If Starbucks Won't Caribou Will

This was an easy one. Starbucks got into some Social Media heat this week when they pulled a promotion. Starbucks was offering a free ice coffee to friends and family via an email marketing campaign. As expected by all of us (but, apparently, not by Starbucks), the campaign went very viral to the point where people were offering up this free coupon for a minimal fee on eBay (and some counterfeit coupons were spotted as well). Starbucks pulled the free coffee campaign citing that it went beyond the intended audience.
What happened?
Starbucks realized that this may be one or two (thousand) more free ice coffees than the promotion had budgeted.
Caribou Coffee picked up on the news and offered to redeem the Starbucks coupons at their locations (on a set date and for a limited time frame).
Two top-level lessons were learned in this promotion and why it matters to marketers:
One, Caribou was able to get tons of free publicity and maybe even pick up a new customer or two (thousand) by leveraging a minimal PR campaign backed into a very powerful Social Media machine that would spread the story far and wide. I had never even heard of Caribou Coffee until this story broke. Now, look at me, here I am evangelizing them.
Two, Starbucks, like Agency.com, Chevy Tahoe and many others before them, underestimated the power of Social Media (which is strange considering that Starbucks is are about to unleash their Podcast, Coffee Conversations). Here was a great opportunity for Starbucks to live their brand. Starbucks is all about community, conversation and affordable luxury. Within that scope they could have let their customers know their intentions and created an adjunct campaign that would not have steered the publicity towards Caribou and turned the online world against them.
The implications are simple. If you are going to run a campaign, be prepared for it to be highly viral and be prepared for the Social Media folks to run with it. The trick is in being able to deal with the results – positive or negative. I’m still having a hard time seeing why Starbucks thought that all of these counterfeit and eBay coupons were a “problem”? Any one of us would kill for that kind of viral success.
What we continue to see is that the bigger the company is, the bigger the brand is, the harder it is for them to deal with something that is highly viral and talked about by many.
Why is that?
Companies are used to having a one-to-many conversation (like buying media on a CPM – cost per thousand basis), so when they have to turn and deal with a one-to-one conversation (viral is spread by one person to another, and Blogs are one person writing to a smallish segment), the wires get crossed and the end result is this:
Big Company speaking like it’s a one-to-many conversation to individuals who thought it was a one-to-one conversation. Visual aid: imagine speaking to your spouse on a stage through a microphone and sound system. With or without an audience, it’s not very romantic.
(Special thanks to C.C. Chapman of Managing The Gray for the tip).