Blog Post

  • Marketplace

Evolution of NFP marketing

Donated to charity recently? Don’t worry, there’s no guilt trip coming from us.

As the cost of living grows, hip pockets get tighter and our motivation to exercise our good will through charitable donations inevitably drops too.

So how do charities and not-for-profits rise above and achieve success in this marketplace?

Stop selling guilt

If you’ve been contacted by a charity in recent months and years, you’ve probably been taken on a long and winding guilt trip.

You’ve also probably received emotive images and stories of animals, humans and environmental regions in need and told your support is the only thing that can stop ongoing hurt for the former.

Guilt is an effective motivator for these one off interactions, but it doesn’t encourage brand loyalty and repeat donations, which is ultimately why charities spend so much on call centre salespeople to make contact with you month after month, after month.

It’s all well intentioned and we certainly don’t wish to criticise such important work, but it’s the wrong marketing approach.

At present, there’s very little repeat business in this sector, and that’s derivative of the marketing and sales strategy being taken by organisations within the marketplace.

If only they had a marketing strategy of encouraging both those values of loyalty and repeat donor-ship to avoid such crippling sales & staffing overheads…

Start selling ‘member benefits’

One of the biggest marketing mistakes we’re observing being made by charities is having no system in place for rewarding the support of its donors.

Now you might say that getting something back isn’t the point of a charitable donation, but how many charities would you support if they all delivered with a set of benefits for you?

We’d wager that number increases and that’s advantageous to every charity in the marketplace.

As mentioned at the top of this post, people are more money conscious than ever, so charities and not-for-profits need to focus on creating a strong motive to donate.

In our opinion, it comes down to fundamentally changing the way you view your market:

  • Should they be approached just as donors, that come and go?

  • Or are they members, who should get a set of benefits from you for their continued support?

It may sound trivial but it revolutionises the way an organisation interacts with their market, and its worth every charity and not-for-profit having a good think about this marketing crossroads.

By treating donors as members, the sales pitch changes from asking for their financial support to saying, “sign up today and receive these benefits, for only X per month".

Isn’t that a much better phone call or email to receive? We think so.

The subscription model

Charities can execute this strategy in a couple of ways, the first being via a subscription style approach.

Like with any other subscription, it involves a sign up from the end user, in order to get a series of benefits, typically on a monthly or annual basis.

What those are, we’ll leave up to your imagination but the typical examples are gift cards, entries into a monthly draw for a prize, branded merchandise and discounts at certain retail partners.

We’re seeing this a lot more in the marketplace via a ‘paycheck pledge’ whereby someone will pledge say $5 from their monthly paycheck to a charity, that gets direct debited each month in return for benefits like those above.

A great example of this is from Australian not-for-profit Socially Conscious Club, who sends out a box of socially conscious goodies to members monthly in return for their donation commitment.

Provided the numbers are crunched and the benefits not too cumbersome on the organisation’s bottom line, charities stand to do exceptionally well out of this model, with the potential being to sign up 100 new members up to a package of this kind, creating a steady, predictable stream of donations that can be used to fund major campaigns in the calendar year.

The tiered, campaign model

The second way, and most popular in the marketplace is to focus on a key event and offer benefits in order to encourage bigger donations for that drive.

Think Movember, Shave for a Cure - there’s a specific way these organisations use milestones and incentives to get more donations from the market during their donation drive, and it’s a marketing lesson for all to consider.

Getting someone to donate in the first place is just one part of the marketing strategy’s job; the other is to see their $30 donation turn into $300.

A great example is Parkinsons Australia and their annual event ‘A Walk in the Park’.

To encourage registered participants in their annual park walk to reach $25 in donations, they received messages via phone and email about the free event t-shirt they would receive by reaching this $25 milestone.

The process was repeated, and the freebies duly upgraded for $100 milestones, $200 and so on.

Despite a decrease in event registrations, a Walk in the Park raised $260,000 against a $185,000 revenue target that year, exceeding expectations and resulting in a 27% year-on-year increase in donations.

Less donors = more donations.

This tiered approach transforms the donation process into a goal based, almost competitive environment whereby the supporter gets something back for their increased support, and it’s the future of donation drives, in our opinion.

So you see, giving something back doesn’t have to mean cutting into your bottom line. In fact it can mean growing it exponentially.

Contact us about helping your business recognise shifts in the marketplace.

Published on June 26, 2018 by Jordan Fitzgerald