Girl Scout move shows Visa at its craftiest

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A credit card with EMV (for Europay, MasterCard and Visa) chip security.

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Visa's Girl Scouts program is about many things, not the least of which is converting one of the last bastions of cash sales.

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When Visa and Dell this month agreed to invest $3 million in a program to upgrade the e-commerce capabilities of the Girl Scouts, it was a concrete glimpse into the marketing minds at Visa.

Although a healthy chunk of credit certainly deserves to go to Dell — it created an app for the site and "Dell hopes to supply nearly 4,000 girls from underprivileged communities with laptops and tablets" — the more interesting story here belongs to Visa.

That is because this move has a lot more strategic goals than merely being associated with a friendly brand. Consider what Visa gets:

  • Get 'em Young. Visa here is taking a lesson from early Apple, whose strategy for taking over corporate America's IT hearts and souls was to give away lots of free hardware and software to university computer programs. The plan was that once those computer science majors got trained on — and fell in love with — Apple systems, that's what they would insist on when they graduated and joined corporate IT teams. Although that plan failed for Apple in its first iteration — Macs never became corporate IT darlings, beyond art departments and Web designers — the idea was still powerful.
  • A Family Affair. Not only is this effort going to make lots of Girl Scouts — who will be, if they're not already, avid e-commerce aficionados — think kindly of Visa, but so will their relatives and neighbors and anyone else accosted with a demand to buy a dozen boxes of Thin Mints from someone far more adorable than anyone working for Visa.
  •  Girl Scout Cookie Sales One of the Last Cash Holdouts. This may be the most powerful part of this program. This is certainly billed as an online effort and it works well there. But the Girl Scouts' e-commerce move is relatively new and today accounts for a smidgen more than 1% of all Girl Scout cookie sales.  That remaining almost 99%? Door-to-door and those dreaded moments when an order sheet gets pulled out at an extended family get-together.

And the vast majority of those physical sales are cash-based. The single most profitable move that Visa — or any card brand, including MasterCard, American Express, Discover, Diner's Club, JCB, etc. — can do is convert a cash sale into a payment card sale. Heck, even if that initial sale goes to MasterCard, Visa correctly theorizes that it could always win that sale down the road. It's far easier to convert a MasterCard sale to a Visa sale than to convert a cash sale to a Visa sale.

Why? The biggest challenge here is causing a behavioral change, something that American consumers are truly reluctant to do. But if payment cards become effortlessly integrated with Girl Scout cookie sales, behavioral change shall happen. And once those shoppers go digital, it will be very unlikely that they'll go back.

Suddenly, cash sales — which deliver no card processing fees, a.k.a. interchange — morph into payment card charges. And if it's all done as part of a mobile app, all the better.

Envision receiving an email with a link from a Girl Scout relative: Just download this app and select me as your preferred sales contact and then your purchases can become a 10-second chore, with one finger scan.

But what about those interchange fees? Why would the Girl Scouts be willing to give up part of their profits to encourage digital purchases? My guess is that they won't have to: Visa and it's partners will spend the future profits with this campaign and will gleefully waive (or otherwise absorb) such fees.

As payment card firms try and figure out how to be a major presence in the digital world of 2016, they have hits and misses. For a miss, consider MasterCard's move last week, as it tried to integrate itself into new Samsung refrigerators. Talk about missed opportunities.

At least Visa seems to have figured it out with the Girl Scouts. It's e-commerce people may end up finding far less value in tracking cookies than Caramel deLites Samoa cookies.

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