Latest / The Nonprofit Podcast / Ep 129| Maximize Monthly Giving: The 3-R Incentive Formula (Part 2)

Transcript

Ep 129| Maximize Monthly Giving: The 3-R Incentive Formula (Part 2) · The Nonprofit Podcast

• 0:04
  SPEAKER_02: The Nonprofit Podcast, powered by DonorBucks.
• 0:09
  SPEAKER_02: Last week we explored how simple nudges can guide donor behavior.
• 0:14
  SPEAKER_02: But what if you could turn one-time donors into those elusive unicorns, loyal supporters?
• 0:21
  SPEAKER_02: This week we're focusing on how the right incentives can help make that happen, building stronger, ongoing relationships for your nonprofit.
• 0:30
  SPEAKER_02: Welcome to the nonprofit podcast.
• 0:32
  SPEAKER_02: I'm Jenna, education and community engagement manager here at DennerBox.
• 0:37
  SPEAKER_02: We are here each week with practical actions you can use today to increase donations and take your nonprofit to the next level tomorrow.
• 0:46
  SPEAKER_02: Today's episode is all about harnessing the power of incentives to enhance your monthly giving.
• 0:52
  SPEAKER_02: It is not just about offering something extra, it's about tapping into what really motivates people to give and keep giving.
• 1:01
  SPEAKER_02: And once again, joining me is Kara Augsburger, Executive Director of Grace Care Center Foundation and our podcast co-host.
• 1:08
  SPEAKER_01: Hey there, Jenna.
• 1:10
  SPEAKER_01: I am thrilled to continue our discussion from last time.
• 1:14
  SPEAKER_01: You know, last week I shared a little bit about how I'm gearing up for a monthly giving campaign for my nonprofit.
• 1:21
  SPEAKER_01: And then you inspired me with some tips on how to use some simple psychology or behavioral economics, as you shared, to boost fundraising this fall.
• 1:31
  SPEAKER_01: And you shared with me how nudges gently guide donor behavior.
• 1:35
  SPEAKER_01: And when we talked, you mentioned another big motivator, and that's incentives.
• 1:40
  SPEAKER_01: So I'm curious about how incentives can play a role.
• 1:44
  SPEAKER_01: For our listeners who might have missed our last episode, could you briefly explain what that behavioral economics is and what we mean by incentives?
• 1:54
  SPEAKER_02: Yeah, of course.
• 1:56
  SPEAKER_02: So behavioral economics is a little bit of psychology and a little bit of economics.
• 2:03
  SPEAKER_02: It looks at why people sometimes make choices that aren't purely logical, like spending money impulsively or sticking with a default option just because it's easier.
• 2:15
  SPEAKER_02: And incentives are basically rewards or perks aimed at getting people to take specific actions.
• 2:21
  SPEAKER_02: So these can be things that you actually use, like discounts or special offers, or they can be more about the feeling of doing something good, like supporting a cause that you care about.
• 2:32
  SPEAKER_02: And incentives play, um, they just play on our desire for a good deal or to feel satisfaction.
• 2:39
  SPEAKER_01: Yeah.
• 2:39
  SPEAKER_01: And you shared with me that behavioral economics is kind of rooted in retail.
• 2:43
  SPEAKER_01: And we see these things in our world all day, every day.
• 2:47
  SPEAKER_01: Um, and that good deal is a huge motivator for me.
• 2:50
  SPEAKER_01: So when it comes to using incentives to boost monthly giving for a nonprofit, what are some key strategies we should consider?
• 2:58
  SPEAKER_01: And maybe how to how do you implement these ideas to really make a difference?
• 3:04
  SPEAKER_02: Yeah.
• 3:05
  SPEAKER_02: Um, so there are three key types of incentives that can be incredibly effective in enhancing your monthly giving.
• 3:14
  SPEAKER_02: And uh I call it the 3R formula.
• 3:17
  SPEAKER_02: I I say I call it that.
• 3:18
  SPEAKER_02: I just came up with this.
• 3:20
  SPEAKER_02: Uh I am now calling it the 3R formula.
• 3:23
  SPEAKER_02: So that is reciprocity, rewards, and recognition.
• 3:27
  SPEAKER_01: I know you love your fundraising formulas.
• 3:30
  SPEAKER_01: So it makes me smile today.
• 3:31
  SPEAKER_01: But what that keeps it easy to remember.
• 3:34
  SPEAKER_01: So thank you for that.
• 3:35
  SPEAKER_01: Okay, let's dive into each of these.
• 3:37
  SPEAKER_01: Let's start with reciprocity.
• 3:38
  SPEAKER_01: What do you mean by that?
• 3:40
  SPEAKER_02: Sure.
• 3:41
  SPEAKER_02: So reciprocity is all about the natural human tendency to want to return a favor when someone has done something nice for us.
• 3:51
  SPEAKER_02: I remember on a call with our brand director here at Donorbox, Ronald, he said something like, If I brought you a coffee every day for three months, you'd naturally feel like you owe me.
• 4:04
  SPEAKER_02: And it's true.
• 4:05
  SPEAKER_02: He was talking about that in the context of marketing and how we can engage people better.
• 4:10
  SPEAKER_02: And it's so true what he said, and it really stuck with me.
• 4:13
  SPEAKER_02: Reciprocity is a big part of human interactions and can be a really powerful tool in fundraising.
• 4:20
  SPEAKER_01: Yeah, that's so true.
• 4:21
  SPEAKER_01: And I would absolutely feel that way if that was the case.
• 4:24
  SPEAKER_01: So, how can an organization use this to amplify their monthly giving program?
• 4:30
  SPEAKER_02: Well, one effective way I've seen several organizations leverage reciprocity, whether they realize they're doing it or not, is through matching gifts.
• 4:39
  SPEAKER_02: I've seen this work really, really well for monthly giving programs.
• 4:44
  SPEAKER_02: So, for instance, you might offer a campaign where every new monthly donation is matched for the first three months or whatever that may be.
• 4:54
  SPEAKER_02: And this not only amplifies the impact of each donation, but also creates that sense of partnership and shared purpose with your donors.
• 5:02
  SPEAKER_02: So, I mean, how satisfying is it when your donors see their contribution being doubled or tripled or whatever that may be?
• 5:09
  SPEAKER_02: And it can really just increase their motivation to both give and continue their support over time.
• 5:16
  SPEAKER_02: And another example could be including a small thoughtful gift with your donation appeal.
• 5:22
  SPEAKER_02: So let's say you're sending out a direct mail campaign, maybe adding a small branded tote bag or a sticker or a magnet or a handwritten note can really make potential donors feel valued and appreciated.
• 5:36
  SPEAKER_02: And it's a simple gesture that shows that you care, but it makes them feel more inclined to support your cause and return that nice favor.
• 5:43
  SPEAKER_01: Oh, yeah.
• 5:44
  SPEAKER_01: Those are fantastic examples.
• 5:46
  SPEAKER_01: I think even a great acknowledgement or a meeting with a key supporter can really create that sense of gratitude in the donor, too.
• 5:53
  SPEAKER_01: So the feeling that they feel when they give.
• 5:55
  SPEAKER_01: You know, I know when I receive those, I feel like the nonprofit needs me, you know, a little bit of an obligation or desire to give again and continue that cycle of giving.
• 6:06
  SPEAKER_01: Sharing impact, I think, can also do that.
• 6:09
  SPEAKER_01: It's a bit of feeling like they said they couldn't do it without me.
• 6:12
  SPEAKER_01: So here's another gift or an increase from my last gift.
• 6:15
  SPEAKER_01: I like that.
• 6:16
  SPEAKER_01: And I'm going to use the sticker that you mentioned, I think, in my next monthly giving campaign mailer.
• 6:23
  SPEAKER_01: So that's a great idea.
• 6:24
  SPEAKER_02: I I love that.
• 6:25
  SPEAKER_02: Well, shoot, I'm gonna have to sign up for your campaign so I can get this.
• 6:31
  SPEAKER_02: And yeah, sharing impact is also a really big part of that as well.
• 6:35
  SPEAKER_02: I totally agree.
• 6:36
  SPEAKER_01: So you mentioned rewards next.
• 6:38
  SPEAKER_01: How can they be used to enhance monthly giving?
• 6:42
  SPEAKER_02: Rewards are all about reinforcing positive behavior.
• 6:47
  SPEAKER_02: So when people receive something for their actions, they're more likely to repeat those actions.
• 6:52
  SPEAKER_02: So, for example, you could offer exclusive content as a reward.
• 6:57
  SPEAKER_02: So imagine creating a special newsletter with behind-the-scenes updates, early access to new program info or unique insights into your organization's work that only your monthly donors get access to.
• 7:11
  SPEAKER_02: So this gives your donors something to look forward to each month.
• 7:14
  SPEAKER_02: And again, it creates that sense of belonging and exclusivity.
• 7:18
  SPEAKER_02: And another approach is implementing tiered perks.
• 7:21
  SPEAKER_02: So, what I mean by that is donors who give at a certain level every month might receive invitations to exclusive events or special recognition in your impact reports or branded merchandise.
• 7:34
  SPEAKER_02: So, for example, say your donors give$25 a month.
• 7:38
  SPEAKER_02: Maybe they receive a monthly email and a special thank you postcard.
• 7:43
  SPEAKER_02: Or if they give$100 a month, perhaps they get all those$25 a month perks plus a special branded gift.
• 7:50
  SPEAKER_02: Offering these types of perks really taps into the desire of being part of, you know, that inner circle and can be really motivating for donors to give out higher amounts.
• 8:01
  SPEAKER_02: And it just kind of goes beyond the donation itself.
• 8:04
  SPEAKER_02: And what I think is great about this approach is that you can get creative here and build out your perks.
• 8:10
  SPEAKER_02: It doesn't have to be a physical item, it can be whatever you think is valuable to your supporters and that work well with your organization in its unique circumstances.
• 8:19
  SPEAKER_01: Yeah, for sure.
• 8:20
  SPEAKER_01: You could even offer like a welcome gift or a special email series when they start giving on a recurring basis.
• 8:26
  SPEAKER_01: You can use some video just behind the scenes with your phone camera, you know, a nice short, authentic video.
• 8:33
  SPEAKER_01: But I love how rewards can make donors feel special and feel connected.
• 8:38
  SPEAKER_01: You know, many years ago, I worked as a fundraiser for a fraternal organization and we created a special cardinal red sport coat and we gifted it to donors who gave a certain dollar amount over their lifetime.
• 8:52
  SPEAKER_01: And that sport coat was a real motivator, especially at large gatherings.
• 8:57
  SPEAKER_01: I saw some pictures a few weeks ago of a large national gathering they had, and they're still wearing those sport coats.
• 9:03
  SPEAKER_01: And the organization is gifting those to supporters today, still, which is really great.
• 9:08
  SPEAKER_01: It's really neat to see photos of a room full of participants, and those sport coats really stand out.
• 9:14
  SPEAKER_01: So those donors are really proud to wear them and showcase the impact they've made over time.
• 9:19
  SPEAKER_01: I'm thinking about perhaps using the same approach with a lanyard for my organization.
• 9:24
  SPEAKER_01: Every volunteer has a lanyard name badge and maybe a special one for those monthly givers or something.
• 9:30
  SPEAKER_01: And that's not super expensive, but it kind of shows that you support and encourages others to support too.
• 9:36
  SPEAKER_01: So that's just maybe some ideas of what I've done.
• 9:39
  SPEAKER_01: But let's talk about that last R in your formula.
• 9:42
  SPEAKER_01: So recognition.
• 9:43
  SPEAKER_01: How does recognizing donors impact their recurring support?
• 9:48
  SPEAKER_02: Well, the story he just shared about the sport co is a great segue into recognition too.
• 9:53
  SPEAKER_02: And by the way, I love that example.
• 9:55
  SPEAKER_02: That is a wonderful example.
• 9:57
  SPEAKER_02: I think that a really great acknowledgement is the best source of recognition.
• 10:03
  SPEAKER_02: You and I, Kara, have talked so much about acknowledgments.
• 10:07
  SPEAKER_02: Recognition is a really powerful motivator because people crave acknowledgement.
• 10:12
  SPEAKER_02: And when we're recognized for our contributions, it just validates our efforts and encourages us to continue those actions.
• 10:20
  SPEAKER_01: For sure.
• 10:21
  SPEAKER_01: So, what are some practical ways to recognize donors in this context?
• 10:25
  SPEAKER_02: Well, there are so many ways, so many easy and effective strategies for recognizing your monthly donors.
• 10:32
  SPEAKER_02: For instance, you can spotlight your monthly donors in your newsletters or on social media.
• 10:37
  SPEAKER_02: You can share their stories, highlight their reasons for supporting your cause, and show how their contributions are making a difference, showcasing their impact.
• 10:46
  SPEAKER_02: And this not only makes them feel valued, but it just publicly acknowledges their support, which can reinforce their commitment.
• 10:53
  SPEAKER_02: Not everybody loves those public acknowledgements, but even a personal one is really nice.
• 10:58
  SPEAKER_02: Oh, yeah.
• 10:59
  SPEAKER_02: And another approach is to celebrate milestones in a donor's giving journey.
• 11:04
  SPEAKER_02: So, for example, you can send a personalized note or a special mention to mark the anniversary of their first donation or a significant cumulative donation amount.
• 11:14
  SPEAKER_02: Or better yet, you can call them to acknowledge these milestones, right?
• 11:18
  SPEAKER_02: Or make a quick video.
• 11:20
  SPEAKER_02: And these gestures just show that you're paying attention and show that their support is really appreciated and making a difference, which of course encourages ongoing support.
• 11:30
  SPEAKER_01: Yeah.
• 11:30
  SPEAKER_01: You know, these strategies can be a pretty low lift for your team too.
• 11:34
  SPEAKER_01: It only takes a few minutes to acknowledge your donors, but that impact can go a long way.
• 11:39
  SPEAKER_01: When you're reaching out to your donors one-on-one, it shouldn't just be about asking for money.
• 11:44
  SPEAKER_01: It should be about making donors feel appreciated, feel involved, and feel really, really valued.
• 11:50
  SPEAKER_02: Yeah, exactly.
• 11:52
  SPEAKER_02: And by incorporating these incentives into your fundraising strategy, you just create a more meaningful and motivating experience for your supporters.
• 12:01
  SPEAKER_02: It's just about making them feel like a vital part of your organization's success and reinforcing their commitment with those incentives.
• 12:08
  SPEAKER_01: And when they feel like they're part of your team, they'll stay engaged.
• 12:12
  SPEAKER_01: You know, this has been such a great discussion.
• 12:14
  SPEAKER_01: So, my favorite part, what can our listeners do right away to incentivize more monthly gifts?
• 12:21
  SPEAKER_02: Review your current donor engagement strategies and identify one area where you can implement an incentive.
• 12:29
  SPEAKER_02: So consider those three R's reciprocity, rewards, and recognition, whether that's setting up a matching gift campaign or creating exclusive content or spotlighting your monthly donors on social or just simply giving them a call, taking just a small step can really have a big impact.
• 12:47
  SPEAKER_01: Yeah.
• 12:47
  SPEAKER_01: And then once you get them implemented, don't forget to get some feedback from your donors to learn more about how to improve their experience and keep them motivated.
• 12:57
  SPEAKER_01: You know, these approaches not only keep donors sticking around, but can also maybe motivate them to give more, which could make the monthly giving program even more powerful.
• 13:08
  SPEAKER_01: I need to put some thought into how to do these and do them well.
• 13:10
  SPEAKER_01: So I think these can make a really big difference for my organization and so many other organizations out there.
• 13:17
  SPEAKER_01: Thank you.
• 13:18
  SPEAKER_02: I'm excited to see how some of these ideas are put into action at Grace Care Center Foundation.
• 13:24
  SPEAKER_02: And thank you as always for chatting with me today.
• 13:27
  SPEAKER_02: Oh, my pleasure, as always.
• 13:28
  SPEAKER_02: Thank you, Jenna.
• 13:29
  SPEAKER_02: And thank you for joining us on the Nonprofit Podcast.
• 13:33
  SPEAKER_02: I hope you've left with the confidence to take a small step today that will make a big difference tomorrow.
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