Amazon announced in an email to customers yesterday that they will be ending the program that allows shoppers to direct 1/2 of 1% of purchases to the nonprofit of their choice.
At first glance, Amazon Smile has impressive stats. It has resulted in nearly $450 million in donations since it began in 2013. Media accounts yesterday featured quotes from small nonprofit leaders, often volunteer-led, that will be hurt by this decision.
But according to reports, the average donation per nonprofit in the United States was just $230 in 2022. One million organizations around the globe were eligible to receive donations from Amazon Smile.
Good riddance, Amazon Smile. It was, at its core, a gimmick by Amazon designed to lure more shoppers and make them feel better about eschewing local small businesses. The percentage donated and opaque manner of determining whether or not consumers were using the separate Smile website was always designed for minimal impact.
Amazon has announced that it will instead refocus on bigger investments in areas such as affordable housing, computer science education and disaster relief. But no details were offered about this commitment.
Amazon has a chance to make this a win for both its customers and itself. Amazon has some experience in the affordable housing sector. Two years ago, Amazon announced a $2 billion Housing Equity Fund that will create or preserve 20,000 affordable homes in three headquarters regions—Arlington, VA; Puget Sound, WA; and Nashville, TN. Most of that commitment will come in the form of below-market loans. In addition, Amazon’s Housing Equity Fund is providing $125 million in cash grants to businesses, nonprofits, and minority-led organizations to help them build a more inclusive solution to the affordable housing crisis, which disproportionately affects communities of color.
Good stuff. Yesterday’s announcement about the demise of Smile means Amazon needs to step up again. Increase grantmaking to nonprofits leading the way with innovative solutions to the housing crisis. Increase the geographic reach of this giving to include other high-cost communities like Boston that desperately need more corporate investment to complement robust public sector efforts. Invest in communities of color and commit to closing to racial wealth gap.
As progressives we love to take shots at Amazon. It is such an easy target. But Amazon’s hand in transforming retail in the United States is not a short-term phenomenon. Like it or not, Amazon is here to stay. As the world’s leading retailer and sixth largest public company, Amazon has a responsibility to be a big part of transformational solutions to intractable problems that impact Amazon workers and their neighbors.
Jeff Bezos and senior Amazon executives are right to focus on housing affordability. They have seen the need up close in Seattle, a city Amazon has been part of gentrifying. Adding insult to injury, Amazon and others successful fought a tax in Seattle in 2018 that would have funded housing for the homeless. Five years later, they have a chance to repair the damage with a historic investment in solving the housing crisis in the United States. Will they?
Amazon strives to be “Earth’s most customer-centric company” according to its website. It customers in Boston, Seattle and elsewhere need housing help. Its customers are watching and waiting.