One recent morning in Richmond, Va., in a half-vacant strip mall, a mob began to form in front of a modest variety store. You might assume that Upscale Flea Market owner Forondo Holmes would feel a twinge of panic, or at least puzzlement, about this highly unusual event: like many other businesses these days, his bazaar has struggled. But he was all smiles. Happily for Holmes, his shop was about to be hit by a cash mob.
The cash mob is gathering steam across the nation as a bona fide social phenomenon. But unlike its forebear, the flash mob--a pointless bit of performance art popularized in the 2000s, in which groups convened in public places and danced to "U Can't Touch This" or engaged in large-scale pillow fights--cash mobs have a quantifiable purpose. That purpose is simple: support a local business by using Facebook, Twitter and other forums to gather a throng of shoppers at the same independently owned business on the same designated day.
Since a systems engineer organized the first cash mob in Buffalo, N.Y., last year, they've gone viral. Hundreds of cash mobs have sprung up across the U.S.--in all 50 states--as well as in large European cities such as London and Milan. Mobbers may be asked to spend $10 or $20, to show up at one time or throughout the day, but the basics are always the same: local business, cash, en masse.
The idea is a perfectly timed tonic for a sour economic moment. "I'm happier to give it to them instead of a big business," says Ashley Massey, the mother of 5-year-old Olivia, who arrived at Upscale Flea Market excited to spend her birthday money on dress-up clothes. The local shop gets a cash infusion, and the shoppers can benefit from a sense of solidarity. "People are struggling all over the country," says Knox County Mayor Tim Burchett, who's been organizing cash mobs for the past year in Tennessee. "This is an opportunity for everybody to join hands."
Studies have shown that spending money at local businesses has a bigger impact on the local economy than shopping at big chains. Even the most spendthrift cash mob can't make a business in a single day, but many mobbed owners say their real payout came over time, through repeat customers and increased name recognition. "We depend on word of mouth," says Scott Duennes, whose natural-food store, Nature's Bin, was mobbed last spring. The siege raised the store's profile and turned first-time shoppers into second-timers, he says. "A lot of those folks never knew Nature's Bin existed before."
So who's behind this whole thing? There are at least two variations on that story. In July 2011, Chris Smith, the systems engineer in Buffalo, read articles online about the negative effect that Groupon-type schemes can have on small businesses. Many lose money on the drastic discount and never recoup it with repeat customers. "I thought there had to be a better way to do that," Smith says, "and the semantics of [cash mob] worked for me." He sent a tweet about his flash/cash revelation: get people to flood a local business all at once, but make sure the business charges full price so customers don't get accustomed to unsustainable deals.
Buffalo responded. Weeks later, Smith and about 100 fellow citizens each spent around $10 at a wine shop, with local media in tow. He's been hosting cash mobs ever since.