Public radio should fund itself with credit cards

Helping fund public media with credit cards was one idea that we generated at the Integrated Media Association (IMA) conference and if you get to the bottom of this article I’ll propose how we might do it.

At IMA in Austin, TX earlier this month I ran a session titled “Pledge your support for mobile” and I wanted to share the output of our discussion. We had great people in the room, interface designers, app developers and other public media folks, but I think having more people focused on membership participating in a future discussion would be very helpful. We may be bringing the same discussion to the Public Media Development and Marketing conference in July and if so I’d love for you to come and join the conversation.

The focus and purpose of our session was to understand the friction of donating on mobile devices and to see how we might improve the ways in which consumers/listeners/viewers financially transact with public radio and tv stations. While we focused mostly on how this works in a mobile context, the challenges and barriers related to donating and pledging to stations aren’t specific to any single device or platform. We discovered it’s more about how public media thinks about transactions with consumers in general.

Pledging now is pretty painful.

Below are two examples, the first shows what it is like to donate to a public radio station on your mobile phone. The second shows what it is like to buy an app on an iPhone. If you work in membership at a public radio or tv station I highly recommend you watch both the whole way through, watching me try to fill out the donation form is painful, really painful. Now imagine trying to do that while you are about to hit a dead spot in your cell phone coverage.



Filling out the form and donating to public media took nearly 5 minutes compared to about 20 seconds to download Task Rabbit. 5 minutes may not seem like much, but how many people that start the donation process bail out when they are prompted with so many fields. I’m not filling out a mortgage form and developing a relationship for 30 years, maybe I’ll want that longer, larger relationship later on but at the moment maybe I just want to give you some money. Dan Saltzman from EffectiveUI helped us to visualize the emotions that people go through as they try to pledge on their phone.

 

 

Pledging doesn’t get much better when you are at your computer

It’s pretty obvious that giving money to a station right now isn’t the simplest process and that by doing so you’ve probably just created a long term bond with the station that can only be broken by throwing a ring into a volcano.

People are getting used to new forms of transactions that take less effort and don’t result in a marriage. My assumption is that public radio and tv stations still want to attract the big donors, those that can help with large capital projects and investments, but shouldn’t they also be creating a wide funnel that guides younger and more casual listeners into becoming donors and sustainers?

Walrus Research performed detailed research in 2003 about how and why people donate and give to public radio stations, and I don’t think it is surprising that this was one finding:

Individuals who not only listen but also sense that public radio has become important in their lives are more likely to become givers.

But giving to stations in the current methods is a pretty weighty decision, it takes time and effort to mentally commit to becoming a member/giver/donor/sustainer. Once over that hurdle, I’ve set myself up for physical mail coming to my house every few months and emails asking me to pledge for a very long time. I think there are ways for more casual listeners to participate in funding public media if stations embraced new transaction methods and how they define relationships with organizations and companies. I highly recommend that stations learn more about ProjectVRM, ListenLog and EmanciPay, work that public media friend Doc Searls and company have been preaching about for a few years now.

As a way to encourage membership staff to think about different methods of financial engagement we discussed newer and alternative transaction methods that are starting to pop up. Text to donate has been around for quite a while and a number of stations and programs have been experimenting with it, but there are other opportunities as well that I’d like to highlight.

Square is doing amazing things with digital transactions, and I think it’s quite awesome that we’re able to get back to the days of having a “tab” at a place of business. I used to have a tab at my local neighborhood market in Cambridge and being able to say, “Put that on Matt MacDonald’s tab” just felt like a great interaction, they knew my name and I didn’t have to pay for anything right then. Wired has a great overview of the Square geofence payment flow. Could public radio and tv stations setup geofences for live events? Encouraging those that might not be ‘members’ to pay or add a tip to the event?

Check out these other transaction methods for inspiration

  • Bill Me Later at http://www.billmelater.com is like old school pledging but with teeth.
  • Free Rice at http://www.freerice.com could public radio stations get a large underwriter on board that backs a donation for every click on their website?
  • GOP Debate Watch at http://www.gopdebatewatch.com
  • Humble Indie Bundle at http://www.hunbleindiebundle.com would a coordinated ask/donation call to action from a number of independently produced shows increase the total giving?
  • Kickstarter at http://www.kickstarter.com you pretty much need to be living under a rock if you produce content and don’t know about Kickstarter but here it is.
  • In-App purchases, no link but think about how you might be able to buy a virtual tote bag. Sure Apple or Google take 30% but you get more money and develop the start of a relationship.

While we developed some bigger processes and ideas we definitely still wanted to identify some quick improvements that stations can do to reduce the pain that people currently feel when donating:

  • Actually go through your pledge process – When is the last time that you did this? I strongly encourage you to fill out your pledge process, record it if possible. How long did it take you? Did you get frustrated at all?
  • Reduce the fields that you ask for - Do you really need all those fields? Take a hard look at those fields, if the person going through the process doesn’t want a gift why do you need their physical address?
  • Make sure you have analytics - Contact your pledge/donation vendor and make sure that you have Google Analytics installed
  • Review and understand your pledge analytics - How many people are landing there and then dropping out? Where are they dropping out of the process? If you can’t answer those questions at least start there.
So, there are some simple changes that can be made but those are bandaids on top of the core problem – giving money to public radio and television stations takes too long.

So, how do we help fund public media with credit cards

I promised you that I’d share how I think this could be done. Affinity credit cards. That’s it. Public radio and television stations should collaborate and work together with Visa, Mastercard or American Express to create an nationally branded affinity public media credit card. Each transaction made with that credit card would get rounded up to the nearest dollar and the card holder uses a website that allows them to determine how it gets allocated back out to participating stations, programs and producers.

How big is this?

Very. Check out some of the stats that can be found at CreditCards.com

  • 609.8 million credit cards held by U.S. consumers
  • It is estimated that there are 10,000 payment card transactions made every second around the world
  • American Express: 2010 transactions (Doesn’t disclose publicly)
  • Discover cards: 2010 transactions (Unavailable)
  • MasterCard credit: 5.85 billion transactions in 2010 (Source: MasterCard) 
  • MasterCard debit: 8.46 billion (Source: MasterCard)
  • Visa credit: 9.4 billion (Source: Visa)
  • Visa debit: 28.6 billion (Source: Visa)

So if 170millionamericans.org is right and there are 170 million people using public media each month, then there are a large number of credit card transactions each day performed by public media consumers. With a coordinated effort could public radio and television stations switch 1% of their consumers over to using a public media branded card? How much money would be generated for public media if every time you bought a coffee that it rounded up from $2.56 to $3.00?

Imagine that 1,700,000 people use the new public media credit card and they average 1 transaction per day and that the average amount rounded up is $0.52.

  • Public media might expect: 1,700,000*1*365*$0.52 = $322,660,000

Now, that won’t cover the entire operating costs for public media but generating over $300,000,000 would definitely help.

So would you switch over to use a public radio affinity credit card? Do you think something like this would actually work? I’d love to hear your thoughts and comments.

Thanks,
Matt

4 thoughts on “Public radio should fund itself with credit cards

  1. The history of affinity cards for public broadcasting is long (I worked on such deals when I was at PBS 30 years ago). Would be interesting t check with stations to see what recent experience in this area is. It’s not an area that has proven to be very significant in the past in terms of revenue and relationship building. Note how many fewer affinity credit card offers one gets these days from universities.

    Good points on mobile pledging which does have some impediments.

  2. Great idea, and yes — we do a pretty dissatisfying job of making the pledge process painless.

    My understanding is that the round-up feature is different than what standard affinity cards offer, and a national card that would allow users to select their public media stations/orgs/programs would be a distinct feature. My question is could we as a system bring ourselves to suggest that we are a nation-wide group that is not just NPR and PBS but a constellation of providers that are all public media?

    I’d like to see an attempt like this reach out to the CPIs, St Louis Beacons and Voice of San Diegos of the world — not just public broadcasting.

    this probably wouldn’t be the only card a person would have, but a second card — hard to displace those airline and cash back cards.

  3. First off, thanks. Some good thinking all through this.

    As Steve Bass noted in his comment above, people have been working on this for decades. So, there has been a good deal of testing of some ideas already. And like Steve, I’m cautious about the potential of affinity marketing. People jumped all over this ten years ago. Most of it just didn’t work that well.

    This kind of thing can look pretty good on paper: You take large numbers like all the listeners and viewers and multiply that by some small number that seems reasonable, and suddenly you’ve got a pretty sweet deal. Unfortunately, it rarely if ever work out like that.

    One piece of this definitely did work: the marketing partnership with Amazon (stations/sites get a commission from sales generated by click-throughs). That seemed to be a very good program, easy to do, decent money for some large stations. Not enough to fund public broadcasting, but good money.

    All of this should not inhibit brainstorming or testing. Instead, it suggests to me that it would be very helpful if someone could collect more information on what has been tried.

    I would be more than happy to work with PRX or DEI or others to do some of that.

    Mark Fuerst
    Innovation4Media/Current

  4. Great comments and critiques, the post is doing what I hoped it would, spark conversation about how to attract the “fringe listeners” into financially supporting public media. Having those that have tried this in the past share their knowledge about what worked and didn’t would be very helpful for the entire system.

    One of the reasons that the credit card rounding up interested me as a thought experiment was that it is a form of giving and a financial transaction that is attached to a pre-existing behavior. Asking casual listeners to create a new behavior is tough and I think the language and transactional methods that public media uses to ask for donations could be tweaked to encourage those that aren’t “core listeners” to financially support the organizations and system.

    Public media should spend effort reviewing some of the newer transactional methods that are being used to see if they can be adopted or modified to widen that donation funnel and convert more listeners into providing financial support. The credit card concept is only a single idea and while I think it should be explored again at the system level, frankly, it was used to spark conversation.

    @steve, hearing from stations recent experiences with affinity cards would be great. Something that I’m suggesting is that instead of individual stations developing this relationship is to create a system wide push for both public radio and television stations across the country. I wonder how that coordinated marketing message might be received as compared to how it may have been used in local markets only.

    @mark, It’d be great to see the results of those tests published. I’ll admit I didn’t perform an extensive search to find those previous results, but if the documents and findings exist references and links to them would be great. The Amazon example is a great one, and I’m glad that some stations use it,. That method also attaches to a pre-existing behavior, people buy stuff on Amazon so why not just piggyback on top of something that they are already intending to do.

    Bottom line, I think there is a huge room for improvement in the system related to who we attempt to collect money from, how transactions are encouraged and we move people through the fullfilment process. Stealing from Target, Amazon and others that spend millions of dollars on this is a good thing.

    An example of just how bad it is from a recent @andrewphelps tweet:

    “Classic: Got a blank e-mail from a station I give to. Subject: “Sustaining Gift Payment has Failed.” Reply-to just bounces. cc: @neocMatt” https://twitter.com/#!/andrewphelps/status/185370740755931136

    How long would something like that last at Amazon or Target before someone fixed it or got fired?

    Thanks,
    Matt

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