Power Shift: Succeeding Online in a Donor Centric World
Whether it be channel preferences, communication approaches or donor expectations, the fundraising landscape is changing.
In his session, "Power Shift: Succeeding Online in a Donor Centric World," at Fund Raising Day in New York 2009 earlier this month, Vinay Bhagat, founder, chairman and chief strategy officer at Convio, discussed the myriad ways fundraising is transforming and keys to fundraising success amidst the transformations.
Bhagat began by breaking down channel preferences according to four main generational groups:
- Core grassroots donors (older) — Channel preferences are direct mail and telemarketing; occasionally use Web and e-mail.
- Boomers (the next big wave) — They are multichannel donors, many of whom prefer to give online and use the Web at work and home.
- Gen X (emerging donors) — "The Web generation" will only give online; generally not direct mail or telemarketing responsive.
- Gen Y (future donors) — The social media and mobile generation. These donors don't have land lines and rarely check personal e-mail.
On top of the shift of grassroots fundraising to the Web, Bhagat noted that channels such as mobile marketing and social networks are proliferating and, with them, communication approaches. In this environment, Bhagat said, channel integration is a must, as online engagement has been found to improve annual donor value and retention rates even if donors continue to give via direct mail.
"Multichannel donors give the most and are the most loyal," he said.
As for major donors in cyberspace, Bhagat pointed to "The Wired Wealthy" study his company did along with Sea Change Strategies and Edge Research, which found that 86 percent of wealthy donors visit a nonprofit Web site before making a gift online.
New-donor expectations also are changing, becoming elevated by sites like Kiva that are much more transparent about how donated money is used than typical nonprofits and consumer marketing, and that offer customers the flexibility to opt into lower communications frequencies.
But not all donors want the same thing. Organizations need different offerings for:
- Relationship seekers — People most likely to respond to opportunities to connect emotionally with your organization online.
- All business donors — Not looking for relationships or emotional connections.
- Casual connectors — In between the aforementioned two in terms of attitudes and preferences.
Bhagat pointed to the following seven key success factors:
1. Maximize your Web presence.
Make sure you have a Web presence that really speaks to donors and includes compelling content; storytelling via video; multiple tools to engage (drive e-mail capture); one core feature element and multiple secondary features; reader-oriented tabs; and all content above the fold. He also recommended that organization Web design be respectful of typical readers' Web-browsing habits by keeping content brief and offering a user-friendly design.
2. Rethink your e-mail communications.
Be "donor-centered" by writing content that is of interest and value to the donor. Don't be a slave to your schedule; if you don't have something compelling to communicate, skip sending the e-mail. Pay attention to engagement metrics, e.g., open rates, clickthrough rates. All of these things, along with segmentation and personalization, will lead to more effective e-mail communications and stronger constituent engagement.
3. Make giving opportunities tangible.
For example, Bhagat described the "Fill America's Fridge" campaign in which Feeding America sent e-mail appeals with a specially designed landing page that showed a virtual refrigerator that filled up based on the size of a donor's gift and indicated how many meals the donation would provide.
4. Run integrated, multistep appeals.
"Multiseries campaigns don't have to be fancy," Bhagat said. "If you don't have time to create different messages, simply resend the original e-mail." Just add "Reminder" or some other indicator to the beginning of the subject line, e.g., the subject "Please Renew Your WWF Membership" in the first e-mail can be changed to "Reminder: Renew Your WWF Membership." Integrate appeals across channels, incorporating the images used in direct-mail campaigns into e-mails and coordinating the timing of on- and offline appeals.
5. Implement a "moves management" strategy.
This is about how to get people from prospect or lapsed status to one-time or multidonors, to monthly donors, and on up to major donors. Bhagat recommended giving distinct "treatments" based on behavior and affinity to advance constituents to higher value tiers.
Apply the moves management strategy across constituent programs so that event participants are moved to register, create a personal page and, ultimately, fundraise and recruit; donors are moved to give repeat gifts, monthly gifts and, ultimately, major or planned gifts; and prospects are drawn to your Web site, their e-mail addresses are captured and profiling data is collected on them.
For major donor treatment, Bhagat recommended organizations:
- Offer a highly personalized and donor-controlled Web and e-mail experience.
- Treat donors as serious program partners.
- Send a high ratio of cultivation to appeals.
- Provide opportunities for two-way communications.
- Give donors things they value to encourage word-of-mouth.
- Use video.
- Develop a quasi-directed giving program.
6. Empower constituents to act for you.
7. Organize for success.
He noted the following four key elements:
- Plan — Map organizational objectives into Internet marketing plan; establish key metrics dashboard, and set goals; and determine execution plan and staffing.
- Technology deployment — Design site and configure software to support marketing goals. Implement appropriate/effective data synchronization strategy.
- Operations — Content management, administration of Web site; e-mail communications (newsletter, ad hoc, services); engagement (surveys, advocacy, etc.); e-mail list building (offline promotions, viral campaigns, etc.); appeals (develop concept and case for support, design creative, implement landing pages, configure forms, select segments, create test cells, send e-mail, report results); and regularly track and report results.
- Review — Periodic reviews of online marketing program; analysis of file performance and composition; and benchmarking with comparable organizations.
Bhagat said it all begins with an organization's structure, as that impacts behavior, which impacts performance, and planning often is an afterthought. He advised organizations increase attention to how they organize their resources; how they plan and prioritize their work; who owns and is accountable for the work; and what interactive skills are required.
He said there are three different organizational structures:
- Centralized, where all staff for online programs is consolidated within a single department.
- Decentralized, where staff for online programs is spread across the organization in different departments.
- Hybrid, where staff is mostly consolidated within a single department but there are also others outside the department.
Centralized is the best performing structure, Bhagat said, noting the following key staffing takeaways:
- Know the blind spots of your existing structure and work hard to compensate.
- Centralize/concentrate your online staff where possible.
- Location of decision ownership appears to matter.
- Take planning seriously; define goals, accountability and communication scheme.
- Be mindful of the diverse skills required, and fill gaps through training and/or outsourcing.