At the peak of the shopping and giving season, consumers are increasingly combining both activities.
They are buying products that have charitable tie-ins, shopping through Web portals that send savings to nonprofits, and donating at the registers when they check out at stores. They’re buying product lines like Newman’s Own, which channels profits to a foundation, and TOMS Shoes, which gives a pair of shoes to a needy child for every pair the company sells.
These charity-linked purchases might give consumers a good feeling, but are they good for charities? And for shoppers?
Laura Brooks, 38, is a stay-at-home mom and lives in St. Louis with her husband, Steve. After one of her three children asked for a pair of TOMS shoes last year, it occurred to her that she could incorporate giving into her regular shopping. She now buys most of her children’s books through the Kohl’s Cares programs, which donates 100 percent of proceeds to children’s causes.
“I bought all these things before — shoes or salad dressing — but now it feels like I am doing good, too,” Brooks said.
Maybe so, but only if those shopping decisions aren’t taking the place of her other charitable giving, say some specialists.
Charitable shopping “undermines the philanthropy of a nonprofit through diminished charitable donations,” said Sondra Dellaripa, principal consultant for the nonprofit consultancy Harvest Development Group. In fund-raising development for charities, she said, it is important to build a relationship with a donor — something that doesn’t happen in these transactions.
So, how can you make your shopping turn into giving while keeping in mind how much you’re really giving to charity?
Big money — Direct donations at merchants are one of the biggest cash generators. For instance, St. Jude’s Children’s Research Hospital’s holiday season has a “Thanks and Giving” campaign that collects dollars at cash registers and is now its single largest fund-raiser. More than 60 firms, mostly retailers, participate in the two-month drive, which raised nearly $65 million for St. Jude’s last year.
Cause marketing reconsidered — One step removed from this are consumer products that give a portion of profits to specific charities. This is soaring, from pink ribbons during Breast Cancer Awareness Month to campaigns that donate loyalty rewards from companies like Amazon.com and airlines.
The broad array of products makes it difficult to tally the overall retail impact, but companies will spend about $1.7 billion this year on sponsoring causes — more than double their spending a decade ago, according to IEG Sponsorship Report. And, increasingly, retailers are trying to connect with shoppers by aligning their brands with charities.
But not all products with charity tie-ins are created equal. Some deliver no money to charity at all; they’re just for awareness. Consumers can check this, before they buy, on the product’s website or by reading the tiny print on the product’s packaging.
Feel-good shopping portals — For those shopping online, there are pass-through sites where a charity gets money every time a consumer makes a purchase. For sites like iGive.com, GoodShop.com, We-Care.com, and Social Good Network, the user picks the charity, which could be as small as a local school, and donations are not regarded as tax-deductible.
The donated percentage of the purchase price varies from 1 to 25 percent. Major retailers, such as Nordstrom Inc. and Lands’ End, are at 2 percent on iGive.com. So, a $250 purchase from one of those retailers would result in a $5 donation to a charity. Magazine and newspaper subscriptions tend to have the highest returns, sometimes in excess of 20 percent.