EFFECT[ive] Marketing…Connecting Real-Life Businesses with their Online Market

A (one-time) major player in the (pre-big-box) midwestern retail grocery industry, Marsh Supermarkets last week launched their very first viral marketing campaign with a $10 coupon for their Facebook fans. It crashed and burned. Badly. What went wrong?

Marsh Supermarkets, based in Indianapolis, Indiana, has a Facebook page with about 3,300 fans. Last week, when they had about 3,100 fans, Marsh posted a message on their wall offering a $10 in-store coupon to their Facebook fans, old and new alike. The offer was posted for one day, only on their Facebook page, and linked to a printable coupon.

What happened? Their fans responded to the offer. Boy, did they ever.

But they didn’t just print the coupon for themselves; many of them forwarded the link to their friends, who forwarded it to their friends, and so on, and so on. No numbers have been released, but it’s probably safe to guess that, on the very low end, more than 10,000 coupons were printed. Sound like a successful viral campaign? I’d say so. Those coupons represent a whole lot of bodies through the doors of Marsh’s stores, each ready to spend money. And nowadays, going head to head with WalMart, SuperTarget and Meijer (an aggressive midwestern big-box chain), Marsh could surely use that money.

So how did Marsh respond? The offer ended on schedule on July 29th. But on July 31st, Marsh panicked. They posted a note on their Facebook page that said, in part:

“Unfortunately this offer has been widely distributed in an unauthorized manner throughout our marketing area. Due to the vast numbers of inappropriately transmitted and replicated copies of this offer, we will no longer be able to accept these coupons in our stores.”

(To their credit, they did include an apology.)

Unauthorized? Inappropriately? It’s the Web. You put up an easily replicable coupon, people are going to jump on it. Times are tough, and people need groceries.

But apparently, it never entered the collective mind of Marsh’s marketing department that people receiving a coupon offer on the Web might not want to hoard it.

The Web is a social medium.

People find things they like, they share them. That’s really not news where I come from (and I come from literally just down the road from Marsh’s corporate headquarters).

[As an aside, I'm currently reading (and enjoying, and learning a tremendous amount from) David Meerman Scott's new "World Wide Rave," which directly and comprehensively addresses viral marketing. I wholeheartedly recommend the book and Scott's blog to anyone considering the jump into online marketing (but most of all to Marsh's marketing department).]

So what went wrong? Did Marsh fail to prepare properly for the promotion? Should they, as many commenters on their Facebook wall and on the Indianapolis Star/News website’s story on the debacle have noted, have prepared better? Without a doubt. A little homework on viral marketing (like reading a good book) wouldn’t have killed them.

But I’d say the real problem with the promotion was that Marsh was utterly unprepared for its success. They apparently thought the math was simple. They’d give up about $31,000 in coupon discounts. That number, for them, had value. That is, they had to believe that redeeming $31,000 in coupons would bring in more than that much in sales. Otherwise, the promotion would never have made it past the bean-counters.

So my question is, if the promotion was expected to yield a positive return for Marsh at the $31,000 mark, what changed at the $100,000, or $250,000, or $500,000 mark? Were the rest of those people expected to walk the aisles with coupon in hand, searching for an item that cost exactly ten dollars? Not likely.

More coupons meant more people in their stores. More people in their stores meant more sales.

But here’s the worst part: Marsh has for years offered a “Marsh Fresh Idea Card” that, like any such store card, has personal information attached to it. Does the technology not exist to tie the use of the coupon to the customer’s card to prevent multiple redemptions? It seems unlikely. And doing so would have motivated coupon-holders who didn’t already have a Fresh Idea to obtain one. Seems like a win-win-win for Marsh. More traffic, more sales, more customer information in their database.

In the end, though, Marsh took a wildly successful “World Wide Rave” and, instead of riding it out and reaping the rewards, deliberately turned it into a crushing customer relations failure. Marsh ended up with a bad taste in their mouth for online promotions, which is tragic, and with tens of thousands of local customers, potential customers and former customers who are furious with the chain – which is beyond tragic. For a company teetering in Marsh’s position, it could just be fatal.