All posts by Moira Kavanagh

9

Jan

When Great Board Members Have Not-So-Great Fundraising Ideas


Board members are integral to nonprofits. Legally, of course, but more importantly, because of the incredible role they play in enabling nonprofits to run well and make an impact. They bring expertise, ideas, connections, funding and so much more to the organizations they serve. They are awesome.

But sometimes, between you and me, they have less-than-stellar fundraising ideas. They get direct mail and email, they’re on Facebook, they text, and so they think they understand direct response and online fundraising. The problem is, being a consumer of media doesn’t make one an expert in its implementation. It’s that false “oh, I could do that!” instinct that we’re all guilty of at times. But you know that just because you watch TV, it doesn’t mean you can write and produce CSI. (That episode idea you have is really excellent though.)

So how do you handle well-intentioned but not-so-hot fundraising ideas from your Board or Development Committee? With care and consideration for sure. But also with the power of data and a vast body of testing to validate why you might respectfully disagree and suggest a different direction. To help you respond to those occasional iffy ideas, here are the five most common ones you might encounter, and the facts and best practices to help inform your fundraising decisions:

1: “I don’t read long letters, so our fundraising letters should be short.” Boards are filled with busy business people who want you to get to the point quickly. It seems unfathomable to them that donors would actually read a 4 or 6 page letter. And they’re right because most donors don’t read your letters word-for-word. But it’s not about whether donors read your letters – it’s about whether they respond to them. And in head-to-head testing, longer letters almost always perform better than shorter ones.

2. “Our donors get too much email/mail from us and are starting to tune us out. If we send less, they’ll be more welcoming of our communications and will give more.” You are sending too much email and mail … to some of your donors. And you’re not sending enough to others. But sending less to everyone will almost surely mean raising less money overall and losing more donors to attrition because one size does not fit all in direct response fundraising. What you should really focus on is identifying the donors who are most likely to give or take action and communicating with them more, and in more targeted ways.

3. “Our major gifts program raises so much more than our membership program. We should shut down our membership program and just focus on major gifts.” Compared to major gifts, general membership programs often appear to take an inordinate amount of resources relative to the return. But that’s only if you evaluate membership in a vacuum, which you shouldn’t. A properly structured membership program is a vehicle for public education, a source of unrestricted revenue, and a lead-generator for your major gifts program. Your evaluation metrics for your membership program should always include the number of major donors who started out in the membership program, as well as their subsequent giving in the major gifts program. After all, you wouldn’t have them in the first place if you didn’t have a membership program. And if you find that your membership program isn’t yielding many major donors, then you’re probably missing important opportunities to cultivate and upgrade members and need to do more to optimize your membership program for major donor conversion.

4. “We need to do something ‘different.’” There’s good different and bad different in direct response fundraising. Good different is

… applying a known direct response principle or technique
… in an inventive way to your fundraising communications
… and testing it.

Bad different, on the other hand, is invention without basis, and not testing. Make sure any new ideas you try fall under the “good different” definition. And always, always, test especially if circumstances require you to test an idea that verges on “bad” different. Nothing clarifies strategy like hard testing data.

5. “Direct mail is so expensive and everyone gives online anyway. We should eliminate our direct mail program and fundraise online only.” According to Convio’s 2011 Online Marketing Nonprofit Benchmark Index™ Study, online giving is indeed the fastest growing fundraising channel for nonprofits. Direct mail still comprises the majority of giving however. Of the nonprofits included in Target Analytics’ 2011 donorCentrics™ Internet and Multichannel Giving Benchmarking Report, direct mail comprised 79% of giving and online just 10%. But it’s not a matter of choosing direct mail over online or vice versa. The report also affirms the complementary role that the channels play in acquiring, retaining and upgrading donors.

So, when you are occasionally presented with a questionable direct response idea, take advantage of the wealth of testing data and information that the industry has to offer. Then use it as a springboard for a good conversation with your Board or Development Committee about direct response strategy and how you can make your program even more successful.

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31

Oct

Charitable Deduction Limits: Limiting Only to Nonprofits?


As part of the larger debate on Capitol Hill about jobs, deficit reduction and increasing taxes on the wealthiest Americans, the Senate Finance Committee and the Joint Select Committee on Deficit Reduction (aka the Supercommittee) are considering proposals that would increase tax revenues by limiting the deductibility of charitable donations.

But over 2,000 nonprofits agree that the only thing this will limit is their ability to provide services to people in need.

As United Way Worldwide CEO Brian Gallagher recently testified before the Senate Finance Committee, although tax incentives may not determine if people donate, they are a factor in how much they give. In his testimony, Gallagher cited recent studies that claim a cap on the charitable deduction would reduce giving by $5.6 billion per year. For the United Way, a 2.5% drop in revenue would translate to 1.3 million fewer times it could provide job training, home care for the elderly, supportive housing, or mentors for at-risk students.

To date, twenty-five national nonprofits and over 2,000 regional and local nonprofits have signed an open letter organized by the National Council on Nonprofits urging policymakers to preserve the charitable giving incentive. Read the letter for yourself, view a list of participants including American Red Cross, Easter Seals, the Association of Fundraising Professionals, and Habitat for Humanity International, and sign on if you agree with them … quickly though. The deadline to sign the letter is close of business Thursday, November 3.

You can also speak out via the DMA Nonprofit Federation‘s action center, where you can send a letter to your own Senators or Representatives.

What do you think of the proposed charitable deduction limits? Would your nonprofit be affected?

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13

Sep

Now More Than Ever


It’s a pity “now more than ever” is one of the most abused phrases in fundraising. Because it actually applies now. More than ever.

But I’m not talking about the need for philanthropy at a time when 14 million Americans being unemployed is just the tip of the iceberg.

I’m talking about our approach to fundraising and advocacy.

Yes, giving is down and the need is up. Obviously, now more than ever our nonprofits need contributions to fund our missions.

But if you really want to make something happen, the first “now more than ever” your nonprofit should be thinking about shouldn’t be your donors’ call to action.

It should be your own.

What is your nonprofit doing – now more than ever – to earn your donors’ involvement and trust? Emotional support is the precursor to financial support, and it’s more valuable.

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10

Aug

11 Strategies For Extraordinary Fundraising in ‘11


Nonprofits have been soldiering through shaky fundraising territory for the past several years. With the addition of “fear index” and “double dip” to the mainstream economic crisis vocabulary in the past few days, we can probably expect those challenges to stay around for a while and maybe even intensify.

So what do we do?

First, recognize that a lousy economy calls on nonprofits to be more than merely competent; a lousy economy challenges nonprofits to be extraordinary.

And second, as you roll up your sleeves on your extremely important fall fundraising campaigns against an uncertain economic backdrop, do the one thing you can: Don’t settle for 10. Turn it up to 11.

To get you started, here are 11 ways your nonprofit can turn up your fundraising from great to extraordinary in 2011:

1. Write letters, not direct mail. It’s surprisingly easy to forget that direct mail is really just a letter from one person to another. Often, the best direct mail fundraising doesn’t look or feel like direct mail at all – like a closed face envelope with an un-designed return address and an actual postage stamp. Or a letter that begins “Dear Evelyn,” not “Dear Friend.” Or a message that is driven by substance, not appearance.

2. Write emails, not eblasts. A “blast” is like dropping flyers out of an airplane – not particularly targeted, respectful or effective. When was the last time you heard someone say, “Wow, that mass email advertisement I received really made me feel special and inspired me?” It’s easy to hide behind your email marketing tools and fundraising templates. Remember that a fundraising email you send to your donors and constituents should be just as relevant, personal and carefully considered as an email that you might send from your own computer to someone you know personally. In fact, why not send your next fundraising email in plain text from your Executive Director’s actual Outlook account?

3. Give your constituents options for involvement. It’s important to recognize, create and value ways people can get involved in advancing your organization’s mission. A person may care about your issues and want to take action, but not be able to contribute financially right now. Don’t exclude them. There are plenty of ways they can help – you just need to offer them. And when an involved constituent is ready and able to give financially, you better believe that they’re going to give to the nonprofit that gave them a place at the table when they didn’t have two nickels to rub together.

4. Give your donors options for giving. A commonly used direct response ask array is 100%, 150%, or 200% of the donor’s highest or last gift amount. It’s a good upgrade-oriented ask strategy, but if not targeted appropriately, it can also be brutishly response-suppressing. Target your ask strategies by donor segment (such as current, lapsed, multi, single), and develop your ask around what you want to have happen for each particular donor segment. For instance if you are communicating with active donors who have given multiple times, then the upgrade-oriented ask array would be appropriate. However, if you are communicating with deeply lapsed donors, your immediate goal should be reinstatement, not an upgrade, in which case you may want to offer downgrade options to lower barriers to participation. And for donors who just can’t make single gifts at previous levels, now is a time to consider offering installment options.

5. Focus like a laser on donor retention. An organization’s donors are its most valuable asset. At a time when it’s more difficult to acquire new donors, and existing donors are most likely to lapse, it’s critical to retain the donors your organization has. Because the single most significant driver of donor retention is solicitation frequency, start by examining the frequency and quality of your organization’s donor solicitations and communications. If you’re only communicating / soliciting a couple of times a year, your organization is unquestionably leaking donors. Pick up the quality and frequency of your communications to help guard against attrition.

6. Start a monthly giving program. Monthly giving programs are powerful tools for retention and upgrading. Let’s say your average active donor gives $60 a year. When they join your monthly giving program with a $10 per month pledge, they double their annual giving. And because their pledge is processed via credit card, they can remain active donors and valuable partners in your mission almost indefinitely. Monthly giving programs are a lot of work to set up and manage, and monthly donors require special stewardship – but it’s nothing your “11” nonprofit can’t handle.

7. Be brave. Are you making the same formulaic argument for support season after season? Now is not the time to blend safely into the crowd. Put yourself out there. Challenge yourself creatively and inject some standout passion, color and personality into your communications.

8. Connect, for real. Development and membership people are trained to make the case for support, to explain. But explaining to donors what your nonprofit does, why it’s important, and what you achieve can quickly turn into a one-way conversation. Instead of building your case for support around what you need from your donors, build it around your donors’ needs. Once you begin to look at your issues through your donors’ eyes you can create a foundation for genuine two-way conversation and connection. This in turn will help you build deeper more lasting relationships with your donors.

9. Get serious about multichannel and integration by getting the help you need. The statistics speak for themselves. Online giving is the fastest growing channel. (To learn more, read Convio‘s Online Marketing Nonprofit Benchmark Index Study.) The mobile web is predicted to be bigger than desktop internet use by 2015. According to analysis from Blackbaud, nonprofits that add social media communications to their constituent communications mix experience increased fundraising results. And so the advice that nonprofits hear over and over is this: if you’re not where your donors, and future donors, are then you may find yourself wondering where they all went a few years from now. But it’s not actually very helpful advice, because nonprofits already know this. The obstacle isn’t buy-in to multichannel; it’s lack of technical resources and mountains of logistical hurdles created by outdated databases and websites designed in 1997. If you have problems like getting interactive content on your website, designing, targeting and sending emails with your current system and resources, or maintaining a meaningful social media presence, then you need to solve them. A great place to begin is by joining NTEN (the Nonprofit Technology Network) which can help connect you with resources to take your nonprofit’s tech to the next level as well as a community of people who eat, sleep, and breathe this stuff – and are generous about sharing what they know.

10. Acknowledge donor anniversaries. We celebrate wedding anniversaries to affirm relationships. We celebrate birthdays to say “we’re glad you’re here.” Why not celebrate donor anniversaries – the anniversary of your donor’s first investment in your organization’s work – to send the same message? Donor anniversaries are a great opportunity to strengthen donor relationships, raise additional funds for your organization, and strengthen donor retention.

11. Think hugs not shrugs. It’s great if you were already a 10 on your donor stewardship. But in this economy you can’t give up – you’ve got to turn up the love to 11. Be positive. Share your gratitude. Say thank you in special ways. It doesn’t cost much if anything, but the rewards are great. Kudos to one near and dear organization who will, literally, be giving hugs (not mandatory!) to each and every contributor to their annual fund this year. That’s what I call 11 thinking.

At the end of the day, we can’t control extraordinary economic events, but we can be extraordinary. How is your organization turning it up to 11?

Thanks for reading and connecting!

P.S. Just for fun, identify the photo reference with this post correctly and then tell us your favorite nonprofit (and why, if you’d like) in the comments section. If you’re the first, The Nth Factor will be very happy to make a contribution to the nonprofit you name.

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5

Aug

Summer Reading Recommendation: The Art & Science of Multichannel Fundraising


If you ever find yourself scratching your head about which tools to use for your fundraising efforts – or how to fit multiple channels together – you might want to pick up The Art & Science of Multichannel Fundraising this summer.

Eliza and I wrote one of the chapters in this new book from Direct Marketing IQ, and it contains eight more from multichannel fundraising thinkers and doers like Roger Craver of The Agitator, Jo Sullivan, Joe Boland of Fundraising Success magazine, and others. It also contains a bunch of robust case studies that illustrate cutting-edge applications of best practices in multichannel fundraising.

While the perspectives, case studies and channels discussed are refreshingly diverse, a few universal principles of multichannel fundraising come through loud and clear in the book. Most notably, whether it’s direct mail, email, telemarketing, mobile, social media, or all of the above, the new terrain of multichannel fundraising is guided by the same old-school basics of good marketing.

Happy reading, and happy Friday!

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25

Jul

Best of Bridge 2011


The sixth annual Bridge Conference on integrated marketing and fundraising for nonprofits ended Friday, but the great content will stay with us long after.

Here are just a few words of wisdom from sessions I was lucky enough to attend at this year’s conference:

“I’ve never regretted taking the high road.” – Jocelyn Harmon, Care2 (on online etiquette). Good advice offline too.

“Write stronger; someone is going to weaken it.”– Barry Cox

“Blogging without responding to comments isn’t community building; it’s broadcasting.” – Sarah Durham, Big Duck

“Remember: monthly donors are future planned giving donors.” – Steve Kehrli, PETA

“50% of donors who have had a bad experience with a nonprofit don’t complain to the nonprofit … the problem is, they complain to others.”– Katya Andresen, Network for Good

“The message that matters most isn’t what your nonprofit is doing; it’s why it’s doing it.” – Barry Cox

Great stuff – but a woefully incomplete list! What were your favorite comments and advice from the conference? Post them here or email topics@nthfactor.com directly, and we’ll compile a complete “Best of Bridge” comments list. Looking forward to connecting!

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18

Jul

Is the Annual Report Dead?


It’s no secret that our organizations’ donors have been moving and shaking in the last decade. Not a week goes by it seems without a new report on the magnitude of their migration online, social, and mobile.

One of the most exciting developments in donor communications as a result of all this has been a renewed focus on something that’s not new at all: the idea that fundraising isn’t about our nonprofit’s interests; it’s about our donors’ interests. Or to put it another way, being all “me, me, me” doesn’t cut it in a relationship.

What’s different, however, is how our uber-connectedness today has held our feet to the fire on this point at a totally new level:

What we say about ourselves is becoming less important than what our donors say about us, what they think about us, and what we say with our donors.

Where we used to have no choice but to talk at our donors, at least on a large scale, now we can talk with them (and are expected to), and they talk about us with each other.

The great news is, we know this. While we may not have realized our full potential yet, nonprofits are building vibrant communities and fostering connections on Facebook and Twitter. We are getting interactive on our websites, blogs, and in our emails, inviting our donors to share and take action. We’re even taking the conversation on the go, exploring exciting possibilities in our nascent mobile communications programs.

It’s a “let’s talk about you” world that has turned our donor communications strategy on its ear. And as our social media intern, Facebook page, blog, and mobile program say: We got that memo! We are down with all this!

But did we? Are we?

Because – curious thing – many of our organizations are still pushing out the ultimate “me me me” document, year after year.

The annual report.

For decades it’s been a mainstay of the development officer’s toolbox and a vital instrument of nonprofit accountability. It’s an important document that says a nonprofit recognizes its responsibility to its donors as investors in the organization’s approach to fulfilling its mission.

But at the same time, even with the long donor lists as the end, more often than not it also says “but enough about you, let’s talk about me.”

Is that so wrong? Until recently, no. Truth is, there are a lot of nonprofits that could do far worse than monopolize a conversation with powerful stories of their beneficiaries, interesting details about their issues and work to enact change, and their plain all-around awesomeness.

But our donors’ expectations and preferences are changing. (Apparently their brains are changing too.) And so as good communicators, we need to ask the unthinkable.

Is the annual report dead?

As we know it – words on paper, content on PDF, 2D, monologue – maybe it is. But, at least in fundraising, I believe in reincarnation. The things that are good and essential in fundraising never die; they just take different forms over time.

And so perhaps the question we should be asking isn’t whether the annual report has left the building. Maybe it’s this: are we going to greet our donors at the door with a new kind of annual report that’s in step with the way they’re thinking and behaving? Or are we going to catch up to them later – and are we willing to risk being too late?

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29

Jun

Direct Response #*¢!ups – Let’s Hear Yours!


One of the best national conferences on integrated direct response fundraising is right around the corner. If you haven’t yet registered for the Bridge Conference, taking place July 21-22 in Washington DC, I hope you will. It’s chock-full of valuable sessions representing best practices and breakthroughs in multichannel direct marketing. And with early bird rates in effect through July 5, it’s also respectful of nonprofit budget realities.

But I hope you’ll attend for another reason too: I could use your help!

Along with Dolores McDonagh of the National Trust for Historic Preservation, Evan Parker of The Nature Conservancy and Bonnie Catena of Amnesty International, I’ll be conducting a session that’s, well, a little different. Instead of sharing tips and case studies in how to do multichannel fundraising right, we’re going to be talking about how to recover – and even thrive – when you accidentally do it wrong.

Between the four of us, we have collected some amazing case studies in turning direct response snafus into successes. But we know there are more out there that we can all learn from … it’s just a matter of getting folks talking.

That’s where you come in. Have you found a way to make lemonade out of a direct response lemon? Then post your story here, or email it to topics@nthfactor.com. If we can use your story in our presentation, we’ll credit you of course at the conference and here on The Nth Factor. And you, in turn, will enjoy the satisfaction of helping your peers and colleagues become better fundraisers by learning how to navigate the inevitable bumps on the road to fundraising success.

So send in your stories. And if you’re at Bridge, stop by our session – Direct Response #*¢!ups: A Survival Guide – and say hello. I hope to see you there!

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16

Jun

Smart Marketing vs. Chasing Windmills


 

“What if we just got 100,000 people to each give us a couple of bucks?”

“One percent response in new donor prospecting is terrible! We should accept nothing less than 99%.”

“Our donors are too old. We need to get younger donors.”

“What we really need to do is focus on major donor acquisition. (Who here knows Mark Zuckerberg?)”

If you work at the foundation of the donor pyramid (aka direct response fundraising), you’ve probably heard all this before. From a client, a Development Committee member, a boss.

They’re all saying the same thing:

We’re different from everyone else.

It’s a powerful thought. Nonprofits are like snowflakes. And if you’re too cynical to believe anything less of your own organization, then you’re likely to fail or, worse, be mediocre.

But even snowflakes are subject to the forces of gravity.

Will you ever achieve a 99% direct mail response rate? No. Will you ever have a donor file made up of 20 year olds? Probably not. (And are you sure you’d want that anyway?) Will Mark Zuckerberg ever become a major donor to your organization? I wouldn’t count on it.

But recognizing the realities of direct response fundraising doesn’t mean being a quitter. It means being a smart marketer. Good marketing is not about chasing the elusive majority who say no; it’s about what you build with the minority who say yes.

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12

May

What Personality Type is Your Nonprofit?


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Like people, nonprofits have personalities. They’re complex amalgams of an organization’s history, mission and leadership. People rarely have any idea how they come across to the rest of the world, and nonprofits are often the same. And yet, as with people, how your nonprofit comes across to the rest of the world plays a huge role in whether and to what extent you achieve your goals.

So, have you ever stopped to consider what your nonprofit’s personality is? Not what you think it is. And not what the small group of people who nurtured you and love you unconditionally think it is (e.g. your mom, or your organization’s founder).

No, I’m talking about how everyday acquaintances, friends, and new people you meet see you. If you haven’t yet considered your own nonprofit’s personality type, you should. And don’t cut yourself any slack …

… Are you a Pessimist or Optimist?

… Are you a Talker or Listener?

… Are you a Sad Sack or Got-it-Together type?

… Are you a Holiday Carder or Year-Round Friend?

… Are you an Air Kisser or Hugger?

… Are you a “Me-Me-Me” Bore or a “You-You-You” Friend?

Obviously, your organization is way too complex for labels. But is it realistic enough to know that it is being labeled constantly by donors and prospects nevertheless? And is it self-aware enough to know what those labels may be?

Just like it is with people, changing how you look on the outside usually begins with a good long look on the inside.

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