Thursday, July 05, 2007

"Obama's Viral Marketing Campaign"

As eye-popping as Barack Obama's second-quarter fund-raising total was--it raked in $31 million for his campaign for the 2008 Democratic nomination, beating even the much vaunted Clinton money machine by better than $10 million in funds for the primary race--what really has the political classes chattering is another figure Obama reported: 258,000. That's the number of people his campaign says have already donated to him, and it amounts to more than a doubling of his fund-raising base in the past three months. "He's got a much more viral campaign than we do," says an envious Hillary Clinton strategist, using a term for word-of-mouth advertising and marketing techniques. "He's got a real buzz about him."
It's a buzz that Obama is finding new and creative ways to fuel, adapting to a world in which the concept of community has grown to include MySpace and Facebook. No campaign has been more aggressive in tapping into social networks and leveraging the financial power of hundreds of thousands of small donors. Nor has any other campaign found such innovative ways to extend its reach by using the Internet--more than $10 million of Obama's second-quarter contributions were made online, and 90% of them were in increments of $100 or less.

The advantages of Internet fund raising are many. It's quick, cheap and far less intimidating for political novices than writing a big check. Some campaigns have set up systems by which donors can have their credit cards billed automatically in easy-to-budget monthly amounts of as little as $20. "We're seeing the full flowering of the Internet for fund raising for presidential races," says former Federal Election Commission chairman Michael Toner, who is currently advising Republican Fred Thompson as he ponders whether to enter the fray.

In 2000, George W. Bush revolutionized campaign fund raising--and shattered existing records--by creating a muscular network of "bundlers," each of whom committed to bring in $100,000, $200,000 or more from friends and associates. But while Bush's bundlers, whom he designated Pioneers and Rangers, were high-powered CEOs and lobbyists, Obama's bundlers include such unlikely political players as Andrew Nicholas, who tutors refugee students at Denver's South High School; Emily Stanton, a stay-at-home mom in Baltimore; and Jeff Larson, a software engineer in Chicago. They are among the 9,500 volunteers, says the campaign, who have signed up to solicit their friends and families by hosting individual fund-raising Web pages for Obama.

By the traditional standards of big-league presidential politics, the bundlers' individual efforts may look like pocket change. Nicholas has raised $1,276 for Obama by inviting people to give according to their height--10 bucks a foot, then a dollar an inch. His friends have forwarded his e-mails to their friends, which explains why half the 14 people who have given through his site are people Nicholas has never met. Many are giving more than he asked for--either that, or his donors are 7 1/2 ft. tall. Stanton has raised $744 from 18 people by tying her fund raising to her efforts to train for her first marathon, an idea that came to her while she was at the gym. As for Larson, he says, "I'm too timid" to ask more than seven of his closest friends--though so far only one of them has said no, and Larson has $580 toward his goal of raising $1,000.

But the point of viral fund raising isn't just to drive up dollar totals. Campaigns are hoping that the personal approach will yield donors who feel more personally connected to a candidate--and who can later be converted into door knockers and phone bankers. And while big donors often contribute up front the maximum $4,600 allowed under the law ($2,300 apiece for the primary and general elections), smaller contributors can be tapped again, creating an ongoing relationship. "You can't look at it as a moment in time," Obama campaign manager David Plouffe says of the modest donations. "It's an investment."

That's one reason why Obama is appearing at dozens of low-dollar campaign events around the country, such as a $25-a-head rally in Minneapolis on June 29, which has sold 3,000 tickets. He has held an online raffle in which those who gave at least $5 could win a chance to be part of a dinner for five with Obama. Other candidates are now beginning to focus more on small donors and new ways of reaching them. Clinton made her first foray into viral fund raising a few weeks ago with the launch of Club 44, which seeks to build low-dollar fund-raising networks of young women excited at the prospect that the 44th President may be the first female one. John Edwards, who claims that his fund-raising list numbers about 100,000, has been holding "Small Change for Big Change" events around the country, with tickets selling for as little as $15. He routinely whips out his cell phone at campaign rallies and asks people to punch in a short code, along with the word today. "Gotcha," he declares, as the campaign harvests more cell-phone numbers to add to its text-messaging network. A few weeks ago, his campaign sent out a fund-raising appeal via text message to the 13,000 phone numbers he had captured that way, and raised thousands, says Edwards strategist Joe Trippi.

And then there's YouTube. Last month Trippi made an embarrassingly awkward video with fellow Edwards adviser Jonathan Prince, in which the two attempted to make the candidate's favorite pecan pie. They offered to share the recipe (courtesy of Edwards' mother) in return for a minimum donation of $6.10; the appeal brought in nearly $300,000 in a week, Trippi says. All it cost was the $20 or so it took to buy the pie ingredients, which made it a highly efficient way to raise money. By comparison, Trippi says, a direct-mail solicitation can easily run into hundreds of thousands of dollars once a campaign has paid for the cost of buying a mailing list, high-quality paper stock, personalized laser printing and postage.

But Trippi knows better than most that while the Internet is uniquely suited to the kind of energy that surrounds an insurgent campaign, a giant splash in cyberspace can turn out to be little more than a ripple against the big interest groups and institutions that surround an Establishment favorite. In 2004, Trippi managed former Vermont Governor Howard Dean's campaign when it too was shattering fund-raising records, only to come crashing to the ground in the Iowa caucuses. While the hundreds of thousands of small donors who are jumping aboard campaigns like Obama's and Edwards' are impressive, Trippi says, "it's a small number in a country of 300 million, and a ridiculously small number compared to the number of adults who will be voting for President." Still, he adds, all that energy--with the leading Democratic candidates raising money at a pace much brisker than that of the Republican contenders--is not likely to be lost, no matter who gets the nomination. "If 200,000 people are willing to give $15 now," he says, "they're likely to give $100 when the opponent is a Republican."



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