Product Red Case Study

Topics: Marketing, Business ethics, Corporate social responsibility Pages: 7 (1139 words) Published: April 15, 2014


Product Red

13 April 2014

Introduction
Over the years, businesses have evolved to incorporate consumer views in their practices. As a result, consumer power has become an influential force that directs organizational strategies towards ethical practices. Based on the previously mentioned view, an evaluation of Product red’s strategy provides insight on its strengths, weaknesses, and improvements. Product Red

Harvard Business School (2009) argues that numerous challenges face various nations. As a result, business organizations should utilize models that contribute to projects that reduce the scourge. Illustratively, the product red strategy inspired business organizations participate in the production and marketing of RED products with an aim of raising funds for AIDS in Africa. This innovative approach of engaging public and private entities in raising funds has enabled the global fund to fight diseases in Africa. Some of the diseases that the global fund targets include AIDs, tuberculosis, and malaria. According to Harvard Business School (2009), RED partners have managed to attract higher revenues since consumers associate the brands with ethical practices. Strategy Analysis

Product red business has made significant gains in inspiring organizations to produce commodities whose revenues can be contributed to ethical activities. As a result, an evaluation of the model’s strengths and weaknesses reveals some improvements that should be made to enhance the model’s efficiency. Strengths of the RED Strategy

Harrison (2005) argues that Product RED strategy increases the awareness of consumers and shareholders on the application of ethical practices in their organizations. As a result, consumers and shareholders utilize their influences to demand for social, political, and environmental responsibility. Given the inadequacies in government policy and challenges in the allocation of funds, multinational organizations may place their emphasis on capitalistic goals thus introducing negative aspects to society. Illustratively, the Red strategy has the strength of inspiring partner organizations to protect and facilitate consumer rights. The above-mentioned strength has advanced the course of ethical consumerism thus enhancing social responsibility among entities. In contrast to the traditional charity model, the RED strategy portrays the company as an equal partner with its associates. The above-mentioned strength is confirmed by the increase in profit in organizations that have participated in RED’s activities (In Healey,2013).The innovative approach has encouraged partner organizations to devote their resources in the development of RED’s products, promote the concept of ethical practice in business and generating additional benefits that simultaneously benefit the needy in society. Additionally, the RED strategy enables organizations to produce ethical products at prices that match their non-ethical equivalents. The RED strategy has facilitated the production of cheap products thus reducing economic pressures on consumers. According to Harrison (2005), high prices associated with ethical commodities have been a hindrance to the adoption of ethical goods. Subsequently, the introduction of ethical commodities with prices equivalent to that of non-ethical goods has enabled the RED strategy to attract the drifter and conventional groups of consumers In Healey (2013) contends that effective public relations are crucial in the adoption of ethical consumerism within a society. Subsequently, the RED strategy employs concepts of the public relations excellence-theory to develop a suitable communication loop between organizations and consumers. As a result, RED strategy develops a strength that is associated with enhanced co-orientation of messages between environmental, consumer and organizational systems. The above-mentioned strength enhances availability of information among consumers thus...
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