NONPROFIT BRANDING: Fundraising Premiums – The Secret Sauce

There is a Secret Sauce to using fundraising premiums effectively. Before we get to the recipe  for the Secret Sauce – let’s look at definitions of success & failure.

• A premium is a failure if it fails to pay for itself, if it disappoints the contributor and doesn’t get used, if it fails to effectively assert your organization’s identity and mission.

• A premium is a success if it pays for itself, reinforces your contributor’s affinity for the organization and serves as a free marketing tool by promoting your mission and identity to others and with no additional cost to you.

• A premium is a great success if it does the above and generates additional gift renewal and upgrade revenue you would not otherwise receive.

More than any variable within your control, the combination of two things – representation and presentation – determines whether your premium will succeed or fail. Remember this: the premium is merely a product. It becomes a desirable contribution incentive because you create and then effectively communicate its relationship with your organization.

Your goal is to create what marketing people call “perceived value.” Here is the definition from our GLOSSARY, which you can access through the tab at the top of this page:

Perceived Value – perceived value is the worth someone assigns to an item because of its appeal or other intangible characteristic not related to its cost. A nonprofit’s logo carefully applied to appropriate merchandise can create an item whose perceived value to supporters greatly exceeds its monetary worth. The enhanced (perceived) value is derived from association with a preferred cause or mission and has enormous implications for nonprofit marketing.

Properly enhanced and presented, a common, inexpensive item becomes worth much more to a person who is already committed to your mission. It can then energize supporters and produce revenue. Drawn from our own experience at VisABILITY, these examples illustrate the concept and should help focus your own thinking:

…..the stainless steel insulated water bottle, with the logo of an environmental organization, becomes a premium when it is presented with an explanation that the same water bottle is carried by members of the field staff as they fulfill the organization’s scientific mission out in the wilderness;

…..before the era of electronics miniaturization, a tiny radio about the size of a package of chewing gum was a conversation piece because of its novel size.  This distinctive product reflected favorably on its owner and on the owner’s favorite radio station, whose logo it featured.

…..around 1990 the tote bag, sized and custom fabricated to carry a specific professional cassette recorder plus accessories, became a powerful premium because we added a label that said: “AUTHENTIC NPR REPORTER’S BAG – Carried by National Public Radio journalists throughout the world.”

…..the mug or T-shirt which becomes a badge of support because its graphic is designed by a supporter of the nonprofit and is available only to those who contribute. (NOTE: this technique creates especially strong perceived value when used in a series of fundraisers. Supporters usually want the next edition of a well publicized limited-edition series reflecting membership in a nonprofit constituency. The NPR program Car Talk held contests in which listeners designed the next season’s featured premium T-shirt.  This version, called the Sistine Wrench, was the winner a few years ago. )

…..the new logo will be introduced to the public in January, so in November the mug with that graphic can become a premium to contributors who happily debut the new identity badge before it is available to people who are not members of the in-group;

…..it’s often tough to make a retail product attract contributions, but the book by your organization’s founder or luminary, even though sold at bookstores, becomes a premium when it has a book-plate autographed by the author;

…..the special fundraiser to replace the storm-damaged TV tower became easier when each contributor received a transparent Lucite paperweight with a fragment of the destroyed tower imbedded in it.

 

 

 

After looking at the above examples, you should realize the Secret Sauce recipe combines common sense and two steps:

• First, you take an inexpensive object and build a visible association between it and  your organization.
  
• Then you explain that association to your core constituency with enthusiasm, clarity and frequency – always emphasizing that ownership is restricted to contributors.
  

The goal is to make your supporters realize that using a premium with your logo is a public demonstration of affinity for your brand and your mission. In essence, what’s really happening is this: because it spotlights affiliation with your cause, your branding product allows supporters to brand themselves with evidence of commitment to your mission.

With any marketing initiative you want to know the limitations and downside as well as the benefits. This is what we have learned about using imprinted products as fundraising incentives.

UPSIDE: Premiums can be powerful persuaders. They have helped raise billions of contributed dollars when used to induce action and enhance commitment from current supporters.

LIMITATION: We also note a potential limitation. Well presented premiums have a laudable track record as incentives for renewals and gift upgrades, but evidence in the public radio community suggests they will have less success in generating new contributions and new memberships.

We honestly don’t know if this limitation translates to non-broadcast fundraising campaigns. But we have a hunch it does. So, until we learn otherwise, we urge nonprofits that offer mission-related branding products to position them as tools that target current and recent supporters. The record shows they are persuasive incentives to renew and/or upgrade their contribution level. We are not sure how effective they are in attracting first-time givers.