The cost, value and frequency metric
I’ve spoken to lots of charity fundraisers during the past couple of months. From international charities to local community trusts the fears, focus and fundraising challenges are felt equally in these organisation despite being wildly different in terms of size, budget and resources. Focus is obviously on revenues but they fear losing their audiences when attention and traction comes from short bursts of activity. Keeping donors, volunteers and fundraisers engaged every day in your cause or campaign is a challenge for all organisations.
Sophisticated charities measure everything in their marketing and fundraising funnel; the cost of acquisition, life time value and frequency of donation over cash value, all enable them to understand historic trends in donor behaviour and predict how small changes in variables can have a big impact on revenues.
Playing with the metric predictors is important. Do more of activity A and get more attention from audience B which might give you smaller value donations but over a longer period. Or do activity C and get less attention from new donors but increase the donor value of audience D. Tweaking the slide rule of capital investment, as you can do on any comparison website, lets you see a potential outcome based on any given set of variables without committing a single penny of investment. This mapping activity is a key function of any business but by itself, as a sole method of planning future activity, I believe it narrows the view to the point it can restrict the options available to the decision maker.
When all you decision about planning are based on historical metrics your field of play gets narrower and narrower.
You stop looking outside the organisation and into different sectors of the market to see how products and services are sold to customers there. You stop being adventurous and you stop embracing change because the consequences are potentially huge.
But the consequences of a narrow view are also potentially huge. You could commit to five campaigns a year – most likely the same campaigns you delivered last year – measure your metrics and report the percentage differences year on year. But your audience moves on, it gets exposed to new ideas, media and campaigns and you risk dropping out of their mind and off their radar.
Ring fencing a platform
A lot of fundraisers are acutely sensitive about their websites and don’t like taking donors away from their domains. I can understand this, a lot of resource is invested in getting donors there; SEO, Direct Mail, Social Media, TV, Print and Radio advertising all are pointing in one direction, toward the website where the donate button is and where the retail store lives. It’s also a controlled, known measurable space. Everything on there is designed to transport a donor through content towards a call to action. Again, this speaks of an organisation operating within known boundaries, it is a platform that creates metrics and reports, both of which are important, vitally important, but it inhibits real engagement beyond the moment of a campaign and I can’t help but think it cuts the volunteer, fundraiser and donor out of the ongoing story of the charity.
Short cutting the funnel
If a charity’s marketing mix is sign posting donors towards its website it is in effect a huge and sometimes expensive net cast over an ocean of potential donors. It’s also a net with holes in it through which donors are lost as their attention is lost. So the task is simple, fill the net and fill the funnel so we get as many potential donors as possible down the funnel and to our donate button or retail store.
This is still a numbers game. Spend £000’s to get £000’s more. Pour 100,000 potential donors in the top of the funnel because we know from data 100,000 will deliver us 1,000 donors out of the bottom. We sacrifice potential for a known and by staying in our comfort zone.
Short cutting the funnel requires us to be differently minded and to tinker and play. It requires us to be growth hackers in our organisation, free from constraint with the sole remit of delivering better educated, better engaged, ready to spend donors further down the fundraising funnel. It requires us to be better at fishing. In fact it looks for ways to deliver donors through the side of the funnel closer to the donate button in greater numbers and by doing so reduce the cost of acquisition at the top of the funnel.
Growth hacking looks for value inside the organisation that can deliver instant value and learning to the customer, value that pulls them to us rather than we going looking for them. Hackers are more concerned about achieving an objective quickly rather than going through a prescribed route to achieve the same objective.
Lots of media platforms provide better engagement, mobile particularly but not exclusively. And by engagement I mean a two way conversation across all platforms. It requires investment in time and resource without the guarantee of an immediate return. It demands a management team relaxes the rains and does things differently. In the commercial world there a lots of example of this in practice and one particular favourite I’d point you in the direction of is Hubspot. Hubspot short cuts the marketing funnel by providing Marketing Grader, a free online tool that requires no sign up and enables users to grade the online marketing performance of any website. It’s particularly useful for grading one website against a competitor and if you want a report of a website’s performance you can chose to provide your email and it will send it to you.
The company, through Marketing Grader delivers value immediately to the user. In a competitive marketplace it disrupts the market, whilst reducing the size of its marketing effort and delivers an educated, ready to buy customer deep inside it’s marketing funnel. It’s still interested in measurement and metrics, it still values performance data but it decided that if it wanted to shorten it’s funnel, it had to do something differently. This tool was already available within the Hubspot Platform, it simply decided to make it available for free outside the platform to hook high quality eager customers in.
Numbers are important, performance is imperative but so is the freedom to embrace new technologies and share what your audiences value. When charities are reporting consecutive years of stagnation in donor numbers and difficulties in attracting attention to their cause they must re-evaluate their funnel, identify what their donors, fundraisers and volunteers truly value and share it with them.