Donor-centricity is the ongoing dedication to increasing the depth and breadth of your donor understanding. In doing so, you generate insights that can be used to tailor your communication and engagement efforts and demonstrate to your donors that they are at the heart of your entire organisation. This builds trust and loyalty – the critical foundations of any lasting, sustainable relationship.
How do we know this? Because we’ve seen it before in the commercial world.
Customer-Centric Commercial World
Long ago the commercial world realised that the ‘customer is king’ and so adopted a customer-centric approach to their business. Marketing teams work tirelessly to get inside the hearts and minds of their customers so they can position and promote their products and services in the right way, at the right time and with the right message to engage and nurture the customer and eventually make the sale.
Faced with increasing pressures, change and disruption from technological innovation, and a general decline in trust amongst businesses, commercial entities recognise that sustained competitive advantage doesn’t belong to those who provide the best product or service. Sustained competitive advantage belongs to those who provide a sustained focus on delivering the best customer experience.
A positive customer experience makes us feel something and – as humans – we are motivated to act based on how we feel. We tend to make decisions based on emotion, then find a way to justify that decision based on logic. Which is why we choose to walk that little bit further to get our morning coffee, even though it costs 50c more…but the barista greets us by name, remembers our order and takes the time to ask how our kids are getting on with that school project.
We walk further and pay more because of the way the experience makes us feel; that’s what keeps us coming back. It makes us trust the barista; makes us loyal to the cafe and gives them a competitive advantage. In today’s challenging times with COVID-19, this entrenched loyalty – built up from years of providing a positive customer experience – is keeping many businesses alive, and for that, we applaud them and wish them every success.
To deliver the best customer experience and earn a sustained competitive advantage, businesses need to earn trust and build loyalty by adopting a customer-centric approach:
- Understanding what their customers want, need, like, dislike, hope, fear and value at each stage of their life (see Fig. 1)
- Infusing these customer insights across all their business functions to help shape decisions
- Creating a unique and ongoing value exchange for their customers
- Engaging in open, honest and transparent two-way conversations with their customers, across many different channels
- Empowering customers to interact with their brand on their own terms
This same approach applies to not-for-profits looking to secure sustainable giving. You need to earn trust and build loyalty by adopting a donor-centric approach, and that starts by increasing the depth and breadth of your donor understanding.
Understanding your Donors
In the same way as a customer’s ability or desire to purchase a product or service will vary over their lifetime (see Fig. 1), so too will a donor’s ability and willingness to donate to your cause vary in both time and dollars as their circumstances change and evolve.
Adopting a donor-centric approach enables you to recognise the changes in their life stage (whether it’s a significant milestone or subtle adjustment) and adjust your communication and engagement activities accordingly so you sustain the relationship over a longer period of time.
Smart organisations – both commercial and NFP – would rather have a customer or donor contributing $25 annually for 10 years, versus a one-off transaction of $500. That is not sustainable.
Historically, donors have reported they often feel treated like ATM machines, where the focus is on the financial transaction itself, rather than taking the time to nurture and engage with the donor. But if NFPs treat the donor relationship as a purely transactional one, then it will only ever yield one-off transactional results.
The building blocks of sustainable relationships
Remember, trust and loyalty, are the building blocks of any long-lasting relationship. But they are not built on a series of one-sided transactions. Trust is built over a series of two-way conversations during which the donor feels recognised, valued and instrumental to your organisation and its beneficiaries.
If you can make your donors feel this, they are far more likely to stay loyal to your cause…and even adopt it as their own.
So if you want to grow sustainable giving for your cause, and for the Australian fundraising industry, you need to adopt donor-centricity as a strategic priority to earning trust and building loyalty.
If you’re on a mission to become more donor-centric, we invite you to join LemonTree’s free Donor-Centricity Collective (DCC). As a member of the DCC you can share best practice, learn from your peers, keep up-to-date with the latest strategies to become more donor-centric…and be part of a movement to help grow sustainable giving in Australia!
Next up in this series:
- Barriers to donor-centricity: the challenges you face
- How to become more donor-centric
- The different stages of the donor relationship and how they impact donor-centricity