Top 5 tips for acquisition and retention in the charity sector
The ill winds of an economic downturn can have a devastating effect on charities, but as Britain pulls out of recession these good causes will be hoping for a boost in fundraising as donors once more feel able to support their favourite organisations.
It’s a good time for charities to review the way they go about drumming up new donors and then ensure they remain valuable supporters for the long term. Here are five tips for best practice in third sector acquisition and retention:
1. Embrace diverse and long-term communication
Harnessing the power of a range of media is critical. A sector that was once reliant on direct mail now has many other channels at its fingertips. Digital media are growing in importance as charities look to target a more technology-savvy audience, not least the younger end of the market who are the donors of the future.
Still, the transition will be slow and steady as third sector organisations can’t afford to simply throw the baby out with the bath water and dump traditional media for new, exciting channels. A communications strategy shouldn’t be one size fits all and must draw on donor and prospect data to be successful. We’ve frequently seen charities making the mistake of trying new channels but not adapting the correct tone or frequency of messaging for different audience segments.
Whatever the media approach, the overall strategy should be one of engaging the donor, not just asking for money. This engagement is a long game; charities need to foster relationships well before the person they are targeting actually becomes a donor, seeding messages to spark interest and ultimately convert them. While this can be a long-term strategy that doesn’t offer immediate returns, over time the engagement will be stickier and more valuable.
2. Understand and target new audiences
The charity audience is changing. What might be thought of as staunch, traditional third sector support is an ageing demographic, so charities must seek to discover people beyond this age group to expand their donor databases. It is becoming increasingly important to understand the full customer journey and ensure there is integration between acquisition and retention tactics.
For example, in a fast-moving and complicated media landscape, people who were 70 ten years ago are going to be very different donors to those who will be 70 in a decade’s time. Research points to those people who are currently approaching retirement age being a lot savvier around technology, but that doesn’t necessarily mean they will only engage via digital channels in future. There will always be a place for print media as people like tangible communications, so considering traditional direct mail as a way to prompt online action will be a crucial consideration.
3. Know your database
It may sound simplistic, but any charity needs to truly understand its database. Knowing the profile of the donors informs their journey, meaning that they can be engaged effectively over the years to count on their support. Through careful data analysis, insight and action, charities can deliver a customer journey that meets the dual objectives of efficiency and delivering value to donors. The key is to constantly look to migrate donors from low to high value, through efficient segmentation and data-led campaign strategies.
Meanwhile, knowing the make-up of the donor database is a stepping stone to finding ‘lookalike’ prospects. By seeking similar individuals to target and by developing acquisition campaigns accordingly, supporter numbers can swell. Lots of charities switched off their acquisition budgets during the recession but are now aiming to bring new people on board. Charities should consider the donor as an individual, not purely as ‘volume’. What matters to that person, which product will prompt the best response, which method of communication works best for them?
4. Integrate acquisition and retention
Once a donor is on board, it’s easy to think all the hard work is done. But a clumsy handover process from acquisition to retention teams risks alienating the supporter. First-year attrition rates are high, therefore securing repeat pledges in the first six months is crucial. Each donor should be treated separately and made to feel important. Charities should take a lead from one medical charity, which has a distinct nursery programme for supporters in their first year. One important factor is to ensure the messages made during the acquisition phase are matched with seamless delivery in retention, ensuring the relationship blossoms and the donor remembers and feels certain why they signed up in the first place.
5. Test and learn
Accountability is high in the third sector, so a test and learn approach to donor strategy should play a major part acquisition and retention. In fact, charities are among some of the best practitioners of test and learn. By analysing and refining the finest details of communications, for example email subject lines, campaigns can be constantly augmented to become ever-more efficient; costs are kept low and donors see a higher level of engagement.
The charity sector is about to see major changes in the way it operates fundraising campaigns because of forthcoming European data legislation. Test and learn will become even more critical as organisations seek smart yet compliant ways of reaching their valuable donors and prospects.
By Stuart Huke, Media Director, Response One, and Rachel Strong, Account Director, Occam – both St Ives Group companies