Another Internet Marketer’s Ploy Or Genuine Social Entrepreneurship?

Can being a philanthropist actually increase profits? With the advent of the FTC rulings regarding promotion and testimonials, the market space has changed because there is now more transparency for the consumer. Marketers have to differentiate themselves and make their personal offers much more interesting and appealing than their competitors. As a result, internet marketers are getting creative and coming up with new ways to continue making sales. One trend that is emerging in this regard is some marketers are now indicating during their sales campaigns, that they will support certain charities with a portion of their sales proceeds. So the question is, are they doing this merely as a marketing tactic to demonstrate how big their heart is and draw sales their way because they are “Good People”, or are they genuinely leaning toward social entrepreneurship with their business, and it is simply permeating into their advertising as well?

I suppose the most appropriate way to start this analysis is to understand if there is an allure or attraction to all things philanthropist in the first place.

Money attracts money. The most prominent philanthropists of our time are Bill Gates and Warren Buffet. In 2009, the richest people in America gathered together in New York, at the request of Gates and Buffet, to hear about their project to get them all to pledge 50% of their combined wealth to charity before they die. This was the first of several of these mega- philanthropist “recruiting” dinners. It is not public knowledge how many of these billionaires signed up for the Giving Pledge, but Gates and Buffet are said to be making a huge positive impact.

But being a philanthropist is not the exclusive domain of the mega-wealthy. There are also many other socially responsible entrepreneurs who support causes with proceeds of their businesses. For example, Inc. magazine recently featured a story about a young entrepreneur, Bryan Sims, taking the Giving Pledge early on in his career. We also hear of many people starting their own foundations in support of specific causes. For example, Mark Hoverson, an internetwork marketer, announced earlier this year that he was creating a foundation to help young kids learn the necessary skills to become successful entrepreneurs. These are but two of countless individuals who have decided to pay it forward and support causes. As a matter of fact, according to Giving USA, charitable donations exceed $300 billion per year.

While there are the obvious fiscal benefits of giving, this cannot be the only reason. In fact, supporting a cause with which one truly relates has a much deeper value and that is one of purpose and self-actualization. So it is not unlikely that internet marketers also seek purpose and fulfillment like this in their own lives. It is not a stretch to assume this trend will continue either, as home-based and internet-based businesses become a significant economic contributor over the coming years.

Identifying with Purpose attracts. We know this to be true. We are inclined to make donations to causes we can identify with or relate to. This is how charities conduct their fundraising campaigns. So it is also very plausible that we could identify with a person, a company, or a brand that supports a given cause. For example, Paul Newman’s, Newman’s Own brand of products comes to mind. One hundred per cent of profits from sales of these products goes to support charity. Since 1982, Newman’s Own has given $300 million to charities within the US and abroad. Knowing this, I may be more inclined to purchase a Newman’s Own barbecue sauce over another brand when they are side by side on the supermarket shelf.

Recently, Jonathan Budd announced during one of his marketing campaigns that he was donating 20% of his commissions to Charity Water. Budd went on to become the highest producing affiliate in this campaign and won himself a brand new Audi R8 for his efforts. Did his announcement get him these results? We can’t assume that it was the only reason, but if his social entrepreneurship approach AND his chosen charity resonated with his audience, you can surely see how this benefited his sales volume.

So while it’s impossible to say with complete certainty if these types of marketing actions are sincere or driven by motivations to increase sales, provided that the claims are true and the money actually is given to charity, the result is that positive change is happening and it is the causes that are benefitting. In the end, whether the internet marketer (become philanthropist) is genuine or not is really a moot point.

Patch is a running philanthropist and founder of Groupe Synergos Inc. His company donates 10% of profits to the charities he supports through his marathons. Patch recently created a new blog dedicated to his passions which include running and social entrepreneurship.