“God, do people still give to those things?”
That was my therapist this past December, asking me if people still give to email appeals at end of year. Considering he knows that I write these appeals, and that I was there for his emotional support, it’s no wonder I was worried.
Was I right to be worried? Maybe — we’ll explore that in a moment. And was my therapist right to be so completely unsupportive? Um, no. Because although millions were raised directly from email, we’re seeing some exciting traction generating revenue through social media and online advertising.
First, let’s take a look at the big picture summary of how things went for 26 organizations we work with. The data below is an aggregate and compares performance in 2013 to 2012.
- Revenue keeps growing: 84% of the organizations in our sample group raised more money this year than they did last year. The growth in revenue was a healthy 10%; these orgs raised $34.5M online in 2013 vs. $30.7M in 2012.
- Average gift size was up: 82% of organizations saw a higher average gift this year in December. The median increase in average gift size was 12%.
- Response rates were flat: This is generally good news, as we’ve seen many years in the past where the response rates to email appeals drop. In addition, many organizations had a challenging time with email deliverability this year, so to see the vast majority get through end of year relatively unscathed by deliverability problems was a relief.
- Email lists aren’t necessarily getting bigger: Only 57% of organizations had a larger list this year than last. This is a new trend, as organizations are getting more aggressive about suppressing inactive email addresses (those who haven’t opened, clicked or responded to an email in a certain period of time). Suppressing inactives has become necessary in order to maintain a healthy deliverability ratings. But it also means it’s getting harder to grow email lists without investments in email recruitment campaigns and paid ads. Groups with larger lists saw a modest growth rate of 6.5%.
- Email revenue is flat: Only 50% of organizations raised more money with email this year than last year. That means half of our sample group had a tough time matching last year’s email fundraising figures. There wasn’t a standout reason behind the drop: some had problems with deliverability, some had smaller lists, and others had lists that just weren’t as responsive as they were last year. Anecdotally, it appeared that advocacy organizations had a tougher time this year than direct service and humanitarian organizations.
What mattered this year?
December 31 – I know, not exactly earth-shattering news — but this year just felt much bigger than in past years. Several organizations were tracking behind 2012 figures in email revenue all month, and then December 31 came and they set fundraising records. (A month’s worth of stress is just more grist for the therapists, I guess.) Sending two appeals on December 31st has become almost standard – it might be time to try a third appeal. Personally, I saw some groups (not our clients) send 4 appeals on December 31st. Pretty aggressive, I’d be interested in hearing how that turned out for them. (Was it you? Then let us know in the comments below!)
Deliverability – This was the first year that I remember organizations having to pay very careful attention to their deliverability ratings. Deliverability is the ability to get an email delivered successfully into your subscribers’ inboxes. I know several well-run, big-brand nonprofits that had their emails completely blocked by Gmail this year because of poor deliverability ratings. This has forced organizations to get aggressive about both monitoring deliverability and instituting much more stringent practices on who they send emails to, and what types of content they send. Given that this is such a big consideration, we’re going to be publishing some of our best deliverability tactics in the next few weeks right here on the Lab.
Online Advertising – We tested too many different approaches to list here, but three of the best performing strategies were:
- Search Advertising – Search Engine Marketing isn’t new, but we’re impressed with the growth in revenue SEM continues to generate each year. For the organizations we worked with, we saw an amazing return-on-investment of at least 200%. These ads are especially effective at capturing traffic while running other types of advertising, such as display or retargeting ads.
- Retargeting – This year we tested the impact of retargeting by displaying banner ads to people who visited an organization’s donation page or website but did not convert. We found that our test segments generated more revenue from a statistically significant higher number of gifts. This tactic won’t be worth the return universally across the board, but if you’re an organization with a better-known brand, you should definitely test retargeting.
- Facebook Ads – Remember when people said you’ll never raise money on social media sites? Well, 2013 is the year this all changed. We worked with clients to test showing paid Facebook promoted posts to different segments of an organization’s email file, and several groups saw more online revenue from the test groups who were shown the ads. Organizations also tried using lookalike modeling of existing supporters to find new donors and saw an immediately positive return on investment in some cases.
Time capsules of advice
The 2014 year-end season is going to come up sooner than we know it, but it’s something we want to be preparing for all year. So here are some time-released pieces of advice for our future selves:
February 2014: Start a regimen to improve deliverability. Don’t get caught with your pants down and your emails bouncing the last week of December. Work to improve our deliverability throughout this whole year. That means regularly reporting on it and instituting best practices to keep our deliverability ratings high. (Tips coming soon!)
May 2014: Time to start testing retargeting. Retargeting might seem a bit creepy, but it works. Of all the banner ads we’ve tested, retargeting is the one strategy that’s shown immediate payoffs. Mid-year, organizations should test the tactic or just add it to a campaign to get accustomed to the tactic. Also: Make sure to make the budget request now for this expense in December.
October 2014: Figure out Facebook. Promoted posts on Facebook are a bargain. They work, they’re cheap, and they could help your email fundraising campaign perform better. Make sure to make your budget request for December, but also start trying out creative and target audiences. Want some tips? Check out our Top 5 Tips for Promoting Facebook Posts Like a Pro.
December 2014: Don’t not count your chickens before they aren’t done hatching. (whew!) December 31 was such a huge day, it reminded me that all is not lost even if you’re behind. I’d consider getting more aggressive on the final days of the year with email.
And if someone, anyone, says “God, do people still give to those things?” you say YES! And you send them a link to your donation page.