According to the principles of CSR pundits Michael Kramer and Michael Porter, the MAC AIDS Fund is the CSR initiative that wasn’t, but somehow worked anyway. Kramer and Porter advocate carefully developing a CSR strategy that is in line with an organization’s core business values with an eye on long-term sustainability, economic ROI, and social impact.
After MAC founders Frank Toskan and Frank Angelo lost friends and colleagues to HIV and AIDS – CSR principles be damned, they were determined to somehow use MAC to increase funds for HIV and AIDS programs.
Whether by design or coincidence, their efforts have been wildly successful. MAC established the MAC AIDS Fund (MAF) in 1994, and now it is the second-largest corporate donor and the fourth-largest private donor to HIV and AIDS causes around the world, behind only the Bill and Melinda Gates Foundation, the Ford Foundation, and Abbott Labs. The idea behind the fund was simple: 100% of the proceeds of Viva Glam lipsticks, including retailer markup, will go to the MAF, with MAC assuming the production and sales costs.
Previously, MAC was a quiet company who did no advertising for their cosmetics line, relying on quality and consumer enthusiasm to promote their products. However, with the launch of the MAC AIDS Fund, another side of the company burst into the public eye. A flamboyant, shout-it-out-loud side that gave life to creative, visually arresting ads that thrust a dark, taboo subject directly into the spotlight.
Partnering with celebrities like RuPaul, k.d. Lang, Mary J. Blige, Elton John, Christina Aguilera, Boy George, Linda Evangelista, Pamela Anderson, Debbie Harry, and Fergie, MAC systematically appealed to a large demographic range in a can’t-be-ignored way that has generated millions. The MAF estimates that 2010 spokesmodels Cyndi Lauper and Lady Gaga will have helped raise $28 million by year end, with Gaga’s pink lipstick selling three times more than MAC expected. By the start of 2011, MAC will have donated more than $180 million from Viva Glam sales in more than 70 countries.
So, the MAC AIDS Fund is sweeping the globe, impacting HIV and AIDS communities in dozens of countries and increasing brand profile and loyalty. What about MAC itself? Through it all, the company continues its advertising silence, only promoting Viva Glam for the MAF. Risky? You bet. Worth it? Yes, says Nancy Mahon, Senior Vice President of MAC Cosmetics and Global Executive Director of the MAC AIDS Fund. “The core questions for us have always been: How can we leverage the company’s assets to fuel the Fund’s fight against HIV and AIDS, and how can we leverage the Fund’s good work to contribute to MAC’s commercial success?” It’s not surprising to see which question she asks first, but it seems that she is right. MAC revenues grew significantly from 2009 to 2010 and it continues to broaden its global reach, even in this tough retail economy, with sales in Japan exceeding the cosmetic market by five to six points.
Why does it work from a CSR perspective? How did simple passion translate into a global program helping millions of previously marginalized men, women and children AND generate profits? There are most likely many contributing factors.
Even though MAC is donating the entire cost of the Viva Glam lipstick line, many times cosmetic purchases are made up of lipstick plus other products, so it is a clever way to encourage consumers to donate to their cause, while still making a solid profit (I suspect Kramer and Porter would nod in approval at this tactic – sustainable, economically sound, and socially beneficial). As profits increased, the MAF has been able to make more and more grants to grassroots efforts that are taking hold, growing, and flourishing, keeping HIV and AIDS in the foreground rather than letting it fade back into the shadows. Momentum, combined with a bold presence, is a powerful, genie-in-a-bottle force in both the non-profit and business sectors and capitalizing on it is crucial. The biggest reason might simply be the same as many other CSR campaigns: consumers have demonstrated over and over again that they want to patronize a brand that cares, so when MAC pranced, danced, and winked – consumers puckered up.