Q&A with Bobby Shriver: Changing the way companies think about charity

Journalist. Santa Monica City Councilman. Music Producer. Entrepreneur. Bobby Shriver has worn a lot of hats, some of them simultaneously. Now, while working as a councilman, he runs (RED), a company he created with Bono to fund the purchase and distribution of medications to fight HIV and AIDS in Africa. I reached him at his office in Santa Monica.

Here is a recap of our conversation. It has been edited for space and clarity.

Q: Your father, Sargent Shriver, created the Peace Corps. What did he pass down to you in terms of the right way and the wrong way to get involved in foreign aid?

A: The right way is to put the best American values - optimism, entrepreneurship, hard work, equality - forward. Those values are the real source of American power. That's hard power. It's not the so-called soft power. That's as hard as any gun is.

Q: You worked as a reporter out of college, right? You spent some time at the Herald Examiner and the Chicago Daily News. Has that informed the work you're doing now in any way?

A: Even now, I always think, "What is the story?" And "Can I get that on the front page?" Most of the time the editors told you no. They would give the story three inches and tell you to shut up and get out of here. I had strong training in figuring out ways to tell people something they hadn't heard before.

Q: The first A Very Special Christmas album that you co-produced was not the first album to raise money for charity, but it is the one that launched a wider expansion of that idea, which we see now with the Red Hot campaign and the Warchild projects. Would an album with that kind of blockbuster talent behind it be possible now, at a time with the recording industry has seen its profits eroded by file sharing and piracy?

A: No. Now, no one is buying records. You could try it, but it wouldn't make the same kind of revenue. On the first record there were five artists who had sold 15 million records that year. That will never happen again. You had Whitney Houston, Bruce Springsteen, Bon Jovi, Madonna and U2. I think it allowed the record companies, publishers, distributors and retailers to feel magnanimous because they were making a lot of money in the music business.

Q: (RED) has had a dramatic climb. It has raised more money per year than any similar endeavor. More than Lance Armstrong's bracelets. More than Paul Newman's salad dressing and popcorn and salsa even. What are the main factors behind raising so money much so quickly?

A: We were able to get these gigantic, iconic companies, like Gap, as our partners. With Mr. Newman's model, he had to make the salad dressing himself. We tried to get the creativity of these giant companies to work as opposed to trying to do stuff for ourselves. It gets back to the story telling. We felt here we had the worst health crisis in the history of the world, and that was a story. We were running around as best we could in Washington and London trying to lobby governments, and Bill Frist said to me, "You guys are doing a great job. But we don't hear about this at the pig roast." That was a beautiful phrase. We set ourselves a goal of getting into the pig roast. How are we going to make people talk about this issue? The answer is not to quote a lot of figures. People tune that out. They don't want to process it. It's too distressing. You have to figure out a way to make it something that they want to talk about. We wanted the storytelling capacity of Gap, of Apple, of Motorola to work on behalf of this crisis.

Q: Let's talk a little bit about who does what. There was an article in Advertising Age a few years ago that claimed that (RED) was spending most of the money it was raising on marketing. Now, (RED) doesn't fund the marketing, right? The companies do that. How does it work?

A: That was a damaging article and an ignorant one. The companies are doing the marketing anyway. There are Gap khaki ads and Apple iPod ads. That's what companies do. That's why the criticism of them and us that they should donate their ad budget was so absurdly off the mark. We were trying to get them to repurpose that existing ad budget to talk about the pandemic in a way that would get into the pig roast. We wanted to get some young people interested and have some spin on the ball.

Q: Was Gap enthusiastic from the beginning?

A: They took a long time thinking about it. It's the biggest apparel company in the world. There are a lot of constituencies, and all those people have to be checked in with. We asked them to do some pretty broad stuff. We wanted a whole series of products - not just a t-shirt. One of the big stumbling blocks for them was that they were going to make money on it. They worried they would be criticized. And, lo and behold, they were.

Q: What have been some of the other concerns that companies have had?

A: Other companies thought the problem was too far away. How are you going to get people to care about Africans? Some people thought AIDS was overdone. Some people felt that even if you did get that across, it wouldn't affect purchasing behavior.

Q: How did you overcome those concerns?

A: We had to show them that they could make money for themselves and still make money for charity. People are feeling, in the Keynesian phrase, "the animal spirits." Oh money! That's exciting! And they go out, and they are making 20 different products for you. When you are facing the pandemic numbers of millions of people who need these medicines in Africa, you need a new idea. You need that spirit to get things done. With the Christmas albums, we raised a little more than $100 million over 15 years. With (RED), we have raised more than $130 million in less than three years.

Q: You are the brother-in-law of Arnold Schwarzenegger, the governor and one of the most popular film actors of all time. You have Bono as a partner in (RED). Yet I've heard you say it was difficult to get some of these companies to even meet with you. How is that possible? Why wouldn't doors open for a member of the Kennedy family and the world's biggest rock star?

A: I grew up in a very famous family, but what I observed was that things worked not because people were famous or rich but because people showed up at 7 in the morning and on the weekend. You show up early and work your ass off, and you get on the front page. If you don't, you don't. And with Bono and the U2 guys, I could see quickly that they were really hard workers. Unlike certain other people who did songs for the Christmas albums and could come in and were so blindingly talented they could sing a song in three takes and leave. Persuading people to join (RED) is a lot of work.

Q: if you truly want to effect lasting change that will bring about better health outcomes in Africa, why not persuade the companies to make their shoes and shirts and iPods in Africa instead of countries like China and Cambodia, so that jobs are created and the economy is improved?

A: We have tried to do that as a side light. Our principal objective was to get the cash to buy the medicine. In Gap's case, they have a long history of making products in southern Africa. So we said could you make some of these products in those factories and they were able to do so. They made the t-shirts, for one. Motorola got the packaging for their phones there.

Q: Could you do a second level of branding, promoting the fact that these things are "made in Africa"?

A: The companies would have to be convinced that their customers wanted that. We never want to make an unreasonable commercial request. Then we would be back in the "sell a t-shirt for charity" mode. We want to be in the, "You make money, and we support you making money" mode. We believe that's sustainable. That's not something you would ordinarily hear in a public health venture. That's one of the smart things the Gates Foundation has done, saying to the large pharmaceutical companies: if you develop this vaccine, we will buy it in commercial quantities.

Q: What have you learned about the type of person who is interested in buying a (RED) product?

A: They tend to be young women. There's very high awareness in women 15 to 30. And because we know that and know other things about our customers, we can use that data when we meet with potential partners. And it's expensive to get the right level of detailed research to show a new company the prospects of becoming a partner. The difference between that meeting and the "please will you give us money" meeting is huge. Here's our hard-edged research and focus groups in these six cities. Here is the polling data. And here are your stores in those cities overlaid on a graphic. Here's what your own customers said and how many units they bought.

Q: Some people might not know that they are helping fight AIDS in Africa, right? With some of the (RED) product campaigns, it's not always obvious the products are making money for AIDS medicines.

A: Some of them might not know and that would be fine with me. Like the Christmas record, if people wanted to buy the record because of the Bruce Springsteen song, that's fine with me. If people buy some clothes because they like the clothes, that's great. If they go to the (RED) website and they sign up to help, even better. And we're finding that people want to sign up because they like the story.