“They Have a Basketball Court?” – Red Ventures & How Data Can Transform Nonprofits

By Josh Jacobson

Though it has been in business since 2000, I hadn’t heard of Red Ventures until just a few years ago.  And even then, what I knew was somewhat fuzzy.

Most folks talk about the amazing headquarters located in Fort Mill, South Carolina – a striking 150,000 sq. ft. campus complete with a full-length basketball court and its own on-site restaurant, perfect for a beer on Friday company-endorsed happy hours.  People I know who have been there talk about the stunning array of flat screens everywhere you look, with real-time streaming data concerning client activity.

If that sounds a bit like the playground-style offices of tech start-ups of Silicon Valley in the 1990s, you probably aren’t far off.  It is clear Red Ventures has defined its brand and created a work culture with a great deal of intention – to attract talent, project success, and increase client acquisition.  I can only assume this, but it would certainly make sense – Red Ventures is in the business of demand generation and sales conversion.

I say I’m a bit fuzzy about what they do because it is largely a big secret.  The company doesn’t say much about the clients it serves, but the word on the street is that they are involved with many Fortune 500 companies, with a defined focus on home services, energy, media, telecomm and insurance.  If their building is the first thing people mention, their process is typically the second thing, and little is known about it either.  Their website provides a fairly high-level explanation of the typical sales funnel.  But what they do is different. Or so I’ve heard.  “They will go head-to-head with the sales department of a reluctant client prospect and beat their numbers by a multiple factor,” a colleague told me once. “They’ve got it figured out.”

So, what is “it” exactly?  And how can nonprofit organizations learn from what this company does?  While much of it remains a mystery, two differentiating factors are clearly evident:

  • People – The Right People in the Right RolesInterview
    Red Ventures is a growing company – a really growing company.  Earlier this month, they held an interview day with the intent to add 200 additional employees in 2014.  And that’s on top of its nearly 2,000 current employees.  If you go to their website, the front page is basically a giant classified ad with various positions that need to be filled yesterday.

If you’re an employee at Red Ventures, it means you made it through what is called by Business Insider one of the top-20 most difficult interview processes in corporate America.  I’ve heard it said that, despite the need for so many new employees, the company hires a staggeringly low number of the people who interview.  It seems they know what they are looking for, and don’t accept “close enough.”

From the comments on various employment seeking websites like Glassdoor.com, it appears the company is looking for characteristics and traits that don’t show up on someone’s resume.  “Tell me a joke,” a recruiter asked an applicant for a sales position, for example.  Applicants who don’t get invited back note feeling disoriented and perplexed by the experience, and angry that the interview didn’t follow a predictable format.  Perhaps that’s the whole point.

While nonprofits may not be able to offer the salary or perks afforded employees at Red Ventures (though I hear the YMCA has a great basketball court), they can certainly learn from this process.  The company wants people who can think on their feet, who have a task-oriented skill set matched with a capacity for critical thinking.  They are looking for people who will thrive in the workplace environment they have created.  Like everything about Red Ventures, it’s all very intentional.

For under-resourced nonprofits, the need to find dynamic development staff members who can get results is even more critical.  I’ve argued in the past that there are typically two types of development professionals – those who crave getting out of the office and engaging in donor interaction, and those who prefer to develop messaging strategies and computer-based awareness from within their offices.  Few are experts at both.  At Red Ventures, there are entire departments constructed of both types of people.

While they are both important needs for a nonprofit, too often they are traits (left-brain oriented and right-brain oriented) expected to be found in just one person – the Director of Development – who typically has too little time and too many distractions to do any of it effectively.  Now, I’m not saying organizations should go out and hire additional development staff – I mean, they are likely needed, but most nonprofits don’t have the budget to do that.  But what I am saying is that you should have a good idea of the type of person who will be effective given your organization’s culture, and find the right person to match your strategies – not the other way around.

  • Data – At the Heart of Every Decision & StrategySpreadsheets
    When I close my eyes and imagine meetings at Red Ventures, I picture employees with their sleeves rolled up, pouring over spreadsheets and having heated (though still professional) discussions about data analysis.  Because they are passionate and it’s how they are wired. “But what does it mean? And how can we use it?”

In truth, I’m a pretty big data wonk.  Or at least I aspire to be.  Where most people see the increasing loss of privacy as we opt-in to social media and search engine tracking, I admit that I get pretty excited. The idea that we could model preferences and behavior, and apply that understanding on a large scale?  Yea, that’s pretty game changing stuff.

Red Ventures puts it so well on their website, I won’t even try to paraphrase: “Data drives our decisions – and we build tools that give us unique, actionable insights. We scrutinize response, conversion and economics at every level to continuously boost ROI.”

Put a bit less techie, the company seeks to understand a client’s customer base and what motivates it to act, refines sales strategies through real-time analysis, and once the company is satisfied it has a sales systems that works, it models the current customer base and seeks other people with the same characteristics.  But that doesn’t happen just once – it is a system that continues to inform itself with fresh data, modifying tactics as new variables become known.

Re-reading that last paragraph, I get goosebumps.  Why can’t nonprofits do this too?  It’s a question that has led to some really interesting discussion with Chris Meade, CEO of Catapault InfoSolutions, who has thought a lot about the subject.  In fact, much of this post is informed by his ideas.

A primary challenge is simply the lack of data collected by most nonprofits.  A large percentage of donor databases in the Carolinas are tracking just one thing – financial transactions.  So if we want to understand how an individual became a donor, like who referred them initially or what the person read that motivated them to act, many donor databases don’t shed much light on the subject.

That shouldn’t be a surprise.  What nonprofit has a Chief Information Officer or prioritizes data accumulation for both programming and marketing?  Whereas Red Ventures understands the importance data holds for making decisions, nonprofits typically relegate data management to the most junior person on the development team.  That person is rarely invited to the table or present in the meeting, and so that important data goes un-captured.  A centerpiece of my Data Flow presentation is the need to elevate the process to encourage a “culture of data.”

The other big barrier for nonprofits is a financial one – though data is cheaper to purchase than ever before, it is still more expensive than most nonprofits can afford.  And because many nonprofits have a basic misunderstanding of how direct marketing leads to donor dollars, the ROI on any activity is calculated on a one-to-one basis. “We tried direct mail once, but the response rate was poor so we didn’t do it again.”

After retention (a topic for another day), donor acquisition is the most important metric any nonprofit should track.  And to dispel a popular myth, your board of directors is an important part of lead generation, but should not be your only source of prospects. Through donor modeling and message testing, segmented outreach can be very effective at motivating people who don’t know you to become educated, encouraging those who know you to give charitably and driving people who already give to give more.

Did I really just spend 1,500 words saying that successful fundraising comes down to talented people using data to inform strategies that move people to act?  Yep, I sure did.  And while that may seem a fairly obvious thing, so simple it isn’t worth spending so many words to say it, I can promise you it is a fundraising success model too few nonprofits understand or resource effectively.

Three Questions to Consider This Week:

  1. What are three traits you believe are necessary for an employee to be successful at your nonprofit?  How do you interview applicants to determine the right fit?
  2. Left-brained or right-brained – so which one are you? How do you compensate for the “other half” to ensure you cover all the bases?
  3. How does data inform your organization’s fundraising strategies?  If you could collect one additional piece of data about everyone in your database, what would it be? How would you use it?

Image Credits: Featured Image (Red Ventures Website), Interview (123RF – vgstudio), Spreadsheet (123RF – David Hilcher)