Defining the not for profit sector’s digital divide
So many people are talking about the importance of digital transformation that it’s easy to be swept along by all the ‘what’ and ‘how’ details without ever pausing for a moment to contemplate what’s surely the most important factor – the ‘why’. Why should the charity sector invest in digital transformation?
“Why” is exactly the question being asked during a recent Third Sector webinar, where I was delighted to be a panelist. The full webinar is available online, with the link at the end of this blog. For now though, here are the highlights from the webinar as well as a few thoughts on where the discussion about digital transformation might take you next…
Over these first two years of the pandemic, pivoting online has been the lifeline that has allowed non profit organisations to keep on fundraising even when mass participation events – the core of many campaigns – have been curtailed or cancelled. Since Covid-19 has accelerated the trend for organisations to move online, it’s also allowed observers to determine the extent of the ‘digital divide’ – the gap between the behaviours of digitally advanced organisations compared to those that are reacting more slowly to change, if at all.
Keeping track of such changes is The Status of UK Fundraising Report from Blackbaud Europe which, for the last four years, has polled organisations in order to create a snapshot of the sector. The 2021 Report was compiled from over 1,100 completed surveys and Pascale Harvie, president and general manager of Blackbaud Europe, kicked off the webinar with a flurry of findings and a stack of statistics.
This year’s report shows that while 70% of those polled believe it’s important for the nonprofit community to develop digital maturity, only 17% think they are currently fit for purpose, which probably explains why 64% of organisations are planning on investing in more technology as a result of the pandemic and in order to shift their ‘new normal’ towards a greater amount of remote working well into the future.
As Pascale explained, the Report also answers the ‘why’ questions pretty conclusively by showing that the more digitally mature an organisation becomes, the more demonstrably successful it is in terms of income, service delivery and supporter growth. Blackbaud calls this the ‘Digital Effect’ and it’s revealed by comparing the dwindling income and reach of ‘digital skeptics’ who put little importance in digital transformation with the growing income and reach of ‘digital experts’ who track their own performance and targets through data.
More time spent online, across generations
In my role I work with organisations at every stage of the progression from digital skeptic to expert and have seen how digital transformation improves performance, by allowing teams to work “out in the open” digitally by sharing findings, learnings, wins and losses across an entire organisation, rather than in siloed teams. I’ve also noticed how there is a consumer shift with high digital expectations, from digital maturity in baby boomers, and the silent generation moving more of their day-to-day tasks to digital spaces. Generally speaking, a larger breadth of society is spending more time online and therefore becoming accustomed to digital journeys.
How does this look in the real world? The last two of the webinar’s speakers, Rosie Hebb and Mimmo Di Giacomo, gave fascinating but entirely different examples of how and why they have digitally transformed their organisations.
Rosie Hebb is development manager at Rambert, a touring, contemporary dance group based in London. The lockdowns of 2020 instantly deprived Rambert of both its audience and its ability to fundraise at face-to-face events. Rambert had always relied on its venues to handle tour bookings, so held no data on its customers.
Driven by the pandemic, Rambert moved quickly to adopt new ways of doing everything online, from live-streamed performances rehearsals to creating fundraising and social media events. Central to this was the creation of the Rambert Home Studio platform to deliver the classes, events and performances that had previously been live events. This actually widened their audience reach by making events accessible to anyone, anywhere, rather than just people able to travel to a venue.
“Because we are a touring dance company, we didn’t have our own box office,” said Rosie, “so this is the first time we have our own audience data to grow fundraising strategies from. The Rambert Home Studio is now here to stay alongside more traditional on-the-phone fundraising and live performances. We’re working to find the balance of what works best.”
Accelerating technology investments
In contrast to Rambert’s need to react to the pandemic, Mimmo Di Giacomo’s experience was of the lockdown accelerating processes that had already been set in motion. He’s director of fundraising at Animal Free Research UK which, prior to Covid-19, had already decided to stop mass fundraising events and invest substantially in technology. Indeed, the charity’s first entirely digital campaign was to raise funds for a research programme that can quantify the Covid-19 viral load within a patient, rather than simply give a positive or negative result.
Animal Free Research UK currently has its data sitting across all tools and available to anyone within the organisation who has a need to use it. This not only streamlines digital journeys for users, who enjoy a consistent approach across all touchpoints, but also improves access and analytics for staff who are remote working. Combined with new ways of tracking and reporting that suit all levels of competencies, this approach leverages the benefits of digital by making them available without the need for additional training in certain software systems.
While Animal Free Research UK and Rambert are at different stages of their digital transformations, both show the willingness to experiment, along with the openness to share their processes, that define successful digital adopters. Which is great news because, as The Status of UK Fundraising Report 2021 shows, income growth across the sector is slowing, with 35% of respondents reporting growth in 2021 compared to 49% in 2019. With 40% attributing income growth to an investment in digital and digital maturity of an organisation corresponding to its ability to manage the pandemic, there’s a clear link between cultural transformation and financial benefit.
If the question is “why should a charity embrace digital transformation?” We believe the answer lies in the clear impact it has on performance.
Undoubtedly there are barriers that are holding organisations back from digital transformation. Organisational culture is one of those; the sector needs to adapt to a growth mindset, where fear of failure does not stand in the way of learning and development. This is a theme in our Future Charity report. One of the enablers to come out of the report was a review of the culture and values within your organisation to identify where these promote confidence, and identify whether they reward considered risk taking. Check out the report for more information.
So where does this leave your organisation and what should it be doing next?
Digital transformation is a journey
For digital skeptics, those smaller organisations with lower income and reach, making that first step towards digital is both the hardest one to make but also the most important one. While cost is often cited as a reason not to make changes, the inclusion of conversational AI – chatbots – to a phone-based fundraising campaign can be a time and cost saver for organisations with limited resources, adding value by freeing up human call centre staff for the most useful parts of the process.
For more digitally mature organisations, implementing a Customer Relationship Management (CRM) system is a way to gain increased efficiencies due to better managed customer interactions. Many organisations that already have a CRM don’t make the most of its ability to increase sales, improve customer service and increase fundraising potential through increased automation and greater customer personalisation.
The future is now
The not for profit sector not only needs to invest in digital, they need to embrace it. Change is happening at a considerable pace. We once wrote about the ‘Future Charity’ – but that timeline of change has been accelerated. This has created opportunities. Opportunities where risks have had to be taken, learnt from, developed, and improved. The sector needs to continue this mindset to keep pace with what their audiences expect from their digital experiences.