Recently, a co-worker asked me if I’d heard about this giant Cineplex Entertainment popcorn bag in a field near Windsor, Ontario. Having no idea what she was talking about, she showed me this picture:
Cineplex built “the world’s largest popcorn bag“, filled it with kernels, installed a lightening rod, and placed it in a field near Windsor which is considered to be the most lightening struck town in Canada. The whole purpose is to see whether or not, if lightening strikes, the kernels will pop. There’s even a live feed on their site where you can watch 24/7. Voting on whether you think it will pop or not enters you in a chance to win free popcorn. (edit from Sept. 3 – looks like the contest is closed and the live feed is gone)
I mean…this is just a marketing gimmick, right? It’s not a scientific experiment or anything. It’s just a creative, albeit really weird, way of advertising Cineplex so that more people see movies, buy popcorn and they earn more money.
Here’s the thing – how much do you think it cost to build the world’s largest popcorn bag and attach a giant lightening rod and fill the bag with kernels? Here’s my next question – do you care how much it cost? Will anyone see this and decide that they will never, ever see another movie at Cineplex because too much of their hard earned money that they freely choose to spend at one of their theatres is wasted on gimmicks like this? Will anyone be angry that Cineplex isn’t using 100% of the money they spent on their ticket directly to maintain the projectors and screens and the delivery of movies to viewers?
I didn’t think so. And, I won’t either. Because that doesn’t make any sense. We all know that marketing is necessary for businesses to remain successful. Even if it cost a million dollars to run this weird and totally unnecessary advertising campaign, it might result in more in profit, which is good for our economy as it keeps people employed and it makes us feel good to watch movies. And if it loses money? Oh well, nothing ventured, nothing gained!
Why is it then that charitable organizations are held to an insane standard when it comes to dollars spent on things like advertising and salaries? A colleague who used to work in management at a for-profit corporation before moving to non-profit told me that if he reached the end of his year with a 30% profit, he was a huge success. That means 70% went to expenses. In the charitable world, we’re expected to operate spending no more than 20% on the expenses necessary to stay in business, and even at 20% you’re going to get people saying it’s too much. Any time there’s even a whisper of a charity looking to invest in its own infrastructure in order to build capacity to further the mission, it’s met with opposition from boards and donors alike.
In 2015, Cineplex spent about 48% on what it classifies as “other expenses”. Things like rent, salaries, marketing, professional fees, etc. So, nearly 50% of gross revenue went to costs that are not directly related to you sitting down and watching the movie. But, all those things are necessary, right? How could you possibly watch a movie if there was no theatre? No staff people to pop your popcorn and run the projector? No electricity being pumped in to the building? No super cool technology that allows you to buy a ticket at a machine, or hear the movie in digital surround “destroy your eardrums” sound?
A charity that spent 50% of its gross revenue on costs other than its declared mission would be shut down. Period. And charities aren’t showing movies. We’re trying to make the world a better place.
People often criticize salaries for top executives at charities. They will say that we chose to go in to this field, so we shouldn’t expect a high salary. Spoiler alert: I don’t get a break on my rent, hydro, groceries or car payments just because I work at a non-profit. And why should someone with the skills, talent and experience that’s necessary to run a large, complex charity be expected to accept significantly less than what they would earn in the corporate world? They choose to spend their career in a role that allows them to make a real difference, and society punishes them for it. In 2014, the CEO of Cineplex’s annual salary was $3,942,389. In 2010, the CEO of Sick Kids Foundation earned $500,000 with bonuses, according to a Globe and Mail article about charity CEOs earning six figures.
I can’t improve on Dan Pallotta’s awesome TED Talk “The way we think about charity is dead wrong“. As Mr. Pallotta says, “Our generation does not want its epitaph to read: ‘We kept charity overhead low.'”