The Australian bush fires have certainly made an impact on Australians and the world stage. People have lost loved ones, homes, businesses and pets. Our once buzzing tourist trade is dwindling to nothing as overseas visitors are choosing less charred soils to explore and fresh air destinations to enjoy.
In the meantime, millions of dollars have poured in from around the world to help our scorched nation get back on its feet. People and organisations have trusted that their well-meaning donations will end up in the right hands to help those who need it most.
But it appears that while we have plenty of good Samaritans out there, one of our most trusted charity brands, the Red Cross has admitted that they are withholding up to two-thirds of their $115million donations, and that 10% of this will be used for administration purposes. As a result, our faith in donating to large organisations is dwindling.
In a recent report by 7News, the Red Cross admits that they may withhold funds to go towards future disasters such as cyclones or floods. The problem with this is logic is that people have donated now, for those who need help, now. They don’t want their money quarantined for another disaster.
Unfortunately, the Red Cross has burnt their brand with this behaviour, partly because, in the past donors have trusted that the Red Cross will ‘do right’ by Australian people in need. This latest bombshell breaks this trust.
When it comes to building a reputable and trustworthy brand, consumers look to the brand promise, it’s consistency and its actions for a moral compass on how they behave. When mixed messages start coming through, confusion and suspicion start to creep in.
As recently as November 2019 Judy Slatyer, Red Cross CEO in reference to the ‘Help Aussie Farmers’ campaign was quoted in saying “It’s going to be a long hard road ahead for farmers and their communities. People can still donate and 100% of all donations are going to severely drought-affected farmers.” It comes then as no surprise, that donors may expect the same treatment of their bushfire donations as they would the Aussie Farmer donations. What is not common knowledge is that Red Cross on most occasions uses 10% of donations to fund administration costs. Poor communication is one of the key driving factors
What we have here is a case of donors expecting one thing and the charity doing another.
Now I don’t want to make the Red Cross out to be all bad, as on the whole, they do a tremendous amount of good. However, when huge donations of funds are involved and emotions are running high, this is no time to behave in a way that will make people distrust that the donations that they have made will be used for anything other than what they are intended.
The effect of the Red Cross’s behaviour is far reaching and doesn’t just reflect on them. As an industry, all major charities will come under fire and scrutiny. Without trust in a brand or an industry for that matter (we saw this with the banking sector), people may choose to donate to more local causes, where they can actually see a difference being made. This will be great for grass-root organisations and has in fact made organisations such as B1G1 a popular alternative particularly for businesses.
B1G1 has an easy to access online service where you can choose amongst hundreds of initiatives that you would like to support. Some support requires as little as 50c to help a project. All B1G1 projects are in line with the Sustainable Development Goals set by global leaders. They also promise that 100% of your giving goes to the projects you choose. B1G1 lets you track every single impact you create in real time through impact counters and interactive maps. This brand is truly looking at how to solve a problem while offering transparency.
Trust, communication and transparency are integral parts of any brand. Once any of these elements falls flat it is extremely difficult to gain back the trust and reliable reputation. The raw reality is that your consumer or supporter is not interested in what you say, they are interested in what you do. Actions always speak louder than words.
So what should the Red Cross do to help mitigate this brand damage? For one, they need to communicate better. Secondly, they should ensure that there is complete transparency when it comes to where they are spending the donated money and how people can get access to it. By demonstrating how they are helping and who they are helping, they will over time be able to build back trust. But this is a challenging emotion to overcome and some may not be as forgiving.
It would be a shame for people to lose faith in the very charities that are supposed to help, support and care for those in need.