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Crown Philanthropic Solutions

Recent Posts by Crown Philanthropic Solutions:

The New Donor Engagement Reality: A Shifting Definition in the Era of the Online Experience

"There is a struggle in how donors tell you they want to be engaged, but when approached in that way, they don't want it. For example, a new donor came in to set up a fund. He nodded and agreed with everything that was said about outreach and what is available to donors, but we expect he will just act on his own."

That's a real quote from a community foundation. And that's a sneak preview of one of the most powerful findings in the 2014 Donor Experience Study. This comment, of course, relates to the shifting definition of donor engagement that is present among community foundations in this new era of leveraging technology to build meaningful relationships.

This statistic from the 2014 Donor Experience Study might surprise you:

Nearly 95 percent of community foundations included in the research identifies donor engagement as a top priority, but only 27 percent of the strategic plans reviewed demonstrate that a foundation has adopted a well-defined metric to measure success.

Donor engagement is often a product of the community in which the foundation resides. A foundation can influence the outreach to its donors regardless of what phase of growth it may be in—operating with a large endowment, leveraging programs, or even just initially growing. But staff is often also responsible for recruiting new donors, maintaining donor relationships, handling administrative tasks for donors, and sometimes managing programs—which limits the quality time spent with donors. Defining donor engagement must be a key part of the strategic plan and a key conversation across the entire organization.

To understand and define donor engagement, a community foundation needs donor intelligence; that is, data and metrics about donor behavior to inform the most effective strategies and use of resources. Data and metrics, of course, are assets that technology can build for your organization, creating a true return on investment on a foundation's online donor engagement systems. But before a foundation's leadership team can determine the role of technology in donor engagement, it must define donor engagement in the first place—which is much more than just donors' activity online.

For example, a common definition of donor engagement is whether a donor is actively making contributions into existing donor-advised funds. And many foundations take a comprehensive approach by including donor activity when a donor "engages" with another fund. For example, what if a donor adds a significant contribution to a nonprofit endowment fund held at your foundation? Should this count? According to emerging best practices, yes. This activity is an example that would be included in a definition of donor engagement.

The next question is whether your system can actually track donor engagement efficiently. Before a foundation can answer that, the management team must address the synergy among donor engagement, technology, and measuring results at a systems-wide level.

Here are two questions for your team to consider and discuss to take your donor engagement game to the next level and to prepare you to create data and metrics through technology.

How Do You Define It?

To get started, check in on the basic question: What are the key elements that define "donor engagement" in your organization? And how have they changed as more and more donors rely on online tools, especially related to their philanthropic pursuits? How has it changed as the donor base gets younger and more mobile?

When it comes to technology, do you view donor engagement as more than just getting donors to go online? Are you considering the quality of the online experience that you are providing, versus merely the existence of one?

Donors want a clear, relevant, accessible, and interactive experience when it comes to online technology so that they can easily find information on their own. Does your foundation provide an online experience that is seamless for donors from the second they land on your website all the way to processing a grant in your online account management system, as demonstrated in the image below? Or does the experience fall short?

How Will You Measure It?

Next, start thinking a little bit more about measurement. What are your organization's goals for online donor engagement? Are there success metrics included with these goals, metrics that are both quantitative (analytics or numbers) and qualitative (donor or staff feedback)?

Consider these ideas to get you started:

  • Systems Integration: Is your online donor account management system fully integrated with your accounting system so that donors aren't calling with questions about their fund balances?
  • Content Synchronization: Do your online donor account management system and your website work together to synch content automatically, so that the information on your website can be viewed when donors log on, as demonstrated in the image below?
  • Web Traffic Tracking: Are you able to track, through web analytics, the activity on your website and online donor account management system? Are you benchmarking the activity on your site with other foundations of your size to see where you match up?
  • Objective Review: Do your digital assets accurately reflect your brand as an organization? If you were a first-time visitor to your website, would you feel that the content and usability of the site and donor account system were forward thinking and user friendly?

Donor engagement. How do you define it, and how will you measure it? Those are two questions you might ask to begin to re-energize your donor engagement strategy—starting with the definition and then setting goals. After you've laid the groundwork, you and your colleagues can get the right systems in place to truly engage donors, and tackle the shifting definition of donor engagement and what it means for your organization. In turn, with the systems up and running, you'll get a robust batch of data, or "donor intelligence," that in turn creates value for your organization and drives return on investment.

The new donor engagement reality. Are you ready?

Learn more about the new donor engagement reality or download the Donor Experience Study

© 2014, Crown Philanthropic Solutions

Crown Philanthropic Solutions creates a powerful donor engagement platform that empowers clients with the ability to create passionate donors by managing their donors' experiences.

The New Donor Engagement Reality: Bottom-Line Priorities for the Online Experience

Community impact is all about people—the customer experience. Making a difference through philanthropy is the result of donors getting connected to causes they care about. The deeper the engagement, the deeper the impact. That's nothing new.

But what does donor engagement mean now, in 2014? And what does it mean to your institution's future success? The answers to those critical questions might just be online. Literally. Here's the reality:

  • The online environment continues to transform our lifestyles. Cloud storage, mobile devices, social media, and "big data" analysis are now part of contemporary life.
  • Software will continue to shift its emphasis to the quality of the user experience. Donors want a clear, relevant, and interactive digital experience. Online applications must be engaging, easy to navigate, and compatible with mobile devices.
  • Online transactions are the accepted norm and an integral part of society.
  • An organization that delivers an engaging online experience will drive asset growth and will secure the long-term loyalty of its donors.
  • A few years ago, the mere existence of an online transaction-oriented platform could be a compelling selling point for a philanthropic institution. Now, the mere existence of a system is not enough. The overall online experience, not simply a system's existence, is the key.

For donor-advised funds, it is essential that the online account system continuously improves so that it meets donor expectations. For Internet users, the absence of a positive, effective online experience is like fingernails on a chalkboard.

Consider the reported by the Pew Internet & American Life Project:

In addition, a growing number of Americans now trust and use online services for a variety of financial transactions. Even large corporations understand the importance of online technology to the customer experience. Consider these statistics:

  • In 2013, 51 percent of American adults, or 61 percent of Internet users, banked online. In 2010, the numbers were 46 percent and 58 percent respectively. These figures are up from 18 percent in 2000.
  • Some 60 percent of executives note that they plan to invest most heavily in websites, 40 percent in e-commerce, and 51 percent in mobile applications.
  • In 2013, 35 percent of mobile phone owners banked using their mobile phones, up from 18 percent in 2011.

And here's the real kicker for donor-advised fund programs. Consider these statistics of affluent individuals (those earning more than $70,000 a year), the population most likely to engage in philanthropy:

  • Some 96 percent use the Internet and 75 percent bank online.
  • Some 44 percent with mobile phones use them to conduct banking.

The upshot here is that savvy philanthropic institutions—especially community foundations—are figuring out how to respond to donor demands for a comprehensive online experience. Donors expect a high-quality and integrated online experience that meets all of their online needs, from accessing contact information to finding dates for events to recommending a DAF grant. Oh—and it has to be visually pleasing, too. Clunky just doesn't cut it anymore.

Why does a comprehensive online experience matter? Because what's at stake is the bottom line. How would your bottom line change for the better if you knew your website—and your online account platform—were working hard, synergistically?

Consider this chart:

What can you do to get started? Begin by testing a few theories internally. For example, consider the following scenarios in an executive team brainstorming session:

  • Evaluate the cost of a major event, involving 100 or more donors. Could the goals of that event have been accomplished through online engagement? Donors are faced with too many events pulling for their time, and they might welcome an alternative to an evening out. The math can be compelling. For instance, if the event cost is $50 a head, 100 donors at an event is a $5,000 expense. Staff time would likely add an additional $5,000, for a total $10,000 expense. The question here is, might there a better use for the funds and staff time? Would the organization be better served through a content-rich website that gives donors great information and a place to collaborate and make grants with other donors?
  • Conduct a scan of multi-generational donor families engaged with existing funds. If your foundation is already working with more than 10 multi-generational families, ask yourself whether you offer a compelling online option to encourage family members to work together and communicate? If you don't, you may be missing an opportunity to retain the next generation and generate those powerful donor-to-donor referrals.
  • Pretend you are a donor preparing to make an online grant. Hop onto your website. What is your honest impression of your foundation's brand and quality of technology? Pay attention to the look and feel of the online environment as you are walking in your donors' shoes, toggling between the core website content and the online account system. Is it a seamless and pleasant experience? Or do you feel whiplash?

So, the key to the new donor engagement reality is simple. Philanthropic institutions must acknowledge that it is the quality of the online experience that matters, not the mere existence of an online presence and transactional system. A positive online experience creates a positive return on investment. A negative online experience creates a negative return.

It's time to take it seriously.

Learn more about the new donor engagement reality or join the conversation

© 2014, Crown Philanthropic Solutions

Crown Philanthropic Solutions creates a powerful donor engagement platform that empowers clients with the ability to create passionate donors by managing their donors' experiences.