Playing With House Money in Cause Marketing

On Nov 26, 2012 I posted the results of a survey that measured Canadian opinion on cause marketing. One of the findings was the 67 percent of Canadians would be willing to donate to a cause at checkout if the company matched their donation, thus reinforcing what almost any gray-haired nonprofit fundraiser could have told you. Namely, that when it comes to philanthropy people love playing with house money.

Tripadvisor, the big travel website that aggregates opinions and reviews is offering a little house money for you to use at Kiva, the lender that provides microloans primarily in the developing world.

For the next year, when you submit a review of a hotel, restaurant, attraction, etc. in one of the countries where Kiva.org is active, Tripadvisor will send you email that allows you to direct a $25 microloan in that or any other Kiva.org country. That $25 costs the reviewer nothing.

No word on what happens if TripAdvisor meets the $250,000 cap before the year is up.

The idea was inspired, TripAdvisor’s CEO Steve Kaufer told TechCrunch, by Reid Hoffman’s $1 million offer to encourage people to try Kiva.org. Hoffman is the co-founder of LinkedIn.

Earlier this year Hoffman put $1 million into Kiva.org microloans to encourage newbs to try the service. Of the $1 million, Hoffman has already gotten back all but $11,000 of his investment (these are loans with interest, remember). Hoffman also donated $50,000 to underwrite Kiva.org.

But people who took Hoffman up on his offer also invested $417,000 of their own money in Kiva.org recipients. The net impact was $1.6 million (some of the money was recycled).

With this promotion, TripAdvisor is hoping to replicate some of Hoffman’s success.

This also plays to the burgeoning trend that people want more say in where their cause marketing donation goes. Kiva.org offers thousands of choices of people to invest in.

Kiva.org is an interesting case and unlike most other charities. But the lesson to draw from this promotion is that people like to play with house money. So cause marketing promotions that uses these kinds of matching funds and offer choice in where the money lands are likely to be appealing to customers.

Tip of the hat to Howard Brodwin at sportsandsocialchange.org.

Comments

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