Amazon, Stopping the Smile

As of February 20, Amazon is announcing it will no longer Smile. This is not great news, not even close. In fact, it stinks. Nor does it seem to make a lot of sense, unless considered purely from a greed point of view. For those that may not know the program, since 2010, Amazon through its AmazonSmile point-of-sale program “directed donations equaling a half-percent from each purchase to a charity of the customer’s choice.” It has been an unmitigated success. According to reporting of Amazon’s accounting:

“In 2013, the charitable-giving arm disbursed $10,000. In 2020, its distributions grew to $60.5 million, which went to more than 300,000 groups.” Sixty million dollars in giving. ANNUAL giving. Those are big, big real numbers. So is this one: 300,000+ nonprofits will now take a direct hit in their revenues, potentially thousands of dollars a year critical within their small operating budgets. All of it, just wiped out by an Amazon management whim. Of course, Amazon has a right to its profits, But they seem to be doing well in that department with net income for the twelve months ending September 30, 2022 of $11.323 billion, and $33.364 billion in 2021 (when we all shopped more online thanks to covid), a 56.41% increase from 2020. So the $60.5 million in donations made from AmazonSmile in 2020 registered at a likely 0.004% or so percentage, of their annual net profit.

For those of us working in fundraising for mission-driven organizations, AmazonSmile was always one of the easiest way to secure funds for nonprofits of any size. Were they smaller dollars? Yes.

Yet, I would argue, of more importance for so many nonprofits than the dollars earned, was the visibility. Most folks order from Amazon, and anyone who had signed up for Amazon’s Smile program would get their donation and the name/mission of their chosen organization reinforced immediately at each sale. I loved the little updates I would get from Amazon tallying my end-of-year donation total from Amazon purchases I had made, for my selected organization, the Surfrider Foundation (since switched to the nonprofit my wife launched, Shattering Glass). Yes, the dollars were not huge – though with a young family, we seemed to purchase quite a bit from them each year! It all added up and all parties seemed happy and to benefit from the partnership: the consumer, the nonprofit, and Amazon.

But, no longer.

Making the impact of Amazon’s management decision worse, these revenues are being yanked out from under 300,000+ nonprofits at just the time when so many of them are struggling … with revenues (particularly unrestricted), staffing shortages, and the uncertain economic future we are all facing. Looking forward, we hope corporations – big and small -- can develop a better understanding of the value of their community and philanthropic support. Real return on investment – ROI -- from a marketing, loyalty, branding, and community-driven point of view happens. We at Rising Tide would be happy to talk and work with companies about the value and ROI they can see with this type of program. Reach out anytime. We have been proud to watch sponsoring companies reap significant value from nonprofit partnerships in our work. And, maybe with some public outcry and attention, Jeff Bezos (current net worth of ~ $120 billion or so, and somewhat of a noted philanthropist, who can be reached at jeff@amazon.com) might reconsider this decision.