Reply To: SOS’s Audio Production / Disttibution Subscription Venture, SOS for Artists

[LinkedMusicians]

On joegyork said

I’m an occasional customer of Humble Bundle (for cheap games rather than music resources) I have noticed that their cut to the charities seems to have gone down recently. Do you think that they are sufficiently bad not to deal with them?

The reality is that the model that Humble Bundle uses is to exploit charities to make it look like they’re doing good, when in reality, it’s just a standard for-profit business. So, I don’t think Ziff Davis’ Humble Bundle is any worse than most businesses. I just think it’s important to know that they’re a for-profit business and not a charity, because there’s a lot of public confusion around that, somewhat by design.

Back when I had a publication on marketing and branding, I wrote on the topic (not Humble Bundle, but the practice of for profit companies exploiting charities to create the appearance that they’re a kind, charitable operation, often confusing consumers into beleiving that they are a charity). Now, I didn’t share that I was personally working on a marketing campaign with what was, pretty much, the biggest (at the time) and maybe the first big business to do this kind of exploitation of a charity by a for profit business, RED. And we were working with Bono and some other celebrities. Candidly, I felt morally conflicted about the practice (yeah, this was before influencer marketing exploded and ethics in marketing hit an all time low — and keeps going lower). Just to give you an idea. I was a director at one Fortune 200 where they — not me — had been the sole sponsor of a huge city marathon. The company spent something like $1 million on promoting the event and gave a few thousand dollars to the charity they partnered with. Personally, if I ran that program, there’s NO WAY I would have done that. It’s exploitive and if people only understood how these things work, they might see them for what they are.

So, I don’t think it’s that brands that engage in this kind of marketing strategy are necessarily WORSE than any other business.I just want our community to know that it’s not actually a charitable organization; that if they really want to help a charity, don’t consider this doing so. Give directly to a charity. A Humble Bundle purchase is something we do for ourselves — for fun. But from a business ethics perspective, here’s the issue. It’s simply exploitative and confuses the public into thinking they’re supporting a charity, which is why these ventures exist. Charities are often cash-strapped and they’ll accept deals like this because they desperately need funding. It was Bono’s argument that as much as this arrangement isn’t pretty, it still delivers some cash to charities that they otherwise wouldn’t see.

As far as SOS, we have a serious journalistic ethics dilemma when a publisher that does reviews is now marketing and making profits from those products.  As a potential scenario, let’s say that SOS brings in $1 million a year from the sale of Product X. Do you really trust them to give a completely unbiased review of Product X, when they’re also promoting it and bringing in $1 million a year in revenue? One would have to be fantastically naive to believe that would not result in bias. But the publishing industry is in a horrible situation. I made a bunch of friends in the industry from my days at large brands — journalists and editors. When I met them, they were all gainfully employed. In recent years, they’ve all had to do different kinds of work to get by.

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