How Product Red Seeks to Operate

To the Editor:

Your article entitled “Courting Consumer Dollars” in the July 26 issue misses some very important distinctions about the Product Red campaign.

First, Red is a business model that empowers consumers to buy everyday products from companies who then send a portion of their profits directly to the Global Fund to buy AIDS medicine for women and children with AIDS in Africa.

The money generated from the sale of Red products — whether it’s a Red iPod Nano or a Red Armani watch — never passes through Red. Rather the companies involved (Apple, American Express, Armani, Converse, Gap, and Motorola) send it directly to the Global Fund, which dispenses the funds on the ground to programs earmarked by Red that deliver antiretroviral drugs to Africans living with AIDS.

Red charges a one-time licensing fee that helps underwrite Red’s overhead. That amount is established at the outset of the partnership, and has nothing to do with the money that goes to the Global Fund.

The money raised by Red products is clearly communicated by each partner — either in flat amounts or in percentage of sales — and can be tracked through the Global Fund Web site in aggregate amounts.

As always, our goal is raising money to directly fight AIDS in Africa.

Susan Smith Ellis
CEO
Product Red
New York