Undoing mediocre marketing

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1 Undoing mediocre marketing IT S TIME TO REVOLUTIONIZE YOUR PROGRAM By: Tim Kachuriak SVP, Innovation and Optimization 5151 Belt Line Road Suite 900 Dallas, Texas

2 Revolutionizing the Way We Think About Clarity trumps persuasion. That s what my friend and mentor Dr. Flint McGlaughlin says is the key to successful marketing communications. He would know; Dr. McGlaughlin heads up MECLABS, a market research company that works with Fortune 100 companies to optimize their sales funnel. Through their 10 years of research spanning 1,300 plus experiments, including more than 1 billion s and 10,000 landing pages, MECLABS has developed a rigorous methodology that has been proven to optimize campaigns. But how might this methodology work in the nonprofit world? That s been the focus of my research over the past three years. This whitepaper will introduce the new science of optimization and provide you with practical ways that you can apply rigorous testing to your campaigns. What IS Optimization? Optimization is defined as: To make effective, perfect, or as useful as possible; To make the best of something; To be optimistic, To constantly push forward. Peter Drucker once said it this way: Adequacy is the enemy of excellence. As it relates to marketing, your website or even direct mail, what you did last year or even last month could be communicating the wrong message, wearing your donors out or, worst case scenario, convincing them to ignore you. But where do you begin to optimize your donor communications and move them from adequate to excellent? Start with the End in Mind Oftentimes we are so excited to test out a creative idea that we fail to think through what we were trying to accomplish in the first place. We end up sending mixed messages, like the direct mail package that says, A nickel could save a child s life. So, by mailing a nickel, what did we just do? Is that what we want to communicate to our donors? No, but if we neglect our strategy, we will regularly fail to execute on our goals. Instead, we say things we don t mean and mean things we don t say. Yet hopefully, through such failures, we learn what not to do and can optimize our efforts for next time. 2

3 The Psychology of Optimization To further understand optimization, it s important to understand that it s not something that happens on the page. In fact, it happens in the mind. Whenever we send a message, regardless of channel, we are entering into a mental conversation with people. In the case of , that mental conversation begins when we capture the person s address. It carries forward through the From line, the To line and the Subject line, all of which inspires them hopefully to open the message. The conversation continues through the message body, which inspires the click, and that carries all the way to the landing page that inspires the individual to act. If we think about it this way, we don t need to optimize our campaign; instead we need to consider how to optimize thought sequences. Best Practices Are Not Enough You Need a Rigorous Methodology If I were to show you three different s all designed by top notch agencies how would you determine which one is optimized? Would you look at the amount of white space? The use of colors and images? Would you evaluate the copy, the messaging, the call to action? How do we really know when something is optimized? The reality is, we don t. While we all pride ourselves as wonderful marketers and cunning fundraisers, the key to success is humility. We need to come to terms with the fact that while best practices may be helpful, they are not enough. And though we like to trust our marketing intuition, we find often that testing trumps marketing intuition. So, if the key to optimization is testing, how and what should we test? That s where you need a rigorous methodology a methodology that has been developed through years of scientific testing. MECLABS conducts rigorous experiments in the new science of optimization. Here s a snapshot of their Optimization Methodology, which we ll refer to throughout this paper: eme = rv(of + i) (f + a) eme = marketing effectiveness index rv = relevance to the constituent of = offer value i = incentive to take action f = friction elements of the process a = anxiety elements of the process It reads in plain English like this: Marketing Effectiveness equals Relevance times Offer plus Incentive minus Friction, minus Anxiety. 3

4 Start by Identifying Value Factors and Inhibitors To begin applying this formula to the mental conversation you re having with your constituents, start by identifying the Value Factors in this formula, which are RELEVANCE, OFFER and INCENTIVE. You ll also want to consider the Inhibitors, or the FRICTION and ANXIETY your constituents experience when they go through the mental process of moving to a decision point. MECLABS describes this process as an inverted funnel your donors are not falling in, they are falling out. What we need to do is help them through the series of micro decisions that lead them to the macro decision. To accomplish this, the marketer must increase the Value Factors as much as possible and to mitigate the Inhibitors as much as possible. Small Changes Can Make a Dramatic Impact There are four aspects of the Messaging Sequence or the touch points where the mental conversations take place Capture, Open, Click-through and Landing Page. This is how MECLABS states the formula: ec < op < ct < lp ec = capture op = open ct = click-through lp = landing page We ll walk through each aspect in the sequence one at a time. Capture The first step of successful capture is to enable website visitors to give an address. The average nonprofit sees slightly more than 2 percent of website visitors registering an address there s lots of room for improvement here. Place your subscription box on the home page, make it easy to find and clearly state what you re OFFERING in return for their address. HINT: If the information you desire to share with constituents looks or sounds just like what they ve seen on every other website, it s time to re-craft your message. How to Optimize Capture Build a strong value proposition connecting the prospect s desire for your information and the exclusivity of the offer. Remember, it s a mental conversation. They are giving up their contact information; what are you going to offer in return and is it equal in value or worth way more? HINT: It doesn t hurt to throw in an incentive like access to a special report to tip the scales in your favor. Compare these two sign-up offers. The offer on the left clearly communicates a strong value proposition for signing up. There is a clearly identified list of benefits 4

5 the visitor will receive when they subscribe, and it appears that the content offered is something the visitor can t get anywhere else. Compare that to the sign-up offer on the bottom left corner of the site on the right. Is it clear what you are signing up for? Is the offer compelling, clearly communicating a unique value proposition? Open Rate Once you ve developed a desirable and exclusive offer that incentivizes the prospect to give you an address, you ll want to look at open rates for the messages they receive. This number tells you how many people looked at your . The nonprofit average is 18 percent for appeals. Optimizing for Improved Open Rates Focus on the To line, the From line and the Subject line. Making small changes like personalizing the To line can increase response as much as 10 percent or more. Remember RELEVANCE, OFFER and INCENTIVE as you think of the conversation happening in your constituents minds. Click-through Rate Whether it s fundraising, advocacy or registration, the goal of any is to get a click. The click-through rate tells you how compelling your content was based on the number of unique clicks divided by the total s delivered. The nonprofit average is 1.76 percent for a fundraising appeal lots of room for improvement here! What most marketers do not understand is that most people are not looking for a reason to click they are looking for a reason to delete. Sometimes we provide too much information in the body that we force the recipient to make a decision before we have presented our full value proposition. Optimizing for Improved Click-through Rates RELEVANCE is the key to improved click-through rates. There are two types of RELEVANCE: internal and external. Internal relevance is applied through segmentation; external relevance is applied across segments. Consider any of these options to add RELEVANCE to the conversation going on in the minds of your constituents. Internal Relevance Personal interests Demographics Personality Communication styles Level of engagement Donor lifecycle External Relevance Seasons Holidays Special events News Weather Limited-time offers 5

6 Landing Page The conversion rate for your landing page is the total number of goal completions divided by the total unique visits. On average, 2.7 percent of the people who come to a nonprofit website will give a gift. Optimizing Landing Page for More Conversions The psychology of giving a gift online is the complete opposite of the psychology of ordering a product online. When you buy something online, the benefit comes later, when you receive it in the mail. When you give online, the benefit already came: you ve been blessed, you ve been inspired, and you ve been motivated. Make it as simple as possible to give online. To optimize your landing page, focus on: The OFFER The ask is the impact promised in exchange for a gift. The INCENTIVE Introduce an appealing element to motivate the gift. Eliminating FRICTION Minimize anything that causes psychological resistance including numerous hoops to jump through (registering, logging in, too many clicks, landing pages that don t look like the initial message, etc.) before arriving at the giving page. Testing Trumps Everything Best practices are only best practices for you when they produce the desired results. Rather than trust industry best practices or your intuition, test several options with your audience and continue to refine based on the outcomes. If you have an idea and you re not sure it will work, test it out with a control version. The results don t lie. Strive for RELEVANCE. Personalize the subject line or salutation, change the layout to look more like an coming directly from the inbox of the president of your organization, shorten your copy, improve your ask, provide an INCENTIVE for signing up, eliminate FRICTION in giving. Test, test, test, and trust your results to inform what you send in the future. Adequacy Is the Enemy of Excellence These lessons apply to more than just . If your website, or direct mail program produces lackluster results, find your way out of the status quo by applying the science of optimization. Consider the conversation you wish to create in the minds of your donors and prospects and apply that to every type of campaign you pursue. The best place to start is by taking off your nonprofit hat and getting inside your constituents minds to really examine the messages you re sending. And then, once you know, do something about it. It could be as simple as changing the way that you structure the OFFER by presenting something that represents value to them. Or improving the RELEVANCE of the offer and mitigating some of the ANXIETY associated with taking the next step. Remember, optimization doesn t happen on the page it happens in the mind. 6

7 CASE EXAMPLES Version A Control Version B treatment 139% increase in Clickthrough What is the goal of an ? The goal of any whether it is an appeal, an announcement, or a newsletter is to get a click. When we focus an on selling a click we can then drive more people to the landing page where we continue the conversation and lead them to a conversion. In this example, we made one change to the treatment. We changed the very last sentence of the . We focused on communicating a greater value to the reader and this little change resulted in 139% greater clickthrough and 42% increase in revenue. 7

8 Version A Control Version B treatment 257% increase in Clickthrough This is another example where we focus the on inspiring a click. In the treatment, we used shorter copy that provided a teaser to a story and invited the recipient to click through to read the rest. This change in focus resulted in 257% increase in clickthrough. 8

9 Version A Control 118% increase in Donations 50% increase in Petition Signers Version B treatment In this experiment, we were testing creative. A typical from this organization would look like the control, in an HTML template. We wanted to understand how an that looked more like an Outlook version would perform. Our thought was that if the looked like it came from the CEO of the organization, we might find that it is more motivating to people. Interestingly, we did not see any significant difference in clikthorugh rates between the two s. However, the people clicking through from the Outlook version were much more motivated to complete the actions presented to them. The treatment received 118% increase in donations received and generated 50% more petition signers. 9

10 Version A Control Version B treatment 369% increase in Clickthrough 121% increase in revenue This is another example of focusing the on selling a click. In this end-of-year , the control used typical ask language to give now. The treatment however, focused more on getting people to clickthrough to view a video that was on the landing page. Both s took the recipient to the same landing page, however the treatment sent 369% more people that resulted in a 121% increase in revenue. 10

11 Version A Control Version B treatment 42% increase in Registration This is an example of optimizing an capture page. Search engine ads were targeting people looking for adoption services and inviting them to access to free resource center. The treatment featured a much more simplified landing page that communicated a stronger value proposition. The result was a 42% increase in registration on the treatment landing page. 11

12 Version A Control Version B treatment 74% increase in Donor Conversion Rate 189% increase in Average Gift 274% Increase in Revenue This test even surprised us! The control landing page had been tested an optimized over the span of three years through various A/B split tests and Multivariate tests designed to increase conversion rate. With the treatment, we decided it was time for a radical redesign. In this completely redesigned landing page, we broke a number of best practices including putting the donation form way below the fold at the very bottom of the page. The test resulted in not only a 74% increase in conversion rate, but also a 189% increase in average gift. These two factors contributed to a 274% increase in revenue for the landing page. What we learned is that when we can communicate the value proposition with tremendous force, we can greatly impact average gift as well as conversion rate. 12

13 About Pursuant Ketchum Serving more than 12,000 organizations over the last century, Pursuant Ketchum is recognized as the unequivocal industry leader in organized fundraising. Building on our roots in fundraising counsel and campaign methodologies, Pursuant Ketchum now provides a complete range of services covering the entire donor spectrum to meet the revenue growth needs of philanthropic entities. No other firm offers the collective capacity, years of experience, and award-winning creative and consultative services as Pursuant Ketchum. Pursuant Ketchum. Leveraging donor intelligence to develop relevant communication that produces unparalleled financial results Belt Line Road Suite 900 Dallas, Texas

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