II-05-02-Ramer-Interra 399-408

II-05-02-Ramer-Interra 399-408

The Interra Project: consumer dollars as collective goods

Jon Ramer¹

What kind of world do we want?

Along with other leaders of the social and environmental business movement, Greg Steltenpohl, founder of Odwalla Juices, and Dee Hock, founder of VISA International, share a deep concern about our dwindling natural resources, human-caused climate change, and resulting political and ecological consequences.

By harnessing consumer power, 70% of U.S. GDP, Greg, Dee, and other concerned leaders believe that we can make systemic change happen. Change that could:

• Stabilize the effects of climate change;

• Dramatically reduce human need for natural resources; and

• Restore our local and global communities.

To make this vision a reality, Greg and Dee have assembled a diverse team of social entrepreneurs with business and technical skills and proven track records to create Interra.

Our vision derives from four beliefs:

• Our consumer lifestyle is the driving force behind the growing destruction of social and ecological systems.

• Vibrant communities are created and organized by the citizens who live and participate in them.

• By influencing the economic choices people make, and harnessing that spending power, together, we can transform how business is conducted.

• Systemic change is needed. To enable it, we, at Interra, believe that a new model for social commerce is required. We call it “restorative commerce.”

In this model, business is transacted in a way that re-circulates sales proceeds within a community to benefit all of its stakeholders: citizens, nonprofits, businesses, and natural ecosystems. The force of increasingly empowered consumers drives the model; and the model attracts citizens by giving them substantial reason to participate, both for their personal benefit and that of their community.

The Interra model is based on a simple, purchasing-based platform that intelligently bundles open source technologies for community cooperation and empowerment. It works with any form of payment at the POS and online, promotes education and awareness of restorative options, drives community loyalty, and supports community causes—all with a simple swipe of a card or click of a mouse.

Consumer power: a vicious cycle can become virtuous

Americans lead the world in consumption, making the majority of their purchases from profit-driven multinational corporations focused almost solely on cost reductions, with little regard for people or the environment. Our current consumption patterns affect our health, economy, society, local communities, and our planet.

Generally, U.S. consumers do not connect their lifestyle choices with the destructive impact of their consumption. And because most alternative lifestyle products are not readily available, average consumers are not aware that they have the power to reverse these impacts.

At the same time a growing number of consumers—50 million in the U.S.²—are seeking products in every part of their lives that enable them to live their social and environmental values. Yet they live within a constant paradox: the need to make lifestyle choices based on time, convenience, availability, and economic constraints, and the desire to support their health and that of their surrounding community. Major corporate manufacturers and merchants like Ford, Nike, Toyota, and Whole Foods are capitalizing on this growing movement of conscious consumerism, as are numerous small, locally owned businesses.

What this movement has lacked is a way to cohesively tie together the civic, nonprofit, and business sectors in a way that makes conscious consumerism and responsible business easily accessible and a systemic part of everyday life.

Interra’s model resolves this issue for all stakeholders providing economic value to merchants and consumers alike for making choices that benefit communities and each other.

Building on a movement

Interra will build on the success of the LOHAS industry (Lifestyles of Health and Sustainability) fueled by its primary driver: 50 million people and the quickly growing consumer segment, the “Cultural Creatives.” Cultural Creatives are looking to live their social and environmental values in all of their daily decisions. LOHAS currently represents more than 1/3 of the U.S. adult population, who purchase $230 billion³ in restorative, community-friendly products and services.

The most important psychographic motivator for Cultural Creatives is health and well-being for their family, community, and planet, making them Interra’s core target.

Current vehicles for change are not enough to meet the needs and desires of Cultural Creatives nor the growing base of other concerned consumers. The public is increasingly dissatisfied with the ability of our institutions to solve the problems plaguing our society and environment. Non-profit organizations, social institutions, and governmental agencies can do good work, but are constrained by a lack of resources.

Introducing Interra

Interra provides the means for consumers to meet their needs, live their values, and benefit their communities―with the convenience and ease of using their existing payment instruments. Interra is a social benefit system that:

• Brings together the civic, nonprofit, and business sectors and enables them to leverage the power of the consumer dollar to reverse negative social and environmental trends;

• Simplifies restorative living by making alternatives easily available through an on-and off-line directory of local and national merchants;

• Rewards consumers for buying from restorative manufacturers and merchants;

• Donates dollars to local nonprofits and social service providers creating a reliable source of funding for nonprofits;

• Leverages existing payment card networks (which 88% of adults currently use), open social networking technologies, and loyalty program know-how; and

• Provides real-time feedback to consumers and communities about the difference their choices make, while sending a clear signal to the market by aggregating consumer data.

In sum: Interra provides the tools and incentives for consumers to vote with their dollars for a new kind of marketplace that supports local economies, community culture, and the environment. Through its fair share of transaction revenues Interra will be capable of self-funding as it scales its impact.

Interra’s target market

Interra’s market includes several segments of a community: consumers, local businesses and community alliances, nonprofits, and manufacturers of sustainable products, all of which benefit from Interra’s offering.

Consumers

Our consumer strategy has two parts:

1. Engage progressive consumers: Capture and fuel the growth of the LOHAS market by making it easier for like-minded consumers and companies to connect and engage in business.

2. Engage the mainstream: Provide the framework and tools for the growing number of community alliances forming around the world working to preserve their local economies and cultures.

Sustainable businesses and community alliances

Independent businesses are struggling for survival as the many “big box” retailers move into their communities with sophisticated CRM systems and lower prices. Forward-thinking community alliances are forming to support local businesses through customer loyalty and other community based programs.

However, these alliances need a complete set of tools for making these programs truly successful. Interra provides community alliances and sustainable businesses with an affordable back end system, locally issued Community Cards, online Interra Bot, and the community loyalty tools they need to fuel a vibrant economy and, in aggregate, give big box retailers a run for their money.

Interra will implement community loyalty programs at the point of sale and online with local and national merchants, promote those local businesses through a directory and social marketing campaign, and issue Community Cards to neighborhood residents.

As we scale, local businesses and community alliance programs will also feed into a national Interra meta-directory of locally-owned businesses that locals and travelers alike can easily find, support, and be rewarded by. A simple community based rating system will enable the best manufacturers and retailers to rise to the top and gain the most visibility.

Local and national nonprofits

Interra has relationships with many well-known national nonprofit brands that are eager to develop affinity card marketing programs —a great way for Interra to aggregate millions of consumers whose every purchase benefits their favorite nonprofit. Community alliances can also nominate local nonprofits to benefit from local consumers’ and visitors’ purchases as well as merchant donations.

Socially and environmentally-minded manufacturers

Interra will leverage and aggregate existing directories of like-minded businesses and products, providing broad market access for manufacturers and creating a powerful resource for consumers to find and support sustainable companies.

How Interra works

Interra’s primary interactions are with representatives of community alliances. We offer alliance partners a self-funding solution with two major deliverables:

1. Membership program and Community Cards and online Bot, which facilitates the rewards, donations, and criteria for merchants and beneficiaries

2. A community information commons that uses open source software which enable communities to create their own combination of content management, community mapping, social networking, “wikis”, directories, etc.

Interra has in place a template project plan to facilitate work with communities. The main areas of activity are: program design, merchant enrollment, card production and distribution, and community marketing. Each community program will be co-branded with Interra, but distinct. Program specifics will be decided locally and Interra will provide the common operating system that links the cards, online Bot and community programs together.

With new funding, Interra will rapidly roll out its offering to community alliances, merchants, consumers, and nonprofits. Below are some highlights of our plan.

For Interra cardholders we:

• Publish and provide access to a network of directory publishers and merchants so that as consumers travel from city to city, they can immediately localize themselves, finding like-minded merchants who also reward them for their patronage;

• Provide merchant location information and special offerings on their cell phones or PDAs;

• Provide a choice of local or national nonprofits to benefit from their purchases anywhere in the country as long as they use their Community Card at participating Interra merchants;

• Register their existing credit or debit cards in the Interra system, or apply for an Interra co-branded Visa or Mastercard, issued by a local bank, enabling them to reap additional rewards for the nonprofit of their choice;

• Provide third party ratings and reviews of businesses using criteria related to overall excellence, social values, environmental performance, and local ownership; and

• Provide real feedback on the local economic footprint and global impact of their purchases—e.g., how they have helped CO₂ levels drop, conserved resources, or enabled a school to be built.

For Interra merchants we:

• Increase access, visibility, and sales through community based marketing programs;

• Provide a direct connection to specifically targeted customers within the Interra network, to whom they can provide discounts, rebates, coupons and other incentives;

• Provide valuable market data on consumer trends, needs, and desires;

• Share state of the art tools and practices for rewarding customer loyalty; and

• Decrease costs through wholesale buying cooperatives.

Now is the time for Interra

The market is ready. With the release of Al Gore’s movie “An Inconvenient Truth” there are new opportunities for sustainable thinking to become mainstream. In addition to the over 50 million consumers already spending more than $230 billion on restorative goods and services, communities throughout the country have begun to organize alliances to preserve the vitality of their neighborhoods and local economies. Companies have demonstrated that they do respond to consumer demand for more responsible products and practices, and many have begun to redefine their own standards to increase differentiation. Interra can accelerate the process.

Local economies need the tools. By providing small businesses—many of whom lack customer attraction and retention tools—with a powerful, federated CRM (Customer Relationship Management) system, they can fuel customer loyalty, get valuable data to improve sales, and be recognized as part of an important movement. By helping to keep small businesses alive, Interra helps local communities preserve their economies and culture.

The technologies are proven and affordable. Use of electronic payment cards is nearly universal and still on the rise. Affinity cards have demonstrated that consumers are more likely to choose a card aligned with something they care about. Loyalty programs have demonstrated that consumers are motivated by incentives. Additionally, and perhaps more important, when companies deliver a blend of “soft benefits,” such as recognizing a customer’s preferences or creating a relationship, the experience feels more personalized and customers become increasingly loyal. Loyalty programs at HP, Rain Bird, Huggies, and many others serve as prime examples of the benefits to companies. Network technology has enabled many-to-many connections, and demonstrated the vast potential power in aggregating individual action. By leveraging these tools, Interra can build a movement like never before.

Progress to date

Interra is piloting programs in Boston, Puget Sound, and Vancouver and has identified additional programs to be launched in the next 12 months.

Current pilots include:

• The Boston Main Streets Boston Community Change Card.

• The Puget Sound Community Card.

• Roots of Change Fund.

• The Evolver Project.

• BALLE (Business Alliance for Local Living Economies):

• Berkman Center for Internet and Society at Harvard Law School:

To enable community implementation, Interra has established working relationships with a number of providers and partners, including:

• Nietech Payment Technology Company:

• The Institute for the Future, Howard Rheingold, and the Cooperation Future Commons:

• MediaVenture Collective

The potential impact is enormous.

How will Interra scale?

As more people wake up to the issues their communities face, the conscious consumer movement will continue to grow. We believe Interra has the ability to speed up the process, making it easier for mainstream citizens to take action and collectively make a difference in their communities and in the world.

Interra will scale quickly and naturally through:

• Partnerships.

• Self-organizing networks.

• Hybrid structures.

What will it take?

Ready to scale. Interra has learned from our pilot communities how to architect a versatile and robust social networking and transaction platform that supports specific community needs. It has selected vendors, established partnerships across the business and nonprofit worlds, and begun to build local teams.

Interra is seeking funding and has a business plan available for discussion. Donors that make leadership gifts in the launch round can also invest in the for-profit entities as they are created.

Imagine a world in which living standards are improving while we consume fewer resources, and citizens are engaged in furthering the health of our communities and global society.

Interra will help make it happen.

We hope you will join us.⁴