St. Jude Children's Research Hospital

This blog would not be complete without mentioning St. Jude Children's Research Hospital. When I first really learned about this organization, I was in my first marketing class and I wasn't sure if this was what I should major in. I wanted a business degree and marketing seemed interesting to me but there was a darker strictly about money side of business and marketing that made me consider switching majors.

But this story in my textbook about St. Jude put my doubts to rest. St. Jude is a remarkable organization. "It is the only pediatric cancer research center where families never pay for treatment not covered by insurance. No child is ever denied treatment because of the family's inability to pay." If that wasn't enough, the protocols they have developed helped increase childhood cancer survival rates from less than 20 percent when they opened to 80 percent today. St. Jude was ranked the number 1  pediatric cancer hospital by Parents magazine and the number 1 children's cancer hospital by U.S. News & World Report.

But of course all this care does cost money, and since patients do not have to pay it has to come from somewhere. In the average year 5,700 active patients visit the hospital and the average daily operating costs of St Jude is $1.6 million, most of which is covered by donations. And they are very efficient with these public contributions, 81 cents of every dollar received has supported the research and treatment at St. Jude." This orgnization relies heavily on individual donations but fortunately they also have a long list of corporate partners. This list of partnerships include over 60 companies including AutoZone, Jewelers for Children, Reebok, FedEx, and Target. 

In addition to partnering with companies, there have also been successful cause-related marketing campaigns ran by St. Jude. One of their most famous was "in 2004, St. Jude invited companies to be a part of the Thanks and Giving® campaign, an unprecedented union of celebrities, media retail and corporate partners that asks consumers to 'Give thanks for the healthy kids in your life, and give to those who are not.'”

Sustainability at REI

On Monday, February 28 I went to a talk on Western's campus by Kirk Meyers, Corporate Social Responsibility Manager at REI. In his talk, "Next Generation CSR: Integrating Sustainability to Thrive in a Resource-Constrained World," Meyers talked about the importance of this topic and the efforts currently under way at REI.

The core purpose at REI is "to inspire, educate, and outfit for a litfetime of outdoor adventure and stewardship." And Myers explained that they must align the way they do business with their mission in order for people to believe the company as authentic. Myers went on to say that right now is only the beginning, that sustainability will become the dominant business model because its not only greener but its a smarter way of doing business.

One of the main points to Myers' talk was that companies need to have a unified framework and vision integrating CSR into the business. Business leaders have to understand that sustainability creates value-- that they don't have to choose between the environmental or their finances when making decisions.

An example of this at REI is the way the company ships its goods. Myers said that normally the viewpoint is that to make the most money companies choose whichever transportation method is fastest to increase sales. But that doesn't take into account the environmental impact of those decisions. REI chose to transport their goods by boat through the Panama Canal because it had the smallest carbon footprint. But in addition to the green benefit, this choice also helped to shield REI from exposure to fuel price fluctuations and saved the company over $700,000 in fuel surcharges.

The next step is not an easy one but it is essential. It is difficult for two reasons. First, this means changing business practices that people are accustomed to following and changing the minds of decision makers of what really will be cost effective in the long run. And second, the expectations of customers are rising. As time goes on people are more aware of what constitutes real change and they are better at recognizing attempts that are less than genuine. But that doesn't mean its impossible or that it shouldn't happen. I'll end this post with a quote from Eric Hoffer that Myers shared in his talk:

"In times of change, learners inherit the earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists."

Good News For Nonprofits

A recent article on PhilanthropyJournal.com gives some promising news for nonprofits. Despite the recession Online Giving Grows in 2010. The results of a new study " include 24 months of online giving data from 1,812 nonprofits from the Blackbaud Index of Online Giving."

Online fund raising grew 34.5 percent in 2010 with both large, medium and small sized nonprofits all experiencing double digit growth. Large organizations experienced a 55.6 percent growth, medium sized organizations had 15.9 percent growth and the donations to small organizations grew by 22 percent.

One of the driving forces for this increase is of course the response to the earthquake in Haiti. Compared to 2009, online giving for international affairs groups increased by 130.8 percent. But in addition to that, nonprofits of all missions and causes can be benefited by donors giving online.

These results show the importance of nonprofit organizations being on top of new technology that allows them to be connected to current and future donors.  Having a web 2.0 and social media presence are crucial for nonprofits to grow in this digital age.

"'2010 saw the continued growth in the importance of online fund raising for nonprofit organizations,' Steve MacLaughlin, director of Internet solutions for Blackbaud, says in a statement. 'A recovering global economy, online response for disaster relief, peer-to-peer fund raising, and the role of social media in the nonprofit sector all shaped 2010.'"

Hopefully this is just the start of increased donations in all forms.

Amazon

Amazon.com is my favorite web site when it comes to ordering anything online. The selection is huge so I look there no matter what I’m interested in purchasing, Amazon’s prices have saved me money especially on text books and I have to commend them for their customer service. The order process is straight forward and they effectively communicate so I know exactly when my order will arrive.

But in addition to their selection and customer service I also commend Amazon for its responsible business practices. On the website their is a section called Amazon and Our Planet where it describes the ways Amazon tries to reduce its environmental impact. These include frustration free packaging, environmentally friendly packaging, and  AmazonEncore Publishing which ensures that "physical editions are assembled using recycled and sustainably harvested paper stock that has been certified by the Forest Stewardship Council or the Sustainable Forestry Initiative." 


Also, in times of disaster, customers can make donations to the American Red Cross through Amazon. Through icons located on Amazon's homepage, customers have donated more than $35 million to global relief programs since 2001. 

Another way Amazon customers can help nonprofit organizations is through Amazon Wish Lists. Through this service, people can help organizations by giving them exactly what they are looking for and the right amount of each particular product. And this all done through a payment system that people know to trust as safe and Secure. 


There is also an affiliate marketing program called Amazon Associates. "As associates, organizations place links to Amazon products and services on their websites. For each purchase made through these links, the organization earns up to 15% in referral fees from Amazon.com. It's a great way for nonprofits to earn revenue without asking donors for direct contributions. Plus, donors know that each time they make a purchase through these links, they're helping their favorite nonprofit."

Nonprofit Survival Guide for Hard Times

I recently read an article on About.com by Joanne Fritz entitled Nonprofit Survival Guide for Hard Times. This article contained eight steps that can help organizations get through the tough times like our current recession. The steps are:

1. Don't pull back on fund raising.
Just as companies shouldn't cut back on advertising during a downturn so they don't lose top of mind with customers, Fritz writes that retreating won't help a nonprofit organization. Instead, take the opportunity to focus efforts and establish more personal relationships with donors.

2. Let your donors know that those you help are in more need than ever.
"No matter how a donor may be hurt by an economic downturn, the disadvantaged are damaged far more and have less opportunity to recover."


3. Find the stories that will touch the hearts of your donors.
In these times especially, try to find ways to show the shared humanity between people that need help and current and potential donors.

4. Stay in touch with people who have stopped giving.
In addition to the possibility of recapturing these donors, staying in touch reminds people of what they want to support when they can later afford to donate again. 


5. Find new donors in industries that are still thriving.
Though this is not the case for most, there are some industries that are recession proof and would be great donation candidates. Instead of following the traditional best practices, be proactive and find donors that other organizations haven't reached out to yet.

6. Take the opportunity to lower fund raising costs.
One way to do so is instead of having an expensive event, organizations can go directly to their donors for donations. For example, "Wrap a simple, low-cost mailing around the fact that you are lowering overhead by skipping the event, and ask for a direct gift that will put more services and money into your clients' lives."

7. Cut costs -- sensibly.
This is a time to cut things that lack efficiency and are extraneous and unnecessary. Just make sure to never deviate from the organization's mission of helping those that need it.

8. Take a new look at projects you intend to raise money for.
Though there may be ideas for future spending, this is not the time to use valuable resources. Instead postpone changes until the economic future is a little more certain.

All in all these ideas are great for nonprofits experiencing lean times. Economic downturns make things harder but at the same time they also offer the opportunity for innovation and new ways of doing things. New ways that are make your organization more efficient and more effective at achieving its mission.

A Case for CSR And Ethics

For my Marketing Management and Strategy class I'm reading a textbook entitled Marketing Strategy by O.C. Ferrel and Michael D. Hartline. One of the chapters is on Marketing Ethics and Social Responsibility in Strategic Planning. It lays out the importance of ethics and social responsibility for success in business.

"Firms that choose to take these extra steps concern themselves with increasing their overall impact on society, their local communities, and the environment, with the bottom line of increased goodwill towards the firm, as well as increased profits," writes the authors.

An example in the book is the White Dog Cafe in Philadelphia. Owner Judy Wicks has grown her business from selling coffee and muffins in her home to a restaurant that can seat 200 and grosses $5 million annually. "Wicks pays a living wage to all restaurant employees, even dishwashers; however, most employees at White Dog Cafe make above this amount." What's more is that the restaurant is powered by renewable energy and 10%-20% of profits are donated to White Dog Community Enterprises. This affiliated nonprofit strives to achieve a more socially just and environmentally sustainable local economy in the greater Philadelphia area.

High ethical and responsible standards can benefit firms by attracting employees. A survey conducted by business consulting firm LRN found that 94% of respondents considered it very important to work for an ethical company. And 82% would even take a pay cut to work in an ethical environment.

Corporate Social Responsibility can also benefit companies by increasing employee loyalty. An example where this paid off is for Washington's own Burgerville. It "realized significant cost savings, decreased employee turnover and higher sales after it began to cover 90% of health care costs for all employees who work over 20 hours per week." When employees are proud to work for a company their commitment to achieving high quality standards also increases.

I will end this post with two more quotes from my textbook that show the sales benefits of companies behaving in socially responsible and ethical ways.

"A Cone Cause Evolution study revealed that two-thirds of Americans consider a company's business practices when making purchasing decisions, with 85% claiming that they would switch products or services should a company be revealed to be unethical."

"Research by the brand and marketing agency BBMG revealed that about 3 out of 4 Americans prefer to buy goods and services from firms that are socially responsible and good corporate citizens."

Ban on Donation Apps

Apple's decision to not allow people to donate on the iPhone through charity apps have irritated nonprofits. Stephanie Strom of the New York Times writes that instead of being able to donate directly through an application, "Prospective donors instead are directed out of a nonprofit’s app and to its Web site, which the organizations say makes the process of contributing more cumbersome." Nonprofits argue that donations can be increased if people could use apps directly instead of the current more difficult longer method.

In Apple's defense executive director of Public Radio Exchange Jake Shapiro has said, "one of Apple’s major objections has been that if donations were to go through its payment mechanism, it would have to be in the business of managing and distributing funds and verifying charities as well." That argument does make sense being that Apple is a computer and online music retailer, it may be difficult and costly to have to manage the distribution of money in an industry it is not familiar with.

But is that the only issue? Following the earthquake in Haiti, Apple solicited donations for the American Red Cross through iTunes showing that they can be an intermediary for charitable giving. This seems to lead that another large aspect of this issue is money. Apple currently takes a 30% cut from its App Store transactions which would likely not be seen as a fair amount to take from nonprofits as a cost of doing business.


If it is a money issue, hopefully Apple and nonprofits can work out a way that people can use apps to easily donate to charity. That way both the causes being supported can benefit from increased funding and Apple can benefit from being seen as a company doing the right thing.