And to make it even tougher, the competition in the non-profit regular giving (RG) marketplace shows no signs of letting off. So if cost per acquisition (CPA) is a concern for you, here are three survival strategies to help your programme not just survive but thrive.Survival strategy 1: Know your numbers Firstly, a word of caution about using CPA as a key performance metric. Comparing CPA across different channels is like comparing apples and oranges, it has no reflection of the quality of supporter acquired.
If CPA is your preferred metric — and it often is because it’s easy for Trustees to understand — then make sure that you never look at it in isolation. The ‘holy trinity’ of metrics, if you will, is CPA, annual average gift value and retention rate. Only when you look at all three together do you start to get a true picture of the quality of supporter.
The other essential thing to know if you’re using CPA is what the average donor is worth across their giving lifetime. You’ll be spending big budgets on your acquisition campaigns but if you don’t know the average gross income per donor, it’s money into a black hole. Know the average gross value (5 years is what most charities work to) and you then have clear guidance for allowable CPAs to inform acquisition investment decisions.Survival strategy 2: Diversify your channels This is the go-to solution for charities, hoping that a new high-performing channel will solve their CPA woes.
But before you start investing in a shiny new channel, ask yourself this: have you really done everything you can to max out results and opportunities on what you do today?
There may be quick wins that will have a far speedier impact than what is likely to be an expensive new channel test. So how clued up are your Supporter Care team on the cost of the loss of every regular giver cancellation they administer? How effective is your online conversion process? Do you have an automatic email bounceback for people who don’t complete the online payment process?
Another good idea is to revisit the historical data for clues. Go back one, two, three years, even before your time (especially if KPIs have changed) and review past channel tests that have ‘failed’ with new eyes, looking for the little gems of success that may have been overlooked. Critically, look at how those supporters from the ‘failed’ test went on to perform on the warm programme. I can guarantee there will always be surprises.
Now if you’re working on the quick wins, then you can think about a new channel. The big trend in acquisition channels right now is towards a two-stage process, which is generating callable leads from paid-for advertising, or mass events, and then phoning to convert to RG.
We first saw this back in 2009, with Save the Children’s Gaza press campaign that asked people to text to donate. Two-stage is interesting to the sector right now because it combines the shiny new business rules, often offering supporters an incentive at the first stage, with the ‘old’ RG back end.
If this is something you want to test, there’s three things you need to know. This is a volume game. You need huge gross volumes to get decent RG conversion volumes out the other end. Make sure you call back as soon as possible, while the initial engagement is still fresh in people’s minds. And ensure the ask on the phone is both consistent and relevant, so reference what they’ve done so far, and ensure there’s a common theme that carries through.Survival strategy 3: Tell powerful stories We’re all talking about powerful storytelling in the non-profit sector right now, and for good reason. It delivers cut-through in a busy marketplace, driving down CPA if you get it right. Charities have a unique chance to tell incredible stories but often they over-complicate the message and lack consistency from one channel to the next.
Emotional advertising is twice as effective as rational, according to an IPA study. We humans are emotional creatures, our decisions are primarily emotionally-driven (and then post-rationalised). So deciding how you want prospective supporters to feel in your acquisition creative is critical. For example, do they feel angry, then surprised the solution is so simple? Maybe it’s shock followed by hope? The best stories offer potential supporters an emotional transformation.
Once you’ve got that core emotion, your acquisition proposition needs to be the most compelling demonstration of the need and the simplest articulation of the solution. This is challenging because it means you have to be really brave about what you miss out — you cannot afford to talk about every area of your programmatic work (and quite frankly, individual givers don’t want to hear about it). If you’re able to get internal buy-in for one simple acquisition proposition, you will be onto a winner.You can’t get exceptional results with a safe approach Supporter acquisition is no easy job. You’ve got to be part-mathematician, part-entrepreneur, part-scientist, part-psychologist, part-storyteller. You must resist the tendency to play safe all the time, it simply won’t get you exceptional results.
The only necessary thing for the triumph of evil is for good (people) to do nothing. And so good people, keep fighting.