An ode to the mostly filled thermometer

When was the last time you saw an analog, mercury-based thermometer?  Chances are, it was in a fundraising campaign, indicating how close you were to goal.  Even as thermometers go digital, their ancestors are honored through skeuomorphism* to symbolize progress.

But we come here not to bury the fundraising thermometer, but to praise it.

Specifically, we want to praise how the fundraising thermometer, or a specific state of it, can make people more likely to donate.

fundraising-thermometer-template

Cryder, Loewenstein, and Seltman took a look at how the amount toward goal already raised impacts a person’s likelihood of giving here.

They call it the goal gradient hypothesis: they think that people will be more likely to donate the closer a campaign is to goal.

So they tested this with Kiva, the microlending site that you may remember from such hits as “does being more attractive increase your chances of getting funded on Kiva”?  (Yes, it does.)

They found that when an individual fundraising goal was 0-33% complete, the average hourly progress toward goal was 6.7%.  When it was 33-66% complete, progress was 10.8% per hour; for the final third, it was 12.8% per hour.

So, having the thermometer partial full helped increase fundraising efforts.  This would tend to make sense, since the thermometer is a measure of social proof, a potent persuader.  (It’s the same reason that servers will seed a tip jar with larger denomination bills — it helps set the pressure and the anchor)

Hey, I can hear you yawning.  Yes, I know you aren’t going to be going on Kiva tomorrow.  But we’re just warming up.  The researchers then worked with a nonprofit to mail lapsed donors.  They had three separate goals that they were trying to reach and mentioned that one was 10% complete, a second was 66% complete, and the third was 80% complete.  They also had control conditions where no progress was mentioned.

Sure enough, the 10% and 66% conditions were not significantly different from the no progress control.  However, the 85%-to-goal piece significantly increased response rate (from .5% in the control to 1.17% in the 85%-to-goal version).

They even tested the “why” of this with donor surveys.  They asked people if they would be more likely to buy candy bars from a 7th grade fundraiser if the fundraiser was two bars short of goal or 32 bars short.  Two-bars-left won handily.  Additionally, the donors who chose the two bars indicated they felt like they were having a bigger impact and were more satisfied with their donation.

So, since not everyone can be the donation that pushes you over the finish line, how can you use this?

One tactic is to have a silent period of a campaign.  For online year-end giving, I’ve worked with organizations that will set their goal and their thermometer based on what it will take to hit goal starting from November 1, but only announce the goal and the effort on Giving Tuesday.  That way, their thermometer is at least 20% full when the first donor hits the form.

Another is to ask internal audiences (especially board members) to make the first gifts.  Showing them this research may help them feel like their gift is making a difference by getting others to give more freely.

Finally, you can define down your goal.  The 85%-to-goal condition mentioned above was based on being 85% toward buying a GPS unit for an international relief organization.  This is not a high-ticket item.  By setting the goal low, they were able to talk about 85% complete easily.  This type of microcampaign, repeated writ large, can help illustrate impact for your donors.

So keep those thermometers more than half full and you should be on your way to filling it up the rest of the way.
* A design based on an older version of an item to help people understand the newfangled version.  It’s the reason that email programs look like folded envelopes and your video app probably features an old-school movie clapper.

Thanks to Tim Vandevall here for the thermometer image.


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An ode to the mostly filled thermometer

When does a match light a flame?

We’ve talked about how a lead donation can be as or more effective than a matching gift campaign and how using a lead donation can also calm the overhead related concerns of donors.  

From that, it may sound like I’m anti-match.

 

mission2bimpossible2bfuse2blighting2bmatch2btv

(insert Lalo Schifrin score here:
BUM BUM BABA
BUM BUM BABA
WAHNAHNAAAH WAHNAHNAAAH etc.)

But I’m not.  It’s a widely used tool that I’ve found to be effective in several cases and, unlike most tactics, the donors I talk to also seem to enjoy matching campaigns.

Some research can help shed some light on when to use a match and when not to.  Karlan, List, and Shafir published a study in the Journal of Public Economics (and who doesn’t pick that up for a little beach reading over the summer) looking at match rates.  

Normal studies tend to focus on whether the match works overall: yes it does or no it doesn’t.  This study, however, gives some guidance on when to deploy a match.  It also cross-deployed the match with a test of urgency, which is one of the building blocks of influence.

So there were four test conditions:

  • Matching gift with urgency (with a reply device and PS that said things like “NOW IS THE TIME TO JOIN THE FIGHT!”; you can tell it’s urgent because it’s in ALL CAPS!).
  • Matching gift without urgency
  • Control with urgency
  • Control without urgency

And they did a bunch of other stuff also that is not relevant for our purposes here, including testing different match sizes and timings and such.

The authors found that urgency actually hurt the appeal in many cases (probably, they hypothesize, because there was no particular reason given for the urgency; when it was combined with a match deadline, this negative effect disappeared).

As for the matching gift, there was evidence that it worked, but it only worked for donors who had made their previous gift in the past year.  These donors were 3.2% more likely to donate with a match in place and their average gift went up.  On the flip side, donors who had last given more than 12 months prior had their response rate drop when the match condition was in place.

I mentioned earlier that the donors with whom I spoke seemed to like the tactic and that seems to be supported by this study: active donors do like a match.  However, it seems to bump into trouble when the person has not donated reanecdotalcently.

There’s likely one exception to this (and this is based only on anecdotal evidence, so take this with an appropriate-sized amount of salt).

I have found that people who have given to a match before are more likely to give to a match again.  Thus, if you are suppressing out 13+ month donors from your match campaign, I’d counsel you to leave the ones who have shown the tactic has worked for them.

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When does a match light a flame?

Nailing the direct marketing-event relationship

Yesterday, I argued:

a quality direct marketing program can help increase both event and non-event giving.  Moreover, you get people who are more connected to the organization.  And when these people are already giving to 6-9 other organizations, usually through direct marketing, unilateral disarmament doesn’t seem the wisest approach.

Let’s test the three major assumptions here:

  • Event participants and donors are connected to your organization
  • Event participants and donors are likely direct marketing donors
  • Direct marketing can raise all boats

First, are event participants and donors really connected to your organization?  Yes and no.  Certainly they are willing to give money that benefits your organization.  However, let’s take a donor to a person’s walk team for your organization.  Your organization clearly isn’t repugnant to them.  However, they are likely giving more to their friend than to your organization.  So let’s say they are more likely to support you than a person off the street would be (because some of them won’t like your organization), but not much more likely than the average outside acquisition list (because you’ve chosen those lists to include people who support like-minded organizations).

fh6wo8vmcukic2qcl4p2lq Second, are event participants and donors likely direct marketing donors?  Yes and no. Yes, because they are willing to give to charity.  Gallup asked Americans if they gave to charity in the last year.  As you can see, not everyone did.

If you set aside that people are likely to inflate their charitable giving to pollsters, you have one out of every six people who don’t give to charity.  Clearly, you’ve weeded out this group by talking to event folks.  However, it’s likely that your event participants are different demographically from your “normal” direct marketing donors.  If you take an extreme example like walk participants versus telemarketing or mail donors, you may find that the former are demographically the sons and daughters of the latter.

Thus, as before, they are more likely than a person of the street to donate through direct marketing.  But they haven’t proven channel responsive and that could be troubling.

 

You might question, then, whether event participants and donors are good direct marketing prospects.  The answer is definitely yes.  Both Making Strides Against Breast Cancer and MS Society (this link goes to an excellent webinar on the topic) reported significant gains in both event and direct marketing revenues from adding direct marketing to their marketing mix for events.

So why?

It’s because these communications centered on the person’s previous experience.  I can support this anecdotally. I’ve both customized communications to walkers and walk donors and dropped them unprimed into an ongoing direct marketing stream.  Customized is better.

What would a program like this look like?

Recruiting people to the event: This would include inexpensive communications to your existing constituents about the event (inexpensive because the transitive property says that if your event donors are unlike your direct marketing donors, your direct marketing donors are unlike your event donors).  These could include buckslips, stories in existing donor newsletters, email communications, outbound voice mail announcements, and online co-targeting.  Using lookalike audiences and remarketing could also help bring new people to the event.

Reattracting lapsed participants: This would look very much like any other lapsed campaign you would run.

Engaging current walkers: Try new walker online welcome kits that engage walkers in the general mission.  Also, don’t forget direct marketing nudges to fundraise for the event.

Converting the event donors:  Here’s where you customize your regular communications to event participants.  You might even try “The walk is over, but the fight continues” walker specific emails and mail pieces, but mission-forward pieces and engagement opportunities like surveys, membership appeals, and the like tend to do better with this audience.  And, as any good donor steward knows, making sure these event donors get outstanding gratitude is highly predictive of future donations.  

And, as I’ve stated previously, because of the inherent national/field friction in some national organizations, I would strongly recommend running these techniques as a test in year one with sites that are willing to experiment.  Using the other sites as a control, you can then present how much better the direct marketed to walks did versus those that didn’t have the wind at their back from email, online, mail, and telemarketing.
Hopefully, this will help you acquire your own donors and cross people over into organizational/cause donors.  More importantly, I hope it helps break through the “my donor” mentality that can be so destructive to programs.

Nailing the direct marketing-event relationship

Easter eggs in your donor database (guest post)

I have the privilege of sharing a guest post from Angela Struebing, president of CDR Fundraising Group.  For more insights from Angela and the CDR team, you can try their blog here.  Thanks, Angela!

eastereggs

Every year I organize our neighborhood Easter Egg hunt. I stuff and hide over 600 eggs and love watching kids run through the field searching for them. The excitement they feel when finding an egg is the same rush I get when I discover something actionable in a client data file. It got me thinking about some data eggs that are often hidden. For some you have to look a little harder, but the answers are always in the data.

  • When evaluating list performance look past initial response metrics and assess long-term value (LTV) at an individual list level. We often find that lists that look bad upfront may show life when looking at 12-month or 18-month payback periods or retention rates. The same goes for looking at LTV by package. A test that might have had a lower response initially may bring on more loyal donors over the long haul. Make sure you look well beyond just campaign reports for this information.
  • Along the same lines, matchbacks where you look at returns that may be coming in through one channel but driven by another, is another hidden gem in your file. This is especially true for brick and mortar institutions where a recipient gets a mail piece and can respond through the mail, via phone, online, or in the lobby. In order to gauge true list value, you’ll want to look at all response channels and see from where the response was driven. This will also encourage you to make it as easy as possible for donors to give through any channel.
  • This leads us to multi-channel migration and attribution analysis. You’ll want to understand if donors are migrating from online to offline or offline to online. While counterintuitive, we see more people giving an initial gift and then moving to offline giving than vice versa. Knowing this may change your marketing focus. Attribution is critical to making investment decisions and understanding how the various channels are working together.
  • I find lapsed donors particularly interesting and profitable. They have already exhibited an interest in your mission. They can usually be reactivated for less than it costs to find a new donor and are more valuable to an organization (based on number of gifts and average gift). Take the time to test what really works with lapsed segments. Do they perform better in acquisition or to housefile packages or perhaps a tailored lapsed package? All lapsed cohorts aren’t the same with deep and recent lapsed names performing very differently. Should you use a reduced ask, Most Recent Contribution vs. Highest Previous Contribution or generic acquisition string? Do you reference their previous relationship or – if they’ve been absent long enough – treat them as a prospect? How far back can you mail? All of the answers to these questions can be found within your database (and carefully crafted tests).

These are just a few of the things I go looking after when reviewing results and file trends. What hidden gems have you found? Happy Hunting!


C80B9596crcloseANGELA
Angela Struebing is president of CDR Fundraising Group, a multichannel agency focused on helping nonprofits maximize their online, direct mail, telemarketing and DRTV fundraising results. As president, Angela is responsible for overall agency management and strategic planning for national nonprofit clients to include Shriners’ Hospitals for Children, MoMA and the Marine Toys for Tots Foundation.

 

Easter eggs in your donor database (guest post)

It’s time to stop… the donor pyramid

All pyramids are lies.They have a dishonest scheme named after them.  They will not keep your razor blades sharp or apples fresh.  They messed up the four food groups.  Maslow’s Hierarchy of Needs isn’t really true (in the sense that there are fundamental needs, but there isn’t a hierarchy).  Even the Egyptian pyramids were really built by aliens.  I know that last one is true because I saw it on the History Channel and you can’t have lies in history.

They have a dishonest scheme named after them.  They will not keep your razor blades sharp or apples fresh.  They messed up the four food groups.  Maslow’s Hierarchy of Needs isn’t really true (in the sense that there are fundamental needs, but there isn’t a hierarchy).  Even the Egyptian pyramids were really built by aliens.  I know that last one is true because I saw it on the History Channel and you can’t have lies in history.

i-am-not-saying

It’s time to give up the donor pyramid as yet another three-dimensional-triangle lie, something that desperate presenters shove into PowerPoint slides to give the illusion of intelligence.  (See also: clipart of stick figures doing things, photos of people shaking hands, any time arrows make a circle.)

So let’s see and know the enemy:

pyramid-12

It looks innocent enough.  But do not be drawn in by its tetrahedral lies.  These include, but are not limited to:

Steady steps up the pyramid.  Some illustrations even have a person climbing up the side of the donor pyramid like Yodeling Guy from The Price Is Right (I’m sure Yodeling Guy has a canonical name and such, but hopefully the description suffices).  In reality, steps are so frequently skipped as to render the metaphor useless.  Think of the little old lady who gave your organization $10 each year at Christmas, then left you a bequest of $400,000.  She skipped all of the steps.  You didn’t even try to get her to be a monthly donor, because your modeling indicated that she probably refers to going online as “The Google.”  And major donor?  Fuhgeddaboutit.  $10 per year.  She was probably the last person you were going to ask.  Literally, the last person.

I will bet the contents of my wallet (two dollars cash and seven receipts from my trip to DMA) that this experience happens more often than someone stopping at every step of the so-called donor pyramid.  At the point that the worst-case scenario for your metaphor is more common than your best-case, you have a metaphor problem.

More mundanely, it’s probably counterproductive to think that you are moving someone up one step at a time.  Take a look at monthly givers versus major givers.  Yes, you are probably going to invite your monthly donors to make major givers.  But if someone is giving you a thousand dollars through the mail and comes in high on wealth screening and affinity, you are going to start personal cultivation with that person (while not removing them from direct marketing, because you are not an idiot).  That will come at the expense of, and rightly so, an invitation to, and stop off in, monthly donor land.

The donor experience pinnacle is death.  If this is true for your organization, take a good long look at your donor relations processes.

Progress.  The donor pyramid has never heard of a lapsed donor.  When the donor pyramid thinks someone is about to say “lapsed donor,” it sticks its fingers in its ears* and says “lalalalalalalalalala” like a recalcitrant seven-year-old.**  The idea that you would have to get a donor back doesn’t occur to this pyramid – its donors are too busy ascending.

Meanwhile, in reality, lapsed donors are valuable.  They are less valuable than multi-donors, but more valuable than person-off-the-street.  But they don’t fit into the pyramid power’s progress.  So they are left aside.

This last point also shines the way to the better analogy: the donor flowchart.  It isn’t as aesthetically pleasing, but it is true.  In being true, it also helps us better conceptualize our process.  We need to differentiate major donor versus monthly donor asks.  We need to try to get our lapsing donors back.  And death is not the only way the donor story ends.

So congratulations, donor pyramid.  You make our list of Things to Stop Doing.  Now, if someone asks where your donor pyramid slide is, let them know that aliens took it.  After all, aliens are far more plausible than the pyramid-y version of the donor story.

* Yes, in this analogy, pyramids have fingers and ears.

** This author has a seven-year-old and knows of what he speaks.

It’s time to stop… the donor pyramid

Do do-gooders do good deeds?

Good deeds are an odd thing.  You would normally think that a moral choice would make one more likely to follow the path of virtue in the future.  And research has shown that that when people are told they are good people, they do good things.

On the flip side, researchers describe the licensing effect — the thought that a good act gives you the license to do a bad thing and still be balanced. .  

This is well described in a New York Times piece creatively entitled “How Salad Makes Us Fat.”

Researchers tracked shopping carts and found that selecting a virtuous product make one more likely to subsequently pick a “bad” product.  

strawberry_26_apple_salad

This is your meal? Clearly, you are going to hell.

Other studies have shown that people who have eaten something indulgent are more likely to do good deeds — compensation in both directions.

How can both of these be true?  Would you rather catch your donors coming back from the gym or the Krispy Kreme?  And is it better to remind your donors that they are good people, or remind them that it’s been awhile since they last gave?

One study has worked to reconcile these in the context of donor communications.  

In the study, people were sorted into three groups.  One group was asked to write about good deeds they’d done.  A second group was asked to write about bad things they’d done.  And, not surprisingly, the third group was asked to write about neutral things.  Then they were asked whether they would like to donate a part of their fee for participating in the study to charity.

Significantly more people donated, and donated more, from the people who were asked to think of good deeds than either bad deeds or neutral things.

This is consistent with the idea that people who think of themselves as good people are more likely to do good things.  People act in relation to their self-conception.  But how does this explain moral licensing?

The study discusses this as well.  It finds that more licensing happens mostly not when we see ourselves as good or bad, but when others see us as good or bad.  For example, in the study of shopping carts discussed above, we would be judged by the person checking us out.  And if you think this doesn’t happen, you have never worked at a grocery store.

This fits with our study on slacktivism: people who did good things to help people are more likely to donate; people who did good things to get recognition as a good person are less likely to donate.

This can be well summarized in the old saw “I’m not a racist — I have plenty of friends who are [name of target group].  But…”  The person is working to establish positive external conception before saying whatever is going to follow.

(Fun fact: in the history of humankind — literally tens of thousands of years of human speech — not one thing that came after the phrase “I’m not a racist, but…” has ever been good.)

So, in an ideal world, when your donor receives your communication, they would feel like they are a good person, but feel like everyone else thought they were a bad person.  A tough balance to achieve.

I believe this comes down on the side of reminding donors not only of the good they have done in the past, but also tying it directly to the good they aimed to do.  So it would never be “you’ve given to be a part of our Founders Circle;” it would be “you’ve given to save lives and help people.”  You are telling them that they only did it to do good, not for any greater glory.

Similarly, in your lapsed communications, you would be better off establishing that clearly the donor is the type of person who gives to appeals like this one than you would be reminding them that they had lapsed.

Thus, this framing isn’t of donations like the previous few; it’s a framing of the donors that can help your appeals.

Do do-gooders do good deeds?

Priming with donation history and localization

I realized while preparing this post that I have used the phrase “play back” donation history in four different posts — in measuring retention, in the power of commitment and consistency, in my first post on customization, and yesterday.

But I realized I had not provided the intellectual background for why, other than as an example of commitment and consistency.

That ends today.  Kessler and Milkman of the Wharton School did a study of identity in charitable giving.  As they are from Wharton, they gussy up the paper with all sorts of stuff likewharton

But the paper is basically did two split tests with the American Red Cross.  The first was with lapsed (25+ month) donors, where the test version added the line “Previous Gift: [Date]” at the top of the letter (this was the only change).  Lapsed donors renewed 20% better when this statement of their donor status up front.

Also, response rates were 6-8 percent.  Can someone tell me what Red Cross was mailing to lapsed donors in 2010? Because if it wasn’t gold bricks, I want to test it.

I would wager that this is part the idea that the nonprofit knows who I am and what I’ve done.  It’s nice not to be treated anonymously, especially in this day and age.

 

farside

Copyright: someone who isn’t me. My apologies.
If it helps, I owe all of the Far Side books…

Part of this is reminder: “oh, goodness me, I meant to send a check, but I forgot.  Has it been that long?”.  Part is almost certainly shame.  Like we said yesterday, people want to feel good about themselves and a donation four years ago likely isn’t enough to cut it.

The second test looked at community identification.  People received solicitations for one of four efforts: the annual drive, the state drive, the winter drive, and the city drive (with the name of their state and city filled in).  Customizing this down to the city level significantly helped response rate:

  • City: 5.51%
  • State: 4.12%
  • Annual: 4.01%
  • Winter: 3.82% — proof that people hate winter

There was also a 4.8% higher average gift for those who received the city mailing.

The authors went a step further and looked at community size.  Sure enough, people from smaller communities were even more influenced by having the drive be about their city than people from larger ones.  After all, it’s easier to have community pride for Greendale, WI, than the entirety of Chicago, IL.  In part because Greendale is awesome, but mostly because of size.

So these two types of priming work and are thus things that can work for us in the mail, on the phones, and online, considering that the costs of these types of tweaks are typically low.  So go forth and customize!

Priming with donation history and localization