The Pepsi Refresh contest so far has awarded $20 million in grants for creative charitable ideas.
The Pepsi Refresh contest so far has awarded $20 million in grants for creative charitable ideas. Casey Rodgers/AP
If you watched last year's Super Bowl, you might have noticed that, for the first time in 23 years, there was no Pepsi commercial.
Instead, the company decided to take the $20 million it would have spent on advertising and start an online contest to fund creative charitable ideas.
The Pepsi Refresh contest has been a big hit so far — giving money to hundreds of projects, like providing prom clothes for disadvantaged youth and building playgrounds. So the company is extending it for another year. But it's also changing the rules to address complaints that some competitors were a little too creative trying to round up votes.
Kris Horlacher is with Shoes for the Shoeless, a small charity in Dayton, Ohio, which buys shoes and socks for needy children. Her group entered the contest last December to compete for one of the $50,000 grants awarded each month. Much to her glee, Shoes for the Shoeless came from behind and beat out hundreds of other contestants.
"We just won by the sheer numbers of regular people in Dayton, Ohio, who voted," says Horlacher. "Our college campuses voted for us. Our high schools voted for us. We were on our local paper every week. We were on our local TV stations. We were on our local radio stations."
She says it was a huge community effort. But Shoes for the Shoeless also got some help. Horlacher says that as her group moved up in the voting, she was approached by some other children's charities in the contest about joining them in a voting bloc. Since the contest allows anyone to vote for up to 10 projects a day, the groups said they'd have their supporters vote for her project, if her supporters would vote for theirs. It's something lots of contestants have done.
Horlacher was leery at first, but since it wasn't against the rules, she eventually decided to go along.
"If you're going to vote 10 times, you might as well vote for other people with like-minded projects," she says. "So I don't know that I see anything wrong with it. But on the other hand, I had an uneasy feeling about it."
Allison Fine, author of the book The Networked Nonprofit, says it makes sense that groups will do what they can to maximize their chances.
"All contests like this are going to have a game of whack-a-mole between the sponsors and people who want to game the system," Fine says.
But some losers have complained, especially about one of the biggest voting blocs, the Progressive Slate, which has won almost $1.7 million so far for about 34 left-leaning groups.
Still, Fine thinks Pepsi has done a good job of keeping things under control.
"And they've been very straightforward. If a problem has been raised, they've investigated it," she says. "And certainly with the case of the Mr. Magic problem, they've rectified it."
The Mr. Magic problem, as she calls it, involved one contestant who was disqualified for allegedly using a paid service run by someone in India, known as Mr. Magic, to help generate votes.
Pepsi says it audits all the winning tallies but that it will now do more. Marketing Director Ana Maria Irazabal says when the contest resumes in April, there will no longer be a $250,000 prize category, the largest offered. The huge amount attracted "big national organizations that the majority of time muscled out the little guy," she says. "And we want to make sure that we're there for the little guy to really refresh America one community at a time."
Instead, Irazabal says, this year the contest will give out twice as many smaller awards. There will be about 60 a month, ranging from $5,000 to $50,000. The company will also limit people to only five votes a day and make other changes to keep the focus on helping the best local projects.
Irazabal admits they also hope it will help Pepsi's bottom line. "The idea is doing well by doing good," she says.
Pepsi sales have dropped over the past year, but Irazabal says the company is looking at the long term. She says the company wouldn't be extending the contest if it didn't think it was helping the Pepsi brand along with hundreds of worthy causes.