An Open Letter To Chase About Their Big Charity Transparency Fail

Dear JP Morgan & Chase,

You've recently made waves in the social change community with your Chase Community Giving initiative, a $5 million Facebook giveaway contest. Unfortunately, you've also demonstrated some pretty bonehead anti-transparency tendencies which have hurt your brand with exactly the people you were supposed to be getting excited. Further, you've demonstrated a lack of understanding about how nonprofits really work. You've got an awesome opportunity to literally be the coolest contest there has ever been, but you've got some work to do.

First, lets be clear about your motivations for the $5 million giveaway. It is almost certainly true that your staff care about community involvement and giving something back. It is also almost certainly true that your marketing department and leadership determined that that caring, combined with the distribution power of the internet, could be great for brand building at a time when banks are somewhere between sour milk and sinus infections in the public eye. In short, Chase cares, and they *really* want us to know about it.

This is pretty much the way branding efforts around doing good happen. A genuine interest in doing good comes together with a genuine interest in the ability to sell the company as one that cares about good, and it happens. The key is making sure that the marketing actually reflects the company's practice - or perhaps the other way around.

You have committed two major boo-boos with potentially far ranging consequences for the success of your branding efforts. Both of them belie a problematic anti-transparency that just doesn't work in the digital world, and a fundamental lack of understanding of the real cost of nonprofit work.

Boo-Boo #1: No Leaderboard

The first mistake you made was that you didn't have a public leaderboard. The contest was all about getting the most votes, and your calculation was, I'm sure, that if groups knew their total but didn't know how their total compared to others, they would push harder and harder. To take it even farther, you actually took down individual charity's totals with a few days to go to "build excitement among the broadest number of participants."

Chase, I don't know if you're reading, but let me be clear about something:

This made you look like jerks.

Sorry, it had to be said. By not having a public leaderboard, you demonstrated your lack of understanding of the cost to nonprofits of a) the time it takes to ask people to do things for you and b) the social capital cost of asking for favors. Your lack of this one piece of transparency made groups go out on a limb to research their competition (which took an immense amount of time away from the good work that they do outside of their fundraising apparatus) and put them in the unenviable position of having to ask people to help without clear information about how likely that help was to actually achieve anything. All those groups that didn't win actually probably lost some good will.

The result in terms of your brand? You created a situation in which the nonprofits who were supposed to carry the good message of your brand found themselves apologizing profusely to their supporters for the lack of good information. This left them grumbling behind the scenes. You can bet that while groups participated, they did it grudgingly and because $25k was just too much to not go for, and that their feelings about you are not, at the end of this, very good.

Boo-Boo #2: Late Stage Disqualifications

The New York Times reported today that some groups are claiming that you disqualified them at the last minute because you decided that their missions didn't fit well with yours. The groups, some pro-Marijuana and some anti-abortion, claim that when you stopped making the tallies available a few days before the contest, they were comfortably in the top 100 vote getters. They claim that they've been "stonewalled" because you found their missions to be controversial.

So basically you managed to piss off probably the two most well organized groups on either side of the political spectrum. Niiiiice.

This one is harder to know the extent of your goof. It could be that these groups just genuinely didn't get enough votes to be in the top 100. It also could be that their claims are right, and you disqualified them because you didn't like their work.

Either way, you don't come out looking good. Because the reality is that unless you tell us one way or another, we can't know what the truth is. Your lack of transparency - in this case that you haven't released the final vote tallies - means that we any group can call foul. For all we know, you could have sifted through the top 150 groups and picked those who had missions you like to award.

If you *did* disqualify groups without notice and at the very end of it all, you've made an even bigger mistake. You may have legally indemnified yourself by putting in the terms and conditions that allowed you to disqualify whoever you want, whenever you want, for whatever reason you want, but contracts carry little currency in an internet that can separate what's right from legal rights.

So why does this all matter?

It matters because this is your BRAND, dudes. This is your cache, your currency, your good will, your social capital. This is the emotional aftertaste we all get when we think of you. You had the potential to build an incredible amount of social oomph with this contest. When it started, the nonprofits I knew were incredibly excited. I wrote incredibly positive things about you. Now, most of them think you're just one more system to game and me, well, I think it's pretty clear how I feel.

And by the way, keep this in mind. Brand matters for you perhaps more than any other type of institution. When it comes to banks today, cash rewards and all the other gimmicks you try to use to get the public to chose you instead of your competition matter not one iota compared to our trust in you. This transparency fail is at the end of the day a failure in the trust that you have to build, and its implications go beyond this contest.

Is there a ray of light? Sure, you've still got time to get these issues of transparency right in the second part of your contest. Hell, you could even apologize, open the vote totals, and basically act like a real community instead of just one more doesn't-get-it vestige of an antiquated 20th century organizational model. Like I said, you have the opportunity to be the coolest contest ever. So what comes next?

Let me be clear. Giving away $5 million to charities is awesome and Chase is to be commended for it. Using an online contest to allow crowds select the winners is a great way to approach it. These issues of transparency are part of the bargain, however, when you go down that route.

Maybe Pepsi, who won't be buying Super Bowl advertising this year, in part to pump those resources into their Pepsi Refresh campaign will learn from all of this?

Smooches,

Nathaniel

(Photo: Nima Badley)