Disruption and personalization aren’t limited to retail industries. Nonprofits, higher education, and other organizations can reach more people with their mission by incorporating disruption and personalization into their fundraising models, too.
The key to making these traditionally consumer-based business techniques work for other organizations is to use them in conjunction with the right software. This guide discusses the types of business disruptions, how to build experiences using data driven personalization, the three essential elements of one-to-one personalization, and the software that makes it all work at scale.
This guide is based on a presentation given by Bob Ghafouri, the Founder and Senior Managing Director at Accenture Bloom, a group that helps companies turn their existing assets into new revenue streams.
How Personalization Has Caused Disruption Across All Industries
Before the era of online shopping, an individual’s interaction with a brand was limited to the time they spent in a brick and mortar store or perusing a printed catalog. Advertisements on TV, radio, or in magazines were intended to appeal to a wide audience. Potential customers were exposed to few if any personalized experiences that could have increased the likelihood of a sale.
Online shopping and advertising have completely revolutionized this process. Now, companies can infer what products are the best fit for potential customers and present relevant advertisements to those prospects on any platform. Marketing is tailormade to the individual using curated merchandise choices based on their preferences and behaviors.
On top of this, companies have revolutionized the ways they do business. These disruptive elements combined with personalization techniques allow relative newcomers to overtake entire industries and leave long-established businesses in the dust.
3 Elements of Disruptive Businesses
There are three primary ways to disrupt an industry: through experience disruption, business model disruption, or technology innovation. Companies that have successfully disrupted their industry have mastered at least one of these elements.
Experience disruption occurs when you create a unique customer experience that causes consumers to pivot because the platform is so frictionless.
AirBnB is a prime example of this type of disruption. With AirBnB’s website or app, you can instantly find a one-of-a-kind place to stay anywhere in the world.
Not only that, but AirBnB can help customers find curated experiences or monthly stays, all in a simple and pain-free platform. Customers have no need to supplement their travel experience with any other company.
Business Model Disruption
New pricing models, product delivery methods, and different ways of allocating capital are all types of business model disruption.
Dollar Shave Club is well known for having a disruptive business model. Part of what made the company so disruptive was the simplicity of their idea.
They sidestepped traditional retailers and rethought pricing. Instead, customers pay a monthly subscription to have Dollar Shave Club razors and cream delivered to their door.
Data and technology have reached new levels of democratization. That means you no longer need massive amounts of capital to get a product off the ground, rather, you can make use of technology ecosystems that are already there.
“It makes it a lot easier for disruptors to get into an existing business or industry and quickly consume the most profitable elements of the profit pool,” Ghafouri noted during his presentation.
For instance, you could start a kombucha company today that could compete with Nestlé by building a business on top of Amazon’s Redshift platform. You could market through Instagram and Facebook, then source and create the product through on-demand manufacturers.
Incorporating Disruptive Business Elements Into Fundraising
What do these disruptive business elements mean for nonprofits or organizations who are trying to raise funds? It basically boils down to how fast and easy it is for donors to give amounts and gift types that make sense for them.
If your organization has an outdated website, is using buggy software, or doesn’t offer personalized giving options, then expect to miss out on a few new donors. That effect is compounded if a similar organization touts a more streamlined experience.
“There is a set of experiences that consumers are expecting from you,” observes Ghafouri. “Whether you’re in nonprofit, banking, retail, or luxury, there are expectations around those experiences that come from other places.” For example, customers are, “expecting an Amazon, AirBnB, or Netflix experience on Nordstrom.com.”
Technology innovation is perhaps the most accessible disruptive business element available to organizations like universities or financial services who aren’t looking to reinvent the wheel in their industry. A prospect screening tool like WealthEngine not only makes it possible to comb through prospects at scale but also automatically updates their profiles with new data about their wealth and lifestyle.
WealthEngine then uses predictive lead scoring to hone in on prospects that are most likely to give to your organization. With this level of intelligence at your fingertips, you can simplify and automate the process of converting prospects into donors.
How to Effectively Use Data to Drive Personalization
Companies gather a lot of data about customers. It’s a hot topic of conversation, and while that data collection gets a bad rap, it shouldn’t put you off from making use of it.
In fact, Ghafouri asserts that 82% of customers are willing to share their data. The secret to that sort of buy-in is in how you collect and use their data.
Customers want to know what data you’re collecting and why. They also want to know that you value their data and will do whatever it takes to protect it from being compromised. Finally, it’s important for them to know that you won’t sell it to third parties.
Aside from being the smart thing to do, it’s also the legal thing to do. If there’s even a chance that your customers or donors reside in the European Union, you’ll want to make sure you’re following all the guidelines in this GDPR checklist.
Give Customers Control
Instead of predicting what customers want and sharing a potentially irrelevant offer or promotion with them, give customers the opportunity to share their intent data. Intent data basically states what things customers are interested in.
“I think the important thing here is that a lot of the customers or consumers out there want to control that journey that we create for them,” notes Ghafouri. “They want to provide input as they create that journey.”
Dollar Shave Club puts this into action by immediately giving potential customers the opportunity to share their intent data. This invitation to take a quiz about what products a customer might like is displayed prominently on Dollar Shave Club’s homepage:
The quiz asks questions like what body parts you shave, how often you shave, and if you have any problems, like skin sensitivities. With this information, Dollar Shave Club’s software can infer which products are best for you and create a personalized customer service experience.
Create Unique Experiences
Customers are looking for personalized customer service experiences that go across physical and digital spaces. If sharing their data gives them the ease and functionality they’re looking for, then they’ll be more willing to share it.
Nike+ is a connected fitness ecosystem that includes products and services like the Nike+ Training Club App, the Nike+ Running App, and Nike+ SportWatch GPS. Working together, these apps and products collect massive amounts of data about customers, but it’s all in service to their fitness.
This integrated ecosystem also helps customers seamlessly log and analyze workouts in realtime, which is essential for anyone who wants to improve as an athlete.
Focus on the Four Rs
The four Rs are to recognize who the customer is, remember them, and make relevant recommendations. If recommendations aren’t relevant, then the customer is going to feel wary about sharing their data.
Ghafouri offers this anecdote on how jarring irrelevant recommendations can be:
“If you go to MyFitnessPal, you get offers or promotions that have nothing to do with fitness. I got a travel offer for a Cancun vacation on the app. What they did is they sold my intent to a third party, then that third party advertised to me because I was searching on vacations to Cancun.”
This sort of personalized advertising can feel particularly invasive because it signals to customers that their behavior and activity around the web are being monitored, then the data sold to the highest bidder.
3 Elements of One-to-One Personalization
Once you’ve gotten permission from customers or prospects to collect their data, you’re ready to put that data to work. These three elements of one-to-one personalization will help you create the unique and relevant experiences that your customers are looking for.
Personalized shopping is the products or services you recommend based on data you’ve gathered about an individual and the intent data they’ve shared with you indicating their preferences.
A donor pyramid is an example of how personalized shopping might work for a nonprofit or organization. It breaks up donors into different types, with the majority likely being one-time donors and the fewest falling into the planned giving category. Using the right tool, you can target certain prospects with a request for the level of giving that’s best for them.
WealthEngine’s Donor Pyramid Modeler can automatically determine the number of prospects you need for each level based on the amount you need to raise during a campaign. You can adjust the modeler with conversion rates and What-If analysis. The modeler then shows how much you can raise with current contacts, who you need to contact at each level, and how many new prospects you need to reach your fundraising goal.
On its own, personalized shopping is limited, as it relies on significant customer profiling in order to make any inferences. Personalized merchandise takes it to the next level by looking at the small details and unique preferences that make up an individual.
“Profiling isn’t personalization,” says Ghafouri. “Personalization is about that intimate human conversation you have, whether it’s digital or physical and with a consumer or donor.”
Automation can only take you so far. Many exchanges require a human touch and connection so that customers or donors can get exactly the experience they’re looking for. By communicating directly with a donor, you can learn about what issues or services are important to them and what giving options they may be open to that the screening software couldn’t determine on its own.
A personalized advisor is a moment of upselling or cross-selling to a customer or donor.
For example, if you were to order a latte through the Starbucks mobile app for pick-up, the app might also recommend a muffin to go with it.
“I may want a bottle of water to take with me,” says Ghafouri, “and who knows, maybe I want lunch, packed, so I can buy lunch at breakfast. That’s a curated experience, a pure recommendation which is what you’re finding in a lot of the sites today.”
What should be avoided, notes Ghafouri, is recommending a product that would replace or compete with the original purchase. For example, you wouldn’t want to offer a chai tea after the customer indicates they’re interested in a latte.
In Summary: Combine Elements of Disruption and Personalization to Create an Unstoppable Organization
Technology like WealthEngine’s prospecting software can help nonprofits and organizations create personalized experiences and disrupt their industry. However, technology alone isn’t enough.
Don’t let real conversations with your donors or patrons fall to the wayside. These can be critical moments to unearth details about people that software alone can’t hone in on.
Aside from that, your organization is likely in the business of helping people. What better way to do that than by directly asking donors how you can best be of service?
The way to make more of those conversations happen is to use software that scales up your prospecting efforts. Get in touch for a free demo to see how WealthEngine makes it possible.