You’ve probably heard the old saying: “You’ve got to speculate to accumulate.” Or: spend money to make money. But knowing where to spend that money is often a challenge. Is it cost-effective to use email asks? Will paying for ads on social media increase donor acquisition? And where should you go if you need help with understanding all of it? Read on to learn about where and how you should spend your money to make a smart investment.
1. Your ROI may be determined by the advertising channel you use.
The type of digital marketing channel you use may not just affect campaign costs, but may also affect the amount of money your nonprofit can successfully raise. The latest M+R Benchmarks Study breaks down their findings:
- Search Advertising: For every dollar spent, nonprofits generated $3.81 in revenue.
- Social Media Ads: Nonprofits generated $0.97 in revenue for every dollar spent.
- Display Ads: Earned $0.68 cents in revenue per dollar spent.
However, numbers alone don’t tell the whole story, and M+R makes sure to point out that these figures are general ones. Ideally your goals and strategy, not just ROI, should play the biggest part in determining which channel is used. Also, your organization is not limited to using only one channel or platform — in fact, cross-channel advertising is an increasingly popular marketing strategy.
2. Leave some room in the budget for staffing.
No matter which digital channels or social media platforms your organization uses, you will want to think carefully about the staffing levels and time needed to set up and run an effective digital marketing campaign. To maximize your potential reach, work with a professional who understands the pros and cons of different channels and can advise you on the most effective strategy for your organization. This person will work with you and your team to fine tune your goals, establish milestones, set up campaigns, and consistently review the campaign’s progress. Yes, a consultant may cost a little more money upfront. But it’s an investment! The money that you spend will more than pay for itself in better supporter outreach and engagement.
3. Think beyond Facebook for donor acquisition.
Facebook ads are pretty popular. And for good reason — at their best, Facebook ads are extremely effective tools that easily allow you to reach out to current and potential supporters alike. But other digital platforms may better fit your organization and its goals. Instagram ads also drive supporter engagement. Or, if you want to get the biggest bang for your buck — or leave Facebook all together — consider using a search advertising vehicle such as Google Ad Grants; as mentioned above, search advertising provided the biggest return on ad spend.
4. Developed information overload? Consult a consultant.
So, you’ve run your campaign. And, excitingly, you have all this data! But what exactly is it telling you, and what should you do with it? No matter how your ad performed, you can still glean valuable information simply from having run it. This information should at least:
- Provide valuable information on just who is reacting to the ad (sometimes the results are not what you think!); and
- Illustrate what happens after viewing the ad — do they like it, share it with others, or donate?
It’s easy to get caught up in “information overload,” and if there’s no one on your team who can accurately evaluate these stats, some vital information could be overlooked. Be sure to reach out and work with someone who can undertake good data analysis — a consultant who can interpret this data, extract what is important, and make that data work for you. Ultimately, this data should be used to inform your future donor retention and marketing efforts.
An organization can get away with spending very little on a digital marketing campaign. But, as the old adage says, you get what you pay for! To run an effective, successful campaign, one that puts you in touch with the people most interested in supporting your organization, your organization should be prepared to spend a decent amount. These expenses will pay off in better donor engagement efforts — and more donations. So clarify your marketing goals, and spend wisely!