So, here we are in Part 2 of this case study in irregular competition, a case study that focuses on Change.org. If you haven’t read Part 1 and you wish to do so before proceeding on with this second part, then please click here to go to “Change.org Is a Formidable Irregular Competitor – Part 1.”

In Part 1, we left off with the Findings, Corporate Status. In today’s post we’ll pick up with the research findings and take a look at some of the web traffic factors of Change.org.

Findings

Traffic

Change.org is no slouch when it comes to attracting traffic on the Internet. Let’s see what Alexa.com, one of the major Internet traffic trackers and a unit of Amazon.com, says about Change.org.

Alexa.com

Per Alexa.com, accessed on January 29, 2010, based on traffic Change.org was ranked as the 16,464th most popular site on the Internet. You can check their ranking today by clicking here. Now, this ranking of 16,464 might not seem very impressive at first blush. But, I can tell you that this level of traffic ranking is very impressive. Here’s why.

Alexa.com tracks approximately 20 million websites. Number 20 million would be the least trafficked website that Alexa.com tracks, while number 1 would be the most popular. (On the date that I checked this, Google.com was the number 1 site.) This ranking of 16,464th is a global ranking. Alexa.com showed that the ranking for United States traffic is 4,350. This is especially important since most of the social issues with which Change.org deals are American issues. With Change.org being the 4,350th most popular website in the United States, it’s plain to see that many Americans are receiving the Change.org message.

Okay, traffic rankings are fine. But what do these rankings translate to in terms of the numbers of visitors that actually go to the site? Alexa.com doesn’t provide much in terms of identifying actual numbers, but Compete.com does. So, let’s go over there.

Compete.com

On the same date as shown above, I went over to Compete.com to learn about Change.org’s traffic level. You can take a look at the current Change.org status by clicking here. On the date that I examined it, Compete.com showed that in 2009 Change.org averaged around 300,000 unique visitors per month. Check the Compete.com graph below, which is as of January 29, 2010.

This graph represents unique visitors, not “hits.” So, even though their traffic is relatively flat for the period shown (except for that blip up in January 2009), it’s plain to see that Change.org does very nicely in terms of the numbers of people who visit the site every month. That means that every month well over a quarter of a million people are seeing the social change, and anti-corporate, messages that are being sent via Change.org.

Where’s all this traffic coming from? Well, Alexa.com says that Change.org has 2,321 sites linking in. This is an astounding number that definitely contributes to that unique visitor trend you see in the graph above. But I think a more significant contributor to Change.org’s traffic is referrals from the social web. Indeed. Compete.com, on the date I visited, showed that approximately 28% of Change.org’s referrals were from Facebook.com. This is a considerable percentage of their referral traffic, and may account for much of those 2,321 inbound links reported by Alexa. com. So, it would appear that the social media program of Change.org contributes heavily to their activist efforts. Let’s take a look at that social media program.

Social Media Program

Here we’re going to take a focused look at Change.org’s social media program. You and I are going to concentrate today only on their Facebook and Twitter efforts. They do have other areas of the social web in which they are active and I may come back to those areas in a future post. But because Change.org’s social media effort is so extensive, for now, I would just like to concentrate on their Facebook and Twitter initiatives.

On the date examined, January 29, 2010, the Change.org Facebook main fan page contained about 4,000 fans. This is a respectable amount, but it is not overly impressive when you consider the amount of traffic that they have going to the Change.org site every month. Yet, the Change.org Facebook blog effort more than makes up for any seeming deficiency in fan levels on the main Facebook page. Let’s take a look at the fan blogs they have on Facebook and also at their individual Facebook blog fan numbers.

A number of over 27,000 Facebook blog participants, as of January 29, 2010, is quite impressive and most likely contributes to those heavy unique visitor numbers we saw above. Of course, it could be that some of the 4,000 Facebook primary page fans participate in more than one blog, making the blog fan numbers appear larger. Yet, it is clear that with a blog fan number of over 27,000, the Change.org message has great “legs” and propagation potential.

A random sampling of the fans that I observed in the blog pages, and on the main fan page, shows than most are individuals and not groups. So, this means that Change.org is not necessarily “preaching to the choir.” A high proportion of fans being other groups, similar in agenda to that of the social causes that Change.org promotes, would certainly indicate that their audience characteristics are limited. But with individuals comprising most of the audience, we cannot say that the audience is necessarily skewed.

And with a “Take Action” tab prominently displayed on their Facebook fan pages, any of the many blog participants can make an easy trip to that “Take Action” area where they will find at least three choices for petition participation. Change.org has many more than three petitions active on their main website at any given time. So, on their Facebook Take Action page, they have displayed a convenient link which when clicked will take the Facebook user to the Take Action area of the Change.org website. There the user will be greeted with a full menu of petitions. The visitor merely needs to enter in some identification info and press submit. There are many other features that Change.org deftly employs on their Facebook fan page, almost all of which will further their activist campaigns, but I’m rapidly approaching my self-imposed 1500 word limitation for blog posts. I’ve more to say in other areas, so we will need to move on. Let’s move to Change.org’s Twitter use.

Their Twitter main profile page shows, on January 29, 2010, a Twitter following of almost 10,500. This number is nothing to be “sneezed at.” There is a lot of controversy on the level of Twitter followers. The arguments revolve around quality or quantity of followers. Of course, just accumulating followers for the sake of inflating your Twitter following number may not increase the power of your message. But a high Twitter number certainly doesn’t decrease the power either. Although this Twitter following is not considered extremely high, it is a decent level and indicates that the following of Change.org on Twitter can help increase the efficacy of Change.org’s message. This number of 10,500 may also help contribute to their petition effort. As new petitions are launched on the main Change.org site, tweets may be launched, automatically, driving traffic to the site for petition participation, signature, and completion.

As I alluded to above, there is so much that can be said about Change.org’s social media program. I’ve barely scratched the surface. I could probably write a book about how this particular irregular competitor exerts force against various business efforts. Perhaps I will. But right now, because I’m approaching my own words per post limitation, I’m going to wrap up this case study and move on to the Discussion and Conclusion section.

Discussion and Conclusion

Overall, this is one very high-powered irregular competitor. They are a very adept activist organization and they make use of their digital tools, as we saw above, in an effective manner.

If indeed Change.org is a for-profit corporation, which they certainly seem to be as shown by the evidence in Part 1 of this case study, it certainly makes one wonder why they use the dot org upper level domain name in both their corporate name and in their URL. There is no prohibition in for-profit companies using the dot org upper domain level name. It’s just that it’s not customary for this to be done. The dot org designation is usually reserved for the non-profit organization. Of course, I have my own theory as to why they use the dot org upper level domain name. A theory about which I will leave you to ponder. You may have your own theory as well.

Their presumed status as a for-profit company, as explored in Part 1 of this case study, if true, is quite unusual for an activist group. This would make Change.org a new breed of activist. They are a new breed of activist not only for their ability to combine editorial content with activist initiatives, but they would also be classified as a new breed of activist because of their apparent for-profit status. And this presumed status combined with Change.org’s excellent use of digital technology, as we have seen here in Part 2, makes them a formidable irregular competitor.

In Part 1, I said I would discuss why their for-profit status would be important. Here it is.

The fact that they are a Delaware corporation (remember from Part 1 that they switched to become a Delaware corporation in 2006), and if they are indeed a for-profit company, affords them certain state income tax advantages not available to corporations domiciled in other states. This tax advantage gives Delaware corporations comparatively more net income with which to work. Perhaps that’s why they made the corporate registration switch from California to Delaware in 2006? And in the case of Change.org, such a status would simply give them relatively more resources with which to communicate activist, and sometimes anti-corporate, messages; perhaps some of which are aimed at your employer. Ironic, isn’t it?

You may be thinking that since non-profit 501 (c) 3 organizations don’t pay any taxes at all, wouldn’t a better organizational strategy be to simply form under that tax-exempt, non-profit status, and have even more resources with which to operate? Not necessarily. I have two theories for which they may be organizing their corporation in this for-profit manner.

The first theory is that for-profit companies can do more in terms of backing political candidates, as we have seen, at least in part, from the recent U.S. Supreme Court decision in Citizens United vs. FEC. Non-profit corporations, i.e., 501 (c) 3 – tax-exempt organizations, because they do not pay taxes and in effect operate partially on implicit tax payer dollars, have many, many, restrictions on the backing of political candidates. Thus, for-profit activist groups can have a far greater impact on the political process, and by extension a greater effect on corporations, than can their non-profit activist group cousins, with all the anti-corporate effects that implies.

The second theory is that for-profit companies can raise funds in the private money market. Venture capitalists are often looking for new tech companies to invest in. And a tech-based company such as Change.org would represent a new vanguard of company, one with a differential advantage. This might increase their overall ability to attract funding, and make them not have to rely on the capriciousness of donations as would a non-profit corporation. Thereby, the possibility exists that this type of activist organization could be better financed than the non-profit variety.

Of course, these are all theories. If Change.org is not a for-profit corporation, I would certainly like to see them correct their “Entity Type” status on their Delaware corporate filing, as shown in the Part 1 post, so as to avoid further confusion.

What all this comes down to is, based on the evidence shown in both Parts 1 and 2, Change.org is a very formidable irregular competitor.

So, on the “Irregular Competition Threat Index,” a scale of 1 to 10 (10 being the highest threat level), I rate Change.org as a “9.” If this organization has your corporation in its activist sights, well then, you may need some help.

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Change.org. That’s the focus of this case study in irregular competition. Before we begin, do you need a definition of “irregular competition?” If so, please click here.

Introduction

Ready?

Who is Change.org and what do they do? Well, to help define them, let’s start with a passage from their own About page (accessed January 28, 2010):

Today as citizens of the world, we face a daunting array of social and environmental problems ranging from health care and education to global warming and economic inequality. For each of these issues, whether local or global in scope, there are millions of people who care passionately about working for change but lack the information and opportunities necessary to translate their interest into effective action.

Change.org aims to address this need by serving as the central platform informing and empowering movements for social change around the most important issues of our time.

Change.org is a site, and an organization, that combines activist editorial with one-stop petition shopping. As a “platform” for social change, their editorial content, both from guest writers and from Change.org staff and rendered in blog format, attracts readers from across the Internet who, once at the site, may participate in the signing of petitions organized for grievance purposes against various targets. The petition initiatives are plainly and prominently featured among the editorial content. Even for the casual reader, not noticing these petition initiatives is almost impossible.

Some of the targets of the petitions are traditional petition recipients, i.e., government entities and legislators. Some of those targets are entities less accustomed to receiving petitions from the general public, i.e., trade coalitions between academe and corporations. And some of those targets are entities even less accustomed to receiving petitions from the public, no less acting on them, i.e., corporations.

The petitions may be started by groups or by individuals. Change.org gives either groups or individuals the platform and the audience to start or augment a social movement.

Since this blog, Telofski.com, is about irregular competition and how it affects business, from here on in this post I will be discussing Change.org from the viewpoint of being an irregular competitor. And as you know from the definition of irregular competition, irregular competitors are activist organizations and NGOs within the context of their impact on corporations.

At first glance, Change.org would appear to be an activist organization itself, targeting or enabling the targeting of various corporations, and would seem to fit the definition of irregular competition, one aspect of which is that irregular competitors are generally thought to be non-profit. But, after doing some research on Change.org, my findings say that they don’t seem to fit this definition completely. And where they don’t seem to meet completely the definition of irregular competition is in that non-profit aspect. They don’t appear to be a non-profit organization. The reason I say this is due to the findings of my corporate status search for Change.org which I will share with you now.

Findings

Corporate Status

In this corporate status search, I had two objectives. First, to identify the corporate name behind Change.org, and second to determine if that corporation was a non-profit organization.

Identifying the corporate entity behind Change.org wasn’t particularly difficult, but it did require some digging, as well as the knowledge of where to dig. The first place I looked for corporate entity information was at the bottom of the Change.org home page. The copyright notice is always a good place to start to look for this type of information and theirs says “© 2010, Change.org. All Rights Reserved.” Hmmm. I thought that it’s odd for an organization that describes itself as a “social entrepreneurship venture” not to have the more liberal and permissive Creative Commons copyright notice. This was an indication that they might be a for-profit corporation. A nice clue, but what I was looking for was a corporate name, and the copyright notice didn’t give me a corporate name, only the website address. Unless, I thought, the domain name is also the corporate name. I moved on. (Note: This characterization of “social entrepreneurship venture” is also per their About page, same access date as above. Yes, I know that access date is several weeks prior to this post’s date. That’s because I tend to write ahead and employ the “magic” of Word Press’ post pre-scheduling function.)

Thinking that the domain name and the corporate name were the same, I then made a leap of research faith. Presuming Change.org to be a non-profit corporation, I tried searching for Change.org on Guidestar.org which is a database site containing information about non-profit corporations. On the same access date as listed above, Change.org was not listed at Guidestar.org, indicating that they are probably not a non-profit organization. However, there is always the possibility that Change.org was overlooked in the Guidestar.org database input process (even though Change.org lists Guidestar.org as an information “partner.”), or that the Change.org organization is registered on Guidestar.org under another company name. I wanted more and better information. I continued my search.

Still in search of that corporate name, to identify it, I tried the old standby, searching the “Whois” Registry at my favorite Internet domain registration website, but that search didn’t provide much useful information. I then went back to the Change.org About page. There was a clue there that I had missed before.

The About page said that this social entrepreneurship venture was based in San Francisco, CA. Okay. Now, we’re cooking, thought I. So from there I went to the California Secretary of State’s website to check for Change.org’s corporate filing information. You can see that California corporate filing information, too. Just click here to go to the California Secretary of State’s Business Entity search page. Check the “corporation” radio button, then type in “Change.org” in the search box, then click the Search button. After you do that you will see a listing for Change.org, Inc. Click on the company’s name and then you will see the following result:

Alright, so now I had the corporate name. But, now this search was starting to get very interesting. Yes, Change.org’s statement on their About page saying that they were based in San Francisco was confirmed by this state record, although that record was going on four years old at the time I accessed it. But, I wasn’t really intrigued by their location. No, an online company being based in San Francisco wasn’t a surprise. But, that word “Forfeited” was a surprise. That word intrigued me. So, that I would have a proper definition of “Forfeited,” I clicked on the “Field Descriptions and Status Definitions” link provided on the search results page. I looked through the list of definitions and found this:

Suspended or Forfeited: The business entity’s powers, rights and privileges were suspended or forfeited in California 1) by the Franchise Tax Board for failure to file a return and/or failure to pay taxes, penalties, or interest; and/or 2) by the Secretary of State for failure to file the required Statement of Information and, if applicable, the required Statement by Common Interest Development Association. Information regarding the type of suspension can be obtained by ordering a status report. For information on ordering a status report, refer to Information Requests.

Researcher’s Note: This search of the California records was made on January 28, 2010.

Now, in this particular case study, it didn’t matter to me if the corporate status was forfeited for reason #1 or reason #2 as shown in the definition above. Or even if Change.org, Inc. is registered in California or if they even need to be registered in California. Although, it would be interesting to find out these things, I didn’t order a status report via the Information Requests link which would have detailed the situation further. If you’re interested in further information on these issues, you may always follow that link. No, I had enough of a clue here to reach my second research objective, to determine if this company is a for-profit organization or is of the non-profit variety. That clue was “Delaware.”

So, my next stop was at the website of the Department of State: Division of Corporations for the State of Delaware. Delaware, the home of more corporate “headquarters” than any other state. Click here to go to their site, if you like. At that site, in the search box you would type in “Change.org,” then hit the Search button. From there, click on the result “Change.org, Inc.” You will then go to a page entitled “Entity Details” and you will see the following:

Yes, it looks like they transferred their corporate status from California to Delaware in September 2006. And I thought that significant, but not pertinent to my research objectives. In the Discussion section of this case study, I will talk about why I think that switch from California to Delaware is significant. That’s later. For right now, let’s stay on the second objective of determining if this company is non-profit or not.

Now, I believe that that sentence “This is not a statement of good standing” doesn’t necessarily mean that the record is a statement of bad standing. I believe this means that to get the official statement of “good standing” you need to pay the record retrieval fee. So, what you see in these preliminary search results would just be an unofficial record. But considering that I was seeking their profit status, I knew I didn’t need the official statement. What I needed was right before my eyes. And what answered my profit status question was “Entity Type: General.”

If you click on the Entity Type link you will see the definitions:

A – General – Type General refers to a legal entity with no special attributes such as non profit or religious.

and you will see;

R – Non-profit or Religious – This description type refers to a corporation that sets forth in it’s certificate of incorporation or subsequent documents that it is a non-profit corporation. The “Religious” literal does not infer that, in every case, the corporation is for Religious purposes only. The intent is to define the corporation as Non-Profit, charitable corporation which maybe formed for Religious purposes.

Researcher’s Note: This search of the Delaware records was made on January 28, 2010.

So, according to these Delaware Secretary of State definitions, if Change.org, Inc. was a non-profit corporation, in the Entity Type field it would read “Non-profit or Religious” and not “General.”

Therefore, from this research and the evidence found, it appears that Change.org, Inc. is a for-profit corporation. And I will take it that state corporate records are highly reliable.

Why is it important to know whether Change.org, Inc. is a for-profit venture? Well, there are several reasons. And you and I will discuss those reasons when we get to the Discussion section of this case study.

*          *          *

Right now, I’m going to pause this case study by breaking it into two parts. Generally, for readability reasons, I don’t like to write over 1500 words in any one post and in this post I’ve exceeded my own limit by quite a bit. So from here, we will move on to Part 2 of this case study.

Part 2 will be published on Tuesday, February 23, 2010. If you are reading this prior to that date, please click here to subscribe to the free RSS feed so you will be notified when Part 2 publishes. If you are reading this after that date, you may simply click here to be taken to Part 2.

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Tags: Activism, Change.org, cyber activism, digital activism, irregular competitor