Where the money get spent?

[AndrewNC]

The question is simple: If you were to buy a product, and 100% of the profits went to charity, would you be more likely to buy it than if the owner kept the profit for himself?

Assume all other factors are equal.

Let's assume it's a non-profit that actually puts the money to good use - not one of those where the president makes half a million per year. And that it's a misc. a charity that isn't something you're personally 100% passionate above.

A company that I was helping out with marketing donates 1% of their proceeds to an environmental charity. GoDaddy has you round up for charity on there.

I'm interested in hearing the answers.

 

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[Damage Inc.]

I'm a bit skeptical from the start for reasons like you mentioned (some charities spend millions on commercials, or the ceo takes home millions). But assuming that I know the charity is legit but I'm not overly passionate about the cause or the brand of product it still wouldn't have much of a bearing on my purchase. It seems like the companies that use this successfully build their whole brand around one main cause and really go hard with the message and the marketing (like Tom's shoes).

Would I pick one toaster over another because today they are donating 2% to give coats to people in another country? Honestly probably not, I'd just pick the toaster I like more.

If DC shoes came out with a cool new belt that I like and they were donating 20% to a no kill animal shelter, yea maybe I would buy it today even though I don't really need a new belt yet.

 

[Sunscreen]

The question is simple: If you were to buy a product, and 100% of the profits went to charity, would you be more likely to buy it than if the owner kept the profit for himself?

Assume all other factors are equal.

Let's assume it's a non-profit that actually puts the money to good use - not one of those where the president makes half a million per year. And that it's a misc. a charity that isn't something you're personally 100% passionate above.

A company that I was helping out with marketing donates 1% of their proceeds to an environmental charity. GoDaddy has you round up for charity on there.

I'm interested in hearing the answers.

I feel like a lot of people only really give a shit about helping other people when they get acknowledged that they do it. Just look at all those cringey youtube videos or facebook pics of people giving to homeless people. They don't treat it as a an altruistic act but more of a mutually beneficial act to get views or praise. With this is mind I don't think many people would change their buying behaviours because of this donation to charity. Personally I would prefer to donate to a cause that I connect on a personal level or have strong feelings about rather than a charity selected by the seller.

 

[AndrewNC]

I'm a bit skeptical from the start for reasons like you mentioned (some charities spend millions on commercials, or the ceo takes home millions). But assuming that I know the charity is legit but I'm not overly passionate about the cause or the brand of product it still wouldn't have much of a bearing on my purchase. It seems like the companies that use this successfully build their whole brand around one main cause and really go hard with the message and the marketing (like Tom's shoes).

Would I pick one toaster over another because today they are donating 2% to give coats to people in another country? Honestly probably not, I'd just pick the toaster I like more.

If DC shoes came out with a cool new belt that I like and they were donating 20% to a no kill animal shelter, yea maybe I would buy it today even though I don't really need a new belt yet.

Love their setup!
http://www.toms.com/
http://www.toms.com/improving-lives

I, too am skeptical. When I hit it on GoDaddy checkout, my first question was "how much do they actually give to charity". I wonder what people outside of the entrepreneur world think. We are a unique bunch on here.

 

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[Damage Inc.]

Love their setup!
http://www.toms.com/
http://www.toms.com/improving-lives

I, too am skeptical. When I hit it on GoDaddy checkout, my first question was "how much do they actually give to charity". I wonder what people outside of the entrepreneur world think. We are a unique bunch on here.

Yea my general feeling is that if and when I want to donate, I'll do my own research and pick my own charity and my own contribution amount. I don't need some pre-packaged charity deal that's intertwined with an un-related purchase.

Edit: But I do understand why some companies do it and I'm sure it works to a certain degree and in certain situations (like when McDonalds asks if you'll donate an extra dollar, I'm sure they get a ton of money for the charity on those days which isn't a bad thing). As a business owner it might even be something I would consider doing. I'm just usually not a fan of that model as a consumer.

 

[Fox]

100% No...

Most charities take a LARGE slice of the pie (or so is my thoughts) so I am instantly biased against charities that I do not know. I have one I usually use that where everything goes to the person they are helping. No wages for anyone, everything is volunteer. I don't trust new charities that I haven't heard off. Anytime a product is 'for charity' I just have that gut scam feeling.

I would be skeptical of any service or product where 100% goes to charity. You know the price is hiked to cover the costs of production plus the quality is probably diminished. They don't have the same focus on the product as a company that depends on profit would. I would rather just buy a real product, support that company and then leave my donations separate.

I presume that there is another hook within the product or service. Like lending a needy neighbor your lawnmover once... how long till they need it again. Charities seem to always push hard for repeat business. No thanks.

I do donate, but to companies/organizations where there is a strong record of actual progress and dedication. Just my thoughts.

Edit:
Actually the only exception to this would be if a bunch of kids had done something to help a cause. For example local kids baked cookies or offered to paint my fence (if I had one) for their school or a local charity.

So if it was a local collection of people - yes/maybe, if it was a proper business with a product I see on the shelf with no real interaction - no.

 

[AndrewNC]

Yea my general feeling is that if and when I want to donate, I'll do my own research and pick my own charity and my own contribution amount. I don't need some pre-packaged charity deal that's intertwined with an un-related purchase.

Edit: But I do understand why some companies do it and I'm sure it works to a certain degree and in certain situations (like when McDonalds asks if you'll donate an extra dollar, I'm sure they get a ton of money for the charity on those days which isn't a bad thing). As a business owner it might even be something I would consider doing. I'm just usually not a fan of that model as a consumer.

I think the one time I donated in person to charity through a business was at a Panda Express in Scottsdale, AZ.

"Would you like to round up your purchase to the nearest dollar to charity"

Me - "no..."

Her "I'ts 3 cents"

"Fine"

 

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[AndrewNC]

100% No...

Edit:
Actually the only exception to this would be if a bunch of kids had done something to help a cause. For example local kids baked cookies or offered to paint my fence (if I had one) for their school or a local charity.

So if it was a local collection of people - yes/maybe, if it was a proper business with a product I see on the shelf with no real interaction - no.

Somehow girlscout cookies came to mind when I read this.

 

[Fox]

Me and my girl have a running joke about my complete lack of resistance to Cookies.
I don't know why but I can never say no.
Luckily they don't have girl scouts in my area.

 

[AndrewNC]

Me and my girl have a running joke about my complete lack of resistance to Cookies.
I don't know why but I can never say no.
Luckily they don't have girl scouts in my area.

They are ruthless.

I saw a news article where they set up a table in front of a medial marijuana dispensery in California or something.

 

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[Choate]

I had a co-worker come up to me asking me to buy a light bulb for his kid's project, you know one of those green light bulbs. 100% went to charity. He's a fellow sales agent and tried to pitch me it, anywhere between like a $4 light bulb and a $20 set, those energy saving ones. Saves you money on your electricity, money is sent to charity, the kid succeeds...

And whenever I walk into a mall I hear the jingles from Red Cross asking me how's my day, saying goodbye...

And I remember when I used to eat fast food they'd ask whoever was driving to donate $1 to a fund...

I flat out say no to everything. Absolutely everything. For one simple reason, its outside of my locus of control. I'm not cynical, ruthless, or Machiavellian... when I want to give, I will choose when I give, who I give to, how much I give. Everything else is a distraction. I don't want light bulbs arriving at my house and then I have to change all my light bulbs, properly dispose of the old ones, or give you money out of my budget that's now unaccounted for. Or fill out your form to buy them which is also costing me time.

If I was shopping for a soccer ball and came across two identical soccer balls for $20, one with full donation to charity, one going to a full for profit business, I still don't think it'd matter. Business is what makes the world go around, more business leads to more jobs which means a rising tide for all people, means more people being lifted out of poverty. But charities are good too. So to me, it doesn't matter.

TL;DR - Give to charities when you want to, when you can make the most impact. Like when you start a business and can afford to create a charity yourself. Or just give regularly. But do it out of your own free will and not because someone is trying to convince you to through advertising. Control your money, have more impact.

 

[biophase]

Love their setup!
http://www.toms.com/
http://www.toms.com/improving-lives

I, too am skeptical. When I hit it on GoDaddy checkout, my first question was "how much do they actually give to charity". I wonder what people outside of the entrepreneur world think. We are a unique bunch on here.

Andrew, I can't remember if we talked about this before you left. But this is exactly what my new business does except it does it for dog rescues. I like the Toms approach because it is a tangible item that is donated and it can be leveraged by the business to increase its value vs just giving a dollar. I don't like the percentage goes to blah blah. This is because if I say 100% of profits go to charity I can still mess with that number. I can pay myself $50k a year and make company profits $0 and donate nothing.

I would like to see something like 50% of gross profits are donated, not overall profits after all expenses.

 

[AndrewNC]

Andrew, I can't remember if we talked about this before you left. But this is exactly what my new business does except it does it for dog rescues. I like the Toms approach because it is a tangible item that is donated and it can be leveraged by the business to increase its value vs just giving a dollar. I don't like the percentage goes to blah blah. This is because if I say 100% of profits go to charity I can still mess with that number. I can pay myself $50k a year and make company profits $0 and donate nothing.

I would like to see something like 50% of gross profits are donated, not overall profits after all expenses.

Yeah, I remember talking about it when I saw your samples.

Reason I brought this topic up is because ever since being in Boulder, I've been thinking of using my business as a tool to fund things I can contribute in the environmental movement (eco friendly items, planting trees, etc.). With what you do, and what @Damage Inc. brought up with Tom's shoes - I see the direct approach working well.

Your product -> dog rescue

Are you doing just amazon with that? Or do you have a site where you could educate them like this? I think the education and outlining the cause on the site is a good idea.

 

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[biophase]

I am selling on Amazon and I have created its own website but I'm driving all my traffic to my Amazon listing. I think once people get the product, they can go to the website. My packaging has my website on it.

 

[biophase]

I should emphasize that the product must be good. Just because you are donating to a charity doesn't mean you can sell a shitty product. My products are better if not as good as its competition. I also donate the same high quality product to the rescue, not some cheaper made version. You would buy my product even if it did not donate to a rescue. But the fact that it does is a selling point when compared to its equals.