Get Off the Rollercoaster, Part 1: Rational Budgeting for Nonprofit Tech Projects

Get Off the Rollercoaster, Part 1: Rational Budgeting for Nonprofit Tech Projects

Get Off the Rollercoaster, Part 1: Rational Budgeting for Nonprofit Tech Projects

Image courtesy of Jeremy Thompson.

I see a similar pattern across the nonprofit sector, and its one I was guilty of myself when I was a communications director: I call it the website rollercoaster.

Youre worried about your website (or digital) budget, and youre busy. As Sam Dorman explains in his Product Team methodology, you put a very minimal amount of time and energy into the website for tech development: you create content, but you don’t invest in updating the technology or design. Then every couple of years, your website and your online presence get so out of date in terms of the look or the capabilities that you go through a sudden, steep investment in the website tech and strategy.

The investment of time and attention and money peaks as you launch the website, and then drops off precipitously and stays low … and you start to fall behind, and a couple of years later, you start the cycle again with another big website overhaul project.

And worst of all, you’re only seeing incremental improvements in the effectiveness of your digital communications (your website combined with email, social media, video and other online channels). Your analytics reflect only modest improvements in the performance of your digital communications, and its not clear how to establish the return on investment (ROI) from the money youre spending on digital.

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Image courtesy of Mobilisation Lab.

Is there an alternative? Yes, but first you have to acknowledge that youre on the roller coaster and commit to applying some discipline toward getting off of it. There are three main stages that I recommend going through for this process:

  1. Reasonable budgeting for digital growth
  2. Move to constant improvement
  3. Better partnership with your web consultant

Let’s start with step one…

What does a reasonable budget for digital growth look like?

Imagine that your organization has some fundraising goals, and in order to reach those goals, you have figured out that you want to start sending a print newsletter (remember those?).

First, you would think about how big your list is, and if its big enough to raise enough money to justify the cost and effort that goes into a mailing. (For this example, lets assume the answer to that question is yes.)

To set the budget for your print newsletter, you would factor in elements like design at a fixed cost. Then you would project how many people you want to mail the piece to, and that would set your budget for printing, prepping for mail, and for postage.

You wouldnt just pick a random number, say $300, and say, whether were mailing to 100 people or 1,000, thats how much the printing and postage is going to be.” But thats often how people budget for website development — they develop digital budgets that are separate from programmatic or fundraising goals and scale, and as if it can all be done as a fixed number, versus being done based on the scale of your organization’s reach and goals.

So how do you figure out the scale of your digital reach?

Well, for one thing, you can take a look at your strategic communications plan (if you have one). You’re not going to have identical interactions with every person in your key audiences. To reach your programmatic goals, you have to plan for the fact that different people will have different types of engagement, and that each of those interactions requires a different investment of time and money.

  • How many people currently spent more than 30 seconds on your website in the last year? Count this as one group of people in your strategic website audience total.
  • How many people does it involve engaging as new donors, and how many people would you expect to visit your website to become new donors? Count this as one group of people in your strategic website audience total.
  • How many people engage with your programs over a year and should be able to get their questions answered via your website? Count this as one group of people in your strategic website audience total.
  • How many people do your public education programs want to engage with via your website? Count this as one group of people in your strategic website audience total.
  • How many people do you want to be using your website to send messages to decision-makers? Count this as one group of people in your strategic website audience total.

This list gives you a sense of all the people that you want to include in your budget. Then you can consider how much you want to spend per person for these engagements.

Similar to planning for postage, you have to be realistic about how much the particular engagements cost on a per-interaction basis.

Just as different sizes of printed mailers vary in cost, different levels of engagement vary in cost.

  • Postcard-type site: Building a site where users engage by reading content is the equivalent of sending a postcard — the lowest cost per person, and its mostly effective to remind people you exist (a legitimate goal for a piece of communication).
  • Downloadable content site: Setting up a site with downloadable content costs more, in the same way that it costs more per piece to send an envelope with a few pages in it. This is the most common type of mailing that will generate a reasonable return in terms of fundraising. On the web level, its probably a bit lower in terms of actual programmatic or fundraising benefit.
  • Smart customizable site: A site that recognizes returning users and helps them send customizable messages to members of Congress, that is another tier higher when planning for cost. Think of it as the equivalent of sending a glossy mailer with a reply envelope — a higher cost per user youre engaging, with a much bigger programmatic and fundraising payoff if you reach a large enough audience.

The challenge is to keep your planning realistic to the level of engagement you need with your audiences in order to reach your programmatic and fundraising goals.

So the way to think about your realistic digital budget is:

The cost per piece of the different types of engagements you plan to use to reach your goals

X

The scale of each type of piece

That sets an overall realistic budget for website functionality to support your nonprofits programmatic work.

If you have sticker shock when you look at this budget number, its not necessarily the indicator that the number is wrong or wasteful. It’s more likely that what you’re looking at is the first realistic budget you’ve ever set for reaching your programmatic goals through digital engagement.

In Part Two, Ill talk about how to plan for investing that budget to get the best results!

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