Wednesday, October 20, 2004

Taking it home - to the customer

The other day, had the chance to participate in an exchange with Robert Egger, founder of the DC Central Kitchen in Washington, and co-author of Begging for Change.

With Robert's permission here are some of his thoughts.

Capitalism 2.0:
... I am interested in taking it "home" to the consumer. It's not enough just to make profit and give it back, or to make social change in the way you produce your goods (although both are important steps)...the big jump will be in public understanding that "what they buy" is the biggest and best philanthropy there is. Let's call is Capitalism 2.0.

Newman's Own:
Imagine if Paul Newman printed a set of "guiding principles", or a kind of "social nutritional" label on the back of his products that, instead of saying "100% of Newman's Own goes to charity" listed simple principles under which Mr. Newman chooses to make his product and invest his profits. Imagine if he went on Oprah and told the audience "how and why" he chose these guiding principles, and let them in on his thought process. Imagine if they, in turn, became not only his partners, but, through his lead, became more enlightened consumers, and then they began looking for, and maybe even insisting on similar guiding principles from other products. Now THAT would spur some serious change.

In short...the focus should not be on how much we make and give back, or how much good we might do while making it (even though both are important steps), but rather, how these new ideas can entice/enlist Joe and Jane Q into becoming full-fledged, lifetime partners in the beautiful non-profit experiment while subsequently bringing the staggering power of the consumer economy into the mix.

Two Generations of Social Enterprise:
...there's really two generations (so far) of social enterprise. The first generation generally looks for profits, and redirects those profits towards social good. Think of Target, gives 5% of profit to local charities, etc. Great stuff, but somewhat limited in the impact that you can have this way.

The second generation, he explained, was where the very act of making a profit creates social good. (I think the economics term is that the business has "positive externalities".) Think about alternative energy producers, or organic food producers.

... Hence my interest in Paul Newman, or lots of our corporate citizens who are trying to be good stewards of profit. Frankly, most of their PR efforts (intended or not) look like they're saying "we care, BUY our product." I think the public is suspicious of that tact.

Walking the Walk ...
AOL, here in DC is another interesting example. Graduates of our job training program went out to their HQ in search of jobs in their cafeteria. They only paid $8.00. Imagine if, in addition to their philanthropy, they made a very public case that, "NOBODY who works for AOL makes less than a living wage, NOBODY. And...we're so committed to that, that we won't do business with anyone who doesn't do the same." It's sounds bold, but they (at one time) had that kind of juice. Imagine if the public saw THAT kind of core philanthropy...I wager they'd have more customer loyalty now, and...more companies might see that consumers will support what they have historically deemed to be risky business.

To cut to the chase...if a few, brave, very visible folks/companies help lead folks to the water, I bet they'd GUZZLE...and we'll be playing a whole new game.
I'm of the school of "look at what you've got, or are already doing--can you tweak THAT--before you launch something new?"

An Engaged Public:
An enlightened and engaged public then drives the non-profit sector into a higher degree of performance via their demands for bigger, bolder steps, hopefully widdling down what I personally feel is an unmanageable number of non-profits fighting each other for resources.

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