There are some people that, like the old EF Hutton commercials, when they talk, you listen. Mary Meeker is one of those people, as one of the lead analysts on online and high-tech issues.

To give you some perspective, she managed the Netscape Communications IPO in 1995. Usually when someone says they have 20+ years of online business experience, you assume they are padding their resume.

Her Internet Trends 2018 report came out yesterday. As ever, there’s a lot of great value it in for the digitally curious (which is, hopefully, everyone). I wanted to highlight slides 76 and 77 (yes, it’s a 294-slide presentation):

For-profits agree with our assessment that lifetime value the most important factor in optimizing their ad spend:

And Facebook now allows you to use lifetime value in building Custom Audiences:

This is great news for Facebook advertisers. It used to be you uploaded a list of donors and used lookalike audiences to say “find me people who look like this.” Now, you can say “find me people who look like this, biased towards those who have been our best donors.” It’s almost like cheating.

So why don’t we cheat in other areas of new donor acquisition?

Well, you say, we don’t know lifetime value for a while. By the time we know lifetime value, the rental list market has changed, the canvasser has graduated college, and the telemarketer’s replacement’s replacement just left.

That’s all true. However, there are knowable proxies for lifetime value. These can base your acquisition decisions on more than just cost to acquire. (The old maxim that you get what you pay for is often correct in such cases.)

This will require you to listen quickly for things like commitment, identity, and satisfaction, which are highly predictive of lifetime value. But the benefits are manifest:

• One UK animal organization (anonymized) asked callers if they are cat people or dog people. The script then customized based on this information. This simple change resulted in a 15% increase in response rate and a ten-pound increase in average annual gift.
• Amnesty Belgium asks how committed and satisfied donors are while the solicitor was still with the donor. This cut their monthly donor bleed in half. The full story is available in detail here. They used this information to remediate for the individual donor and for donors in general. If a canvasser had a low cost-to-acquire, but none of their donors were going to stay, they would get retrained instead of promoted.
• A disease charity found (shocking!) those donors who had the disease themselves had a donor lifetime value over twice as much as those without the disease. However, the organization was paying the same amount to acquire each type of donor. They are now selecting the audiences and messages that will attract those with the disease, rather than trying to boil the potential donor ocean.

Even with this new Facebook tool, it would still be wise to upload your Custom Audiences by identity segment. This new lifetime value tool will tell you who the best donors are, but it won’t differentiate between cat people and dog people. And, as we’ve seen, this type of ad targeting can increase your click-throughs by 40%+.

Facebook has a lot of information on all of us, but it usually can’t get to the heart of donor identity and why people give to you. For example, it can tell who is a parent, but it can’t tell you which of those parents involve their kids in their philanthropy. It’s up to us to drive our acquisition efforts. Retention begins with who we’ve decided to acquire. And we need to make that decision based on more information than just cost.