WHAT’S THE SUBSCRIPTION ECONOMY?

There’s a major economic shift taking place that touches many aspects of our daily lives. And your nonprofit can use it as a model to build your recurring revenue.

Try to picture the last time you bought a DVD. Brought the box home, wrestled with the plastic to get it unwrapped, and popped it into the tray to watch your movie.

Now think about the last movie you watched at home. 

If you used a paid streaming service like Netflix, then you’re participating in what’s been dubbed the subscription economy.

The subscription model has been around for a long time (think of newspapers and magazines), but these days some of our most basic needs are also being met through subscriptions: groceries and home supplies through Amazon prime, clothing from Stitchfix or Trunk Club, and even Apple phones or cars by subscription from major automobile makers. Then there are the things that make us happy: music on Spotify or TuneIn, TV and movies on demand through Netflix or Hulu. And that’s just to name a few!

Do you see the trend? In growing numbers, people are opting to pay a monthly fee online (monthly, quarterly, or annually) for the things they want and need.

USING THE SUBSCRIPTION MODEL TO BUILD RECURRING REVENUE

In terms of what this means for your nonprofit, successful fundraising is about meeting people where they’re at. Since many potential donors already have monthly subscriptions, you can borrow from the subscription model to shape and strengthen your online fundraising efforts. Here are two simple things you can do to get started:

• Make recurring donations your primary giving option.
• Treat your recurring donors like subscribers.

Encourage donors to give monthly.

The rise of the subscription economy has primed people to make a monthly commitment. And the even better news is that monthly donors give more in the long-run: donors who set up recurring donations give 42% more annually, compared to one-time donations. Motivating donors to make a monthly gift—rather than one time or once-yearly—can make a big difference. You can do this by:

• Making monthly giving the default option on your website’s donate page.
• Pre-populating the donation field with an appropriate monthly gift amount. This is generally between $10 – $50 based on your nonprofit’s average gift amount. You can also give donors the option to fill in their own amount.
• Connecting monthly giving levels to tangible outcomes.
• Including obvious call-to-action buttons on each page of your website inviting people to become monthly donors.

Changing how you ask for support will encourage your supporters to give accordingly.

CULTIVATE YOUR MONTHLY DONORS LIKE SUBSCRIBERS.

It’s not just about your mailing list! Once they give, you’ll want to build relationships with your recurring donors as subscribers—and subscribers expect to get something of value for their money.

While your nonprofit can’t offer goods or services in exchange for tax-deductible contributions, what you can do is communicate the impact of monthly contributions. A regularly scheduled e-newsletter curated specifically for your subscribers is a great way to make them personally feel good about giving to your cause. You’ll want them to be in the know about recent events, project updates, and major milestones reached with their support. The value that they’ll get from contributing is knowing that they’ve made a difference.

To help create this content, there are a number of great subscription tools available to nonprofits for free and at discounted rates. You can edit photos from your program sites with a subscription to Adobe Photoshop CC via TechSoup or sign up for a free nonprofit professional plan on Canva to create infographics and banners.

By treating your recurring donors like subscribers you can nurture donor relationships, grow your recurring revenue, and build a stronger base of support for your programs.