Let’s Not Be Cryptic

Cryptocurrency

Be honest, you don’t know what Blockchain is, or exactly how it works.

Facebook recently introduced Libra, a cryptocurrency built on blockchain and there are some very direct connections and implications for nonprofits.

Before we get to what this could mean for nonprofits, here is a simple introduction to blockchain, and to cryptocurrency.

What is blockchain?

At the highest level, it’s a decentralized, publicly available warehouse of transaction data. This warehouse relies on a vast network of computers to encrypt or “hash” the personal particulars, verify details and validity, and then add each transaction to a “block” that is inserted into the chain that connects all the blocks.

What makes this a more secure solution? Here’s a great explanation from Investopedia:

“Let’s say a hacker attempts to edit your transaction from Amazon so that you actually have to pay for your purchase twice. As soon as they edit the dollar amount of your transaction, the block’s hash will change. The next block in the chain will still contain the old hash, and the hacker would need to update that block in order to cover their tracks. However, doing so would change that block’s hash. And the next, and so on.

In order to change a single block, then, a hacker would need to change every single block after it on the blockchain. Recalculating all those hashes would take an enormous and improbable amount of computing power. In other words, once a block is added to the blockchain it becomes very difficult to edit and impossible to delete.”

Cryptocurrencies like bitcoin, Litecoin, Ethereum, and the aforementioned Libra are essentially digital currency. But, what really distinguishes cryptocurrency is the fact that it is not issued by any central party and therefore is not subject to regulation by any government or regulating authority.

Yes, that does make it a channel that seems custom built for money laundering – but we will ignore that for now.

[Sidebar] Does anyone out there watch Ozark? Somebody ought to clue Jason Bateman’s Marty Byrde character in on cryptocurrency – they can’t keep buying funeral homes and rundown resorts forever.

Satoshi Nakamoto is credited with inventing cryptocurrency, referring to it as “a new electronic cash system that’s fully peer-to-peer, with no trusted third party.”

However, Satoshi may or may not exist. He hasn’t been seen or interviewed; Satoshi could be multiple people, or a pseudonym. But he is credited with writing the whitepaper that introduced the idea of bitcoin and clearly doesn’t want to be found… he’s encrypted himself. 😉

What makes Libra most interesting to those of us in the nonprofit space is the inclusion of a couple large nonprofits amongst the founding members: Mercy Corps and Women’s World Banking.

But what does Libra (or cryptocurrency generally) mean for nonprofits?

For one thing, moving money from the people who give to the people in need can be done quickly and with significantly lower processing fees, a huge benefit.

In developing countries where aid and support are most needed most, the unbanked or underbanked often comprise the majority. For context, here is a chart provided by the World Economic Forum.

Crypto World Chart

According the World Bank Group, almost 60% of those without bank accounts cite lack of money as the reason.

There are 1.7 billion people in the world without bank accounts, but a percentage of these people do have inexpensive smart phones; the ability to get money to them and allow them to transact without the burden of fees could have a significant impact.

Do we need to start accepting cryptocurrency in our appeals? Probably not yet.

But the gradual integration of cryptocurrency into the global market and our day-to-day is certainly something worth watching.

A Conversation With Michelle Hurtado, Head of Google Ad Grants

Michelle Hurtado
Global Head of Google Ad Grants

Jeff Ostiguy, Vice President of Marketing at THD, sat down with the Global Head of Google Ad Grants, to discuss Google’s commitment to the nonprofit sector, Ad Grants program changes and how nonprofits can be successful with Google Ads.

THD: Michelle, thanks for taking a little time to talk with us today! Can you give us a brief history of the Ad Grants program?

Hurtado: Google’s mission is to organize the world’s information and make it universally accessible and useful. Google Search is critical in this. We saw how effective ads on Google Search results pages were and so we started the Ad Grants program so that resource strapped nonprofits could have good access to share information on Google.com. We’ve now been giving free Google Search ads for 16 years, directly in alignment with Google’s mission. We hope that we’re helping nonprofits amplify their vital work and grow with Google: by supporting nonprofits to raise awareness, get people involved, and fundraise.

THD: What does the Ad Grants team look like? We often hear it is a small team of volunteers.

Hurtado: Ad Grants has been a small team historically but we have doubled in the last year! We are a dedicated group of 12 and we have team members who have been with Google for 14, 15 and 16 years, sitting across 6 different offices.
We also have partners we work closely with. For example, we have our Certified Professionals Community of agencies and consultants who are knowledgeable about Ad Grants and dedicated to nonprofits, so we recommend their services. We also partner with universities to offer a program for students learning online marketing to volunteer with Ad Grantees through the Google Ad Grants Online Marketing Challenge.

Last year we served about 51,000 nonprofits so we also rely on volunteers to scale our support efforts. You’ll see many of our volunteers on our educational resources such as videos and livestreams on YouTube and our new Community forums which are great platform for nonprofits to ask questions and get help quickly.

THD: In January of 2018, a number of new performance and structural guidelines were put in place for the program. Have the changes had the impact on performance that your team had hoped? What trends or changes have you seen since you made the changes?

Hurtado: Yes! We reviewed our program policies to add clarity and raise standards of quality for our free advertising grants. We want our Grantees to all be in compliance with these policies and we hope they act as a guide to optimize accounts. For example, we don’t permit single word keywords because they don’t often make a good match with a relevant ad and a user taking action on your site, so that policy prods nonprofits to build out keyword lists.

Performance metrics like conversion goals met show positive results and click through rates have more than doubled. My team is committed to helping nonprofits use their Ad Grant successfully.

THD: Have a large number of Grantees been suspended since the policy changes were implemented in January of 2018? Are more nonprofits opting to use automated options like Smart Campaigns?

Hurtado: Many nonprofits have been impacted by the policy changes but almost all fix the issue and are reactivated. Smart Campaigns is an excellent option for Grantees that can’t invest the time to manage their online ads regularly. This campaign type can be set up in just 15 minutes, and then works to constantly improve an ad around a goal, measure its performance, and show clear, understandable results. More nonprofits are using Smart Campaigns as they see the ease, but it’s still a low proportion of our Grantees.

THD: How do you plan on making compliance more smooth for all parties involved?

Hurtado: We want our Grantees to have a good experience with us and we have provided a lot of educational opportunities to nip compliance issues in the bud. Currently, we are developing an on demand report so Grantees can check compliance proactively that we think will help a lot. We send out a monthly report by email and recommend Grantees confirm their correct email is associated with their Ad Grants account to ensure they don’t miss our notices, and check spam folders just in case.

THD: One of the biggest challenges – and opportunities – nonprofits have is balancing the role of Ad Grants with their paid programs. What is Google’s point of view on how to manage that? How should nonprofits view Ad Grants vs. paid Google Ads and how can they avoid competing with themselves?

Hurtado: Indeed, Ad Grants doesn’t cover all online ad opportunity. We encourage Grantees to get to know online ads through Ad Grants and learn about what’s worth investing more in. Ad Grants is limited to Search ads on Google.com after paying ads, so investing in some paid ads extends your reach significantly and has additional features to market specifically to supporter lists and use image and video ads to drive retention and advocacy. Additionally, when something is in the news or when there is high seasonality, Grantees can capture more of that increased interest by supplementing their Ad Grants account with a paid account.

It’s important to note that Ad Grants accounts do not compete with paid Google Ads accounts. Grantees can literally duplicate their Ad Grants account to a paid one if they wish to ensure they get the top ad position. Investing in paid Google Ads may result in significantly more volume so it’s worth considering.

THD: We have seen many nonprofits be very successful with Google Ad Grants. What are your top tips when managing and evaluating the performance of ad campaigns?

Hurtado: Whether a nonprofit is brand new to online marketing or already feels pretty comfortable, I have a few recommendations: First, define success metrics. What are the few things your organization wants people to do when they come to your website and how do you know when a goal is reached online? Second, make your organization’s website a priority. Structure the website around key goals and ensure each webpage has a clear call to action. Make the user experience easy and mobile friendly – and refresh content often. Next, set up free Google Analytics to understand what happens on your website and link your goals in your Ad Grants account. The first will help you understand who views what content and the latter will help you improve your ad performance. Then, have a dedicated owner who can be proactive with new ads: learn from user experience on your website, test new ads, be ready to respond to current events and seasonality like Giving Tuesday.

THD: The Google Academy for Ads is a tremendous resource, but it can be a little overwhelming. For a nonprofit marketer, who is familiar with Google, but not with all of the tools and programs available where would you suggest they start?

Hurtado: There is a ton of information out there for nonprofits to educate themselves on how to successfully manage their Google Ads accounts. As for the Google Academy for Ads, it is a fantastic resource but we suggest nonprofits using Ad Grants get started with our tailored educational resources that are program specific and use nonprofit examples for easier consumption. We offer a range of educational and support options for our Grantees because successful online marketing takes commitment and we want to help nonprofits achieve their goals online. A few support options to note:

First, our Help Center hosts tips on how to be successful with Ad Grants such as outlining how to create effective ads and automating your bids. Second, we have our Community forums which we actively monitor for questions. Third, we host educational livestreams and videos on a variety of topics on our YouTube Channel, including how to raise ad quality and how to select keywords. We also develop case studies regularly to highlight how our Grantees are using our program and specific product features to reach their goals. These can be found on our website. Lastly, our Grantees can also leverage the Google Ads support line for help and optimization suggestions. The number is 1-866-2GOOGLE.

———————–

Everything you do in market – brand marketing, direct marketing, content, PR – it all contributes to building awareness for your organization. With awareness comes interest, and that interest is an opportunity. A solid search strategy is a critical part of how your organization can rise up and meet that interest.

If you feel like you aren’t getting the most from your Grant account, get in touch with us here at THD – we can help.

If It Ain’t Broke, Don’t Fix It

We have all heard the phrase “If it ain’t broke, don’t fix it.” While this may be effective at times, as fundraisers we need to constantly strive to grow revenues and fund the critical missions we serve.

This can mean countless hours trying to improve the weak links within our program – a strategy which can yield mixed results. And with a finite number of hours in a day, we must concentrate our time and energy on addressing the problem areas, right?

Not always.

I’m certainly not going to suggest that you ignore problem areas in your program. But I also strongly encourage you to carve out time to focus on your highest performing audiences and already successful strategies — all with the goal of generating even stronger results.

With advanced analytics and predictive modeling, you now have the tools to accomplish this.

There are lots of case studies that illustrate this point. Today I am going to focus on just one example – the “SuperDupe” strategy (aka “Lapsed Matches”) used by many organizations to identify names for lapsed reactivation campaigns. In short, SuperDupes are lapsed names that match rental and exchange lists within your acquisition program.

Mailing SuperDupes is a successful strategy for many organizations. And with predictive modeling, you can generate even stronger results.

At THD, we consistently see modeled names outperform SuperDupes by a wide margin:

Most Recent Head-to-Head Test

For the client, these results were exciting…and unexpected. Before this test, the organization believed there was no room for performance improvement within the SuperDupe audience in their lapsed campaign.

This is just one example where we have been able to generate substantial gains in client programs by applying advanced analytics and predictive modeling to audiences and strategies that were already high performing and considered very successful.

So when it comes to your fundraising program, I urge you to ignore that catchphrase “If it ain’t broke, don’t fix it” – and look for opportunities within your program that you may not have known existed.

If It Ain't Broke, Don't Fix It

Personally speaking, I have already thrown out that old hat. Will you join me?

For more information or to get in touch, click here.

Google, Facebook, Network for Good and The Unknown Known

Facebook and Network for Good have done a good thing.

Partnering for native, embedded, fee-free donation processing helps nonprofits gain increased visibility, delivers a seamless experience and ensures that 100% of the money collected goes to supporting your organization, which is great for you and exactly what the donor wants.

So, everyone wins, right?

Uh... yahh... about that...

Not so much.

Turns out that all the donor data collected stays with Facebook in accordance with their privacy policy. What exactly will they do with this information is unclear, but odds are the answer isn’t ‘nothing.’

There’s your fee.

They have also partnered with Google and others to embed this giving experience (like on Google’s Knowledge Panel), and in addition to donor data never reaching the nonprofit there are real fees ranging from 3 to over 5%, but that information is not immediately clear to the donor.

Now, let’s be honest, your donors are smart people, many a bit cynical, and they have no idea who Network for Good is…

But, if they thought for a moment that any part of their gift was going to end up in Mountain View or at 1 Hacker Way, or that the act of making a gift would only be adding to the deep reservoir of data that Facebook and Google have amassed, I’m guessing they might be more than little reluctant. The partnership helps mitigate that.

Let’s be honest Part II. Both Facebook and Google need this.

DIVERSION

Attaching their name to doing good in the face of repeated data scandals and eroding consumer sentiment is just savvy PR. Facebook in particular has been going out of its way to promote the tools to potential fundraisers and nonprofits alike. They are also offering new features like allowing individual fundraisers to be able to set up their own matching gift campaigns and all the tools and resources available for nonprofits through Facebook for Social Good.

No doubt, some of you reading this have seen nice, even significant, returns showing up from Network for Good thanks to people ‘donating’ their birthdays and prominent donate buttons in the Google Knowledge Panel. And while the checks are wonderful, they must come with a nagging sense of frustration that you don’t know who these people are and you certainly can’t do anything to nurture your relationship with them.

We know the online donor is harder to attract, acquire, and even more difficult to retain.

So, what can you do when you don’t know who they are? How can you bridge the data gap?

Take a look at your donor journey and see where you can tighten up.

A couple of quick thoughts:

  1. Optimize email collection on your site. If they find their way to your site to learn more about where their money is going, make sure you are prominently promoting email capture.
  2. Don’t forget mobile. 80% of social media time is spent on mobile devices* and nearly 60% of all Google searches are on mobile devices**, so inquisitive donors are likely to find their way to you on their smartphones. Make sure your site is optimized to convert.
  3. Page Abandonment. Don’t give up without a fight. If people get to your site and sit on key pages (particularly donation forms) for too long, serve up a pop up encouraging them to complete their gift.
  4. Tighten up your remarketing strategy. Odds are, if someone makes a gift to your organization through Facebook or Google they have or will eventually show up on your site. With the knowledge that only 1.2% of nonprofit site visits result in a donation***, what about the other 98.8%? Set up remarketing campaigns through Facebook and Adwords (display, Gmail, similar audience targeting) based on site visitation, donation page bounces and/or views of key pages that appear along the path to donation. Stay in front of them so next time they come to your forms.
  5. Friends of Friends. Take advantage of Facebook’s targeting capability. If someone sets up a fundraiser on your behalf, there’s a pretty good chance they are following you. With a few hundred dollars you can set up campaigns to target friends of your friends with asks to like your page, subscribe to emails, etc.

At THD, we advocate for a diversification of your fundraising approaches and channels. Understanding your donors and their channel preferences should drive your strategy, so we aren’t going to go so far (as others have) as to say stay away from these programs. In fact, how can you? Facebook is encouraging people to donate their birthdays as they come upon them and you certainly see your friends doing the same. It’s good content.

So, continue to invest in your content and your online presence so donors think of you first and implement some or all of the steps above to make sure you’re doing everything you can to capture folks whenever and however they are showing their support.

*Comscore
**Hitwise
***Benchmarks 2017, M+R

What are you talking about?


SOAPBOX

We like to tie ourselves in knots trying to find the right mix of fundraising and cultivation for our audience segments, but have you ever taken a step back and asked yourself, “Do they care?”

It’s always a pleasant surprise to see a large gift or a number of gifts in response to a cultivation piece even though you ‘don’t ask.’ But, you’re a non-profit, you’re fundraisers and the recipient has become conditioned to anticipate an ask, even if there isn’t one. Of course, when you ask, people give, but the response is as much about a reaction to the impression, is it not?

This is a wild over-simplification, of course, and I’m certainly not saying that the right mix isn’t important. Rather, I’m using it as a way to get us all thinking about how your direct response program should be aligned with your organization’s content strategy more broadly.

Ultimately, your direct response program should be structured to make the right ask of the right people at a certain stage in their journey — online or off. That’s why it’s important that your content and messaging is consistent with or expands upon the narratives and key themes that you’re talking about further up in the ‘funnel.’ Not only will your DR creative in mail, email, social, display, etc. feel more cohesive, but it should be deepening the level of interest and engagement with the constituent; less of a blunt force ask.

The rapid feedback loop inherent in your DR program also gives you a channel to test into some narratives to see how your audience responds. Email and paid social are two channels that come to mind as lower-cost opportunities to stress test some of your messaging ideas.

Let’s not forget there is efficiency in this as well. Whether you’re developing content in house or your agency is doing so, atomizing the content in this way helps you derive more value from its production. That compelling infographic shouldn’t be locked away in a report or a blog post. Let’s leverage that in an email header, a compelling social post and more. Have an important statistic or a quote? Find a way to work them into the design or copy of your DM materials and really drive those impactful points home. That’s what your donor and prospects are looking for, right?

Proof.

By the way, when you’re planning your content development, are you paying attention to what your website is telling you? Are you looking to see what pages people are spending the most time on? What pages are driving people deeper? What pages appear most along the path to conversion? Conversely, are you investing in content that people frankly don’t seem to care that much at all about? There is a wealth of information buried in those web analytics, so dig in!

Start by integrating those content planning sessions, taking learnings from all parts of the organization and letting them inform your plans. Develop a comprehensive content calendar inclusive of your DR schedule and leverage all your content to the fullest!

Timely and relevant: Reaching your donors with news that matters

Beth Mello
Beth Mello
Senior Vice President, Account Services

These days, news travels fast…

Whether it’s a hurricane in Texas, a new drug for a multiple sclerosis, tax reform that could affect the economy or a political event that could cause instability, your donors need to know that your organization is ready and able to respond.

Communication is key…
When external events require an immediate response from your organization, it’s critical that you have a plan in place that you can set into motion. With the right planning, you can respond to an event within hours via Twitter, Facebook, or Instagram. Responding and communication via mail may take a little longer, but it can also be done within days if necessary.

And so is a solid communication plan
Thanks to our work with health charities as well as international relief agencies, THD has developed a Rapid Response Platform that allows us to respond immediately when necessary.

The foundation of the plan is partnership: in collaboration with our clients, we put an action plan into place that can be executed within hours of a landmark event. Together, we look at:

  • Audience: Determine the audience for your outreach and have the mechanism in place to extract those names from your database. Identify a plan for prospecting efforts and pre clear any media that you may use.
  • Channel: Know the plan for each of your channels. Your email template should be ready. Gain alignment on what homepage assets will be deployed. And ensure you’ve got print on demand capabilities ready to go.
  • Expectations: Who has responsibility for each piece of the puzzle? How is information communicated between each party?
  • Execution: How quickly can the plan be executed? With proper planning, an email can go out within hours. And an urgent mail piece can reach donors within days.

A number of our clients, supported by this Rapid Response Platform were able to provide much-needed support to the victims of Hurricane Irma and Harvey thanks to a timely response and rapid execution.

It’s not all about disasters
You may find that the news you want to communicate is positive – perhaps it’s about a recent discovery, a news article that mentions you, or a bill that you helped pass. It may be more informational. In many cases, it will be something that could have a serious impact on you, your donors, or the world at large.

Whatever it is, your ability to communicate helps your donors know that you are relevant, timely, and thinking about them. That can make a difference in how your organization is perceived – and ultimately, on the health of your fundraising program.

To learn more about THD’s Rapid Response Platform, contact Eric Johnson at ejohnson@thdinc.com.

Are you tuned into the right channel?

Jeff Ostiguy
Jeff Ostiguy
Vice President, Digital Marketing

Multichannel… Omni-channel… Cross channel… Pan channel. So many buzzwords … and I think I just made up that last one on the spot.

But… wait! Don’t go!

I know you don’t want another blog post about why these buzzwords matter, so I’m not going to write one. I’d rather talk about diversification.

For direct response fundraisers, this is the lens we should be looking through. Trying to be everywhere is great, but if we’re being honest, not always realistic from a budget perspective. So instead, how do we develop strategies that are not quite so channel dependent?

Let’s start with email.

If you’re like most NPOs, somewhere between 15 and 30% of your digital revenue is coming from email. If you’re on the higher end or above, it might look good on the bottom line, but it’s something that should concern you a little bit. No, email isn’t dead, but its role in the fundraising ecosystem is changing. Attrition and deliverability are real problems, and while the tools we have available are helping us be more responsive and strategic in our approaches, we know email still requires a great deal of care and feeding to keep it viable and productive.

Email needs help.

In the grand scheme of things, email is really just another targeted ad impression. Other than search, it remains the easiest to directly attribute revenue to but if you’re judging email on that basis alone you’re doing yourself a disservice. Also, when you factor in platform costs and all the care and feeding mentioned above, I think you’d discover that your real email CPM isn’t that different than other paid digital channels.

We have seen our clients’ email programs without exception benefit from support in display and social. Opens, revenue, etc. all improve with investment in other digital channels.

It’s not just about investing in those channels to support email however – it’s about lessening the revenue burden ON email.

Invest in targeted paid digital media.

Aim to build a program that strategically leverages targeted paid digital media – such as paid display, paid search and paid social – in combination with more rewards or incentive-based cost per acquisition donor programs. Once established, you’ll find these can each become their own revenue streams and pillar strategies.

But what about attribution?

I know this opens a bit of a Pandora’s Box… attribution. Don’t freak out.

If you’re newer to some of these channels, start by establishing some simple time-based attribution models, giving more credit to view-through conversions that happen within hours and less to those that happen within days. Learn and set expectations for the number of new donors acquired through different techniques and model the LTV of these donors against the investment.

With first party data targeting you can send less email and protect the integrity of your database knowing that you’re making your impression in other channels – mail included. The objective, ultimately is simple; increase overall digital revenue through increased visibility and discoverability.

Does it require investment? Yes.

Should you expect a net positive return immediately? No.

Can all this lower funnel spending be more efficient with support from the brand? Yes, but that’s for another post.

Far too often, lower funnel direct response tactics are being asked to do both and as such, expectations for revenue are inflated.

But I digress…

Set achievable goals

You can definitely set goals for your various tactics. A 2 to 4% conversion rate for search, 50 to 60% return on ad spend through paid display, etc.

Track the value of the new donors acquired and the incremental value from renewed and reactivated donors and measure your success against the growth in your site activity and overall revenue generated online.

Over time, you will grow your digital revenue stream and lessen your reliance on email to carry so much of the weight.

And now, a shameless plug.

If you’re going to be in Chicago for the DMA conference, and want to hear more about this, come check out our session ‘Making the Most of Your Digital Program’ at 2PM Central Time on August 29th. You can heckle me if I say omni-channel or multichannel.

7 Ideas to Rev Up New Donor Acquisition

Chad Lucier
Chad Lucier
Vice President, Account Services

New donor acquisition ain’t what it used to be.

While it’s a road that continues to be traveled by most nonprofits, it’s filled with more bumps and potholes than ever, as evidenced by the Blackbaud donorCentrics Index:


blackbaud-chart

There is some positive news: nearly ½ of all organizations realized a positive change in 2016 and the median decline was only -1.2%.

Regardless of whether you’re in the 51% on the decline or in the lucky 49%, here are a few ideas that might help rev up your new donor acquisition program:

1.    Invest in paid search

The Chronicle of Philanthropy ran an article several years ago that has always stuck with me.

It stated that four out of every five donors research an organization before donating. I imagine this is even truer for new donors than existing donors. This means that optimizing your Google grants and paid search investments will ensure that your prospective donors not only find you, but that they get the message you want.

More importantly, a good paid search strategy is critical to capitalize on the awareness and intent being created by all of your on-line and off-line efforts.

If you want to read more about digital acquisition, check out Jeff Ostiguy’s blog post.

2.    Consider insert media

Insert media utilizes 3rd party companies and publications to distribute your offer directly to individuals. This can take the form of anything from statement stuffers to catalog bind-ins to newspaper inserts.

Insert media has one distinct advantage over direct mail. Because there is no postage or addressing involved, the cost to produce and distribute insert media is significantly less than direct mail. As a result of those low costs, you can reach a much larger audience and deliver a significant number of impressions.

Although response is significantly lower than direct mail, those cost savings can result in a similar upfront CPDR and by all indications life time value is just as strong. For one client we’ve seen a 20% improvement in the CPDR.

If you’ve maxed out your direct mail acquisition efforts, insert media may provide the incremental gains needed to get back on the path to growth.

3.    Use back-end premiums to boost response

Back-end premiums are growing in popularity; most insert media packages utilize them, many DRTV spots offer one for becoming a monthly donor and Peer-to-Peer campaigns are using water bottles, fleece jackets and the like to promote higher gift levels.

More organizations are using them in the mail to effectively increase response rates, and in some cases average gift size.

In three separate client tests, back-end premiums drove significant improvements. Response rates increased by a minimum of 20% and average gift improved by as much as 25%.

If you haven’t tested a back-end premium in the mail, maybe it’s time. I also recommend testing the price point right out of the gate since it can greatly influence both response and average gift.

4.    Consider front-end premiums, too

Hate them all you want. But there’s a reason a majority of organizations use them: they drive response. In many cases those address labels or note cards will increase the number of donors at both ends of the giving spectrum.

Below is one recent example of where a premium was tested against a non-premium and resulted in more new donors at all gift levels.

Compared to the non-premium, the premium generated:

70% increase in $15+ gifts
49% increase in $25+ gifts
10% increase in $50+ gifts

The average gift was $28 for the non-premium and $21 for the premium, which as you can see, can be very misleading. A gift distribution is critical to understanding the value of your premium based acquisition package.

If you aren’t using front-end premiums, they are worth another look.

5.    Use non-premiums for higher value donors

A non-premium based acquisition package won’t increase the number of new donors at the same rate as premium packages. But package costs are low and lifetime value is high so there are plenty of reasons to incorporate non-premiums into your new donor strategy.

To get the most out of your non-premium strategy, make sure you reinvest those cost savings.

While costs vary widely, many non-premium packages cost $100/M less than a premium-based package.

If you are mailing five million non-premium packages, that is $500,000 that you can reinvest in either increased volume or one of the other strategies noted above. By doing so you may actually reap the benefits of both a larger and more valuable donor universe.

Like a balanced portfolio of stocks and bonds, a combination of premium and non-premium acquired donors will typically yield the best balance between growth and value.

6.    Retarget website visitors

Most organizations are retargeting their website visitors with banner ads … but how many are retargeting those visitors with direct mail appeals?

By all accounts, retailers and other commercial organizations are successfully using direct mail to convert web site visitors to customers. This usually takes the form of a postcard featuring a product that you browsed online. While application and execution may be different for non-profits, it is an exciting opportunity nonetheless.

Although this is fairly new to the non-profit space, the potential exists to convert a number of returning visitors or donation page abandoners into donors. This could be especially meaningful for organizations with significant web traffic.

At the very least, this is a new way to target a warm prospect universe.

Which brings us to…

7.    Don’t neglect warm prospects

The path to growth isn’t always through new donors. Sometimes it is more productive to mine the event names or memorial donors that are on your own database than it is to acquire a new donor.

The trick is in identifying the ones most likely to respond. For some ideas on the matter, I encourage you to read Brian Murphy’s recent post about uncovering the buried treasure in your database.

What did I miss? Please share your thoughts and ideas about how to rev up your acquisition program by clicking here.

Tax Reform and You. What Does It All Mean?

Eric Johnson
Eric Johnson
Vice President, Business Development

With President Trump unveiling his tax reform plan in recent days, we’re left wondering what it all might mean for donors and those that do the noble work of fundraising to help others.

In short, we don’t really know quite yet.

We do know that the once-feared reduction in the charitable tax deduction is not part of the President’s proposal. At least for now. And that’s a good thing.

Or is it?

The Trump plan holds the charitable deduction as-is, but looks to double the standard deduction. This change might actually reduce the number of Americans that need to itemize the charitable tax deduction.

If fewer Americans itemize the charitable tax deduction will they actually give less? Tim Delaney, president and CEO of the National Council of Nonprofits seems to think so and was quoted as saying, “Pronouncements of keeping the existing tax deduction for charitable giving create the impression that the status quo would remain, but proposals to double the standard deduction would effectively eliminate the tax incentive for millions of individuals and couples to give to support the work of charitable nonprofits in cities, towns, and rural areas across the country.”

The President’s statement was released on Wednesday, April 26th and has been described as “skeletal” and “a single page filled with bullet points.” In other words, there are plenty of holes and questions outstanding.

As the details of the President’s tax plan become clearer, so will the potential impact on your donors and their financial support. Until then, we recommend these articles for perspective and opinion:

New York Timeshttps://nyti.ms/2plNwHw

The NonProfit Timeshttp://www.thenonprofittimes.com/news-articles/initial-tax-proposal-leaves-charitable-deduction-alone/

Forbeshttps://www.forbes.com/sites/ashleaebeling/2017/04/26/trump-tax-reform-save-for-charities-is-illusory/#7094dfda7888

Beyond the obvious of keeping close tabs on potential changes, nonprofits must strive to be highly-relevant to their constituencies. This will help ensure that contributions won’t decline, even if the tax plan impacts the charitable deduction directly or indirectly.

While THD doesn’t have a crystal ball, we know using data, being nimble and responding swiftly ensures organizations continue to deliver on their missions when donors are faced with issues like tax reform.

To weigh in on this important topic click here.

Is there buried treasure in your database?

Brian Murphy

An interview with Brian Murphy, Senior Vice President, Marketing Analytics & Technology

Q: Brian, acquisition is getting more expensive by the day. And as many as 70% or more of new donors won’t ever give a second gift. But what are the alternatives?

A: Well, a number of nonprofits own an asset that isn’t being utilized to its fullest: their database. There can be hidden treasure in a database – names that have been acquired and paid for but for all intents and purposes are buried.

treasure

Q: What kinds of treasure are we talking about?

A: Untapped revenue sources.

One of the largest sources may be donors who have been lapsed for a decade or more. But they could also include event participants and donors, advocates, and people who were engaged in other types of peer-to-peer programs.

We’ve found that if we approach these audiences a little more creatively, they can be cost-effective alternatives to acquisition in many cases.

Q: You say that you’ve been able to reactivate donors who’ve been lapsed for 10 years or more? How?

A: It’s hard to reactivate long lapsed donors when you’re using RFM, which treats everyone within a segment the same way. But a number of nonprofits have experienced great results through modeling at the individual level.

Q: How about modeling for lower dollar donor records? Those that have given before, but gave a small gift.

A: I’m glad you asked about that and you’re right. While the “M” in RFM – monetary – is really important, a well-built model looks well beyond the amount of a previous gift and identifies donors with both the ability to give again and give at a higher level.

Q: What can modeling do that RFM can’t?

A: To give you an example, THD’s lapsed reactivation model leverages thousands of data points – psychographic, behavioral, transactional, engagement, motivations, preferences and far too many more to name – to pinpoint with surgical precision the lapsed donors most likely to renew their support.

To continue the buried treasure analogy, it’s the difference between sweeping the ocean floor with a net or using the most sophisticated radar technology available. With the technology, you have the equipment you need to find exactly what you’re looking for.

Q: Beyond long lapsed and low dollar donors, where else have you seen success?

A: Over the last few years, we’ve also seen a dramatic fall off in nonprofit peer-to-peer programs like Family and Friends Drives and Neighbor-to-Neighbor Campaigns. This is another area where modeling can make a huge difference. We can model participants as well as donors.

Q: The same basic principle applies to event names as well, correct?

A: That’s right. And for nonprofits who do a great deal of advocacy, those names could be another source of untapped revenue.

Q: Isn’t modeling costly?

A: I think there is a real misconception about the cost of modeling. Many modeling vendors, including THD, will build a model and execute a test to measure model performance at little expense to the client. Test costs are typically much lower than other alternatives – for example developing and testing a new creative package. And the risk is very low because you only need a test panel with enough volume to get a statistically valid read.

But the exciting element of modeling for me is the immense VALUE it is driving for our clients’ programs. The return on investment (ROI) is usually very high.

Q: So you consider modeling a low risk and high value method of mining your database for “buried treasure.”

A: I couldn’t have said it better myself.

To continue this conversation with the team at THD, click here.