Communication Strategies for Donor Retention

Donor Cycle Image

Communication Strategies for Donor Retention

June 29, 2020
Raj Khera

In times when operational costs for organizations are increasing and donor prospects are lower, the need for a donor retention strategy takes on renewed importance. With the unprecedented economic upheaval and evolving business practices due to COVID-19, finding ways to communicate effectively and retain donors is crucial. Donor retention is part of the ongoing donor process that includes identifying prospects, building relationships, and donor stewardship.

Donor stewardship is the process that occurs once a donor has given to your organization. Stewardship refers directly to the continued communication and relationship building that happens after the initial transaction, which directly affects your donor retention rate. 

This guide covers the importance of donor stewardship in order to maintain donor retention, explains why donor retention is economically beneficial compared to acquiring new donors and how it increases your organization’s rate of return (ROI). The critical components of a consistent messaging plan to facilitate keeping donors informed of the impact their donations are having on the cause they care about and highlighting your organization’s continued appreciation for their support is explored in detail.

Keep reading or “jump” ahead to these sections:

Building and Maintaining Donor Relationships

Donor Cycle Image

Source

  • Beginning the Cycle with Donor Cultivation

Donor cultivation is the process of identifying and engaging with possible prospects, sharing your organization’s mission, and beginning to build a relationship before requesting a gift. Donor qualification determines which potential donors have the ability to give to your organization, and at which level they can be expected to contribute. WealthEngine’s wealth modeling feature works to help determine the status of each prospect, so you can easily identify which areas of your organization will appeal to them and which level of contribution is the best fit. 

The donor cycle begins as soon as a prospect is identified. Help these potential donors familiarize themselves with your organization’s mission, and explain why your cause is relevant to each donor. WealthEngine 9’s Engagement Science feature allows you to utilize personalized information and interact with your donors through targeted campaigns designed to increase engagement.

Insights provided by the WealthEngine 9 comprehensive platform dig deeply into the lifestyle of your donors, so you can understand what motivates them, which allows your organization to create meaningful relationships centered around your mission and your donors’ interests. By analyzing relevant wealth and lifestyle signals, WealthEngine gives you the necessary tools to personalize your campaigns and boost your donor engagement.

Once you have utilized this information to appropriately target your messaging, continue the conversation, and explain why their contribution is important. Provide examples of the impact their support will have and make it clear where their gift will be going. This provides your donors with a clear understanding of their impact. Remember, it is important to find ways to personalize your message to make it relatable to each donor. 

  • Continue to Build Relationships Through Donor Engagement

Once a relationship has been established, it is crucial to continue nurturing a connection between the donor and the organization. Focus on keeping an open line of communication with supporters through consistent emails and newsletters featuring updates of your work and achievements. 

It is vital that the relationship between your organization and its donors be one built on two-way communication. Use all of your communication channels to solicit donor feedback through interactive surveys, polls, and reviews, and be sure to announce when elements of initiatives contain suggestions gleaned from donor feedback. This will demonstrate to your donors that their suggestions are listened to and when viable, acted upon.

Invite donors to events or activities your organization is hosting so they can witness how their gifts are being used. Donor engagement will increase the likelihood of recurring gifts while strengthening your relationships with donors, which will encourage them to remain active participants in your organization.

Cost of Acquisition

Source

  • Increase Your Donor Retention Rate

Once a relationship has been established, donor retention is the process of retaining donors and keeping them involved in your organization after their initial gift. The goal of donor retention is to have donors give more than once and see these donors become more involved with your cause. 

Using the model above as an example, assume the initial cost to acquire a new donor is $85 while the cost of sustaining donors is $12. This graph illustrates how donor retention is economically necessary for a nonprofit to survive, as sustaining donors is significantly less expensive than acquiring new ones. 

The average year-on-year donor retention rate in the United State is 46%, which shows that less than half of all donors remain active after their first contribution. This low percentage illustrates how easily money is lost through poor retention rates, as the cost to onboard new donors is greater than the cost of sustainment. 

It is also worthwhile to seek out donors who can donate their time to initiatives. Just because a donor’s financial outlook may not make them a promising cash donor does not mean that the resources they could bring to the organization as a valued volunteer should be overlooked.

The continued cycle of donor cultivation and stewardship is vital because sustaining current donors has a positive effect on your organization’s return on investment (ROI), and plays a crucial role in your organization’s survival. Maintaining relationships and encouraging donor engagement leads to a higher ROI as your sustainment costs continue to lower and your revenue stream increases during a donor’s lifetime involvement in your mission. 

By continuing the donor cycle past the first gift through communication and strategic donor engagement, the experience donors have with your organization can improve, and your donor retention rate will increase. 

The Importance of Communicating the Impact of Donations

So you’ve received a donation, now what? Making sure your donors see how their gift is supporting your cause will be vital in retaining them for future contributions. Some organizations give the option for donors to specify where they would like their donation to be used. Finding ways to showcase these impacts can strengthen the donor relationship. 

Start with a plan for communicating the value of each donation. Share the ways these contributions are being used to sustain your organization’s guiding mission, while also enabling the pursuit of important new endeavors that align with the values of the organization. 

Continually emphasize how the generosity of your donors makes these actions possible. In the digital age, it is easier than ever to keep in touch with donors, so you can easily focus your social media messaging to showcase the impact that is being made to benefit your cause.

It’s also extremely important not to forget the importance of personal contact. Send a handwritten note thanking your donors for their gifts; have a plan for you or someone from your team to speak with them personally when they attend events, and make a point of discussing all the ways their donations are being used, being sure to listen to any suggestions donors may wish to share. Making the effort to meet and speak with them as individuals and discuss the progress the organization is making thanks to their generosity can make all the difference when it comes to donor retention. 

Communication Strategies for Retaining Donors

Communication is the most important factor when working to retain donors. Focus on maintaining early contact with your donors. Personalization is also vital in nurturing the donor relationship and small acts such as remembering to acknowledge and express gratitude to donors right away, with a quick post-gift follow-up, such as a brief phone call or a personalized email thanking them for their continued support, increases the likelihood the donor will continue to feel connected to your organization and its goals. 

Timing is important, and maintaining consistent and efficient communication will ensure a donor feels seen and appreciated by your organization. Always let donors know that the important role they play in the organization’s success is appreciated and go out of your way to ensure each donor feels welcomed by your group.

Share meaningful content and a consistent narrative. When reaching out to donors to give updates on the impact their support is having, focus on driving your messaging through intentional content. Donors will appreciate, and most likely respond to, action-driven messages rather than fluff, and a consistent narrative illustrating how their gifts are being used will encourage continued donations to your organization.

Ask for donor feedback by conducting surveys and polls, and do your best to integrate their suggestions into your work. Don’t be afraid to use your communication lines to ask your donors what they think. Reach out and hold conversations with them, so you can tailor your communication strategies to their needs and avoid donor fatigue

Developing and Implementing a Successful Donor Stewardship Program

Donor Stewardship Program

Source

As you continue to search for new prospects, and implement donor stewardship programs, start by gathering and analyzing your information. Create personalized campaigns, segment donors according to their financial capacity to give and their shared interests, based on insights gathered by WealthEngine 9’s We Analyze tool, which features look-alike modeling, and use this information to create a plan to reach your target audience. 

Find ways for donors to get involved beyond their initial gifts. Reach out when you need volunteers, especially if you have an event coming up that is being funded by their contributions, or when something exciting is happening within your organization. 

Donors who are actively involved in initiatives will see the impacts of their gifts first-hand and feel inspired to continue giving, which increases your donor retention rate. Donors who give of their time also need to feel they have made impactful contributions and be shown that their endeavors are making a difference. Continually prioritize highlighting the impact donor support is having on the sustainability and success of your mission using every form of communication available.

For more information about how your organization can more efficiently search for new supporters while retaining its current donor base and increasing its donor retention rate, check out a free demo of the WealthEngine platform today.

 

8 High-Conversion Fundraising Tactics in the Wake of Coronavirus

Donor Pyramid

8 High-Conversion Fundraising Tactics in the Wake of Coronavirus

June 17, 2020
WealthEngine

While everyone is contending with some level of financial uncertainty in the wake of the coronavirus (COVID-19) pandemic, this does not mean your fundraising efforts need to stop or even decrease. In fact, continued fundraising activities during this time are essential for ensuring you maintain a strong relationship with your donors.

However, one important element of fundraising has changed as a consequence of COVID-19the manner in which organizations need to go about identifying and reaching out to their donors. This guide details ways fundraising organizations are pivoting to continue their capital campaigns, explains the types of messages that are proving most effective at this time and outlines specific actions you can take to continue raising money. 

Read on or “jump” ahead to each section:

This guide is based on an interview between Rick Dunham, Chair of the Board at the Giving USA Foundation and the CEO of Dunham + Company, and Raj Khera, WealthEngine’s EVP and Chief Marketing Officer. Listen to the webinar here

The Importance of Fundraising in the Time of Coronavirus

Given the global impact of the sudden economic downturn, it’s imperative that nonprofits continue fundraising in this difficult time. It is important to bear in mind that many nonprofits are founded based on mission statements declaring a commitment to increasing equity in fair treatment and opportunities for advancement among underserved sections of society.

The societal challenges members of these groups face are only exacerbated when a catastrophe like COVID-19 shakes the foundations of social and financial norms. As Dunham noted, “If your mission was relevant before all this hit, then it’s still relevant today.” 

In fact, the number of individuals in need of assistance can increase significantly. This has certainly proven true in the wake of COVID-19. As Khera observed, “We saw [recently] there were over six million people that had filed for unemployment. Our country is hurting…there’s a lot of need out there.” 

Donors also depend on consistent communication for assurances that the organizations they support are still functional and fulfilling their mission in times of crisis. If you go silent during a critical period for fear of being perceived as insensitive, it may end up damaging your relationship with your donors rather than helping it.

Dunham urges people to remember, “It’s not about the organization, it’s about what the organization is actually able to accomplish in the lives of people.”

8 High-Conversion Fundraising Tactics in the Time of Coronavirus 

The pandemic hasn’t put an end to fundraising. It’s only changed how fundraising is done. These tactics ensure that you’re appealing to and communicating with donors effectively.

1. Find Alternative Touch Points With Donors

Social distancing protocols and specifically, bans on public meetings in groups have disproportionately impacted religious-based nonprofits that now find themselves searching for alternative fundraising strategies. 

Dunham, whose company is a global leader in providing fully integrated marketing and fundraising strategies for nonprofits, offers the following suggestion: “Part of what I want to encourage churches to do is to consider a midweek eAppeal, that is more like an offering, if you would, that encourages people [and] reminds people of the ongoing work of the church.”

The same is true for museums and community organizations that primarily interact with people through face-to-face interactions. Just because your doors are closed to the public doesn’t mean that communications with them need to cease. You simply need to find a more appropriate method of interacting with them. 

2. Segment Donor Lists

Before sending a single email, segment your donor list using a donor pyramid. A donor pyramid can accurately identify which donors nonprofits should pursue at specific target amounts. 

Donor Pyramid

A behavioral trend has emerged where high-level donors are continuing to give but in smaller amounts, while mid-tier donors are increasing their gifts. Take advantage of this trend by targeting donors in these tiers with relevant messages and requests for donations.

WealthEngine recently unveiled the first artificial intelligence-based donor pyramid modeler in the industry. This advanced tool allows nonprofits to easily and quickly visualize how major fundraising endeavors should be broken down among giving tiers. 

With this tool, you can automatically segment your existing donors so you know who to target for planned giving, major gifts, mid-level gifts, and more. You can also easily see how many prospects you need to meet your goals. WealthEngine then works to find those prospects for you. 

Khera detailed how the donor pyramid modeler works by giving a hypothetical fundraising goal and explaining how you can use this new tool to create an accurate visualization of how close you are to meeting your fundraising objective: “Let’s say you want to raise a million dollars. All you do is type that in and our pyramid will actually help figure out how many gifts you need for each tier. You can change the thresholds for each tier…and it’ll recalculate everything for you, including your conversion ratios of how many people you need to meet, and how many you would close.”

3. Identify Donors Most Capable of Giving

It doesn’t make sense to reach out to a particular donor if their financial situation has drastically changed and they’re no longer capable of making their usual gift. Instead, use data analytics to focus your fundraising efforts on those who have experienced less of an impact.

WealthEngine’s WE Data tool enables organizations to quickly identify those individuals most capable of giving.

WealthEngine Profile

The We Data feature analyzes information from 60 sources, 300 million profiles, and 122 million households, and then offers insight into a prospect’s net worth, income, assets, history of giving, and more. With that kind of detailed data at your fingertips, you can easily find donors capable of supporting your mission, even at times of challenging circumstances on a global scale.

4. Be Authentic With Email Marketing

The subject line of your email campaign is the first thing donors see, so make it count. Aim to strike a balance between being sensitive to donors’ current situations and leaving the door open for them to continue participating in your mission.

Dunham shared the experience of one of his clients who supplemented its fundraising efforts with an email campaign that began with a simple yet impactful subject line: “How are you doing?”

Dunham explains this subject line was so effective “because . . . it immediately let the donor know how much and how important that donor was to that particular organization.” 

The body of your email should be equally engaging. In the case of Dunham’s client, the body of the email began with, “How are you doing in light of all that’s going on right now? We’re concerned about how you’re doing.” The message also addressed the health of the organization, its plans for moving forward, and expressed gratitude for the ongoing support it had received. 

This lone email blast generated $50,000 in donations. While certainly an impressive return, Dunham was quick to point out that this example of successful email marketing is not an isolated outcome: “For the month of March itself, that would be the last three to four weeks, we’ve seen a 26% increase year-over-year in revenue, but it’s because they’re actively engaging.”

5. Be Honest About Your Need

This is no time for organizations to hold information back from donors: If your nonprofit is genuinely struggling, do not attempt to downplay the stark reality. Efforts to downplay financial distress could negatively impact the carefully cultivated relationship between a nonprofit and its donors. Dunham emphasizes the importance of maintaining a relationship built on trust by asserting, “Nothing could be more distressing to a supporter, somebody who has invested in you, [than] to find out that you were in trouble and you never said anything about it.”  

Dunham advises struggling organizations to issue “a very clear request for funding” detailing why money is urgently needed. 

One of Dunham’s clients was an organization that could only sustain itself for approximately 18 days before operations would be forced to close. The solution was a quickly assembled multi-channel campaign that honestly addressed the situation, clearly stating the urgent need for funding. The ensuing donations allowed the organization to survive.

Dunham asserts, “Without being vulnerable and communicating the severity of their situation, this company could have potentially ended up closing their doors.” 

Smile FM, a Christian radio network based in Michigan, is another organization that saw similar success using the same tactic. Prior to the coronavirus outbreak, the station averaged a loss of three ongoing givers per month. When the pandemic hit, they began losing roughly three ongoing givers per day.

In response, the organization crafted an honest, compassionate email and sent it to 2,557 people, generating 25 donations within the first hour. Less than 24 hours later, the station had received 68 gift pledges, totaling nearly $20,000. Aside from on-air pledge drives, no fundraising initiative in the station’s history had ever generated such a generous response in such a short amount of time.  

6. Match Messaging to Donor Demographics

In addition to being authentic and honest, the messages you craft and their delivery system should be relevant to the demographics of your donors.

WE Analyze, a tool by WealthEngine, gives organizations an in-depth look at donor demographics so they can create messaging that matches the personas of their supporters.

Demographic Dashboards

For example, if your donors tend to be older, a fundraiser driven by direct mail is likely going to be more effective than one through an Instagram campaign or Facebook ads. 

Of course, there’s some messaging that you can land on without needing a demographics analysis tool. A faith-based organization such as a church, for instance, should tailor the content of their emails to reflect how they would engage with their congregants in person.

Dunham noted, “We’ve seen a tremendous response to a message around ‘How can we pray for you?’ For the faith-based organizations, there’s been tremendous engagement around that.”

This message works because it’s the same approach a person would take if they were comforting one of their faith-based peers in a face-to-face encounter.

7. Offer Gift Matching

Gift matching, a process in which a high-value donor or sponsor matches lower-value donations, is another powerful fundraising strategy. This approach may include a traditional gift-matching program or be implemented as a challenge, in which a larger donation will be made if a certain threshold is met through the combined efforts of several small and mid-level donations. 

Dunham maintains that the “true match” approach is the stronger of the two gift matching fundraising initiatives. Explaining his preference for a true match gift challenge, Dunham argues that true match has more of an impact, “especially if there’s some sort of a time frame on it, that if you run the potential of losing a portion of the match, and the donor’s intent is to get people to really be engaged” this approach can be very effective in getting people to commit to giving. 

The doubling effect of a person’s gift is also a powerful tool. If a donor realizes meeting a certain gift threshold will result in their donation being doubled—increasing the impact for the organization—their incentive to give is increased. 

For these types of programs to be efficient, it is vital that fundraisers have a firm grasp on the capacity for giving among their potential donors. This information allows nonprofits to set realistic fundraising goals. 

We Analyze assists organizations by monitoring and tracking donor giving history. This gives organizations a more accurate prediction of how gift-matching initiatives will perform.

8. Host Virtual VIP Events

Virtual tours and online performances help organizations remind supporters that they’re still offering value to the community and that their societal impact, as well as their financial needs, continue even as the nation works to emerge from “stay in place” restrictions.

However, interest in virtual tours has tapered off as the pandemic has progressed, so organizations need to get creative about differentiating themselves. Virtual events like webinars, live music, speaking engagements, or other distinctive experiences are still seeing success.

Virtual events have proven to be effective tools for cross-promotion and working cross-functionally with other organizations with whom you have established relationships, enabling you to expand your reach to a wider audience. Virtual events also offer ample lead time in promotion and can be used in conjunction with email messaging.

Before scheduling an event, organizations should consider how their donor audience will react to the offering. Ask yourself whether featuring the content online makes sense or if it feels forced; proceed with the event only if you feel that what you’re offering will truly appeal to your core audience.

Key Takeaway: Intentional Messaging Fuels Fundraising in the Time of Coronavirus

Although the pandemic is at the forefront of everyone’s mind, nonprofit organizations remain committed to their founding mission statements. Now more than ever, certain sectors of society depend on the assistance offered by nonprofits, making fundraising and garnering continued financial support for these organizations increasingly essential.

Organizations must pivot their messaging and delivery systems to show donors the importance of continuing to support them. Being honest about your needs, staying true to your mission, and being careful about how you construct messaging and virtual offerings are all essential for fundraising in uncertain times.

To learn more about the full assortment of tools included in the WealthEngine platform that elevates fundraising initiatives in uncertain times, sign up for a WealthEngine demo today.

Retail Banking Customer Segmentation

Retail banking image

Retail Banking Customer Segmentation

June 4, 2020
Raj Khera

Retail banking, also known as consumer banking, offers financial services to the general public. Typical services offered by retail banks include checking and savings accounts, personal loans, credit card access, and mortgage loans. 

This guide covers definitions of retail banking and customer segmentation and a discussion exploring common types of retail banking customer segmentation, how data analytics are used in customer segmentation and the benefits of segmentation.

What Does Customer Segmentation Look Like in Retail Banking?

Retail banking services are commonly provided by financial institutions at physical locations, or branches, where customers can manage their money and speak in-person with a banking agent regarding other financial services or products offered. 

Most services can be provided at ATMs or through mobile banking platforms, which in recent years have gained substantial traction. Since these institutions have a broad customer base, banks often group their customers into categories based on similar traits, a process known as customer segmentation

Customers that make up a retail bank’s user base can vary widely by numerous factors including age, gender, income, lifestyle, etc. Banks can segment their customers into lists dividing their consumers into groups based on certain key characteristics and take actions that better align with each segment. 

Obtaining and acting on customer data through the lens of segmentation can have a massive impact on marketing and sales, retention efforts, customer service, and more. 

Carefully analyzing such a high volume of customer data can be daunting. By using tools and software like WE Analyze, retail banks can easily capture data such as spending habits, frequency, and capacity, and then use this information to identify the most appropriate time to make a loan offer. In turn, this targeted action improves the likelihood of retail banks earning increased revenue through customer loans.

A bank’s customer segmentation approach can vary widely and must be based upon the organization’s business model and priorities. Segments can be quantitative, such as by age and gender, or they can be qualitative, such as separation by values and interests.

Maximum value is obtained when banks merge both types of data to better understand the wants and needs of their customer segments, allowing them to offer the right product or service at the right time.

 

Source 

Common Types of Retail Banking Customer Segmentation

There are numerous ways to segment customers. Traditionally, segments are demographic, geographic, or product based. With basic demographic and geographic information, a retail bank can tailor its marketing efforts so they are personalized to meet consumer demand. 

Here are some of the more traditional segmentation categories retail banks may consider:

  1. Location: Marketing efforts geared toward specific geographic areas.
  2. Gender: Beneficial when promoting male and female-specific products online.
  3. Age: Improve age-based predictions about customers. For instance, millennials are more responsive to digital marketing strategies, with most having an email account dedicated to promotional content and over 95% of them subscribing to email lists after “liking” a company’s Facebook page, whereas baby boomers tend to be more financially stable and have higher brand loyalty.
  4. Wealth models are helpful because they convert certain qualitative attributes into qualitative scores. Wealth modeling enables banks to know where to focus their acquisition and marketing efforts to target customers who yield the highest return on investment.

Once this information is gathered, banks refine these segments by analyzing the spending habits and capacity of their customers to increase revenue by knowing which product or service should be offered and when. In recent years, more emphasis has been placed on segments that incorporate customer spending behavior or interests, often getting quite granular with the variables, as there are many factors that impact a customer’s willingness to spend. 

Source

Sample Retail Banking Segments

Once a bank is able to categorize and understand the customer they are working with, they can use software to learn how to best assist them. These are three examples of retail banking segments and how they might be approached for relevant services and marketing:

    • A family living in the suburbs with two children under age six in a house less than 1200 sq ft, who have a net worth over $500k. This segment could be attractive to candidates looking for home loans to move into a bigger house.
    • An existing customer who has only a car loan for $30,000 with your bank, but is also a business owner. This segment can be approached for business banking, line of credit, or equipment loan/leasing.
    • An existing customer who has less than $50k in your accounts but who has also been flagged as an accredited investor. This segment could be open to your private banking or wealth management services.
    • An existing customer who has a net worth of over $500k and a child, aged 17, who has a debit card with your bank. This segment can be tapped for showing how to help their child build credit using a secured credit card. This works the same way as a debit card, (that their parents might be willing to fund), but their usage and payoff history is reported to the credit agencies to help start building a credit history.

For banks looking to get the most out of their segmentation, knowing how to use wealth and lifestyle information to target the right audience with the correct services is key to retaining customers, and predicting their needs.

How Data Analytics is Used in Retail Banking Customer Segmentation

Once retail banks begin collecting and screening key data from their user base, analytics can be used to turn customer data into actionable insights for each of their consumer segments. As previously stated, data analytics are most commonly used in retail banking customer segmentation to identify common traits or characteristics among customers to personalize service or product offers. 

Marketing software helps companies fill in the gaps in their customer database by using data enrichment, data cleansing, secure delivery and real-time updates to maintain high-quality data. Automation offers increased efficiency in comparison to resources lost when spent manually maintaining and updating databases, allowing more time to be allocated toward building stronger relationships with each customer segment.

 

Wealth screening through WE Screen uses proprietary wealth scores and ratings and merges them with current customer data, enabling companies to know more about consumers’ interests, political affiliations, net worth, and capacity to spend. These insights can be applied to segments to create a variety of initiatives such as reducing churn rates, improving satisfaction, and more. 

With WE Screen, banks can gather analytics on customers from their lifestyle segment using affinity scores applied to their data. 

Using a Look-alike Model

Using segmentation and affinity scores, banks can rank consumers by variables such as net worth or cash on hand to identify their most (and least) valuable customer segments, allowing them to concentrate special marketing efforts directly to their top consumers. 

Creating a look-alike model for these customers takes this application of data analytics further, allowing banks to target prospect segments they know will yield a higher profit. Look-alike modeling allows banks to gather and identify common traits from a certain customer segment and find new prospects who match those same criteria. 

Banks can use this information to create personalized messaging for potential customers who resonate with them from the very first interaction based on the segment(s) they fall into. This often increases conversions and builds stronger relationships with consumers.

Retail banks can use other basic consumer information to more quickly identify trends among customer segments and use it to further personalize interactions. Some of these data points include:

    • Acquisition source: Noting where a new consumer was acquired. This helps track where new customers are coming from, enabling banks to capitalize on those channels.
    • Initial spending: Banks can identify the first purchase a new consumer makes, helping them to make better predictions about customers’ future needs and purchases. 
    • Device usage: This enables banks to understand which devices customers use for various services, clarifying what actions can optimize those interactions and engagements.

Because there are so many pieces of customer data that can be analyzed, data mining is becoming increasingly popular for larger financial institutions. Banks use data mining to apply extensive analytics to current data and to spot trends that may not otherwise stand out. 

For instance, a bank can use data mining analytics to discover the top 5 attributes shared by customers with the highest lifetime value (LTV). Knowing those key characteristics, banks can concentrate their marketing efforts by creating personalized campaigns targeting high-value customers. 

Data analytics performed on customer segments can also be used to create more efficient predictive models for retail banks. When machine learning is integrated, it can use these models to create a smoother customer experience by better forecasting what customers need and when. 

Source

Machine Learning

Machine learning is gaining traction and is predicted to have a positive impact on nearly all aspects of larger technology-driven organizations, with 57% of technology professionals expecting machine learning to contribute toward improved customer experience.

Benefits of Retail Banking Customer Segmentation

Through a solid understanding of their customer segments, retail banks can personalize consumer experiences and quickly form genuine relationships with new and existing customers. Improving these efforts leads to reduced costs and increased revenue. A list of common benefits derived from customer segmentation follows: 

    • Lower Acquisition Costs

Through customer segmentation, banks can deploy more personalized initiatives that increase the likelihood of prospects becoming customers. Banks can also generate specialized efforts toward segments that yield the highest profitability. One way this can be achieved is by using a look-alike model

    • Increased Sales

By knowing customer interests, habits, and desires, banks can offer customers exactly what they are looking for when they need it the most, leading to increased revenue. 

    • Customer Lifetime Value (CLV) prediction 

CLV helps banks identify their most valuable customer segments so they can focus on acquiring customers who generate the most revenue over time.

    • Decreased Churn

Creating a personalized experience for retail customer segments increases customer satisfaction, often leading to increased customer retention and brand loyalty, decreasing churn rate.

    • Improved Marketing Campaigns

Using customer segments, retail banks can determine the best way to attract new customers, build brand loyalty, and promote specific products. Having a better understanding of the target segments will lead to increased conversion rates

Customer segmentation makes marketing, product development, and even customer service more effective by helping retail banks gain further insight into specific groupings within their customer base. 

To begin segmenting your customer list, visit WealthEngine today to see all of the powerful tools our platform offers to help organizations turn data into action. 

How to Create a Donor Pyramid to Raise More for Your Capital Campaign

donor pyramid

How to Create a Donor Pyramid to Raise More for Your Capital Campaign

May 28, 2020
Sharanya Venkatesh

Are you starting a capital campaign? Then, missing this step could send your campaign down a rocky road. This important step is building a donor pyramid.  These structures also referred to as fundraising pyramids, are an accurate way to prioritize development efforts.

Yet, not all pyramids are created equal. Read on to see how to build one that will boost your campaign and help you exceed your goals.

What is a donor pyramid?

A fundraising pyramid is a visual that categorizes prospects by their engagement level. Further, it provides nonprofits a path to move donors from lower levels of giving to greater commitment.

fundraising pyramid

While some donors will move from one -time donations to planned giving, not everyone has the same journey.  For instance, mid-level donors are generally a reliable segment. They need a strategy that is tailored to them and they shouldn’t always be pushed up the giving ladder. However, there are still hidden gems in your donor base who can be nurtured all the way to the top of the pyramid.

Donor Pyramid Modeler

A donor pyramid, also known as a gift pyramid and as a gift table when presented in table format, gives you a clear understanding of how much you can raise. When created manually, producing a donor pyramid can be time-consuming since you have to take into account numerous data points. These include an individual’s capacity, propensity and intent to give.

WealthEngine has created the industry’s first AI-based donor pyramid modeler to empower all nonprofits, small and large, to generate a donor pyramid in minutes. This 2-minute video shows how it works:

Simply enter the amount you want to raise and you will automatically see how many prospects you need for each fundraising tier. Use built-in thresholds and conversion rates, or make adjustments using our What-If analysis. Then, instantly see how much you can raise with your current contacts, identify who to talk to in each tier, and know how many new prospects you need.

WealthEngine does all of the segmentation math and analysis for you in minutes to identify wealth strata and propensity.

Try the Donor Pyramid Modeler → 

 

When you are ready to find new prospects, use WealthEngine’s powerful prospecting tool to identify ideal opportunities and import them directly into your CRM/DMS like Salesforce.

Why Donor Pyramids can Make or Break Your Capital Campaign

A fundraising pyramid helps you focus your campaign dollars to the right set of prospects. When you build a data-driven pyramid, your data will automatically reveal patterns that you can use to build your campaign.

Starting a campaign that is aimed at a random sampling (or the entirety) of your database will dilute your ROI. When your entire base receives a generic message from your nonprofit, the number of people who will engage will naturally be low.

Even if you’re in the middle of a capital campaign and you realize that you’re not seeing results, a donor pyramid can help revive it. All you have to do is segment your base and prioritize those prospects who have the propensity, capacity, and intent to give.

How to Create a Data-Driven Fundraising Pyramid

Wealth screening is the first step. Screening data gives you a holistic picture of who your prospects are. In other words, you can understand your prospects’ wealth, lifestyle, interests, and affinities.  This means you now know their potential not only in terms of capacity to give but also interest and intent.

By learning more about who they are, you can really speak their language. For example, United Way of Greater Saint Louis says,

“We really like the level of granularity we can get in the data, understanding details, such as propensity to give and giving capacities helps to fill in gaps in the profiles….Finally, learning about a prospect’s interests can help us better shape the conversation to customize our asks. We are a lot more cautious about the ask now that we have more intelligence…”

Therefore, screening helps you segment your prospects into different rungs of your donor pyramid. Those with the highest capacity and engagement (for instance, those with high P2G scores) are candidates for major gifts or planned giving. Similarly, those with lower capacities but high engagement are well suited for mid-level or recurring donations.

Interested in learning more about creating data-driven campaigns? Download our Data-Driven Major Gifts Campaign Workbook!

Using Modeling to Enhance Your Donor Pyramid

Wealth Screening is the first step, which means that a wealth model can drive your capital campaigns much further.

Screening can give you a broader view of your donor base. Modeling can actually help you predict the outcome of your campaign. For example, WealthEngine’s Gift Pyramid Model can automatically build a pyramid and predict campaign success.

In that sense, modeling is predictive based on custom insights that are deep and actionable. The model builds a specific formula for your organization’s donor base. The model generates a score against which you can compare your prospects. By doing this, the model automatically splits your list into 10 equal deciles. The top decile will represent the top 10% of prospects for your campaign. The top two represent the top 20% and so on.

Going from Fundraising Pyramid to Campaign: Practical Implementation

Predictability allows you to improve your goal-setting. With your targeted campaign, you can not only set ambitious goals but also exceed them. Follow these steps after creating your data-driven donor pyramid:

1. Segment and target those donors who are apt for your campaign. Annual fund campaigns, for instance, can focus on prospects who have the highest inclination and capacity for this type of gift.

2. Evaluate your deciles to see which ones will be most effective for your campaign.

3. Set your budget based on the number of deciles you would like to include, or include deciles based on your campaign budget.

4. You can go down the list of deciles until you meet and exceed your campaign goals.

Breathe New Life into Your Capital Campaign

WealthEngine’s modeling removes the guesswork and puts you in control of your campaign, budget, and ROI. Book a demo today to learn more!

Request Demo

Related Reading

Capital Campaigns: Fundraising Strategy for Nonprofits

What to Do When You Inherit a Fundraising Campaign

How to Enhance Your Video Conferencing Experience

Retail banking image

How to Enhance Your Video Conferencing Experience

May 27, 2020
Courtnee Davis

As offices around the country start planning for a return to the office, many of us are still working remote and connecting with our colleagues and teams via video conferencing. Video platforms like zoom, GoToMeeting, and Google Meet have all become an integral part in the way we communicate and hold each other accountable at a distance. And though video conferencing etiquette isn’t something that’s often discussed during COVID-19, it is something that should be considered while navigating work to enhance your meeting experience.

Over the last few months, we have all been on more video conferences than we can count with many of us working in situations that are out of our control including multitasking with children in the background, pets barking, or living next door to a neighbor who has decided to mow their lawn midday. However, what we can control is the appropriate way to present ourselves. Similar to in-person office meeting etiquette, there is etiquette that should be taken into account when video conferencing.

Consider your headspace.

Although often overlooked, your headspace and the appropriate amount is a big factor in creating a presentable look on a video call. A rule of thumb is to reference the rules of framing that journalists use while capturing their interview shots. In most cases the 90-degree rule or The Rule of Third applies. Similar to interviews, it’s important to ensure the top of your head isn’t cut off and the entirety of your face and head is shown with 2-4 inches of headspace above to spare. Avoid severe profile shots and too much of your body being shown – as you should always be able to see both eyes and the face straight on. Viewers are attuned to seeing someone’s whole face when they speak and profiles are also unflattering to your team.

Backgrounds for video conferencing.

Not only do we focus on faces when we’re on video, but the backgrounds of others. Busy backgrounds are distracting and can distract others on the call if you let it. We’ve all experienced gazing for long periods of time and strain from spotting things in the background. Similar to shooting an interview, a best practice is to keep it simple and consider a clean and neutral colored background or both while you’re working from home. If you are outside, make sure you’re not video conferencing in a busy area and that the lighting and colors don’t affect your presentation on screen. Another option to consider is creating a company-branded background that you can distribute to your teams and upload via zoom. This is something that doesn’t take too much time and that as a company we have implemented for our Sales division.

Achieve the best lighting.

Proper lighting is a big factor in creating a presentable look during a video conference call. Similar to our eyes, the cameras on our laptops need light to render the best image and achieve the highest quality video possible. When there isn’t enough light or too much light, it can cause cameras to render a lower quality image. It’s important to know how to use proper lighting in order to optimize your video conferencing calls. It’s not necessary to go out and purchase new lighting; any amount of sunshine or room lighting will do. However, minimizing distraction as much as possible and avoiding poorly lit rooms, which can result in harsh shadows or glares on video is best. Proper lighting eliminates this and keeps everyone focused on the speaker and current meeting.

Minimize noise level.

There are many pros and cons of capturing volume from a computer. A con being that all background noise is usually amplified to those who are on the video call. Though a quiet space may be difficult to find during this time, don’t be afraid to use the mute button. Many of us have experienced audio fading in and out while video conferencing or someone working in close proximity to their partner. It’s always worthwhile to test your volume prior to joining a call as this can make a huge difference. Still experiencing issues? Keep a phone nearby and stay dial-in ready.

Adapting to a changing work environment over the last few months has taught us a lot about the resiliency of our teams. No matter what you’ve experienced in the past, implementing these tips going forward during your next meeting can enhance your video experience and take your meeting to the next level. 

 

How to Increase Your Assets Under Management in a COVID-19 World

How to Increase Your Assets Under Management in a COVID-19 World

May 26, 2020
WealthEngine

Tune in for an executive briefing and live Q&A with Chady AlAhmar, CEO of Wealth at Old National Bank, and Raj Khera, EVP at WealthEngine, as they share best practices to help you grow your portfolio in the midst of economic uncertainty.

View the Executive Briefing On Demand

This Executive Briefing will show you:

  • How to uncover insights like estimated net worth, investable assets, business ownership, accredited investor status, likelihood to buy a specific financial product, and more
  • Ways to find and connect with wealthy and soon-to-be-wealthy prospects
  • Techniques to identify clients in your portfolio who are ripe for expansion
Chady AlAhmar
CEO of Wealth

Old National Bank

Raj Khera
EVP and Chief Marketing Officer
WealthEngine
Raj is a past CEO and co-founder of several software businesses, two of which were acquired by public companies. At WealthEngine, he helps to create more value for customers through thought leadership and game-changing product enhancements. He is passionate about supporting higher education and cancer research and volunteers his time at the University of Maryland and local schools.

Short Term Fundraising Action Plans: The Next 90 Days

Short Term Fundraising Action Plans: The Next 90 Days

May 21, 2020
WealthEngine

WealthEngine caught up with Ian Swedish from CCS Fundraising to reflect on the current landscape after 60 days and prepare for the next 90 days. Tune in for an engaging session about creating strategic short term action plans that will help you define opportunities and devise solutions amidst today’s challenges and uncertainties.

View the Executive Briefing On Demand

Areas of focus will include:

  • Maintaining and sustaining key relationships
  • Leveraging leadership
  • Communicating meaningfully with lapsed donors
  • Evolving your case for philanthropy to meet the moment
Ian Swedish
Corporate Vice President

CCS Fundraising

Raj Khera
EVP and Chief Marketing Officer
WealthEngine
Raj is a past CEO and co-founder of several software businesses, two of which were acquired by public companies. At WealthEngine, he helps to create more value for customers through thought leadership and game-changing product enhancements. He is passionate about supporting higher education and cancer research and volunteers his time at the University of Maryland and local schools.

 

How Healthcare Organizations are Pivoting to See Fundraising Success in a COVID-19 World

How Healthcare Organizations are Pivoting to See Fundraising Success in a COVID-19 World

May 6, 2020
WealthEngine

WealthEngine caught up with ChristianaCare’s Vice President of Development Gordon Brownlee and Spectrum Health’s Director of Finance and Operations Greg Workman to talk about how healthcare organizations are successfully navigating today’s challenging environment due to COVID-19.

View the Executive Briefing On Demand

Tune in to learn:
  • Guidance on developing a Caregiver Relief Fund for those on the front lines
  • How ChristianaCare is coordinating hundreds of PPE donations, including face masks, shields and gloves
  • A strategy to look for new donors within your community and ways to optimize your messaging for fundraising as a result of COVID-19
Gordon Brownlee
Vice President of Development

ChristianaCare

Greg Workman
Director of Finance and Operations

Spectrum Health

Raj Khera
EVP and Chief Marketing Officer
WealthEngine
Raj is a past CEO and co-founder of several software businesses, two of which were acquired by public companies. At WealthEngine, he helps to create more value for customers through thought leadership and game-changing product enhancements. He is passionate about supporting higher education and cancer research and volunteers his time at the University of Maryland and local schools.

 

5 Critical Steps for Successful Giving Tuesday Now Follow Up

5 Critical Steps for Successful Giving Tuesday Now Follow Up

May 5, 2020
Raj Khera

These 5 critical steps for your Giving Tuesday Now follow up will increase your fundraising beyond what you capture from initial donations.

Giving Tuesday Now follow up

As many nonprofits send appeals for donations to help in their response to the massive economic downturn caused by COVID-19, most will not know the true potential of their donors. You can fix this. Use these steps to generate bigger donations from your Giving Tuesday Now follow up efforts.

1. Share Your Impact in #GivingTuesdayNow Follow Up

You may have a set of thank you letters to use in your initial Giving Tuesday Now follow up. Send your emails and letters out quickly to acknowledge donors for their contribution. If you received donations electronically, send your follow up by email. For paper check donations, respond in kind with a printed letter.

Mention the impact you are having. Donors want to feel that their contributions are making a difference.

giving tuesday now toolkitFor more messaging ideas, use WealthEngine’s Giving Tuesday Now Toolkit, which contains many templates that you can copy/paste and edit to customize your words.

2. Screen Donors to Know Who Can Give More

You will get donations of all sizes, $10 or $1000 or more. How many can – and would – give far more than $100? How many are millionaires and should be targeted for major gifts? There’s a very strong likelihood that if you nurtured these high capacity donors properly, they would donate more.

Find the Major Gift Donors Hiding in Your #GivingTuesdayNow List

Nurture donors with high estimated giving capacity and propensity.

Leslie VanSant, Chief Philanthropy Officer, at the Rainforest Trust had a donor who regularly gave a small donation, under $500. She did a simple check in their WealthEngine account to see this donor’s estimated giving capacity. Leslie saw that the donor had much greater potential than her past donations. This was an opportunity for building a stronger relationship.

Through personalized engagement resulting from her wealth screening using WealthEngine, the Rainforest Trust soon got a $25,000 donation from this donor.

Listen to Rainforest Trust share their strategic plan that enabled them to grow from 1000 donors per year to 1000 per week →

After your donations from Giving Tuesday Now are in, it’s time to investigate. You now have the opportunity to nurture many new donors who can give much more than they gave.

Screening your donors for their actual giving capacity and propensity will be the most important thing you do in your Giving Tuesday Now follow up. It can double or triple the funds you raised.

If you use Salesforce, get the WE Insights for Salesforce connector to append your donor record with these details instantly. For other tools, use WealthEngine’s API to save time and get all of the information you need right inside your CRM/DMS.

3. Take a Closer Look at Your DAF Donations

Fidelity Charitable reported that during the first 4 weeks of lock downs and economic turmoil, donors of their Donor Advised Fund gave $90 million to help nonprofits deal with COVID-19 issues. So, they challenged their donors to hit $200 million by today. Compare this to $60 million that was donated in all of 2017 in response to the seven natural disasters that year, such as the California wildfires and Houston floods.

Listen to Fidelity Charitable share the exact steps you can take to get donations from DAF donors →

Donors who participate in a Donor Advised Fund generally have a higher giving capacity than what they donated to your organization. Fidelity reports that their average donor has $17,000 in their DAF. Vanguard’s minimum amount to deposit in their DAF is $25,000 whereas Fidelity and Schwab have a $5,000 initial minimum.

When you receive a donation through a DAF of $50 or $500, it’s time to learn more about your donor. They should get special attention in your Giving Tuesday Now follow up. The simple fact that they used a DAF indicates that they likely can give more.

People use DAFs to set aside cash for future donations while taking the tax deduction on the total set-aside amount at once. This allows donors to decide which charities they want to support over time. With the havoc caused by COVID-19, DAF donors are being quite generous.

DAF donors often include their personal name in the donation. Use this to research the donor’s actual giving capacity.

wealth signal

This adds to the information in your donor segmentation analysis so you get a clear picture of where to put your efforts.

4. Use a Donor Pyramid to Project Your Fundraising Potential

It is time consuming to nurture major donor prospects. With limited bandwidth, you and your team want to focus on the most promising opportunities for growth and expansion. Donor segmentation can be hard.

A donor pyramid is a wonderful solution. It can help you segment your new donor list to create a prioritized list of prospects. For many organizations, this is a manual exercise that requires knowing the scores, capacity, propensity and other information about donors.

WealthEngine’s upcoming release makes creating your donor pyramid very easy. Rather than manually sorting and segmenting your donors, our new Donor Pyramid Modeler allows you to see which donors fit into each giving tier instantly.donor pyramid

This saves you weeks, even months, of grueling hours manipulating spreadsheets and digging into the backgrounds of your donors.

The Donor Pyramid Modeler can automatically screen your Giving Tuesday Now list for appropriate follow up. Using data from WealthEngine’s scores and insights, you will know which new donors to nurture for additional giving. Appropriately assign them to your major gift or planned giving officers, or keep them on your annual fund campaign list.

Reserve your seat for a free Donor Pyramid Modeler trial →

You will also see the total giving capacity of your Giving Tuesday Now donors so you know your full fundraising potential. Try it and see how quickly it can help you find your best donation opportunities.

5. Identify the Shortest Path to Reach New Connections

WealthEngine’s connections enable you to see who in your circle of close contacts can put you in touch with others you are trying to reach.

You can find common connections through personal relationships, other nonprofit board members, and professional activities.

Our client constantly report high ROI and big increases in fundraising once they start using WealthEngine. Even in a climate with tight or frozen budgets, bringing in donations is the key to your survival. A tool as powerful and easy to use as WealthEngine can mean the difference between funding new initiatives or turning off your lights.

Request a WealthEngine Demo Today →

How This Nonprofit Grew from 1000 Donors/Year to 1000 Donors/Week

How This Nonprofit Grew from 1000 Donors/Year to 1000 Donors/Week

May 5, 2020
WealthEngine

WealthEngine caught up with Leslie VanSant and Michelle Husko of Rainforest Trust to talk about how they have transformed Rainforest Trust into a world-renowned fundraising organization.

View the Executive Briefing On Demand

Tune in to learn:
  • The strategy that grew their donor base by 50x in the last decade
  • How they use data to convert small donations into major gifts
  • The messaging and tactics they found to have the most impact
Leslie VanSant
Chief Philanthropy Officer
Rainforest Trust

 

Michelle Husko
Director of Donor Services
Rainforest Trust

 

Raj Khera
EVP and Chief Marketing Officer
WealthEngine
Raj is a past CEO and co-founder of several software businesses, two of which were acquired by public companies. At WealthEngine, he helps to create more value for customers through thought leadership and game-changing product enhancements. He is passionate about supporting higher education and cancer research and volunteers his time at the University of Maryland and local schools.