Retailers shift their ad spending from TV, radio and print ads to digital ads.
E-retailers can learn how to grow and activate online audiences by looking to methods used by successful nonprofits.
When a magnitude 7.0 earthquake hit Haiti in 2010, the American Red Cross raised $32 million by encouraging consumers to send text messages to the nonprofit. Sending a message let consumers' mobile carriers tack on a $10 donation to their next bill, said Craig Oldham, vice president of digital engagement for the American Red Cross in a presentation at the 2013 Internet Retailer Conference & Exhibition in June. That response presaged a new era of mobile donations for the nonprofit emergency care organization.
Similar text-based fundraising rolled in after the Japanese tsunami disaster in 2011 and, more recently, when violent tornados struck near Oklahoma City in May, he said. In that last emergency, not only did bountiful donations come in through mobile devices, but about 50% of the organization's site traffic was mobile.
Donations made via the Internet as a percentage of total charitable giving are growing faster than web sales as a percentage of total retail sales. Online giving to charitable organizations in the United States grew 10.7% in 2012 from 2011, according to the 2012 Charitable Giving Report by Blackbaud Inc., which provides technologies for nonprofits. Overall, online giving represented 7% of all charitable giving in 2012, an increase from 6.3% of all giving in 2011, the company says. E-commerce, in contrast, accounted for just 5.2% of total retail spending in 2012, an increase from 4.7% over 2011, according to the U.S. Commerce Department.
As online revenue increases for nonprofits, so has their focus on web marketing and social media, according to a 2013 benchmark study of 55 charitable organizations by nonprofit consultancy M+R Strategic Services and the Nonprofit Technology Network. On average among the organizations in the study, from 2011 to 2012: online revenue rose 21%, e-mail list sizes increased 15%, revenue from monthly subscriptions jumped 43%, the number of Twitter followers soared 264% and the number of Facebook fans rose 46%.
E-retailers looking to drive more e-commerce sales with their calls to action can learn from nonprofits. Most notably, nonprofits' online strategies come from a scrappy, intimate approach to donor interactions. Like nonprofits, e-retailers can use a host of digital marketing tactics to cultivate consumers' personal attachments to their organizations, and do so cost effectively.
Nonprofits are especially good at "making the most of what they've got," says Cate Conroy, founder and CEO of Conroy Marketing Group, which has worked on content marketing with nonprofits. "If a nonprofit does a photo shoot, they're really good at using the heck out of it—slicing and dicing the photos many ways and finding ways to use them."
Leveraging content, particularly on social media, is another tactic nonprofits use to get their donor community moving without a huge upfront investment, but with the long-term benefits of increased loyalty, Conroy says. "Nonprofit strategy is about finding ways people can be supportive without necessarily opening their wallets," she says. "For-profits struggle with that for obvious reasons, but once they figure it out it can make a big difference." Retailers may lose a few customers in moving some resources from a pay-per-click campaign to a loyalty program or social media, for example, but the ones they gain are more likely to keep spending with them over time, she says.
Nonprofits do more than solicit funds from donors. They listen to them and respond with relevant, helpful information. When done well, that content can spark a big response.
Danielle Brigida, senior manager of social strategy and integration at the National Wildlife Federation, says she organizes the nonprofit's Twitter followers in lists by their passions, such as whales, birds or the ocean. Then she follows their posts.
In 2009, Brigida noticed a Twitter conversation among naturalists about their favorite nature-related iPhone apps. She took the cue and wrote a blog post about the best nature iPhone apps and shared it with her followers. It remains one of the organization's most-visited posts, she says.
Donations are one measure of the return on investment for such blogging and social media efforts, Brigida says. Social referrals, often shares of blog posts, typically trigger about $2,000 in donations per month, she says, although they can raise much more in response to crises like the 2010 Gulf of Mexico oil spill. However, she purposely doesn't ask for donations or signatures in all content.
"I'd rather train people to click no matter what than only if they know it's an action alert or they can donate," she says. "You very much get the audience you talk to." The audience she wants thinks of wildlife daily and feels comfortable interacting with the National Wildlife Federation in many ways—not just to donate, she says. When that audience is engaged, she says both her reach and revenue increase.
"It's important to keep in mind that conversions are the ultimate goal, but there can be micro-conversions along the way," Conroy says. Micro-conversions are small, non-monetary engagements, such as signing up for a newsletter, sharing articles or attending events, which help drive later sales. "Someone's not going to run around necessarily and tell everyone about their favorite clothing retailer," she says. "But for-profits can build that customer loyalty by making supporters responsible."
For example, retailers can ask customers to vote on which products they should restock, she says, or ask for feedback on how they could make the next shipment better. "Online retailers need to understand that people want to feel special and like they're contributing to a brand," Conroy says.
Listening also teaches the National Wildlife Federation what its donors want. For example, Brigida once noticed "polar bears" trending on Twitter. She responded with a link to a blog post that included a call to action—a petition to protect polar bears that could be signed electronically—and immediately received around 100 signatures. "We always see an increased response when we're relevant," she says.