Whispers of a looming recession are growing into a full-throated roar. When an august institution like the World Bank resurrects the word “stagflation,” leaders in all sectors are bound to worry. Will our organizations be able to cope with reduced revenue, higher costs and more reluctant customers?
Adapting to the new economic reality will mean learning new ways to engage with customers, and doing so more efficiently, more responsibly and in ways that build trust. For nonprofits, this is familiar territory. In fact, nonprofits can teach for-profit organizations a thing or two about digital transformation in the face of severe resource constraints.
A recent study by Twilio included the surprising finding that nonprofits are ahead of for-profits in digital engagement. For nonprofits, 64 percent of the engagement with participants in their programs is digital, compared with 57 percent of customer engagement for for-profit companies.
Nonprofits are meeting their communities, their users and their “customers” (the people they serve) where they want to be met: Through digital channels including text, WhatsApp, voice and web chat. They are tackling massive problems head-on, despite constrained resources, and they are realizing increased efficiency and impact as a result.
All industry sectors, for-profit and nonprofit alike, have challenges engaging their customer base, but nonprofits are actually outstripping their for-profit counterparts at being digitally connected with their audience. Despite the misconception that nonprofits are innovation laggards, many are remarkably far along the path of digital transformation.
It starts with digital engagement. For consumers (and their equivalent in the nonprofit world: the people nonprofit programs serve), expectations are higher than ever, thanks to the multichannel, always-on, highly responsive model set by tech giants like Amazon, Google and the like.
It’s a common misconception that the people who utilize services provided by nonprofits need low-tech channels. In fact, these services — such as crisis lines, resource navigation, emotional support, medical advocacy and so forth — are often utilized by people whose primary means of communication is a mobile phone. Offering the option to connect via a chat app or text message instead of a desktop-centric website or even an in-person visit can help nonprofits reach more people, improving and even saving lives.
What’s more, these organizations clearly understand that their “consumers” — program participants — expect to be able to interact with them the same way they do with big commercial brands, through a variety of digital channels.
This understanding has pushed many nonprofits toward a more sophisticated embrace of digital engagement technologies, such as text chat apps, web chat and more. Engaging with program participants digitally is critical to achieving nonprofits’ missions, according to 89 percent of the organizations that responded to the Twilio survey.
For example, NAMI, a grassroots mental health advocacy organization, is using digital technologies to provide life-saving services like crisis intervention, emotional support and access to resources. NAMI increased the number of help seekers it reached by over 75 percent, without sacrificing the quality of care, by adding digital channels including web chat, voice and email. It also scaled up its call center by building a remote-first infrastructure that draws on a national volunteer base, allowing it to answer 67 percent more calls from people in crisis during 2021 than the previous year. These services are helping NAMI bring resources and support to people across the US who are experiencing or living with a mental health condition.
For-profit organizations need to follow suit: Engage customers wherever they are, through whatever digital channels they prefer.
The striking thing is that many nonprofits are able to be technically innovative even when they are faced with severe resource constraints. The lean budgets of most nonprofits will come as no surprise to most people, but for technical innovation, the challenge is even greater. That’s because grant-making organizations don’t typically like to fund software development, which is usually categorized as an overhead expense. Funders prefer to see their dollars going to “direct” means of accomplishing a nonprofit’s mission, without seeing that software can actually have a very direct impact. As a result, many nonprofits have smaller development teams (or zero developers) — and hiring developers is an especially big challenge in a competitive labor market.
Faced with the lack of resources and reluctant funders, many nonprofits are simply refusing to take “no” for an answer. According to the Twilio survey, two-thirds of nonprofit leaders plan to hire software developers this year, and they are using their budgets to address technical shortfalls whenever and wherever they can.
For-profit organizations should take a similar approach and prioritize hiring software developers.
Moments of crisis can provide the impetus to get technical innovations done, if the organization has an agile mindset and is ready to move quickly. For example, earlier this year, the Norwegian Refugee Council, an international humanitarian aid organization with the mission to protect displaced people and support them as they build a new future, wanted to help refugees fleeing the war in Ukraine. Cash vouchers are one of the most useful forms of support for people in crisis, especially in conflict zones where it’s critical to get resources directly into the hands of those in need quickly, and let them decide how and where to use it. Managing requests for help and wiring money to people who don’t have access to a bank account or a permanent address are two major challenges, so NRC built an automated system to triage requests and make payment transfers using WhatsApp and MoneyGram. In less than 30 days NRC built a solution that is able to provide up to $50 million in aid to 650,000 Ukrainian refugees.
For all organizations working with severe budget constraints, efficiency in spending both money and time is critical. For digital projects, that means using technologies that deliver impact in the most effective way. But it also means capturing data so that efficiency can be tracked and improved.
While nonprofits may not have the same return on investment calculations as for-profit organizations, there is still a wealth of data to be gleaned from digital engagement technologies that can inform future decision making. Again, nonprofits have lessons to impart here.
For for-profit and nonprofit organizations, capturing data and analyzing it is critical to both measuring efficiency gains but also to surfacing insights that can lead to better service. For example, The Trevor Project, which has provided crisis support for LGBTQ youth for over 20 years, via phone, text and chat, was able to use machine learning tools to flag text messages as high priority based on the content of the text. The organization can also analyze chat logs, in aggregate, to help counselors develop better strategies for helping youth in crisis.
Sometimes efficiency also means serving people faster. The Trevor Project’s text support line, TrevorText, is particularly important, because it allows young people to communicate quickly and discreetly, using a form of communication they’re comfortable with. But the organization was using a legacy SMS text solution that introduced a 10-second delay before counselors could respond to an incoming chat. By switching to a more advanced chat platform and eliminating that delay, The Trevor Project was able to save an average of 10 minutes per conversation, enabling it to serve 22 percent more people over a six-month period.
Far from being technological laggards, nonprofits have been remarkably forward-looking in their approach to digital transformation. These organizations recognize that the world has shifted and that their communities expect to be able to interact with them via digital channels. In order to meet that expectation, nonprofits are seizing opportunities — including crises — to make the digital investments they need, even when funding may not be directly available for that purpose. And focusing on data-driven efficiency improvements can help create a virtuous cycle of innovation and optimization.
All organizations — for-profit and nonprofit alike — could benefit from taking a similarly nimble, opportunistic and data-driven approach. The benefits will include greater customer and constituent engagement, the ability to reach more people and greater impact.
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Image credit: Andrea Piacquadio via Pexels
As chief social impact officer at Twilio, Erin leads the company to use its products, people, and funding to do good. She is also the GM of the business unit that empowers nonprofits to use Twilio to scale their impact, Twilio.org. She previously held social impact roles at Google, Yahoo, and the nonprofit Business for Social Responsibility. Erin holds a BA in human biology/environmental management from Stanford University and an MBA from the University of California, Berkeley.