Photo: Amazon
Should Amazon Have Ended AmazonSmile?
Amazon.com’s recent move to end its AmazonSmile charity donation program saw many beneficiaries frowning on social media.
Launched in 2013, AmazonSmile enabled users to donate 0.5 percent of their spending on Amazon to the charity of their choice. The program donated over $400 million to U.S. charities and more than $449 million globally.
Amazon said in a statement that it wanted to narrow its philanthropic focus to “programs with greater impact” and AmazonSmile faced challenges working with so many charities. The average donation was less than $230.
“The program has not grown to create the impact that we had originally hoped,” Amazon said. “With so many eligible organizations — more than one million globally — our ability to have an impact was often spread too thin.”
Amazon will invest in areas where it can “make meaningful change,” such as disaster relief, affordable housing and community assistance programs.
Many charities strongly expressed their disappointment.
“For us, the impact is significant — every dollar counts,” Global Sanctuary for Elephants, a Tennessee-based nonprofit that received more than $20,000 in total from AmazonSmile, tweeted. “We’re upset by this inconsiderate decision.”
The Cat’s Meow, a Los Angeles-based pet rescue organization that had received $4,000 from AmazonSmile, tweeted, “The program didn’t provide ‘meaningful change’? Our rescued kitties disagree.”
Both the ASPCA and St. Jude Children’s Research Hospital received over $15 million from AmazonSmile.
A New York Times article said some analysts believe Amazon Prime’s growth benefited as AmazonSmile was promoted by churches, clubs and other local organizations as a vehicle for donations.
Beth Hyman, executive director of Squirrelwood Equine Sanctuary, told NPR that Amazon minimally supported the initiative, including never integrating AmazonSmile into their mobile app.
Among other issues, right-wing groups had criticized AmazonSmile for not supporting conservative non-profits. CNBC described the move as “the latest example of the company’s broader cost-cutting efforts.”
One contrarian who supported Amazon’s move was David Hessekiel, founder of Engage for Good, the cause marketing organization. He wrote in a Forbes column, “I always thought AmazonSmile was a poorly conceived initiative, was a bad fit with Amazon’s non-transparent communication culture and, because it was so broad ended up wasting a tremendous amount of time for many charities with very meager fundraising results.”
Discussion Questions
DISCUSSION QUESTIONS: Was AmazonSmile too idealistically conceived, poorly executed or given up on too early? What lessons does it offer about charitable donation programs tied to purchases?
Poll
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Ken Morris
Managing Partner Cambridge Retail Advisors
Ken Lonyai
Consultant, Strategist, Tech Innovator, UX Evangelist
One would hope that this is not the end–but that they will re-conceptualize their effort. A program that supports one million charities strikes me as one with no focus. AmazonSmile was conceived as a great idea, but how to correctly execute it was never considered.
Amazon is big. A charitable effort from this organization should be equally big.
AmazonSmile made it easy for shoppers to feel good about buying from Amazon. Channeling almost $550 million into charities worldwide—of each shopper’s choice—is far from negative. I also get the logistical challenge of over a million charitable organizations. I think, even for Amazon, this was overwhelming. It would be good if Amazon could focus its efforts on encouraging giving, but in a way that’s not so resource intensive. People will contribute to a worthy cause if given the opportunity, and every little bit counts. Maybe it’s not too late to retool the program.
Perhaps they could narrow their focus to a few major initiatives such as clean water, world hunger, etc., rather than spreading themselves too thin. I believe they should consider this narrow focus as you can’t really be everything to everyone all at once. But everyone knows there’s no way it could narrow down the number of charities and not cause a political firestorm from all angles.
AmazonSmile may have been too idealistically conceived, but it also donated over $800 million to charities. While I understand the disappointment from the charities that are no longer getting funding, I commend Amazon for the initiative.
There are two sides to every story. A corporation being generous is always admirable. Best practice is to have an inbound process for entities to request inclusion in the program. The business has the latitude to decide who or who not to include. Doing good for the betterment of society, worthy causes and indeed to address global challenges should always be celebrated. Taking on criticism no matter what you do is an unfortunate result. Focus vs. spreading “thin” is not a bad practice, but change can indeed hurt, so you should provide advance notice so that they can plan accordingly. Evolving a program is a good practice. Target Corp. has a giveback program for schools that has been in place for decades called Take Charge of Education. It has an excellent design where you as a RedCard credit cardholder can direct 1 percent of your spend to your local school. Don’t spread it too thin, keep it local, and make it meaningful.
The idea was not for Amazon to make donations but for the individual to make donations by shopping on Amazon. In the spirit of “every little bit helps,” Amazon did a nice thing if not an overly lucrative thing for a million-odd charities and their supporters. I think the article missed that point — it wasn’t the money, it was the thought that counted.
The challenge for Amazon is transparency. Given their reputation for outsourcing to China, this program was a chance to bring visibility to charity efforts at home and was highly visible to the customer. While it’s true that by concentrating efforts on fewer charities a bigger impact can be made, the sad reality is that even small dollars are meaningful to so many charities, and it is these smaller charities that provide the biggest impact on the front lines of communities.
Customer donations at online sales transactions, retail checkout counters and point-of-sale fundraising campaigns are a popular and effective way to raise funds for favorite charitable causes.
Amazon did little to promote the AmazonSmile program to consumers and little to create the impact it originally hoped for. With so many eligible organizations — more than one million globally — AmazonSmile’s ability to have an impact was often spread too thin. The failure of the program could be attributed to its poor execution. Amazon will invest in new programs and plans to make meaningful change in areas such as disaster relief, affordable housing and community assistance.
Valuable lessons learned from this program are: 1.) Too wide of a selection of charities might cut too thin; 2.) Transparency around donation amounts is crucial to building trust with customers; 3.) The donation process should be simple and straightforward to encourage participation.
As a volunteer at one of the charities that participated in AmazonSmile, 100 percent of the awareness and marketing came from the charities — blurbs in our newsletters, notes on our emails, etc. Never a “spotlight” email from Amazon to our local area indicating the breadth of local organizations contributions could go to or invitations for shoppers to participate.
Over three years we earned about $800. In retrospect it was cheap advertising to get more folks to buy from Amazon — the programs they are investing in now really do look like worker-training and worker-housing initiatives to make their own operation stronger, rather than communities more resilient.
AmazonSmile was probably not too idealistically conceived. After all, what at Amazon ever is? It was a way to humanize a corporation seen by its opponents as a local retailer killer. What somebody at Amazon should have thought of is that there are a lot of Amazon customers out there who have some small, local charity they love. By putting the choice in the customers’ hands Amazon should have figured that the more “successful” the program became the more of a nightmare it would be to administer because more success would probably mean more individuals shopping and that would mean more and more charities would have to be added. I guess the lessons are to “batch” charitable contributions — say one to a leading animal protection group, one or two to environmental causes, one to restoring inner city public schools and/or providing scholarships, etc., then give customers the option of supporting none, one, or more. Still sort of a nightmare, but one that is simpler to manage.
No. We’ve supported a local charity via Smile and although they didn’t get much, they counted on it. Our charity which has no paid employees, put 100% of their Smile pittance to its intended use. Supporting a large national version would not have brought any local benefit and, so many of those charities have been exposed as wasteful or corrupt. Allowing them to leverage Amazon as having chosen them would have manifested more waste and corruption.
It should not have requires you go to a separate website to purchase. It was like they tried to make it harder to participate as a shopper.
It is just another black mark for Amazon.
I think the real lesson here is in how the termination of the program was communicated. The message was interpreted as the program having no impact and providing no meaningful change. That’s evidently not true and I must believe that it was not Amazon’s intent to have its decision interpreted that way. I tend to choose my charities by how efficient and effective they are at using every dollar I donate. My hope is that Amazon is doing the same and hopefully will emerge with a better plan.
I went with “poorly executed”, as in it never should have existed in the first place: people are – or should be – quite capable of donating themselves, and it’s all too easy for “charitable giving” to become more of a P/R ploy (or in this case, apparently, a PR problem).
There are times when businesses are uniquely positioned to be charitable – donating goods or services during times of disaster or when (the former is) no longer marketable. But as for simply being a third party conduit, I advise against it.
More corporate spin from Amazon? Naaaaaaah.
We try not to purchase from Amazon and support local/small businesses. When we do, it’s ALWAY via Smile. Keep driving customers away Amazon, you have all the answers.
Oh wait, A YouTube channel called The Economic Ninja https://www.youtube.com/@EconomicNinja had a recent series of purported leaks from inside Amazon about their concerns of the shrinking consumer buying power and even home ownership/purchase shrinkage reflecting/affecting discretionary spending—the core of their business. It even included mention that FBA was shrinking as sellers do their own fulfillment. It seems like the everything store is in the start of a tailspin and is clueless on how to retain customer goodwill. Killing Smile proves it.
Jeff Bezos spoke internally about decisions as one-way doors and two-way doors. A two-way door is easier to do an about face, tweak or pivot. One-way doors have significant consequences in making a reverse decision. Replacing or simplifying AmazonSmile would have likely been a better step than yanking out the rug from under it all. The consequences will ultimately be customer perception fallout and the goodwill established with community organizations. Hopefully Amazon has a new, and better program coming.
While I understand the administrative challenges of managing the AmazonSmile program, there could be alternatives to simply ending the program. Obviously, customers enjoyed buying & doing good on a micro (my charity) versus a more macro perspective, e.g., affordable housing. The concept of customer choice needs to be maintained. Select a reasonable range of charities & let the customer select the ones that they resonate with on a daily basis.