I was randomly on Twitter scrolling my timeline last Sunday night and saw this: “ROI is not the same as measuring success.” It got me thinking. One of the benefits we offer our clients is that we use our years of for-profit marketing and advertising experience and apply it the nonprofit model. What works in the commercial world certainly works in the causeworthy space, too. But it’s not that simple when it comes to measurement. It turns out that ROI may not be the best measuring stick for the effectiveness of your nonprofit marketing efforts. And here’s why.
If you start with a simple definition of ROI: the amount of profit from an investment—marketing costs aren’t an investment, they are an expense. But, if you’re a nonprofit, any amount of money you spend should be treated like an “investment”. Every dollar counts. When you talk about ROI at your nonprofit, it most often means “If I invest $100,000, will we make back the $100,000 and then some?” And that question can’t be answered directly if your marketing doesn’t ask for money, which it shouldn’t always do. If your campaign is geared toward developing a relationship with your donors/potential donors or even just dredging (creating awareness for your cause) it’s not a Point A (marketing message) to Point B (donating) journey. And therefore, calculating ROI is also not a Point A to Point B exercise, either.
But, you can’t be a successful manager of marketing programs these days (commercial or nonprofit) if you aren’t creating trackable results and using your data to make decisions. The challenge for nonprofits, then, is how to measure profit especially when you’re not directly asking for money in every marketing touch? Here’s where to start: when you create campaigns, mix in communications outreach with donation outreach, so you can measure effectiveness as a group of multiple outreach efforts. Your metrics will then be a combination of engagement gauges and dollars. You could even split test your entire campaign and see which one performs better based on copy or based on day (Monday vs. Wednesday) sent.
Also, consider mixing in other ways of measurement, even if you’re simply sending a newsletter. Here are some ideas:
- Email addresses collected
- Downloads (offer something of value)
- Create surveys to get opinions and/or feedback
- Start a petition (and along the way you’ll collect email addresses)
By using a host of measurement tools, no matter how “small,” you’ll be equipped to say whether a campaign was a success not just by the ratio of cost vs. return.