Mint Condition

The results have been stunning. "How many companies have introduced a product that will sell more than 4 billion units in its first year and will be touched by every person in this country?" asks Diehl. "When you think of it in those terms, this program is huge. Even if you only think of it in profit terms, it's huge."

Huge, indeed. It costs the Mint about five cents to make a quarter. It sells the quarter, through the Federal Reserve Bank, at face value. Translation: The Mint makes an 80% margin on the sale of every quarter. The baseline demand for quarters averages 1.5 billion a year. By the end of 1999, the Mint expects to have produced a total of 3.5 billion quarters, 2 billion above baseline demand. That's real money. But profit isn't the primary objective. "It would be disappointing if, at the end of this 10-year program, all we have to show are 10 enormously profitable years," says Diehl. "Our underlying goal is to rejuvenate coin collecting by getting the interest of a new generation of coin collectors."

But the long-term effects will involve more than money. The 50 State Quarters Program has refocused the Mint on the overall collectibles market. And the explosion of Web-based auction sites -- eBay, Auction.com, Amazon.com, and others -- is helping a fast-growing activity to grow even faster. In fact, 24% of all coins purchased by collectors are bought online. Diehl and Pickens quickly realized that to maintain the agency's momentum, the Mint would have to ".com" itself. "There aren't many companies founded by Thomas Jefferson that are selling products on the Internet," notes Pickens. This now 207-year-old government agency would have to embrace e-commerce.

Weave a Web of Change

Michele Bartram does not collect coins. But she does wear them. A large gold coin bordered by black onyx hangs around her neck. Two small gold coins, framed by her auburn, shoulder-length hair, dangle from her ears. Bartram does, however, collect piggy banks. Talking a mile a minute, she pulls her collection of antique and brand-new banks from a bag and lines them up on her already-cluttered desk. One of the banks even talks, announcing how much change sits in its belly.

Bartram, 35, had been acting assistant director of e-business at the U.S. Mint's Office of Electronic Information and Products. Translation: She's part of the .com crowd -- one of the fire-in-the-belly, let's-move-on-Internet-time change agents behind the Mint's recent embrace of the online world. "I don't want to treat symptoms, I want to solve problems," Bartram declares. "And the Web forces you to address problems that have been swept under the rug for years. That's why it can feel so threatening. My job is to eliminate fear."

Bartram signed on with the Mint in 1995, after spending five years at IBM, and several more as a marketing consultant based in Spain. From the moment she walked through the agency's doors, she found herself in the thick of Diehl's change program. She created and led a task force that introduced database marketing, an initiative that led to the reorganization of the Mint into three separate business units. The closer she got to the Mint's customers, the more eager she became to ask them some basic questions: Why do you collect coins? Do you collect other things too? How did you become a collector? Do you consider yourself a serious or a casual collector?

Bartram knew that the Web was the best way to get those answers -- and a perfect way to work around bureaucratic obstacles such as OMB. "If I can serve more of the public better and faster electronically, then that's my duty," says Bartram. "The Mint's situation represented one of the best business cases I'd ever seen for using Web-based technology." And it wasn't that hard for Bartram to make the case. As a government agency, the Mint has a legally mandated mission not just to serve but also to educate the public -- whether the public is defined as coin collectors, contractors, vending-machine makers, or a mother helping her child with a school project on dimes. "If you give people the information that they want," Bartram notes, "you also have the opportunity to say, 'Hey, if you like dimes, you might be interested in our collectibles.' "

Last December, she got the perfect opportunity to show how the Web's reach could create a powerful blend of education and commerce. The Mint had been in the middle of a tricky product-development program. Congress had passed a law mandating the creation of a new dollar coin to replace the fatally flawed Susan B. Anthony -- which was to coins what the Edsel was to cars. (Beginning in 1979, the Mint produced 857 million Susan B. Anthony dollars. Twenty years later, it has yet to exhaust its supply.) The Mint faced some huge -- and hugely delicate -- questions. What woman from history would replace Susan B. Anthony? How could the Mint embrace its new enthusiasm for ambitious coin design without raising protests from an ever-cautious Congress? What marketing strategies would help the new coin fly off the shelves, rather than gather dust alongside the Susan B.?