The GOP’s biggest tech challenge for 2016 is closing the small-donor gap

Jon Ward
Senior Political Correspondent
(Photo composite by Yahoo News, photos by AP Photo)

WASHINGTON – In the world of money and politics, Democrats talk a lot about wealthy Republican donors, but the reality is that in recent years they’ve had a cash advantage over Republicans that the GOP has not been able to match.

Democrats have their own major donors, but more importantly, they have recruited millions of small-dollar donors whose credit cards are now on file in vast databases and who can be approached at any time — and on a recurring basis — with small asks that can quickly add up to a giant infusion of campaign cash.

Multiple Republican strategists interviewed by Yahoo News described this disparity as the biggest digital gap Republicans have to play catch-up on ahead of the 2016 presidential election. Not a better voter database. And certainly not Twitter followers or Facebook likes — low-dollar fundraising.

“Republicans were outraised by $400 million online in the last two presidential elections and had at least 10 million fewer active emails in each of those elections. Closing this gap and then surpassing the Democrats needs to be our ‘moon shot,’” said Patrick Ruffini, cofounder of Echelon Insights and a former top digital staffer at the Republican National Committee and on the 2004 Bush campaign.

“That means the serious campaigns need to keep one eye on the general election at all times and scale so that they are ready to flip the switch from the primary to the general if they win. The temptation will be to do just enough to win the primary, which from a data and digital perspective could be quite limited, leaving us wholly unprepared to face a virtual incumbent in the general election,” Ruffini said.

And so, said Republican digital strategist Matt Lira, the biggest technological challenge the GOP faces heading into 2016 is “not really a technical challenge” at all.

“It’s a time challenge,” Lira said. “Any candidate can get the product. The challenge cumulatively is the number of users who have accounts. They still have to create them, and you want as large a user base to exist as possible by the general election. The Democrats, through ActBlue, have millions of accounts. … The conversion rate is so much higher among one-click users, it’s a structural advantage.”

The scenario painted by Ruffini, Lira and others is one where a Republican candidate emerges from a primary to face the Democratic candidate, likely Hillary Clinton, and a battlefield decidedly tilted against him. In the world of big-money donors, each side will have roughly equal resources. But if Republicans do not work hard to catch up on small donors — starting now — the GOP nominee will, in the late spring of 2016, see a swarm of small-dollar donations going to the Democrats that his campaign cannot hope to match.

Recent precedents show just how staggering the gap is. In 2012, the Obama campaign raised about $690 million online, while Mitt Romney raised only about $220 million, said Zac Moffat, who ran Romney’s 2012 presidential campaign digital department. And in 2014, the National Republican Senatorial Committee brought in $18 million online — the most raised that way by any of the Republican party committees. The Democratic Congressional Campaign Committee, meanwhile, raked in almost $70 million online.

It’s not easy to get people to take the time to fill in online forms with all the personal information required by the Federal Elections Commission, along with a credit card number — even at the premier one-click database. Principals at ActBlue, the Democratic firm that has more than 1.2 million credit card numbers on file, said much of their work revolves around optimizing the sign-up and data-entry process to make it as easy as possible for the user.

“We’ve done an extreme amount of testing to figure out what order to ask for information in and what kind of language to use,” said Nate Thames, ActBlue’s executive director of technical services.

“As silly as it may sound, not all forms are created equal,” said Mindy Finn, who worked on digital campaigns for George W. Bush in 2004 and Romney in 2008 before moving on to work for Twitter. “The fact is, there are forms that are known to raise exponentially more dollars because the forms are such a superior user experience.”

The trend line for online giving is only going to go up. ActBlue has received 15 million contributions over the past 10 years and more than 10 million of them were over the past two years, said Erin Hill, ActBlue’s executive director.

“Back in 2005 and 2006, small-dollar donations were a supplement,” Hill said. “Now it’s driving things.”

And mobile-device giving is exploding. In October 2010, mobile devices accounted for only 0.2 percent of the online donations processed to Democratic candidates through ActBlue. A year later, it was up to 2 percent. And by the presidential election year of 2012, mobile giving was up to 8 percent of donations made through ActBlue.

In 2014, mobile donations sent through ActBlue represented a full 25 percent of the money they processed, Hill said.

Step one in building a one-click donor database is building a robust email list. “Email drives such a large proportion of giving,” Thames said.

The Democratic advantage heading into 2016 is only going to increase there. Ready for Hillary, the PAC building a grassroots network in waiting for Hillary Clinton, made email list building its major focus, compiling an email list of at least 3 million people. It’s not the 13-million emails that President Obama had after his 2008 presidential campaign, but it’s a huge head start on any Republican.

It’s a “sad commentary” on the GOP’s readiness that in 2014, a year the party swept the U.S. Senate races, it was outpaced by Ready for Hillary when it came to building an online network of supporters, Moffat said.

And email lists serve more than just a fundraising function. They are a springboard to recruiting volunteers, influencing persuadable voters and disseminating a candidate’s message unfiltered by the media.

“It’s going to be really important that you’re generating content and sending it directly to supporters rather than relying on the media to do it, because there are no huge microphones anymore,” said Luke Thompson, the NRSC’s analytics director in 2014.

Lira agreed. He listed amassing an email list, building a one-click donor system and authentic online engagement as the top three priorities for any potential 2016 candidate trying to lay the groundwork for a modern, digital-savvy campaign.

“Don’t use digital as a sort of transactional universe alone,” Lira said. “It needs to be a place for authentic grassroots engagement. Especially early primary states like Iowa, South Carolina, New Hampshire — these are states that really value authentic engagement, and it would be a mistake to see digital in those states especially as anything less than that.”

The email list is “as much about building a cadre of committed volunteers as it is about raising money,” Thompson said. “Small-dollar lists are about the money but also about a list of emails of people who you know you can go to, to ask them to do things, and they will do them.”

“And you learn a lot about what makes people respond.”

Elan Kriegel and Chris Wegryzn, principals at Blue Labs, a Democratic analytics firm, said building for 2016 now means using digital and data tools to start planning out how you will physically build your grassroots operation.

“You have the ability to gather up the data about where enthusiasm is, where are your volunteers, who are they, and then who are your likely supporters,” Wegryzn said, “and to use that to figure out where we should be putting our first field staff — when resources are tight — to maximize those early volunteers.”

“These things grow exponentially, so being able to move on that quickly turns into a potentially major differences in terms of the volume you can have later on,” he said.

Another seemingly small but important detail came up frequently in conversations with the digital experts: the need to make sure Republican candidates’ websites are set up with robust “remarketing code.” That means making sure that visitors to campaign or committee sites wind up being followed around the Internet by ads from the sites they just visited, via the process of assigning cookies to each user.

“You want to serve different ads to people who visit the economic section of your website versus the family-values section,” said one Republican digital specialist who asked not to be identified because he currently works for a large tech company that is not affiliated with either political party.

Strategists also warned that the campaigns should not wait to begin hiring their key digital and data personnel. There are things those sorts of staffers will need to start building now. The pool of talent is finite, and even early-stage campaigns need people who can do rapid response in the digital world to work with the communications team to control the candidate’s image.

And finally, everyone said, steer clear of “shiny objects.”

“The buzzy ‘shiny items’ discussions are increasingly leading campaigns and organizations to forget about the basics that every single proper digital operation needs to have running concurrently: remarketing, engaging social, small-dollar fundraising and search advertising to brand,” said Vincent Harris, who has overseen digital presidential primary campaigns for former Arkansas Gov. Mike Huckabee (in 2008) and Newt Gingrich and Rick Perry (in 2012). He is now working for Sen. Rand Paul (R-Ky).

What are a few of those shiny objects?

“Sentiment analysis tools that cost a ton of money. Facebook like metrics,” Harris said. “A lot of the tech is being sold in the ‘data world’ as helpful but is just an extra cost.”

Extra costs, of course, can be met with extra cash — cash raised by a robust online small-dollar fundraising operation.