The Connection Between FOMO and Loyalty

First, let me say, any marketing article that includes "fear of missing out" (FOMO) in the title is going to draw me in—I read one this weekend. And after reading the article, it brought me back to a topic (and question) I’ve been hearing about a lot lately.

If you read my blog regularly, you know that lately I’ve been working with a lot of nonprofits on mid-level giving. Over the last year, I’ve been involved with at least 30 nonprofits, discussing strategies, segmentation, creative, etc. But, the one question that continues to come up (and seems to have no absolute answer) is: “Do you need a loyalty/named club or membership approach to have a really good mid-level giving program?”

Honestly, there are lots of opinions on this, but there are successful mid-level programs with named clubs and successful ones without named clubs.

So what’s the connection between FOMO and loyalty? The MarketingProfs article I read is titled, “What Customer Loyalty Means in a Fear-of-Missing-Out World.”

The article basically points out that people are not loyal to their loyalty programs, and what consumers really need in loyalty programs.

But my blog is less about the article’s details and more about its implications relative to trends with consumers.

What I found really interesting was that these success factors, or consumer needs, are elements that I believe good fundraising strategies have delivered for a while and must continue to deliver—with or without a club/membership.

Here are some facts and quotes from the article:

• “The days of the perfect fit are over, and consumers have learned the pleasure of discovery. Some 60 percent will happily abandon favorite brands if they get a coupon for a competitor, and 30 percent will change brands just for the sake of a change.”
• “U.S. households belong to an average of 21.9 loyalty programs, however, customers are active in less than half of them. In other words, most consumers aren't loyal to their loyalty programs.”

According to the consumers studied, the best programs provide key elements to people. Below is the list of key elements from MarketingProfs, with my thoughts specific to nonprofits.

1. “Currency. Whether tangible or intangible, there is a clearly perceivable value exchange.”

For nonprofits: Value and exchange must come in the form of helping someone achieve a personal objective regarding your organization’s cause. If you do have benefits, they should provide a sense of connection to the cause.

For long-term relationships based on connections to your cause, donors must believe they are getting something in return for their donations or volunteer time. That can be recognition, a sense of purpose and/or a way to really make a difference.

2. “Community. Instead of stopping at the relationship between brand and consumer, emotionally connected programs offer consumers new connections to like-minded individuals, too.”

For nonprofits: Yep, “emotionally connected.” Can you believe it? We already know this is important, and most nonprofits have this as a critical element of their strategies. But, while emotion typically is a part of nonprofit marketing and fundraising strategies, the community aspect often only is found at the local events.

This is where your social media channels really can help bridge the gap across zip codes, giving people with shared focus on your cause a place to connect and communicate. This matters to people and you must deliver upon it.

3. “Information. Top brands provide access to the latest and greatest trends, tricks and tips to stay ahead of the game.”

For nonprofits: You might be thinking this is a tough one for nonprofits to deliver upon. Nope. There are a couple of ways that you can provide the latest and the greatest. The obvious one is by providing constant updates on the cause and progress made toward it because of your donors.

Also, “access” is another area. Many nonprofits with mid-level and major giving programs provide special customer service numbers to call for any issues. While research shows this is not used more than a typical contact number, providing a sense of special access is a winner in consumers’ eyes.

4. “Entertainment. A fun, engaging or distracting way to spend leisure time is essential.”

For nonprofits: I’m not one to try to fit a square peg into a round hole, so I’m not going to stretch this one too far. While this may not be the perfect match for our strategies, I do believe this consumer expectation continues to be met through community events.

5. “Utility. Consumers expect an easy and intuitive way to learn and improve within a relevant area of interest.”

For nonprofits: Remember the days when the older generations just donated because it was the right thing to do? This is not the case with many of today’s donors.

Remember, some of the younger donors and volunteers have personal goals and they make decisions based on how you help them reach their own goals.

Additionally, the amount of information required by today’s donors to keep them engaged has changed. Make sure you are providing information about your cause, your progress and how your donors actually are a part of the solution.

As I said, these feel like expectations we always have dealt with in this industry, and this latest research confirms this is something that must continue.