2018’S SMALL-DOLLAR DONOR BOOM | Pacific Campaign House

2018’S SMALL-DOLLAR DONOR BOOM

Campaign fundraising operations are pulling in record amounts of money this cycle, with many of the totals bolstered by impressive online fundraising hauls.

Over the past week, campaigns have released some attention-grabbing second quarter fundraising totals. Republican Rick Scott raised $10.7 million in his bid to unseat incumbent Sen. Bill Nelson (D-Fla.). Democrat Beto O’Rourke, whose long shot campaign against Sen. Ted Cruz (R-Texas) has garnered significant national attention from liberal donors, raised $10.4 million in the second quarter. Half of that was raised online, according to the campaign. It follows O’Rourke’s $6.7 million first quarter haul. Cruz took in $4.6 million this quarter.

In Wisconsin, Democratic Sen Tammy Baldwin’s campaign boasted that her nearly $4.4 million second quarter fundraising total included 57,000 grassroots donors and a $25 average online donation. Neither of Baldwin’s potential GOP challengers have come close to her fundraising totals ahead of next month’s primary.

A host of other candidates in Senate races are posting impressive numbers, including some strong fundraising from other Democrats defending seats against GOP challengers, and in a couple of states where Democrats think they may be able to oust Republican incumbents, namely Nevada and Arizona.

On the House side, the fundraising picture is unlike anything we’ve seen before in a midterm election. More than a dozen Democratic House challengers have reported more than $1 million raised in the second quarter of 2018. As Politico reported on Thursday, that compares to only two Democratic House challengers who raised north of $1 million in the second quarter of 2016.

Given the fundraising totals we’ve seen so far from campaigns during the first quarter, plus some of the second quarter totals already released, C&E asked some digital strategists what’s driving the fundraising surge and how campaigns can position themselves to make the most of it.

The obvious starting point is the hotly contested nature of this midterm cycle and the passion being generated by base voters, particularly those on the left energized against President Trump and his administration’s policies. That energy and enthusiasm helped campaigns raise huge sums across a series of nationalized special elections in the run up to this fall, and it’s only growing as November nears.  

“It’s either really polarizing candidates or Resistance Democrats who are seeing the surge,” said Ian Patrick Hines, CEO of the Republican firm Hines Digital.

For the left, said Hines, the value of the small-dollar has been a point of emphasis and Democratic candidates are reaping the rewards this cycle. “The Democrats have built a culture of grassroots giving,” said Hines. “It’s not just about the technology; at the core of the Democratic Party’s base, people believe that chipping in five dollars is a meaningful act.”

In addition, Hines noted, another advantage on the left is an organization like DailyKos, which is endorsing Democratic House candidates and putting its sizable and engaged email to list to work to raise money for them.

“If you fall into the good graces of the DailyKos editorial board, and they say, ‘We have to win this house race,’ well, you just got access to a 3 million-person list,” said Hines. “And it’s not a list rental to a 3 million-person list, it’s DailyKos telling their loyal supporters and readers every day: ‘We need to win this House race.’”

Another driver of the surge in online giving for Democrats is ActBlue. It pulled in more money for Democratic campaigns in the first quarter of this year than it had in any fundraising quarter in its history. And Democratic Senate candidates, including O’Rourke in Texas, Baldwin in Wisconsin, and Sen. Claire McCaskill (D-Mo.), among others, have leaned on the platform to boost their digital fundraising hauls.

“All signs indicate these small-dollar, grassroots donors are more fired up than ever and will be the key to victory in this cycle and beyond,” ActBlue Executive Director Erin Hill wrote in C&E earlier this year.

One thing making a difference on both sides, according to fundraising strategists: an increase in the number of repeat gifts. As campaigns become more adept at building and cultivating online relationships with supporters, it becomes far easier to get that second or third gift, and more campaigns are realizing the value of that outreach.

It’s something campaigns should continue to strive for in their email program, according to Kate Faherty of Campaign Inbox. Quite simply, when a donor feels valued beyond the ask, “the online giver feels more connected and is more willing to give.”

As far as taking advantage of the current fundraising environment, Cheryl Hori, founder of Pacific Campaign House and the former deputy digital director at Priorities USA, said congressional campaigns are best served by fighting for every single dollar they can get ahead of the fall, and she expects them to do just that. Given an expanded House and Senate map, the approach for most campaigns will be to just push the gas pedal and not let up.

“Most of the money is coming out of very blue areas of the country, so California, New York, D.C.,” Hori said. “These are places that, instead of giving to the local congressman who has been reelected the last four years, people want their money to be going somewhere where it’s really making a difference.”

When it comes to her clients, Hori said mobile donations are way up, making up 45 percent of all digital money coming in. “We’re also seeing a huge surge for first time candidates who are pushing the envelope of what it means to not be part of the establishment,” she said.

Take Democrat MJ Hegar’s campaign against incumbent GOP Rep. John Carter. Hegar, who has an uphill battle in a heavily Republican district, raised some $1.1 million in the second quarter, the vast majority of it coming in the 10 days following the release of a bio video that gained national attention. The Democratic consultant who developed the spot, Cayce McCabe of Putnam Partners, told Washingtonian that not only was it an attempt to stand out in a race that might otherwise not gain national notice, but the candidate’s non-traditional background more easily lent itself to compelling digital content.

“Obviously you can’t just touch something with a magic wand and make it go viral, but we knew we were going to try to produce really eye-catching content,” McCabe told Washingtonian. “These new people who have these really dynamic life stories, who come from non-traditional backgrounds and are not politicians. They make for just great visual video content because they have such powerful stories.”

A larger investment in digital acquisition on the part of individual campaigns combined with the new reality of digital strategists having a prime seat at the table is meaningful, too. And for those digital teams that demonstrate the ability to bring in lots of money, the powers that be in a campaign are more likely to get out of their way, allowing them to move swiftly on digital content tied to fundraising appeals.  

While plenty of Republicans are lagging behind their Democratic opponents when it comes to dollars raised, individual campaigns are seeing success with appeals to the Trump base. Immigration and calls by Democrats to abolish ICE have featured prominently in online fundraising appeals to the GOP base, as have public confrontations of Trump administration officials and other prominent GOP figures.

The RNC and Republican outside groups are also posting impressive fundraising totals — large enough to ensure they will make very meaningful investments in the midterms.

Whether or not the current surge of money will represent a high watermark one or two cycles down the road remains to be seen, and digital strategists are universally reluctant to make any such predictions.

“As long as you have a protagonist and an antagonist and a plot,” said Mike Nellis, president of the Democratic firm Authentic Campaigns. “A good villain as your opponent, a charismatic candidate, and a winnable election with a good day-to-day story on the issues, you’ll likely still see strong fundraising going forward into 2018 and 2020 no matter what.”