September/October 2003

Lessons for Nonprofits from Howard Dean's Use of the Internet

by Vinay Bhagat, Founder, Chairman and Chief Strategy Officer, Convio

Nonprofits would be wise to watch former Vermont governor Howard Dean's campaign to win the Democratic party's presidential nomination. Regardless of who you support for president in 2004, Dean is a winner when it comes to incorporating the online medium into fundraising and grassroots mobilization.

In the second quarter of 2003 (the most recent quarter for which numbers are published), Dean raised $3.6 million online, or almost half of the $7.5 million the campaign raised online and offline combined. Additionally, Dean is using the online medium to build a large network of supporters, totaling more than 370,000 by mid-September 2003. Also, by mid-September, the campaign had signed up more than 2,100 grassroots volunteer fundraisers to be "Dean Team" leaders who use Internet tools to recruit and raise money from friends and relatives.

These results are not anomalies. Dean For America is using strategies, tactics and Internet tools that are available to all nonprofits. What, then, are the key lessons for today's organizations?

Lesson One: Recognize and treat the Internet as a strategic marketing tool.
From the beginning, the Dean campaign has: 1) recognized the Internet as a powerful medium for constituent outreach, engagement and fundraising; 2) pursued an Internet strategy with full executive support from the campaign manager; 3) invested in an integrated online marketing solution (Convio); 4) utilized online community tools (Blogs, Meetup.com); and 5) staffed appropriately. In contrast, most nonprofits have Web sites to communicate basic information about their organizations and some handle online donations. Groups that use email for direct communication with constituents are the exception, not the rule. Here's why:

• The Internet is not a "Top Five" priority for most nonprofit CEOs;
  
• Few nonprofit groups have a comprehensive Internet strategy, sized their potential return-on-investment or defined meaningful success metrics;
  
• Nonprofits tend to view their Web sites and email systems as a cost center managed by the IT or communications department versus a strategic marketing tool;
  
• For many groups, investing in the Internet means having an aesthetically pleasing Web site with good content, versus developing an online marketing strategy and infrastructure;
  
• Individual functions typically take on Web projects with limited central coordination for managing constituent relations; and
  
• Many nonprofits are trying to decide between an in-house and an outsourced Internet solution. The latter approach is more efficient and allows a group to focus on its mission, rather than complex technology. But, some erroneously perceive it as new and, therefore, risky.

Nonprofits should treat the Internet as a critical marketing channel.

Lesson Two: Actively recruit and cultivate an online constituency
Primarily through Web site registration, the Dean campaign has built a list of 370,000-plus email subscribers, and plans to grow the list to 450,000 by the end of September. In June alone, the campaign grew its email list from 50,000 to 130,000, with more than 45 percent of those people making contributions.

A large, well-qualified email list is extremely valuable. For example, the Dean campaign demonstrates that people who register, receive email updates and become engaged can be converted to contributors. Comparable donor acquisition through mail is much more expensive.

To recruit and develop an online constituency:

• Ask people to sign up through Web site registration or petitions. The Dean campaign prominently asks people to sign up for updates or join petitions, requesting minimal information so the process is easy and fast.

Figure 1 - Dean sign up today promotion, September 2003

• Send regular email communications with compelling and consistent messaging. Dean has sent millions of emails to supporters. Although such frequency may exceed what's appropriate for most nonprofits, frequent email communications have impact if the content is relevant and reinforces key messages, and if success metrics -- such as email open, click-through and unsubscribe rates -- are monitored.
  
• Give constituents a voice. Dean has created a dialogue with constituents through online surveys, polls and petitions, and he also uses online forums called "blogs." Constituents have a voice, which fosters engagement and inclination to contribute.
  
• Actively ask people to forward messages use "viral marketing." Because it's a more costly method, direct mail primarily focuses on getting a contribution. Constituents may only contribute once or twice in a given period, but often want to show additional support through advocating, participating in an event or volunteering. The Internet makes this easier. A well-written email asking constituents to forward a message to friends can increase distribution exponentially. "You can make this happen," a Dean campaign email told supporters. "If every person who receives this email fires up three people about Howard Dean, and gets them to sign up for the campaign, we will have not only met our goal we will have exceeded it."
  
• Create urgency. Dean staff members update Web pages frequently. For example, they tally fundraising results every 45 minutes. They also issue "calls to action" via email, asking supporters to contribute by a deadline. Nonprofits can create this kind of urgency to drive activism on political issues or stimulate donations, for example, as matching gift campaign deadlines approach.

Lesson Three: Leverage volunteers as fundraisers
The Dean campaign has recruited thousands of "Dean Team" leaders to raise money from and recruit friends and relatives. A supporter uses campaign-provided Internet tools to: create a personal Web page explaining why he's involved; log in to a personal fundraising center to email solicitations to his contact list; and check on responses and thank contributors via email. Nonprofits already use these tools to drive online registrations and donations for offline fundraising events such as charity races, walks and bike rides. Like the Dean campaign, they also should use these tools to drive support without physical events.

Figure 2 - Personal page of a Dean volunteer fundraiser

Howard Dean's presidential campaign demonstrates the power of the Internet for fundraising and mobilizing supporters. Nonprofit and membership organizations, too, can use similar Internet strategies and tools to generate excitement, urgency, participation, donations and other forms of support.