Two months ago, Portland, Oregon-based Jama Software -- the makers of a web-based project management app called Contour -- began a program called "You try. We give." The idea was simple, for everyone who signed up for a free trial of Contour, the company would set aside some money to invest in microloans at Kiva. In theory, word of their philanthropy would help spread their product and more people would sign up to try it out, get hooked, and pay for the full version. Today, Jama made a bold decision: stop advertising on Google AdWords, and instead funnel the money from their advertising budget into Kiva.
According to Jama, the average cost-per-click and cost-per-lead for Google AdWords -- which was eating up 80% of their monthly marketing budget -- was 2-3x their target despite their best optimization efforts. So in short, Google wasn't providing the ROI they were after.
"So, we had an idea. We had been sponsoring Kiva.org for the past few months as an organization we really admire and believe in - they're the online micro-lending site that helps entrepreneurs in the developing world. And, we wanted to figure out a way to funnel the dollars we were sending to Google ads over to Kiva loans," wrote Jama's Director of Customer Outreach & Marketing, John Simpson in a blog post today.
The idea is the same as the original "You try. We give." program. Jama is hoping that press coverage of their unusual marketing plan (such as this), as well as word of mouth, will send as much traffic -- perhaps higher quality traffic -- as Google AdWords. And because Kiva loans are theoretically repaid (currently 97.97% of the time), any traffic Jama receives via this experiment is bound to end up being a lot cheaper, and perhaps even free.
"In the pursuit of growing our own business, we decided we'd much rather help a small store owner in Uganda feed her village than support the Google billionaires' hobby of flying to space," said Eric Winquist, CEO and founder of Jama Software in an emailed press release. Simpson told us he's excited to see if innovative social marketing tactics can out perform traditional search marketing.
"This program just gives people an added incentive to try our product versus the traditional enterprise tools from IBM and Telelogic, or to pass it along to a colleague or friend," Simpson told ReadWriteWeb in an email. "We're going up against 'the institutional big blue' so we differentiate ourselves by being a company with personality and more of a personal touch - we could never outspend them. The Kiva programs serves as a positive first impression and it illustrates our commitment as a company to giving back, whether big or small."
According to Simpson, eventually Jama might supplement their social public relations strategy with more traditional ad buys from Google or elsewhere. Once loans start being repaid, Jama could theoretically put last month's ad budget toward traditional advertising while this month's ad budget is being used to fund a microloan in the developing world.
Kiva co-founder and chief marketing officer Jessica Jackley Flannery was overjoyed by Jama's decision to choose Kiva over AdWords. "We're thrilled when a company like Jama Software develops an innovative program that supports both our global mission at Kiva and their own goals. It's such a simple concept, but that's the beauty of it," she said. We tend to agree, and we wish Jama the best in their efforts, and luck to anyone who receives loans via Kiva.
Comments
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I love 'enlightened self-interest.' I wonder if Jama would consider helping people in their own poverty-striken state of Oregon as well? LCC in Eugene has (at least had) a domestic microlending program.
Posted by: Curt | June 17, 2008 6:55 PM
I started donating in Kiva, they send updates through out. I gave a short loan and it was returned very quickly. Sometimes we give money to charities, we don't know where it goes, whereas with Kiva it is very direct and you can see who you are helping. Great concept, one of the best charities in the US.
Posted by: Chris | June 17, 2008 6:59 PM
In fact, here's the mission statement from the Oregon Microenterprise Network. (http://www.oregon-microbiz.org/aboutOMEN.cfm)
"The Oregon Microenterprise Network (OMEN) is a statewide association of microenterprise development programs and their supporters. These programs provide training, lending and other enterprise opportunities to entrepreneurs with limited access to economic resources."
Oregonians may not be as picturesque as microentrepreneurs in distant climes, but they work as hard and need the money as bad. I think our poverty level in Oregon is 12% if I remember correctly and almost 30% of our people are below 200% of poverty level (which, by any common defense, is poverty).
Posted by: Curt | June 17, 2008 7:02 PM
Thanks for the link Curt, we agree that Oregon is in need of more good microlending programs as well as other places in the world. I've heard that Mercy Corps (here in Portland) is working on expanding their program locally as well.
Posted by: Eric | June 17, 2008 9:13 PM
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Posted by: Email Marketing Software | June 18, 2008 12:13 AM
Kudos to them. I hope more companies think of innovative ways to help people in developing countries.
Posted by: web design company | June 18, 2008 5:45 AM
Guerilla marketing meets cause related marketing. I think it's a great idea. Relevant to this post is a project launched this past April when Kiva announced a unique partnership with Advanta Bank called the KivaB4B Project. Basically, it empowers business owners to double the impact of their Kiva loans. When the lender uses an Advanta busines card, (or the new KivaB4B card), on Kiva, Advanta matches the loan up to $200/month. They also make a donation to Kiva for every new card activated. (www.kivab4b.org)
Posted by: Erick B | June 18, 2008 10:09 PM
This is a great concept, and one that EditMe has been involved with for almost a year now. EditMe puts a portion of deferred revenue from customer prepayments towards Kiva loans. Sure, we could invest this money and earn interest on it, but the benefits of putting it into Kiva loans has been significant, both to EditMe and to the many recipients of our loans.
Posted by: Matt W | June 19, 2008 5:45 AM
That's awesome! A lot of businesses are becoming huge Kiva supporters and changing the world, like Snak:
http://www.kiva.org/lender/Snak
Posted by: S | June 19, 2008 11:56 AM