Connections : multichannel

Does Online Cannibalize Offline Fundraising?

Steve MacLaughlin — Tue, 07 Jul 2009 15:41:00 GMT

This question seems to come up all the time when looking at online giving trends. It came up just the other day at the Institute of Fundraising Nation Convention in London. And the answer to the question is very simple — it depends.

Your Results May Vary
The cannibalization argument says that the growth in online giving comes at the expense of donors who used to, or would have otherwise, given offline. I have seen customer data that backs up this argument and I've seen data that refutes it. Your own trends may differ and it is extremely important to analyze your online and offline donor data together to see what is happening. It is also important to look at how giving to different channels impact the size, frequency, and length of giving. Start by checking a sample of your own data. Your own results may vary.

Changing Channels
The 2008 donorCentrics Internet Giving Benchmarking Analysis examined how donors change channels over time. The Target Analytics study found that online donors do switch to become offline donors, but offline donors rarely become online donors. The same trend was true in the 2006 report and has held up over time. This trend means it is very rare for a traditional offline donor to change to online giving and any cannibalization would be very minor. If you are looking at things from a siloed perspective, then it would actually be more accurate to say that offline probably cannibalizes online. Of course, that would be a very short-sighted view of what is really happening with giving channels these days.

Don't Confuse Programs and Channels
Major giving and annual funds are programs. Direct mail and email are channels. Be very careful not to confuse the two. Email-driven giving doesn't steal from the annual fund. But it may be drawing donors away from those that traditionally gave via direct mail. Many claims of cannibalization are rooted in highly siloed organizations or where the culture rewards hoarding of donor groups. This is why it is so important that programs in the organization use multiple channels to drive giving. The annual fund program might choose a strategy where direct mail, phone, email, and social media channels are used to bring in new donors and retain existing ones too. Focus on the right mix of channels that complement the program and the donors you're trying to engage.

Where the Growth Is
Target Analytics noted in the donorCentrics study that as much as 16% of new donors and 27% of new revenue came from online in 2008. Compare that will a recent downward trend in donor acquisition using offline channels like direct mail. These donors also typically give more online than offline donors. Blackbaud's analysis of online fundraising continues to show positive growth on a year-over-year basis. I am sure at one point in history there were arguments over how the telephone was cannibalizing the telegraph. Even today there are debates over how debit cards are ruining the check writing industry. This seems to me like misdirected angst. But few would argue that giving donors more choice and options is a bad thing.

The Donor is Always Right
Whether they choose to give online or by mailing in a check or during a phone-a-thon then that is the donor's choice. You might limit certain options or focus on certain channels but the donor always has the final choice. In a world where there are more and more options for donors and no shortage of organizations willing to personalize the giving experience the successful nonprofits will be those that embrace donor choice. Don't forget to give your donors choice and let them make choices that are right for them.

2009 Institute of Fundraising National Convention

Steve MacLaughlin — Mon, 06 Jul 2009 07:47:00 GMT

This week is the Institute of Fundraising National Convention here in London. The Institute of Fundraising is the professional body for fundraising in the UK and the national convention has a big event since 1988. There will be over 1,700 attendees from across the UK and Europe. Look for the #iofnc hash tag on Twitter to follow the action.

The IoF is having individual one-day conferences within the Convention called Focus On sessions. Today's Focus On sessions are all about E-Media and Fundraising. There are four sessions all about the Internet and digital media from a variety of different speakers.

I've been invited to speak as a part of these sessions. My session is called "Unleashing Integrated Online and Offline Strategies To Get Results" and it combines some information specific to Europe as well as trends happening throughout the nonprofit sector.

The multichannel integrated marketing topic is not a new one for me, but I'm adding some new connections to social media. We are now dealing with a whole new wave of channels that nonprofits can use to engage supporters. But balancing broadcast, direct mail, online, and social media requires some vision, a solid strategy, and a willingness to break down silos within the organization.

When Marketing and Fundraising Collide

Steve MacLaughlin — Tue, 02 Jun 2009 18:25:00 GMT

We see it all the time. Marketing sees the Web as part of its overall communication strategy. Fundraising sees the Web as a place to engage donors at lower costs and reach out to a broader set of constituents in new ways. Ultimately, they both want to achieve success for the nonprofit. But initially, they usually knock heads when trying to pick the right online solution.

The Standoff
Marketing wants to use the Web to build awareness, improve communication, reinforce the organization's brand, and drive people to donate by using compelling messages and stories. Fundraisers want to provide a variety of online giving options, receipt and steward donors in appropriate ways, build relationships to encourage repeat giving, use online ask ladders to assist with a moves management plan, and acquire new donors at lower costs than traditional fundraising channels. Sometimes marketing gets too caught up on what they can't do today. Sometimes fundraising gets too caught up on how they do things today. This leads to a standoff between the two groups and the creation of lots of silos.

Breaking Down Silos
Nonprofits that operate in silos needlessly waste time and resources maintaining those silos. Sometimes those silos are political or territorial. Sometimes those silos are systems or resources. One group owns the data or another group owns a group of donors. One group owns the CRM or another group owns the content. And these silos get created or reinforced by choosing or keeping fragmented systems. If your supporters only knew what went on in the silos, then I suspect they might not be so supportive.

Leadership Must Lead
Leaders in the organization can be the difference. They can take a hammer to the silos. They can remind people to focus on the goals and needs of the entire organization instead of those of individual departments. That isn't always the easy answer, but it is the right one. And when you break down the walls the view of what needs to happen becomes much clearer. You will quickly find that marketing and fundraising have most of the same goals and audiences in common. Imagine that! The successful nonprofits have leaders that aren't looking for short-cuts or clinging to silos. They are challenging the silo mentality and making changes that are making a measureable difference. What are you doing?

Multichannel Marketing Mojo

Steve MacLaughlin — Mon, 11 Aug 2008 14:20:00 GMT

There is a lot of talk and discussion about multichannel communication out there in the nonprofit world. Organizations want to do it, consultants recommend ways of doing it, and technology vendors claim to have the tools to actually get the job done. But in many cases, it's more sizzle than steak.

At Blackbaud, we've been working on delivering a true multichannel tool that allows nonprofits to do the complete lifecycle: Data Segmentation, Channel Selection, Message Creation and Delivery, and Roll-up Reporting. While some tools on the market handle bits and pieces of this process, there aren't any that embrace both online and offline channels. Until now.

Our Blackbaud Direct Marketing (BBDM) application will soon include functionality that integrates with Blackbaud NetCommunity's email capabilities. It's a great example of the Infinity platform in action that pulls multiple products together as a single robust solution.

BBDM has a very strong set of marketing planning, scheduling, segmenting, and reporting features that clients are using. With a solid foundation in place we've added new channels that can be leveraged as part of a direct marketing campaign. And we're surfacing BBNC's email tools on the Infinity platform to do it.

This is a big step in the right direction for nonprofits that want a solution that does more than just talk about multichannel capabilities. Gone are the days when you have to do your direct mail in one application, your email in another, and other passive channels somewhere else. (Nothing legacy about what Blackbaud is doing here.)

Blackbaud Direct Marketing allows users to make segmentations made up of highly granular data selections from any data source, including but not limited to The Raiser's Edge, Blackbaud Enterprise CRM, or BBNC. Then you have the option to create mailing packages that may be a direct mail piece and/or an email. If you choose email as one of the options, then you can setup the various email settings and design options without having to switch to a different application. Sending test messages or final blasts can also all be done within BBDM.

From there the integrated reporting and tracking capabilities of BBDM and BBNC kick-in. No spreadsheets or disparate system for tracking source codes. Nope, we have the tracking and finder number goodness baked right into the mailings. And conversion information can be round tripped back to the CRM. (I won't confirm or deny the rumor that grown men have openly wept upon seeing this.)

Look for this capability to get even more powerful over time. Adding additional active and passive marketing channels will allow for a more comprehensive approach to marketing and fundraising efforts. Two thumbs up to the development teams and customers that helped shape this unique solution.