Korean companies work together for a good cause

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Korean companies work together for a good cause

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Minister of Health and Welfare Jeon Jae-hee, fifth from the left, JoongAng Ilbo Publisher and CEO Song Pil-ho, fourth from left, and other representatives of companies participating in the Haengbok Nanum N campaign celebrate the launch of the program on Jan. 27 at the Seoul Plaza Hotel. By Kim Kyung-bin


More and more local companies are becoming interested in “cause-related marketing,” in which businesses team up with nonprofits with the profits donated to a good cause.

The “Haengbok Nanum N” campaign (“nanum” means “sharing” in Korean), was launched with an inauguration ceremony hosted by the Korea National Council on Social Welfare and held Jan. 27 at the Seoul Plaza Hotel.

Companies participating in the campaign will put an “N” mark on certain products. The profits from the sale of those products will be donated to those in need.

Six companies will participate in the program initially - the discount store Lotte Mart, the health care goods maker LG Household and Health Care, the pharmaceutical company LG Life Science, the baby goods maker Boryung Medicine, the food maker Daesang and the clothes maker E-Land.

The ceremony was attended by Jeon Jae-hee, minister for health, welfare and family affairs; Song Pil-ho, publisher and chief executive officer of the JoongAng Ilbo, which will support the program; and Kim Deuk-lin, president of the Korea National Council on Social Welfare.

Representatives from the participating companies, including Internet portal operator NHN and the subway operator Seoul Metro, were in attendance as well.

“We will work hard to become a role model for the national sharing and donation movement,” Kim said in his welcoming speech.

Minister Jeon continued by saying that “people earn money to use money,” and emphasized the importance of “spending money wisely.”

She explained that “the characteristic of this campaign is that people can donate as much as they spend and the company can donate as much as they sell.” She also said that the government would support the campaign by giving tax benefits to the participating firms.

After the greetings, the representatives signed an agreement saying that they will cooperate to ensure the campaign’s success.

The Haengbok Nanum N campaign will start in April, when products with the N mark are released.

“Anyone can easily participate in the campaign as consumption is directly connected to donation,” Nho Byung-yong, president of Lotte Mart, said. “This campaign will be an opportunity for both retailers and consumers to feel happiness by sharing.”

The participating companies are those that have already taken the lead in carrying out their social responsibility.

LG Household and Health Care has been working with Seoul National University Hospital to provide plastic surgery to children with congenital face deformations from 2007. They gave surgery to a total of 47 children through last year.

This year, they are planning to focus on providing various environmentally friendly daily necessities with N marks.

Meanwhile, Lotte Mart has focused its efforts on helping children in the low-income bracket. Since 2005, Lotte Mart employees have been participating in the company’s matching grant program. Employees donate the last three digits of their monthly income and it is matched by the company, which makes a donation to a child welfare organization.

E-Land, on the other hand, has regularly sent 10 percent of their net profits to its social welfare foundation since 2002. The foundation has helped build schools in Sri Lanka and Bangladesh.

The pharmaceutical company LG Life Sciences has been providing medical aid to people in need, especially children with rare diseases.

Other companies like Daesang, which is well-known in Korea for their food brand Chungjeongwon, has been donating food to the underprivileged through its Food Bank. And Boryung Medicine has been donating special pacifiers to babies with mouth diseases.



Responsible sales = guilt-free shopping



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The Product RED iPod nano [JoongAng Ilbo]

Cause-related marketing is a type of marketing in which a for-profit company donates part of its profits to a nonprofit company working to resolve various social problems. It not only raises funds but also promotes a product via a mutually beneficial relationship.

The term “cause-related marketing” is attributed to American Express. In the early 1980s, the company worked with a nonprofit organization in the early 1980s to launch a campaign to restore the Statue of Liberty. The company donated a penny to the Statue of Liberty renovation program each time a customer used the card to make a purchase; it donated a dollar each time a new card was issued. It raised $2 million and its transactions jumped 28 percent in a four-month period.

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Bono declares the launch of the Product RED program at the World Economic Forum in Davos in 2006.

One of the most famous cause-related marketing programs is the Product RED program launched by the rock star and activist Bono in January 2006 to fight HIV and AIDS in Africa.

Companies that are part of the program offer red-themed products under a brand called Product RED, including American Express’ RED card, Apple’s RED iPod nano, Nike’s sneakers with RED laces and others.



By Kim Ki-hwan [estyle@joongang.co.kr]
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