Groupon’s Fumble Gives Causes Chance to Score Big

Tag Archive: groupon

Groupon’s Fumble Gives Causes Chance to Score Big

Written on February 8, 2011 in Causerants

Enough people have registered their opinion to confirm this deal-breaker for everyone: Groupon’s Superbowl ads Sunday night were ill-conceived and offensive. Goodwill earned from this promotion: 0%.

As of this printing, Groupon should have apologized (they haven’t), pulled the ads (saw one last night), fired their agency (standing shoulder to shoulder) and donated a boatload of money to the causes they offended (Umm…nope).

But while the ads may have been a disaster for Groupon, they highlight four important lessons for causes and the businesses that work with them.

Holy, Batman! This cause marketing stuff really works! The outrage against Groupon was immediate, loud and passionate. As Willy Wonka said, “Strike that. Reverse it.” Now imagine if Groupon had produced a great cause marketing ad and the raves it would have earned from viewers. Cause marketing is a powerful, meaningful strategy that enhances a company’s favorability–when it’s done well. When it’s not, it has an equally potent but negative impact.

Group buying sites can work for causes. There was a legitimate giving component to Groupon’s Superbowl spots but it wasn’t mentioned in the ads (Groupon offered to match donations to the causes they dissed). Also left out was that Groupon and other group buying sites can be used to help causes. Groupon and Living Social have worked with DonorsChoose.org to raise over $250,000. A recent post in Mashable reviewed seven group buying sites using daily deals to give back. And just this week I did a deeper dive on GoodTwo.com, a daily deal platform that lets causes and individual fundraisers combine commerce with contacts to raise cash.

Humor has a place in cause marketing. Tom Watson pointed this out in his wonderful post on the Groupon mess, and even the founder of Groupon has assured people that his company was just making fun of itself. The key is appropriate, non exploitative, positive and disruptive humor that flies in the face of the melodramatic pandering we see in most cause marketing. Some causes are trying to use humor well, while thers are reminding causes to laugh at themselves every now and then. Hopefully we’ll all get the message: humor for good is good.

The reason Groupon will survive is what you need to thrive in cause marketing. Groupon has a brand with the potential to join ranks with some of the best brands in the world (Starbucks, Mercedes, Nike, Apple, etc.). A strong brand is your most important asset in cause marketing. For cause or company, it’s like a magnet that draws people, money and influence closer, and, in difficult times, repels critics and controversy.

Take a top cause brand like Komen for the Cure that wields one of the strongest magnets in the cause world. They attract donors, celebrities and advocates in hoards who contribute marketing muscle and hundreds of millions to their fight. But last year when Komen got caught in the chicken coop with Kentucky Fried Chicken suddenly nothing stuck, and, despite waves of criticism, Komen weathered the storm well. Groupon and Komen demonstrate the power of brand and why we all need a powerful one.

And Groupon certainly has enough brand power to earn a pass on this Superbowl fumble. The rest of us shouldn’t spend a moment longer dissecting the replay. You need to get busy harnessing the power of cause marketing, the value of group buying sites and the disruptiveness of humor while building a brand that can play offense and defense.

Your goal should be to join Groupon one day in the big game of philanthropy, business and marketing. But unlike them, you’ll be winner.

Tags: cause marketing, groupon, superbowl ads

How to Sell Cause Marketing as a Groupon-Like Promotion

Written on October 19, 2010 in Cause Sales

4 Comments

Persuasion occurs through identification.

It’s one of the basic tenets I live by. It means that we are usually more convincing when we can identify with our prospect’s needs, attitudes, interests and beliefs. When your message aligns with needs, the “pain”, as it’s sometimes called, you get a spark of persuasion. String enough of those sparks together and you have the light and warmth that comes from the flame of a new partnership.

Despite its lofty intentions, cause marketing isn’t any different from any other idea, product or service: nothing happens until it gets sold. That’s why I’m always looking for new ways to meet the needs of prospects and create a spark.

My flint today is a recent post by Sam Decker on Analyzing Groupon Profitability: 7 Factors for Group Buying Success. It really got me thinking about how Groupon works and its similarities to cause marketing (not to be confused with my earlier post on Groupon as cause marketing, better known as Causeon).

Here’s an example of how I plan to use Groupon in future conversations with local businesses to explain and underscore the value of cause marketing.

Me: Are you familiar with Groupon?

Prospect: Sure. We did a promotion with them last year when they weren’t as wildly popular as they are now. It went really well. We didn’t know what to expect from it, but I think we made money off it. We’ve been trying to do another offer ever since, but good luck getting anyone from Groupon to call you back. They have plenty of business now.

Me: Well, the cause marketing programs I offer are a lot like Groupon.

Prospect: How so?

Me: Like Groupon, our cause marketing model is focused on helping local businesses like yours attract new customers.

Prospect: I thought you wanted to raise money for your charity?

Me: I do and we will. But cause marketing partnerships are win-win. We both should benefit from working together.

Prospect: I hear that, but Groupon has a huge mailing list of prospective customers for me. You want me to to sell pinups to my customers. How do I get new customers from that?

Me: True, we don’t have the huge list Groupon has, but we do have two other retail partners for this program. With you on board, we could potentially recruit more. All these partners will be selling pinups in their stores with your offer alongside theirs [I present exhibit A]. You’ll do the same for them. One of our pinup partners redeemed 700 coupons from pinups that had been sold in another partner’s stores. The cross-promotion works.

Prospect: But with Groupon I got this incredible awareness and visibility from the program that really got people talking about my business. That was priceless. Can you do that?

Me: We can actually take it one step further because cause marketing delivers favorable awareness. When customers see that you’re involved in a campaign to help a cause, you’ll get a lot more than buzz. You’ll get positive buzz, the kind that deepens your favorability and credibility. Only cause marketing delivers this.

But the real upside from cause marketing is that while your average Groupon customer may only be as loyal for as long as the expiration date on the coupon you give her, cause marketing can actually sustain customer loyalty. It gives you a competitive edge beyond product and price. The edge is slight when product and price are equal, but an advantage is advantage, right?

——————-

By selling cause marketing as a Groupon-like promotion you’ll be speaking a language to which a prospect can relate and is responsive. It’s a wonderful way to start a conversation.

Tags: cause marketing, cause sales, causeon, groupon, persuasion

Product Red’s Bono Learns the Hard Way: Don’t Put the Cause Before the Horse

Written on October 18, 2010 in Cause Practices

4 Comments

Last month the WSJ profiled U2′s Bono and and his wife Ali Hewson’s efforts to launch a fashion line with clothes made in sub-Saharan Africa. (Hat tip to the good folks at Cone for the lead).

Edun got off to a rough start because Bono and Ali had the best of intentions, which, unfortunately, didn’t top the list of reasons consumers would pay $800 for a jacket. Design and fit mattered more.

“We focused too much on the mission in the beginning, ” explained Hewson. It’s the clothes, it’s the product. It’s a fashion company. That needs to be first and foremost.”

Edun is just another business that learned you can’t put mission before margin. The best way for a business to help a cause is to be a great business first, and an advocate for causes second.

At the Beyond Cause Marketing summit ten days ago my industry’s mom Carol Cone told me that even cause leader Timberland had seen sales erode a few years ago when consumer interest in their styles waned. Cause couldn’t save them. Ultimately, Timberland would rise or fall on their shoes.

Businesses are still making the mistake of putting mission before margin. Causeworld, Panera Community Cafe and Causeon are just three examples.

I’ve written on Causeon, spoken to the founder–a good man with good intentions–and like the idea. But the premise of Causeon is that consumers will choose it over Groupon and 200 copycats because Causeon supports greats causes. But consumers are looking for great deals first and to help causes second.

The real opportunity is when you take a great business and activate it for good.

Take Groupon, which will hit a billion dollar in sales faster than any other company in history. In May, when DonorsChoose.org was the featured daily deal on Groupon they raised $162,000.

Should we wait for cause-centric businesses like Causeon to take hold, or should we double our efforts to work with great businesses of all sizes to raise money for causes?

You know what side I’m on. What about you?

One last point. Next to developing a magnetic cause brand that sucks in great businesses, nonprofits should focus on finding great businesses to stick themselves to. Nonprofits spend too much time on fundraising strategy and ideas when what they really need is the horsepower drive them.

Given the choice between a great idea or a great partner, I’ll take the latter. With a great business anything is possible, and even the most basic cause marketing tactic can be given new life with the right partner.

It’s not enough to right your cart and put the horse in front where it belongs. You have to hitch your wagon to a star.