Raising Social Capital Is a Key to Small Business Marketing
Almost every consumer will tell you that they think advertising sucks. Up until a few years ago, advertising was considered a tacit reciprocal arrangement at best, a necessary evil at worst, in exchange for supporting the business of media.
Meanwhile, the new marketing eth0s arising from social media has nurtured a disdain for any kind of self-promotion as inauthentic, and consumers now challenge advertising’s credibility and deride advertising openly. Even the ad industry and its celebrity promoters got into the act at last month’s Clio awards:
“I love advertising because I love lying,” announced Jerry Seinfeld, winner of an honorary Clio for his involvement in various ad campaigns. Seinfeld used his three minutes onstage to assure the assembled creatives that “duping people” is “an excellent use of your energies” and that “buying stupid things is a great way of life.”
“OK, he said it,” chimed in emcee Whoopi Goldberg as she reclaimed the microphone. “It’s all a bunch of bullshit.” (Goldberg) complained that slick ads had tricked her into buying a car she now disliked. “I bought a Fiat because of you!” she said accusingly, staring out at the crowd. “Sometimes the advertising is better than the product,” she sighed. “You fucked me up with that Fiat.”
In this way, some advertising can now actually be detrimental to a brand’s social capital, which Whoopi clearly demonstrates with her Fiat rant. So how do brands get people to respond to their advertising positively? The social media code that lambasts advertising as self promotional cheers corporate social responsibility. Honey Maid graham cracker’s This is Wholesome campaign featuring a gay family and Exxon’s Be an Engineer focusing on STEM education are two examples of how brands relay a socially responsible message. When brands leverage their power to do good via media, it creates buy-in from the communities they target, and elevates its social capital.
Small businesses face the same quandary as big brands about advertising. Is it really worth the financial capital to run ad campaigns that can potentially annoy the community and deteriorate their social capital? Since small businesses are even more dependent upon local good will to thrive, they become a suitable laboratory for developing new ways to demonstrate social responsibility to their community.
One of the most tangible ways for small businesses, chambers, and trade organizations to build social capital is to raise funds for their community. The current method of nonprofit fundraising from the community happens behind closed doors, relying on Directors of Development soliciting sponsors for fundraising events. Crowdfunding opens up a collaboration between the business community (the sponsors) and the nonprofits, by reframing the decision to contribute from management to the crowd. Businesses can support nonprofits simply asking their customers to crowdfund for the cause.
Here are examples of how collaborations between the business community and local nonprofits can work:
Every chamber, community foundation, Lions Club and realtor association should develop a localized crowdfunding platform that supports their local nonprofits. It should be built on the dedicated domain of the local institution, not a portal like Kickstarter, because it will be a permanent fixture for serial fundraising going forward. White label crowdfunding platforms like CommitChange and Open Tilt give organizations the tools to develop a crowdfunding portal that focuses on their community.
For retailers, the best way to sustain social capital is to provide incentives to local institutions — civic groups, clubs and social networks — to use their services or space for meetings and fundraisers. Restaurants should be open to hosting special days in which a portion of receipts are earmarked for donations to the organizing cause. Meetups on online meeting apps like Meetup and Eventbrite always need venues, and spaces like coworking labs, galleries, restaurants and community centers should step up to provide discounted or free access. Local media often promote events for community good as public service announcements.
Local media needs support too. They should leverage their main asset — reach into the community — to create new business models that supplement traditional advertising. Media can play a critical role in crowdfunding because it exposes campaigns massively to generate contributions. Local media should support the development of crowdfunding platforms for their community by partnering with white label crowdfunding solutions, providing agency services to develop campaigns, and getting compensated on a portion of funds raised. The community responds because media becomes actively involved in civic sustainability, and not simply pushing the tired ad sales pitch.
Patrick Kitano is CEO of BNN Funding, a crowdfunding marketing and strategy group that leverages The Breaking News Network — launched in 2009 and now the largest hyperlocal media network devoted to social good. He is reachable via Twitter (@pkitano).