Page 21 - Harvard Business Review, Sep/Oct 2018

interaction, and we still didn’t have donors’ personal Building Direct Relationships
information, but every metric we measured—giving,
volunteering, public opinion—went up. It was very Since Brian Gallagher became United Way’s
clear that to be more successful, we had to find ways CEO, overall contributions have ebbed and
to get people more involved. They don’t want to just flowed, owing to the lingering effects of the
give a check. They want to help with strategy, they Great Recession. But the organization has
become less dependent on employee and
want to be advocates, and they want to know what’s corporate contributions and has created
happening with their money. stronger relationships with individual donors.
Contributions by year in US$ billions
EVOLVING TO DIGITAL
I became the CEO of United Way America in 2002, Employee and corporate Individual
and a few years later I led our merger with United
Way International. By then we had converted United $4B
Way from a federation of local charities to a franchise
model. The local franchisees bring in donations, and
the worldwide organization receives a percentage of 3
revenue. We promote the brand, provide infrastruc-
ture, and guide the strategy. Over the past decade a key 85% 72%
piece of that strategy has been a digital transformation. 2
An important moment in the evolution of our dig-
ital strategy took place about six years ago. I was at
the World Economic Forum in Davos on a panel with
Marc Benioff, the CEO of Salesforce. We were talking 1
about how organizations can more deeply engage cus- 28%
tomers and other stakeholders. He told a story about 15%
Starbucks that stuck with me. In 2008 Howard Schultz 0 2002 ’04 ’06 ’08 ’10 ’12 ’14 2016
returned to Starbucks as CEO, after being out of that Source: United Way
role for eight years. The company had lost touch with
consumers, and Schultz was determined to fix that.
The first thing he did was create an app that asked
customers how they thought the coffeehouses could average annual giving per donor by 6.5%. Through
be improved. The company consolidated the top 10 digital advertising we gained more than 70,000 new
responses and put them to a consumer vote. Then it leads on donors. Shifting to online interactions also
implemented the top five fixes. The process engaged reduced costs: Participating local United Ways saw
customers in the turnaround and helped restore reve- their marketing costs go down by more than $1 million.
nue growth. That anecdote reinforced for me the idea
that if you want people to be involved, you can’t just
ask them for money—you have to really engage them. PARTNERING WITH SALESFORCE
Digital technology is the best way to do that at scale. In 2017 I saw Marc Benioff at Davos again. We talked
By 2015 we had created a digital services operat- about the potential of digital tools to help organiza-
ing group inside our organization. We worked with 11 tions like United Way engage with donors. Salesforce’s
of our local United Ways and created a website where expertise in customer relationship management soft-
donors could establish fun, interactive online pro- ware, which collects information about individual re-
files. That allowed us to curate content we thought lationships to make interactions between people eas-
would interest them—such as relevant articles or ier, addressed this need. Marc said that his company
volunteer activities and opportunities. We were able was already working on an app that would do much
to put together a donor database of more than one of what we hoped to do. Originally we imagined this
million people, who together represented more than as a vendor relationship, whereby United Way would
half a billion dollars in giving. pay Salesforce for its efforts, but we quickly agreed
Then we began measuring behaviors. We found that that it should be a partnership: We would work with
donors who engaged with us online—just like those the company to create a platform that could be used
who’d taken the paper surveys 20 years earlier—gave across nonprofits. United Way doesn’t want to get
more and continued giving from year to year. The local into the technology business, so we needed a partner.
organizations that joined the online effort increased Salesforce was perfect, because its software is already

SEPTEMBER–OCTOBER 2018 HARVARD BUSINESS REVIEW 41