We all know the drill: it’s budget time and we need to invest big $ to make up for all the new supporters we lost in the last 12 months.
The new campaign kicks off and it’s going so well! Low costs per lead or per acquisition, so exciting! But have we REALLY worked out the long-term value of these new shiny acquisitions? What about the thousands of supporters sitting in our database who occasionally read the dreaded newsletter every couple of months?
Any digital marketer has certain metrics etched into their mind – CPL (cost per lead) and CPA (cost per acquisition) being chief among them. The charity sector is addicted to acquiring new supporters and these metrics hold immense power over budget decisions.
But these metrics mean NOTHING without context.
How do you measure value?
A much better focus that requires some extra work is ‘What is the value of each lead?’
Value per lead (VPL) shines a light on the long-term value of your acquisition activity and offers a link between lifetime value and exciting acquisition metrics.
Suddenly those $15 leads from 2016 don’t look so expensive when many of them have become loyal regular givers, mid donors, and bequests. On the flipside none of those $2.40 leads with that amazing telemarketing response rate from 2018 have stuck around.
I recently worked for 18 months with a large conservation organisation and built a model that forecast their activity for 5 years. It was a real eye opener and one of the main benefits was a calculation of the value per lead.
The model calculates the predicted activity of new leads across many programs – appeals, conversion calling, upgrades etc. We found that small changes in how you engage your current supporter make huge differences over time. A small drop in donor attrition or a slight lift in your regular gift conversion or reactivation programs have gigantic implications when you look forward a few years.
It was a wonderful tool to make informed decisions and highlighted something we all know deep down:
Everyone you engage with has the potential to be extremely valuable to your cause. Put the work in to identify their true value and keep supporters rather than replace them.
Get the best out of your best supporters.
Easier said than done, we know. But with changes in privacy laws, cookies etc, finding new people is more difficult and costly than ever.
This makes our current supporters more special than ever – and plugging the leaky bucket vital, moreso than acquiring new leads. Put the effort in to show them some love, talk to them, ask them questions! You could:
- Call, email, sms them to tell them you love them. Ask meaningful questions about why they care and what you could do better.
- Let them know their impact! Much of the wonderful work you do is only possible because of them – dedicate some time, money and insights into how they’ve made your mission possible.
- Invite them to events, webinars and volunteering opportunities.
- Spend some of that media budget on reaching your loyal supporters such as a social video campaigns on your work directed just at donors (possibly test a control group who do received the campaign to test it’s impact).
Apply some of that shiny acquisition focus (money) on them and let them know you care… we’ve modelled it, it works 😉
Want to talk more about how to model out your Value Per Lead or how to nurture your best supporters? Drop us a line.