Driving Revenue Through Charitable Giving
It may come as no surprise that for such an inherently social species we humans often go to great lengths to highlight our good intentions to our peers. The growth in social media has exaggerated the situation for many to the point where our online presence is partly defined by worthy affiliations and the promotion of valued viewpoints.
It is quite simple: we like to be seen to do good deeds. Furthermore, people give more when they are recognized for it (the ‘anonymous donor’ is something of an relic these days). But don’t be misled, this is not just a vain tendency for those on Facebook and Twitter; there are business opportunities from facilitating charitable and social giving to good causes. This is especially true on a local level where the feel-good factor can be stronger when charitable giving also builds a strong sense of community.
Financial institutions now have an opportunity to place themselves at the center of this virtue cycle. Of course, more charitable donations mean more transactions to be processed, but by adding a social media aspect to giving, credit unions and banks can make themselves the hub of the charitable community. By offering a charitable giving platform, they can provide a place where customers can do good by donating to their favorite local causes – but also be recognized and rewarded for it. Furthermore, by donating themselves, banks can develop great marketing mileage from their support of good causes.
By implementing a charitable giving platform, financial institutions can become a centralized portal for the support of both local and international good causes. The idea is simple; institutions improve their reputation and standing by donating directly to charities while encouraging customers to do the same; and when they do, banks can recognize and reward them.
Do not underestimate the power of doing good: numerous studies have shown that the vast majority of consumers are likely to switch brands to one associated with a good cause. What if each customer or member had a charitable account from which they could donate to any registered charity they wish (local, national or international). As a marketing tool, the portal becomes a hub for all the good causes that are being supported by the institution and its community of philanthropists, encouraging others to join in and do the same.
The financial institution may choose to donate in-kind by adding a percentage to each customer donation. In addition to direct donations, the bank can leverage their charitable platform to generate many cross-sell opportunities by encouraging customers to buy more products and service, and also to drive new customers to join the service. For each everyday payment made by customers, the customer’s charitable account is credited with a percentage of the total. Customers opening a new account or loan facility get a one-off credit to their charitable account to distribute as they see fit.
Making Social Capital from Giving
The charter of an institution’s charitable platform is not simply a place to highlight its own virtue; it is a very real mechanism to drive more transactions. The fact that these charitable transactions greatly benefit the local community is an additional benefit from which much marketing capital can be made.
The portal can be an irreplaceable marketing tool for banks to show what great things they and their customers have achieved, while inviting others to participate. This way, the institution becomes a hub of good community feelings, but more importantly, it offers an avenue to reconnect with individuals and allows them to show they are concerned about the same things as their customers.
The social media aspects of charitable platforms should not be overlooked; this is not just a marketing page that evangelizes for good causes. The aim is to create a vibrant charitable community with the bank at the center of affairs. Charities can provide updates s on what has been achieved with the funds and customers can suggest and promote additional good causes to which to donate.
Inspiring a Passion to Give
The use of a charitable giving platform aims to drive desirable consumer behavior in order to generate additional revenue streams. By inspiring people to act generously, institutions can attract and connect with their consumer base on a much deeper level than before. The fact that they are an established conduit for very real and positive local community giving acts as a significant differentiator to prospects, especially to millennials and affluent demographics. In addition, banks will benefit from strong loyalty by making ‘good’ matter.
But the greatest tangible benefit comes from increasing payment traffic and top of wallet status. A charitable giving hub drives incremental spend regardless of merchant routing choice or card choice, and also grows recurring donation payments. A truly engaged customer is a more receptive customer and so charitable giving portals offer valuable cross-sell opportunities for the sale of additional products and services.
There is little doubt that the feel-good factor resonates well with consumers, but when coupled with interactive social media aspects, a charitable giving platform offers much more than a simple mechanism for donations. All sizes of institutions can benefit, but the message for community banks and credit unions resonates particularly well given the stronger emphasis on local causes. Going forward, it is easy to see potential to link loyalty programs with charitable giving systems with points being redeemed for higher levels of charitable giving than a basic cash back or gift.
Develop a strong sense of community and take the opportunity to evangelize how you are helping all aspects of the local community. A social-media enhanced charitable giving platform allows you to demonstrate not just your own good work, but also the efforts of your account holders. It gives a strong sense of community while driving increased transactions and developing loyalty.
- Can customers be positively influenced by financial institutions that promoting charitable giving?
- Will a bank charity promotional site increase transaction volumes significantly and/or drive more product and service sales?
- Can financial institutions carve a place for themselves at the heart of communities through the funding and promotion of good causes?
What do you think?