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Donation Discounts – Putting Charity and Giving Back in the Palm of Your Hand

Retail businesses have often used discounts to entice customers to purchase goods. The same is true for many other sectors of commerce that range from restaurants to ride-shares. By giving consumers something at a lower cost, they usually see the offer as being higher value. That’s why any discount tends to attract customers and increase sales. And if enough customers are convinced, then the company will have a better bottom line, making the discount worthwhile. At the end of the day, it’s all about math and whether a shift in purchasing volume justifies the discount provided. From this perspective, many companies offer discounts periodically to boost their products and services.

But offering goods at lower prices have some pretty serious negatives. For one, discounts tend to weaken brand image. When an item is offered at lower prices often enough, customers may begin to see a brand as lower quality. Discounts also change consumer expectations over time, persuading them that the regular price is actually too high. For these reasons, companies are beginning to adopt new approaches that match price reductions with charity and giving. Termed “donation discounts,” businesses are finding these can be a great way to drive traffic to their goods. And there’s a few companies that are making it easier than ever to achieve this.

“Discounting is a well-worn marketing muscle, but it’s detrimental to the brand, margins and customer expectations.” – TJ Mahony, Partner at Accomplice

Charity and Giving Back Platforms

Donation discounts have been around for some time as well. Many companies have leveraged charity and giving back in an effort to increase customer appeal. Toms, the shoe company, donates a third of its profits toward needy causes. Warby Parker, maker of eyeglasses, donates a pair of glasses to someone in need for every pair sold. But the increase in donation discounts today is more about e-commerce, especially since the pandemic. During the first half of 2020, charitable donations increased over 7 percent. Thus, creating opportunities for charity and giving back online seems like a great situation for e-commerce sites.

Givz was founded in 2017 with this exact concept in mind. The New York startup only employs 8 individuals, but it’s been making quite the impact since its launch. In fact, the company just received $3 million in seed funding from a number of investors. A big reason for this has been Givz’s growth over the last year. In making a shift from B2C to B2B, the company enabled donation discounts to over 1,100 charities. This resulted in a grand total of over $1 million in customer donations, with the vast majority being small ones. By making it easy for customers to give their discounts to their charity of choice, both companies and consumers win. And of course, Givz also benefits along the way.

“We are creating a new marketing category and generating the largest sustainable charitable giving platform in the process… I believe that using personalized donations to incentivize consumer behavior has endless application across industries, verticals and continents.” –  Andrew Forman, CEO and Founder, Givz

The Appeal of Donation Discounts

Everyone appreciates attaining something they need or want at a lower price. But when a discount can be donated to a charitable cause, it has additional social value. The positive feelings that charity and giving back generates may be intangible, but they’re certainly real.  When companies are able to provide us with these types of opportunities, we also tend to value them more. This naturally boosts brand loyalty and social responsibility image. (Read more about the social responsibilities businesses should shoulder to transform society in this Bold story.) And in many instances, persuade us to make a purchase we might not otherwise make. This is why donation discounts are quickly replacing traditional discounts in many company’s marketing efforts.

Someone making the world a better place via an app
Thanks to a few new apps, charity and giving back is now something that fits in the palm of your hand.

For some companies, leveraging donation discounts to increase sales have been quite rewarding. Tervis, for example, offered to donate $15 to any charity of choice for every $50 consumers spent. This strategy resulted in a 20% increase in website sales conversions and a 17% increase in average order values. But research shows that a bigger discount for donation does not always result in more consumer purchases. Smaller donation discounts tend to promote the greatest amount of charity and giving back. Because smaller discounts have a greater impact of positive self-image, these tend to drive more sales. Larger discounts, because they’re seen more as company donations, are less likely to be as appealing to the average customer.

“We believe Givz’s donation-driven marketing platform offers brands the best way to attract the socially conscious consumer while elevating their brand, moving more inventory and driving increased order value rather than simplistic traditional discounting.” – Vic Singh, Partner at Eniac

Streamlining Charity and Giving Back Online

For several years, online charity funding sites have become increasingly popular. Crowdfunding platforms for nonprofits like Fundly, Salsa, and Bonfire attract many organizations and customers each year. But newer platforms that enable donation discounts broaden this potential to every possible online transaction. This is certainly true as the Come-to-Me Economy expands. (Read more about the Come-to-Me Economy and its impact on the world in this Bold story.) For example, Givz plans to focus on expanding its growth through Shopify retailers, which now total over 1.7 million. If successful, charity and giving back could become a routine marketing approach for the vast majority of e-commerce sites. Social responsibility would simply become the norm that consumers come to expect.

Certainly, the retail sector will be among the first to feel the effects of donation discounts and related trends. In fact, most online companies are already trying to leverage charity and giving back to increase sales and reputation. But soon, expect to see donation discounts in many other industries. Givz specifically is hoping to branch out into the restaurant industry and gaming sectors in the future. The bottom line is that charity and giving back are inherently appealing to consumers. And when they control which charities receive their donation discounts, they’re increasingly likely to regularly patronize a company. Platforms like Givz simply streamline the process, placing charity and giving back in the palm of consumers’ hands.

 

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Flying Taxis of the Future: Ready for Takeoff!

For urban environments, there are a number of struggles that represent modern challenges. Many highly populated areas suffer from frequent traffic congestion with constant highway gridlock. Most also are trying to reduce greenhouse gas emissions in an effort to combat climate change. And noise pollution, as well as air pollution, reflect a less pressing, but still concerning, problem. Imagine if a single technology could help city planners address all of these issues at once. Flying taxis of the future could be precisely that technology, and many innovative companies want to make that a reality.

Believe it or not, this reality might not be that far off into the future. Many competing firms anticipate having these offerings available to the public as early as 2023. One flying taxi company is actually moving forward with its concept in Brazil currently. While regulatory obstacles pose the greatest threat, recent progress suggests these may not be that concerning. But there’s tremendous competition in the field, and each flying taxi company believes their design and plan are the best. The following therefore offers an update on flying taxis of the future and which company might have the best advantage.

“We’ve laid out a plan for what we’re going to execute on over the coming years. We need to build credibility by delivering.” – JoeBen Bevirt. Founder and CEO, Joby

Recent Developments in the Industry

The proper term for flying taxis of the future are electric vertical takeoff and landing vehicles, or EVTOLs for short. Each flying taxi company, however, has their own version of their EVTOL, differing in range, speed, weight, etc. Despite this, all are electric, at least in part, with some being hybrid with a small gas-powered engine. Likewise, all have significantly reduced noise levels, even compared to a helicopter or small plane. And each flies at low altitudes with the hope of offering a new option for urban ride-sharing. These are the features of each that makes them so attractive, particularly for urban settings.

These represent the key developments in the industry from a technology side of things. But from a financing perspective, there have been some notable trends as well. The most notable has been the emergence of special purpose acquisition companies or SPACs. These are essential “blank-check” investment firms created for the sole purpose of advancing a startup in a promising area. In many instances, these startups may not even have a product on the market yet or enjoy any revenues at all. But SPACs not only provide funding, but they can allow them to go public faster via a reverse merger. This has been quite common in the last few years within the EVTOL sector.

“[Our EVTOL’s] full authority fly by wire system, the computer is flying the aircraft and the pilot is telling the computer what his or her desires are in terms of the trajectory of the aircraft. You can layer on autonomy system.” – Ben Tigner, CEO at Overair

The Top Flying taxi Company Contenders

Despite what would seem a relatively niche industry, there are a remarkable number of firms jockeying for position. Each flying taxi company has features that make them attractive and all are efficient and quiet. (Read more about blade-less air taxis in this Bold story.) And it’s hard to predict at this point which will provide the majority of the flying taxis of the future. Regardless, the following are some of these firms that are most likely to have staying power in the years to come.

  • Overair – Based in Santa Anna, California, Overair plans to begin test flying its Butterfly EVTOL next year. The flying taxi company expects to be operating with FAA approval in the U.S. and South Korea by 2025. Its Butterfly weighs roughly 1,100 pounds, has 5 seats, and can travel at 200 mph with a range of 100 miles. More interestingly, it has no carbon emissions, is designed for harsh weather resistance, and is predominantly autonomous.
  • Joby – This flying taxi company might be the frontrunner for the future taxis of the future. It recently went public via a reverse merger with Reinvent Technology Partners. Its EVTOL also has 5 seats, can travel 150 miles on a single charge, and boasts 6 quiet rotors. Joby has tremendous backing, including majority share holder Toyota Motors, and receive notable capital with its public offering. It plans to advance manufacturing and regulatory approvals by 2023 with ride-sharing operations by 2024. It also already has a contract with the U.S. Air Force for testing its models.
  • Archer Aviation – This flying taxi company is also based in California and joined with SPAC Atlas Crest Investment Corporation. Its EVTOL can travel up to 60 mph with a range of 150 miles. The company anticipates being one of the active flying taxis of the future by 2024. In fact, despite an aircraft cost of $5 million, United Airlines has already place a $1.1 billion order with Archer. Therefore, it too is expected to be a flying taxi company with some clout in the years to come.
  • Lilium – Based in Germany, Lilium is already making moves to be one of the major flying taxis of the future. It recently merged with Qell Acquisition Group with an expected EVTOL network for commercial use by 2025. It has also partnered with Brazilian airline company Azul, which will acquire 220 EVTOL from Lilium. Its aircraft can travel 155 miles in range at a speed of 175 mph.

 

“[Electric air taxi] backers focus on operating costs because they look great. As with [very light jets] (and light helicopters), seat per mile costs aren’t much more than with a nice car. Capital costs are the real problem.” – Richard Aboulafia, VP of Analysis, The Teal Group

A CEO bragging about his flying taxi company
Depending on the flying taxi company, different urban areas are very close to having airborne transportation available.

Mixing in a Dose of Reality

As is evident, each flying taxi company has rather optimistic predictions for their year of commercial operation. Likewise, some like Joby anticipate widespread adoption of these flying taxis of the future rapidly. In reality, neither are likely, especially with federal aviation reviews that could add weight and safety measures to EVTOL designs. Certainly, the technology offers many advantages for urban environments. But the price tag of each aircraft makes routine use less likely in the near future until capital costs drop. Flying taxis of the future will eventually come, but hailing one outside your door isn’t likely to happen by 2025. But how cool will it be when this indeed becomes a reality.

 

The official Bold Business survey results are clear: most favor work-from-home over going back to the office. Read more in this important Bold story!