Dead Simple Metrics to Measure and Understand Your Donor Better

A data-centric approach towards chalking out salient donor insights isn’t a fad. As a non-profit marketing manager and a candidate of a data-centric Masters in Integrated Marketing Communication at Northwestern University, I can certainly vouch that in the years to come, the ability to measure and understand donor behavior can set your non-profit’s voice above the noise.

      The article ‘5 Metrics Every Development Director Should Know’ authored by Mike Spear makes various important observations and recommendations. He starts by emphasizing the relationship between donor acquisition cost and donor lifetime value (Donor LTC = Average donation amount per donor / donor churn rate) in order to decide on resource allocation between prolonged engagement and new acquisition. He further advises that donor churn (# of lost donors / # of total donors) be kept as small as possible and donor lifetime be calculated so that business decisions can be based on effective donor segmentation as shown in the pyramid below:

Source: Avectra blog

'5 Basic Fundraising Metrics to Start Measuring Today' by Jeffrey Haguewood further accumulates fundraising metrics that can yield important insights for donor management. The list developed by him uses average gift size and number of gifts for the purpose of planning, budgeting and forecasting marketing activities. He focuses on calculating conversion rate for each marketing activity respectively and measuring them individually against donor engagement. This way, it would be easier for non-profit managers to see which activity reaps maximum contribution and allow them an opportunity to dig deep into donors behavior.

      After reviewing these two articles, here are 3 action items you need to keep in mind and apply to improve your donor marketing efforts:   

•     Develop Success Metrics - Create metrics which allow you to continually monitor the effectiveness of your donor marketing efforts
  
•     Base Communication Strategy on Donor Segmentation - Use donor segmentation to develop strategy that will resonate well with the behavior of high-value and high-potential donors
  
•     Leverage Insights - Understand donor motivation by gauging where your non-profit fits in your donor's life story

Sidra Zia is an MS. Candidate in Integrated Marketing Communications at Northwestern University with a specialization in digital marketing geared towards social development. She is passionate about narrating stories on the digital canvas and has previously contributed to marketing efforts of several international development organizations as a strategic communication professional. 

Follow: @Sidra_Z 
LinkedIn: Sidra Zia

CMO - Examine Eco-Brands and Grow

As a CMO, you know it’s important to understand your customer; as their preferences change, you must evolve your understanding of their needs in order to tie your product into their lifestyle. As a graduate student in Medill’s Integrated Marketing Communications program and an avid supporter of social causes, I have been researching the effect of cause marketing on businesses and how it relates to company growth.

“Inside the Buy-One Give-One Model” by Christopher Marquis and Andrew Park argues that the One-For-One Model, founded by Blake MyCoskie at TOMS, not only creates commercial and social impact, but also is leading the way for entrepreneurship. Marquis and Park argue that One-For-One is an important model to emulate because of its clear messaging. They identify many one-for-one organizations and examine the success they have met merging marketing strategy, social impact, and consumer desires into one package. As the millennial generation garners more discretionary income, causes have become increasingly important for consumers as they make purchase decisions.

Brian Solis 

While the one-for-one model has paved the way for cause-friendly brands, their easy-to-understand marketing message isn’t the only takeaway. “Environmentally conscious companies don’t just sell products, they promote a mission and sustain a lifestyle that benefits their customers and simultaneously makes the world a better place,” says Kate Harrison in “How Four Eco Brands Are UsingSocial Media Effectively”. In this article, Harrison highlights four eco-friendly brands and their standout social media performance. These eco-brands have a triple bottom line that guides their business principals and a mission driven statement that recognizes the interests of their consumers.  Across all four social campaigns, the brands clearly stand for something, allowing them to promote their brand with an authentic voice, cultivate company culture, and enable a strong consumer following.

After reading these two articles, I believe CMO’s must focus on three strategies that will help them keep pace with changing consumer preferences and perhaps enable them to create social impact along the way.

1
      Clarify Your Mission – Both for your consumers and employees, a clear company mantra keeps your brand top-of-mind and has the opportunity to directly meet your consumers’ needs. Do you know what you stand for? What does your company believe in?

2    Leverage Social Media – Your consumer’s needs are front and center on social media. You have the opportunity to have a 1-1 relationship. Embrace this and be authentic.

3
      Sell Experiences – Whether you are a cereal company or a technology start-up, your story has the opportunity to empower consumers. Understand your customer’s lifestyle and become a part of it.

If you haven’t taken the time to understand the intricacies of successful mission driven organizations yet, you should. Consumer preferences are changing, and extensive research suggests that those preferences are trending towards companies that the consumer can feel good about.

Mari Alta Bakken is interested in helping organizations achieve profit maximization through mission driven marketing strategies that motivate employees to thrive and encourage consumers to buy. She currently works part-time in Integrated Marketing at LYFE Kitchen and will be working as a Relationship Marketing Planning Intern at General Mills in Summer 2014. Bakken is studying for her Masters in Integrated Marketing Communications at Medill, Northwestern University and completed her Bachelors of Arts in Radio/TV/Film and Political Science at Northwestern University.