products because you bought into the hype…here is my Math..real simple math.

The Gap Men’s Boxer Briefs:

Red Boxer Briefs: $20 – cost of boxers (lets say $5…assuming far less) = $15 profit. Divide by 2 = 7.50 for the Gap, 7.50 for AIDS.

Regular Boxer Briefs: $20 for 2 > $10 each. $10 – the same $5 cost as above = $5 profit for the gap.

Notice, that because you bought the “RED” boxers, the gap made an extra $2.50. If you would have just paid $10 for the boxers and donated $10 to the charity, the charity would make an extra $2.50…but you wanted to support the cause.

My math also does not include the extra cost that the gap incurs for the extra marketing of their RED products…but no fear, they are splitting the cost of that by ONLY donating half of the PROFIT.

I hope someone can prove me wrong with this, because I really hope it is a good cause… but to me it just sounds like another one of the many ways to market an unnecessary product.

What are your thoughts? Am I just a jaded asshole, or am I on to something?

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{ 22 comments… read them below or add one }

1 Jeffc 02.09.07 at 11:13 am

Helping others is for suckers.

But seriously,

"Product Red" is a commercial venture…not a philanthropic venture. Its a traditional product positioning play…Use the power of big brands to market product…the big brands get good press for having the product, since it is marketed as philanthropy, and they expect to broaden their customer base while appearing to do something "beneficial" for the world.

2 httpwebwitch 02.10.07 at 1:43 am

Your disdain is totally warranted.

People aren't buying "red" because they want to stop AIDS. They're buying "red" because they want to foster the image of someone who wants to stop AIDS. Like being "for a cause" makes them a better human, even though the cause is less of a concern than being recognized as someone who supports it. Underneath is a knotted mess of phsychological pathos and self-esteem, merchandised by corporations and endorsed by celebrities.

It's like those jerks who wear a t-shirt of Che Guevara, but don't have a clue who Che Geuvara was.

3 josh 02.15.07 at 4:36 pm

Isn't any money that goes to helping to cure aids, good. The out come is the same no matter where the money comes from. Whether the money comes from a giant multinational or an oil tycoon, the money is going to help people. It only takes $150 dollars to fund one person's aids medicine for a year. People by crap no matter what and society is very consumeristic, what is the problem with taking advantage of that to send some money to people with aids.

4 Werty 02.15.07 at 4:49 pm

Josh, the whole point I was trying to make is, if you actually care about the charity, you would be better off donating the money directly vs buying overpriced product from the gap.

In my example the charity would make at least 2.50 per each boxer brief, if you bought the regular ones, and donated the equal amount to the charity. So the extra money is going to the Gap, who says they are doing something good. And it is arguable who it is good for… them or the aids charity.

5 josh 02.15.07 at 4:57 pm

Werty, you are competely right and you make the same point i make when people talk about buying things in order to donate to causes. People should just donate directly or get involved and volunteer. But i think that consumers need to take responsibilty and think critically when participating in obvious marketing campaigns all the blame does not rest with the GAP, people that want to wear red shirts or braclets have created the market.

6 markus941 02.16.07 at 11:18 am

It irks me how Sprint attaches the "oh, yeh and by the way, every time you buy a phone, it helps fight AIDS in Africa" which is such a blatantly GENERIC attempt to foster sales by using the "oh yeh, you'll be saving babies and curing diseases" line.

They don't even tell you anything about the program or what it does – it's just BS marketing rhetoric badly (and thinly) disguised as philanthropy.

7 Nancy P Redford 02.18.07 at 8:54 am

You're right of course.

However on the other hand BIG companies get seen and heard more easily by their regular shoppers.

Charitable organizations need the public awareness and welcome most ventures to spread awareness and raise funds.

We ALL know about Aids but how many of us like that “feel good” sensation that after spending 3 times the normal rate for a trivial piece of clothing just because they recognise a name on the label!

Now you are giving to charity they feel that those boxer shorts are priceless.

The companies benefit from increased revenue
Increase credibility
Increased sales

The consumer feels good about their outrageous spend
The consumer is coerced to spend at GAP because of the donation to charity
The consumer may buy more than they normally would have because of the donation

The charity receives more publicity
The charity gets a boost in revenue
The charity may receive more personal donations from people who may not have considered contributing before the promotion.

Yes, we can give direct to the charity but think about how many of the regular GAP customers give to charity in relation to how much they feel they are contributing now that the promotion is on.

Pesonally I think the idea is amicable but I would choose to make a direct pledge.

8 Sean 02.20.07 at 4:58 pm

The only logical conclusion to come to is that the terrorists have clearly won. Fuckin GAP.

9 vanchau 02.26.07 at 7:37 pm

Werty, you're right, but that's not really the point. Companies are making more, but who cares, there is also a ton of money going into the Africa AIDS situation, and that is a good thing.

It's silly to say, oh people should just donate money if they really care. Obviously there is always that option.

The difference here is that there is increased awareness and more importantly more opportunity for a "donation" to happen at every POS location.

How many of us are going to be motivated to look up where and how to contribute funds to some cause. This idea makes it simple. I buy a red iPod and I get what I want and I help a cause right at the cashier.

There is nothing wrong here. The fact that companies do this making a profit is not only fine it is smart.

If you come up with something that makes more money for you AND helps the greater good, that's great!

It's an excellent idea in my opinion and I applaud the effort.

10 Steve from New York City 03.06.07 at 3:49 pm

(Product) Red is just an advertising gimmick that really DUMB consumers fall into.

And we have many of them… they shop for whatever ad is in front of them!

FYI: See article in The New York Post today (2/6/2007), where the writer Rita Delfiner, was able to prove that they only raised $18 million so far, but have spent $100 million in advertising. You know their heads are up, deep in their asses by now!

11 Jordan 04.17.07 at 10:36 pm

If someone who wants to foster the image of someone who is trying to prevent AIDS, they would be supporting it either way. Whither your buying the RED t-shirt because everyone els is, even if you do not agree with it, you are STILL buying it, and your money is STILL going towards the aids epidemic. You are saving lives, and you are promoting aids awarness, and reminding everyone who looks at your shirt that having aids is a devistating state of being. Tell me why buying RED is an advertising gimmick that consumers fall into. The money that RED makes needs to be better monitored to make sure that GAP Company is not making more profit than the aids victims.

12 Annie 04.30.07 at 12:28 pm

You hit the nail on the head, my friend. I attended a World Water Day presentation about a month ago. sponsored by Starbucks. To anyone with a brain, it was clear that the goal isnt ultimately to help bring clean water to 3rd world countries, but to get you to think buying shit from Starbucks would help to being clean water to 3rd world countries. Starbucks sells Ethos bottled water and donates a whopping 5 cents of each bottle to help bring clean drinking water to children who need it most. A God damn nickle?! Fuckers would make more money if they put a box out next to their tip jar. Not to mention bottled water wastes tons of resources, and because it's filtered in California, uses loads of fossil fuels to even be transported to the millions of starbucks across the country. But no doubt people feel good about their purchase. Fucked up man.

13 Alex 10.09.07 at 2:36 pm

Guys I think you are really missing the point here: who cares about what GAP or Amex say in their marketing campaign, the important thing is that (Product)red is a good idea and they are collecting money , 34m $ so far.
If GAP or Amex are able to make money out of it is not the problem, they are just an instrument to collect money for charity, but they are NOT charitable no-profit companies and they are not trying to say "we are good!".

I totally disagree with your analysis. The numbers may be correct but there is no scam here and it works fine for everybody. (Product) red has always been presented as a win-win operation : companies make profit and the fund for Africa gets a percentage.

People buy more because they feel that they are also doing the right thing, without that most of them probably would not send any money to Africa, they would just buy the cheap T-shirt and go home!
The Red Amex is even better. Instead of using their normal Credit card and get air-miles or stupid reward points people prefer to use the Amex Red and contribute to the Africa cause without any effort.
What is wrong in all this? The user pay the same, Amex is happy because they use their cards, Africa Fund gets 1%.
Again …so far they made 34million $ not bad!

14 Aditi 10.22.07 at 3:57 am

So GAP is supposed to be doing this "for a cause"…sure it is, but the cause is they themselves..business bandwagons!

15 Devon 11.26.07 at 8:39 pm

I think ur a dumbass. This is a way for companies to make money as well as provide the care need to the thousands of Africans who are dying each day. Do ur reasearch jerk off

16 Devon 11.26.07 at 8:41 pm

Racist Bastards

17 socialcapitalist 12.22.07 at 2:15 am

Corporations who at least try to make an effort at aiding social causes are more respectable than those that don't in my opinion. Let's stop dissing their efforts, even if they are lame and commercially motivated. Listen, the GAP (and Starbucks and whoever else you want to shit on) could continue generating their enormous sales without doing a thing for people in need. GAP has my vote because at least they are helping people from DYING. think about it…you buy a shirt (maybe over-priced, fine, but you'd probably buy something else from the gap if you are already there) – and at least they are saving lives. Yes for SURE it is a PR play, but when PR plays save lives, I for one dont care that it is for PR.

18 Crystal 04.04.08 at 7:13 am

So ive been reading on what you guys are saying, how to donate money directly to the fund itself, and how buying a "(red)" pair of boxers costs more than regular, just so they get more out of it. But isnt one product member actually making some difference, im not saying a world of difference but a little. Apple, the ipod nanos and shuffles. either way all nanos were/are 200 dollars even the product red one is, but if you get that one specifically 10 dollars of it goes to product red, yes i agree more should go, but what are you losing in buying a red one, either way its 200 reguardless if u get a red one or a pink one or a blue one. But i did ask, how do i directly send money to the charity itself?

19 Werty 04.04.08 at 10:21 am

Hey Crystal, thanks for writing…

I think Apple is a different story since they do not artificially inflate the price of the ipod like the gap does on their shit. So for an ipod there is no added cost to the end user, just the choice of wanting to help or not and that is kind of cool.

The gap on the other hand jacks up the price of "red" and makes it a "premium" product, even though it is the same shit product as everything else you get there… with a red tag sewn in.

20 Joe 04.10.08 at 11:57 pm

Product Red is a scam and HIV is a scam. Someone please tell Kay Warren that the Africans need clean water and nutrient dense food. You can email me at jstokely2@yahoo.com.
"HIV=AIDS Fact or Fraud" is a good documentary on the subject. http://video.google.com/videoplay?docid=-8142733917997460212&q=fact+or+fraud&total=488&start=0&num=10&so=0&type=search&plindex=1&hl=en

Thank you.
Joe

21 Andrew 06.07.09 at 9:29 pm

It seems on this thread that no one is addressing the points made by those in favour of the campaign. It purely comes down to the difference between intentions and outcomes.

You can talk as much as you want about the option for people to go and donate to the charities directly so that the company is not present and the charity receives more money. One thing you may have forgotten is that a lot of people purely do not do this. It's not as if we suddenly only now have the option to donate directly to charity. They have always been around and since they first started the majority of people simply do not donate to them.

The whole idea behind the product red campaign is that people have finally noticed how self-centred the first world is. Although many of us like to think we are good people for whatever reason, a lot of us do not walk to a charity office through our own accord and give money to them.

Whether or not this is the most efficient way to get needed money to whatever cause is irrelevent FOR NOW. The fact is at least some people are trying to capitalise on our selfishness. Who gives two shits that gap puts the price of its red products up and labels them as premium. I'd bet that the same people who would pay extra for them a EXACTLY the type of people the red campaign is aiming at. Someone who is too focused on themself to donate directly to charity, but will see an advertisment for the red product, feel bad and purchase it. If people think it's taking advantage of the consumer that's because it is; and it's about time too. You can't possibly sit here and have a cry about the extra profits that gap makes when if those profits weren't made and these products weren't sold the only difference in the world would be that a different manufacturer who isnt supporting the cause would be receiving those profits instead. It's very very naiive to say that that money would do more if donated directly because that money would not be donated directly. It's as simple as that.

22 Scott 11.21.09 at 5:14 am

I was looking this up, you're the #1 hit, so congrats, because you're 100% right. To the people above (like Devon,) please learn economics and think before you speak. To those arguing against, what is happening, yeah money's being raised, but it's all about profit and ego. The only reason one would go RED is to show off, whether they don't think they are or not. Why not quietly donate, instead of purchasing a product that is RED. (btw, it's red for a reason, because it's noticeable.) I'd rather buy a $10 t-shirt and throw $10 into a jar towards the charity, and not be known, than spend $20 on a RED tshirt that's only going to give 2 dollars to the organization.
If these corporations truly cared about people and their welfare, they would stop using sweatshop labor (look up the GAP in connection with Saipan/the Mariana Islands) Your "Made in the USA" clothing might not be made in USA conditions.

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