Blackbaud have just released their 2011 Internet and Multi-channel Giving Benchmarking Report.
Based on data from 28 US nonprofit organisations, It takes a long-term look (5 years) on how donors move between online and traditional direct marketing programmes.
It's a US study, but many of the findings can be broadly applied to the situation in the UK.
The report is packed full of interesting stats and graphs that make it worthy of detailed study. It can be downloaded here. But just in case time is tight at the moment, here are my particular highlights...
- Direct mail is still king.
- More donors are being recruited via online routes.
- Online donors tend to be younger, richer and more generous than those acquired through the mail.
- But they also demonstrate lower levels of loyalty.
- Robust DM programmes drive up the retention and long-term value of new donors acquired online.
- Online donors also tend to give less once they move offline.
The report also shows that though online donors are happy to give through the mail, there is not much traffic moving the other way. DM donors like to stick with their mailing packs. I rather like this chart showing movement of online donors since 2007 (you'll find the corresponding one for mail recruits in the report) ...
Most charities have pretty advanced direct mail programmes and it's relatively cheap and easy to put online donors in a direct mail communications stream and be pleased with the results. Whereas many of those same charities are still finding their feet when it comes to online fundraising - particularly with warm donors. The report sums up the situation rather neatly...
"The Internet is a successful acquisition channel but it has not proven to be an effective one for retention."
In the UK, the major utilities are persuading ever increasing numbers of customers to engage with them online. In 2010, almost 2 million payments to British Gas and 40% of their customer contacts happened via the web.
So why can't charities achieve the same results?
I think they can. But we need to look at the medium in a different way. If you analyse what happens online when a mailing goes out, you'll find an increase in hits and donations. Call me crazy, but I think there's some sort of correlation here (you can read more about this on this previous post).
The trouble is, most websites aren't built to be fundraising vehicles. Instead the homepage can end up being a battleground where departments fight to get 'their' message out – ideally above the fold.
So when a donor gets a mailing pack and thinks it might be easier to give online, a visit to the charity's website can leave them rather confused. In the worst case they may even end up questioning what the charity actually wants - particularly if they are confronted with a campaigning action or policy statement instead of something that supports the appeal.
And there's little point giving a donor the address of a specific landing page in your mailing pack. Track your statistics and you'll find few actually type in www.insertcharitynamehere.org/christmasappeal. Instead they do what they normally do and find your home page via Google.
We shouldn't really be surprised about this. If we look at the other multi-purpose communication device used by charities – the newsletter – we find that these aren't very responsive either. But when we repurpose them with a specific goal such as raising funds, they do very well.
It's the same when we build a site with the goal of retaining and upgrading donors rather than just hoping our current website will do the job for us. We find – as if by magic – we retain and upgrade our donors.
The techniques required to do this aren't rocket science. They are the same rules that we use to create effective direct mail programmes, the most important of which are...
- Show the donor what they have done.
- Make the experience personal.
- Demonstrate need.
- Offer incentives for actions.
For me, this report offers a challenge. It shows that where we fail to engage donors, we also fail to raise funds. If we are to tackle this situation (and improve the retention rates of all supporters) we need to look again at our websites and ask ourselves if they give donors what they want?
Because when it comes to fundraising, this report firmly suggests that they aren't.