How not for profit organisations can win with lotteries
Category : Increase Revenue
Lotteries, raffles, art unions – whatever name you give them, they are all games of chance. Applying these programs to a not for profit organisation creates incentivised giving, which can become a very powerful tool to acquire and retain supporters.
The not for profit sector in Australia is a crowded and competitive marketplace. Pro bono Australia recorded over 600,000 organisations that make up the sector (www.probonoaustralia.com.au, 2014). And, with a current population of 23,343,640 (www.abs.gov.au, January 2014) – that means there is one NFP organisation to every 38 people in Australia.
When key not for profit executives were asked what they perceived as the greatest challenge for their organisation, the number one issue identified was ‘finding new sources of sustainable funding’(McLean Delmo, February 2012).
Demand for the charity dollar is high. The global financial crisis, or threat of it, has meant the majority of consumers are much more aware of where their money is going. Local charity, International crisis, natural disasters, the list of legitimate causes is large and competitive. So, how can a lottery program help your organisation win?
A well-executed lottery or raffle program will provide three key benefits:
A lottery is an incredibly diverse vehicle, which can be adapted to all channels within the marketing mix.
Promotion of the lottery through direct mail is the most common channel to a warm supporter base. Telemarketing has been used effectively for years by charities of all sizes, however, can be costly for acquisition if an incorrect strategy is adopted. To avoid blowing the budget on acquisition, promote regular buying of lottery tickets by automatic payment so conversions have a higher response value.
The flexible lottery program can be promoted at events of any size or calibre and of course digital channels are ripe with opportunity through a website (with ticket purchase function), emails, social media, search marketing etc.
The lottery may also provide a valuable PR tool through promoting the prize (if it is newsworthy) the draw and the winner/s.
There is a growing demand for transparency of fundraising activities, which leads to a challenge for charities to find creative ways to raise untied funds. Lottery offers the solution through its incentivised giving nature.
Supporters of the lottery are instantly rewarded with the chance to win. This makes lottery a valuable acquisition tool, and exposes the opportunity to acquire donors that would not necessarily support your organisation. The chance to win creates a tempting buzz of excitement and taps into the ‘what if’ optimist that exists within all of us.
Of course, once lottery supporters have purchased and are added to your database, they can be approached to support the organisation in other appeals. The key with cross selling from raffle is to segment and test, test, test! You don’t want to lose the repeat lottery supporter by bombarding them with other messages if they are not interested.
If a lottery program is executed correctly, with a carefully measured balance of warm and cold contacts, a strategic marketing strategy and a smart prize mix, it will return positive financial results and increased brand awareness.
There is no doubt that not for profit organisations in Australia need to adopt long-term strategies to remain competitive. With its diversity and mathematical predictability, Lottery can deliver a winning formula.