Want to Raise Money Online in 2012? First, Learn the Lessons of 2010

The media has been buzzing around the news that the 2012 election cycle will break all previous campaign fundraising records.

The media has been buzzing around the news that the 2012 election cycle will break all previous campaign fundraising records. President Obama’s re-election campaign aims to top its $750 million fundraising total from 2008, and with upwards of a dozen Republican candidates rumored to be eyeing their party’s nomination, it is safe to predict that presidential campaign fundraising will far exceed the $1 billion mark well before Election Day.

While much of the fundraising news in 2010 focused on self-funders and massive donations to Super PACs, we shouldn’t ignore the still growing number of people who are donating to political campaigns and organizations online.

Nearly all of the top-grossing campaigns in the 2010 cycle had a robust online fundraising presence. Many of these candidates, such as Sharron Angle, Michele Bachmann, Carly Fiorina, and Marco Rubio, relied on small donations to fuel their multimillion-dollar fundraising organizations.

To succeed at online fundraising, you have to do much more than just slap a donation link on your campaign website and wait for donors to find it and give. In order to raise the big bucks, as a campaign or an organization, you need to push your message out to supporters through more than one medium and entice them with a compelling reason to give.

Message and metrics have equal importance in raising money. Many fundraisers will tell you that raising money is part art and part science; that is certainly the case for online fundraising. Our company, Campaign Solutions / Connell Donatelli, Inc., has been running online campaigns for over a decade. Like every good consultant, we learn new lessons every election cycle and apply them to our future work for our clients.

To help you navigate what we expect to be a wild 2012 cycle, here are the top five lessons we learned in the 2010 election cycle.

1) Back to the Future

If you were to draw a line representing the online funds raised through e-mail beginning with the 2000 election, it would steadily decline through the 2008 election before shooting up in 2010. Last cycle, the vast majority of our company’s clients—Republican candidates and organizations representing every region of the country—raised anywhere from 60 percent to 90 percent of their online funds via e-mail.

How do we explain this sudden uptick in e-mail fundraising? As e-mail fundraising has increased, funds raised through a campaign’s website have steadily decreased, as has the overall general traffic to websites. A possible reason for this is that Internet users are increasingly getting information pushed to them rather than seeking it out online. Instead of checking campaign websites and blogs, they are getting their political information via e-mail or at Web clearinghouses such as Facebook or Drudge.

By way of illustration, consider the shift in John McCain’s online fundraising over the last two cycles. In his 2008 presidential campaign, 33 percent of his online fundraising came through e-mail marketing, while 58 percent came through his campaign website. By contrast, in McCain’s 2010 Senate campaign, 83 percent of his online fundraising came through e-mail, and only 15 percent through his website.

Given that e-mail fundraising is such a strong and growing source of cash, campaigns would be wise to invest in building a solid e-mail list. Nothing will give a campaign a more significant online fundraising advantage than a large, active, and organically built e-mail list.

2) A Rising Tide Lifts All Boats: The Role of Online Advertising

Online direct marketing entails a two-pronged approach: e-mail and advertising. Online political advertising not only serves to brand a campaign and communicate its message, it can also generate donations.

Online ads come in four forms—search, display, Facebook, and video—each of which serves different goals and has a particular ability to drive donations. Overall, we have seen the percentage of online funds raised from online ads jump from the single digits in 2006 and 2008 to double digits in 2010. For instance, online ads for Carly Fiorina’s U.S. Senate campaign in California yielded nearly 20 percent of all the funds it raised online. We foresee this trend continuing as traffic to search engines and websites such as Facebook skyrockets.

In order to attain a high return on investment (ROI) for your online ads, you need to invest in search marketing, which is why we recommend search as a top-funded element in any online ad budget.

Many campaigns turn to Facebook for advertising due to its low cost and superlative targeting abilities. However, while generating “likes” for your campaign or issue may be relatively inexpensive, remember that you still have to translate these “likes” into actions or donations for them to mean anything.

Other forms of advertising such as display and video advertising are your best vehicles for pushing branding messages or gathering petition signatures and e-mail signups for your campaign. These e-mail addresses, like your Facebook fans, can be used to bring in a constant stream of new prospective online donors.

3) Message Always Matters

We cannot stress how essential a cohesive and relevant message that resonates with the right audience is to a successful online fundraising program. The heart of any fundraising appeal is the message, and it is still the most important determinant of an online direct marketing campaign’s success.

Perhaps unsurprisingly, we found that negative messages were most successful at fundraising in the 2010 cycle. Polling showed that the American public was angry with Washington leadership and with the stagnant economy. This discontent provided campaigns on both sides of the aisle with endless fodder for fundraising emails and ads.

Conservative candidates were able to draw the attention of Tea Party activists who flooded the Internet in search of like-minded candidates to support. When they came online, we were there with message-appropriate ads to solicit their e-mail addresses and donations. When they signed up for e-mail lists, we followed up with appeals to motivate them to support candidates who wanted to bring change to Washington.

4) More People Are Giving Online

In March, the Pew Internet & American Life Project released “The Internet and Campaign 2010,” a study of American Internet usage. It reported that 4 percent of adult Internet users made online donations to political candidates during the 2010 cycle and that Republicans and Democrats were equally likely to have made such a donation.

This is something of a shift from earlier cycles, when Democrats far outpaced Republicans in attracting online donations. An earlier Pew report, “The Internet’s Role in Campaign 2008,” found that 15 percent of Obama voters who used the Internet made a donation online, while just 6 percent of McCain voters who used the Internet did so. (Similar data was not available to make a direct comparison for the 2006 election.)

Conventional wisdom has held that Republicans excel at direct mail and telephone fundraising, while Democrats excel at online fundraising. However, Republicans have made major strides in building robust, consistent, and lasting online donor files. Indeed, the Pew report on the 2010 cycle found that adult Internet users with strong views of the Tea Party (either positive or negative) were especially likely to make online donations. Looking forward to 2012, Tea Party activists are still fired up and giving at unprecedented levels, leading us to believe that Republican campaigns will continue to expand their online donor base.

5) The Average Online Donation Is Declining

While more people are giving online, the average donation is steadily dropping. From the late 1990s through 2008, the average online donation for our company’s clients was between $100 and $125. In the 2010 cycle, this average was cut in half as many new small donors got into the game. The upside to a lower average donation is that we are able to return to our smaller donors multiple times over the course of a campaign cycle to re-solicit them for additional contributions.

However, it is also worth noting that we have seen a steady increase in the percentage of all campaign funds that are raised online. In 2010, for instance, nearly 40 percent of donations to Carly Fiorina’s campaign were made online. One-third of Michele Bachmann’s staggering fundraising haul consistently comes from the Internet. Finally, one cannot ignore the fact that Barack Obama’s campaign raised more than $500 million online in 2007 and 2008, representing two-thirds of his overall fundraising total.

So what do these lessons have to tell us about the 2012 election cycle? We predict that the trends we have outlined will continue and that we are likely to learn more about social networks and mobile devices in the upcoming cycle. As campaign budget demands continue to grow, fundraising is forced to keep pace. Likewise, as more Americans become politically active online, campaigns are naturally tapping into the Internet as a powerful fundraising tool.

Unlike direct mail and telemarketing, online fundraising remains a relatively new form of direct marketing, and we are constantly collecting metrics to better predict future performance. We never stop trying new forms of fundraising—and have even found success returning to an old standby like e-mail, which was considered a dying fundraising method in 2008, but paid great dividends in 2010.

As we head into the 2012 cycle, we look forward to learning new lessons from what we expect to be a competitive and lively presidential campaign—not to mention all the U.S. House, U.S. Senate, and gubernatorial campaigns that we will be keeping tabs on as well.

Jen Stolp is vice president of fundraising for Campaign Solutions. Eric Frenchman is chief Internet strategist for Connell Donatelli, Inc.

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