There’s simply too much good stuff going on out there to spend time dithering about whether or when the economy will rebound, for boards to come to their senses … or whatever folks spend their time worrying about. Usually, things over which none of us has any control.

Agitator Readers are special and we sure don’t want them looking back on 2012 wishing “If I had only known” about this innovation or that innovation.

Equally, we have no desire to tout, hype or otherwise go overboard on the latest New, New Thing. Too much of that going around already.

Rather, our goal with the new Agitator Toolbox is to serve up innovations that have been tested and proven. And we’ll also focus on innovative approaches and processes that build on basic and sound fundraising and donor relationship practices.

Some of these tools, applications and case histories will come from our colleagues at DonorVoice, DonorTrends and TrueGivers. Others from serendipitous discoveries we make while attending conferences and reading mounds of research reports. Still others from alert readers. We hope you’ll share your discoveries with us.

Because a large number of Agitator Readers find themselves dealing with direct mail, our first entry for the Toolbox is about a proven tool designed to identify likely direct mail package winners and losers – without having to waste needless time and money on waiting for ink to dry and the postal service to deliver. It’s all explained by Kevin Schulman, the CEO of DonorVoice.

WARNING: You won’t find the Toolbox in your daily email feed; rather it’s a feature that will appear on the homepage of The Agitator’s website along with other features  we hope prove helpful. Features like our Jobs section … an Archive now Searchable by Categories … and some older favorites like Comments, a constantly updated listing of The Agitator Community, and our popular Blogroll.

We’ve added or rearranged others in response to requests and guidance provided by Agitator Readers in our recent survey.

We hope you’ll pass along any discoveries involving tools, applications and processes you think are innovative and helpful. Help us fill the Agitator Toolbox. Together we can explore a fundraising world that’s filled with opportunity.

Roger and Tom

P.S. A Webinar on the Direct Mail Pre-Test Tool will be held on Thursday, February 9 at 11:30 a.m. Eastern Time.  Registration is FREE, but attendance limited on a first come basis.  Sign up here.

And so I’m going to subject you to this ‘endorsement’ from fundraiser Ken Burnett, who champions donor relationship building more ardently than anyone.

Says Ken, in an article titled The real meaning of commitment … And why it matter more than anything for fundraisers:

“Roger and Kevin have treated donor relationship development to the rigorous assessment that its massive importance deserves. For this, they deserve our gratitude. Only a fool will ignore their findings (OK, I’m getting old. I haven’t got time to pussyfoot around on this issue any longer. Nothing costs our fine voluntary sector and all the good works it does more than fundraisers’ neglect of donor relationship development. I no longer care who I insult in getting that point across.)

Is this kind of thing likely to be of value for the serious fundraiser? You bet. It’s worth at least Roger and Kevin’s combined weight in precious metal. It’s not the first such effort of course and it won’t be the last. But it’s a sophisticated step forward and it does show, convincingly, why any fundraiser today would be simply certifiable to fail to understand and act upon these findings.”

Thanks Ken.

Tom

P.S. Here’s the Executive Summary of the DonorVoice Donor Commitment Study. For further info contact Kevin at KSchulman@thedonorvoice.com.

But how to do it?

My colleagues Roger Craver and Kevin Schulman (at DonorVoice) will give you their recommendations at a free DonorVoice/Agitator webinar on Tuesday September 20th, 10:30am – Noon eastern.

They’ve been digging deep into donor research we’ve conducted over the summer to empirically demonstrate the predictive power of what we call ‘Donor Commitment’ and how you can measure, track and build it.

They’ll show you the seven ‘drivers’ of Donor Commitment … the activities and actions you can take to increase Commitment.

Limited virtual seats are available for the free webinar. You can register here, but you better hurry.

Tom

We all know how to chuck out (more kindly, ‘dis-invest’ in) our most marginal donors, and we know how (or at least we have a plan) to cultivate those with demonstrated high value.

The more challenging group is what our DonorVoice colleague, Kevin Schulman, calls the ‘muddled middle’ — a mixed bag of conflicting signals and potential value.

Figuring out this group is where the hard work comes in. But it’s this group that’s probably the largest for most organizations. It’s the group where retention rates start to head south. And it’s the group where simple segmentation approaches aren’t adequate to the task of identifying where the hidden value might lie.

I mentioned yesterday that this is a nut that Roger, Kevin, and I have been working on cracking … and we’ve made some important progress we’ll be sharing next month.

But meantime, here’s a great article tackling the same subject by Convio’s Michael Rogers, blogging on Connection Cafe.

He talks about this middle group and the need to get beyond simple RFM segmentation. And he’s right on the money.

This isn’t an Agitator ‘product endorsement’, but it is a ‘mentality endorsement’. Fundraisers are going to need to think harder and harder about your ‘muddled middles’ if you want to protect and build the value of your house files.

Just another way your job is getting harder!

Tom

P.S. Thanks Cheryl

The truth is … many do, some don’t.

And of course the trick to optimizing your fundraising is knowing who does and who doesn’t.

While The Agitator preaches retention, retention, retention — i.e., building durable relationships — we also note that you shouldn’t (and can’t afford to) simply throw money against all your existing donors indiscriminately.

So how do you know who to target or invest the most against? Especially when it comes to your newest donors … without much of a giving history?

My colleagues at DonorTrends are refining a methodology to do precisely that … pre-identify and target the donors with the greatest likely commitment to your organization.

They’ve been doing the field and analytical work on this challenge over the summer, working with about twenty participating nonprofits. And they have some answers, tools and tactics.

They’ve targeted September, when fundraisers have reported back for action, to present their findings and insights via The Agitator, after collaborating groups get a thorough briefing.

Stay tuned.

Tom

Posing the possibility that donors don’t want more of a relationship with their charities … in fact, they want less. And if that’s right, says Donor-Central, then the traditional direct response model — acquire as cheaply as possible and then cultivate like hell — is breaking down.

They cite the steadily declining 5-year lifetime values of donors to an un-named “big nonprofit” to raise this point.

Let’s set aside for a moment the problems inherent in using the experience of any single organization as the basis of such theorizing. Starting with the possible ineptitude of that organization.

Assuming many organizations are seeing the same declining value pattern, what might be the non-idiosyncratic possibilities for it?

For one, steeply rising acquisition costs, which virtually every nonprofit is facing. That will certainly (and significantly) drive down the 5-year net for each successive cohort of donors.

A corollary: as groups strive to keep their acquisition numbers up, they push beyond their core market and capture more ‘less qualified’ donors who are intrinsically more casual … less committed. I’ll come back to this in a moment.

A second reason. Much reporting on the recession’s impact on giving has noted that the fall-off has occurred more in terms of average gift than loss of donors (although certainly both have occurred). That too will obviously drive down their multi-year value over the past three years. At the same time, this pattern also suggests that loyalty does indeed count. Donors give smaller gifts as opposed to abandoning ship.

A third reason is that donors are becoming more discriminating and harder to please. So each cohort will have a wider range of donors in terms of their commitment. But not knowing how to identify which of these donors might actually be more committed, groups throw money at all of them, wasting most of their resources on a larger number for whom the heart beats only faintly. When clearly there’s a Pareto principle at work, and the greatest value is buried in only 15-20% of those donors. It’s becoming far more important to be able to identify, early, those 15-20%.

That’s why the project Roger wrote about last week, now underway with our DonorVoice colleagues, is so important.

We think donor relationships remain very important, but that commitment levels vary widely … but also that commitment levels of donors can be pre-identified and investment in them optimized accordingly.

And we’re putting that theory to empirical test with more than 20 organizations who signed up with us for the experiment … our Retention Lab.

Roger last week wrote about how DonorVoice is going about this, and indicated our willingness to share the learnings with Agitator readers who wish to be kept abreast of the results. The ‘Lab’ work has already begun, so participation is closed. But you can still sign-up to get our analysis of the results. See Roger’s post for details.

In any event, theorizing aside, ours and Donor-Central’s, we’ll soon have very specific hard data on donor commitment, its value, and our ability to predict and act on it.

Tom

P.S. Thanks to at Future Fundraising Blog for pointing us to Donor-Central’s hypothesis.

With her usual style, grace and sense of humor Margaret Battistelli Gardner, the Editor-in-Chief of Fundraising Success helpfully added to the growing chorus of concern over donor commitment and donor relationship management.

Margaret correctly notes “That lazy, ineffectual approach of talking at donors is so over that we need a new word for how over it is.“ She goes on to add, “The word ‘donor’ itself even seems one-dimensional these days because it simply doesn’t speak to the depth of the relationships supporters are looking to build with their organizations of choice.”

She observes that ‘donor engagement’ is the au courant topic among fundraisers and that at the recent Bridge Conference in D.C.,  speakers offered “tons of tips on how to build better donor relationships.”

Therein lies a problem. And an opportunity. You see, tons of tips and conjecture, while well-meaning, aren’t going to get us very far in dealing with the horrendous problem of donor retention that continues in free fall mode.

Of course retention is but one side of the ‘acquisition/retention coin’ and just about everyone acknowledges the problem of getting and keeping donors has created a real and urgent financial imperative to find solutions.

In short, why aren’t donors who give you one donation not motivated to give you a second.

Tom and I have long believed the answer lies in ‘commitment’ – the motive or intent to maintain the recently formed relationship with your organization. After all, everyone knows a committed donor generally makes a higher average gift and certainly has a higher lifetime value than the Un-Committed Donor.

What we believe — but don’t yet know for sure — is that it is possible to score donors on commitment; to establish a math-based linkage that identifies a FINITE number of activities organizations undertake that truly impact donor commitment.

In late June we issued a call for volunteer organizations to participate in a benchmark study of commitment and what key engagement activities an organization should use to positively impact commitment.

Clearly we struck a nerve. More than 20 organizations, large, small and representing all sectors came forward and are participating in The Agitator/DonorVoice Retention Lab. The process is detailed here.

In addition, many Agitator readers requested that we keep them posted on the progress of the Retention Lab and the findings that spring from it. As of today here’s the plan:

• Our National Benchmark Survey — which we’ll use to validate the Commitment Model, produce (and publish) Donor Commitment Scores for 50 large charities, AND most importantly, to identify the activities any organization must undertake to impact Commitment and by extension, donor behavior — has just come out of the field and is being analyzed as I write;

• 21 organizations participating in the Lab have provided email addresses and the transaction history behind them so that specific engagement practices can be tied back to actual giving. These studies will be in the field in a week or so with analysis beginning immediately thereafter.

• As soon as we complete the analysis we will hold a series of briefings with participants and our panel of loyalty/engagement experts on the National Benchmark and privately review the results, findings and our evaluation with each participating organization. We anticipate these briefings will get underway the first week in September and conclude by the end of the month.

• Working with DonorVoice and a group of communications, loyalty and tech experts we’ve also designed two automated, online engagement tools to help organizations quickly and inexpensively start getting more engagement and greater commitment from their website and Facebook visitors.

• We anticipate being able to share some early findings with you, other Agitator readers and the nonprofit community by mid-September.

Meanwhile, if you’d like to be kept updated on the progress of the Retention Project and Lab just shoot a quick email to Kevin Schulman, project lead and CEO of DonorVoice, and we’ll keep you posted.

Roger

An inquisitive but tiny handful of pioneers have done so. Folks who care enough about the future of fundraising to jump in. Here’s the list after two days. Hooraay!!!

• The Humane Society of the United States
• The International Rescue Committee
• The Feminist Majority
• ActionAid in the UK
• Common Cause
• Long Center for the Performing Arts (Austin)
• Mothers Against Drunk Driving
• Juvenile Diabetes Research Foundation
• PennFuture
• Metro United Way (Louisville)
• St. Joseph’s Indian School

To them we say, get ready to roll!

However, they represent an insignificant fraction of Agitator readers, suggesting that most of you could care less about donor retention. Or are simply dumbfounded! Responses included: “We’ll have to get back to you once the higher ups approve” … “What are the privacy issues?” … dah, dah, dah, dah. Paralysis.

Are we wrong?

Even more telling are the responses from the consultants, who had more excuses for not wanting their clients to participate than we have shirts. Too much work they say; or they’re not getting paid to figure this one out. “We have to vet this with our client.” … “What if…?” … “What if…?”

However, most of the consultants and agencies who subscribe to The Agitator didn’t respond at all. Their deafening silence is most puzzling. These are supposed to be the fundraising Sherpas. Alas, mostly lost in the snow.

Kudos then to Frey Associates, SCA, PEP Direct and MINDSETdirect who are bringing some clients to the project.

Folks, Rome is burning. We see the crippling retention problem clearly and regularly in the indexes and reports that cross our desk.

But it seems most folks, be they consultants or fundraising managers, don’t see any problem, or could care less, or are simply too perplexed about their historically low retention numbers. Amazing!

In our astonishment, we reached out directly to a number of nonprofit CEOs with the same invitation. Their answers were immediate: “Yes, count me in.” “Let’s go.” From the CEOs, 100% response and 100% agreement to participate.

What strikes and concerns Tom and me is how slow moving and bureaucratic the nonprofit world has become. Maybe too many fundraisers simply rank too low on the organizational totem pole to make a difference, even as donor retention falls through the floor.

Maybe we should have recognized all along that the buck stops at the top … it’s the CEOs and Executive Directors who are on the firing line when more and more donors defect and their support disappears. Boards can begrudgingly accept stalled growth (external factors and all that); but they have a real problem with losing their base.

Given our recent experience, the CEOs and EDs ‘get it’ and feel a need to respond, even as their fundraisers are in denial or paralyzed.

Are falling retention rates on your CEO’s radar? If not, get it there! Then get him or her to give me a call.

Roger

Roger and I think this is hugely important. Because from previous reader surveys and the hard data trend reports from Target Analysis, we know most organizations’ retention rates suck, with tremendous loss of revenue. So in case you missed our invitation — we know long summer weekends are lulling many of our readers — we want to re-extend it.

We simply can’t believe that any fundraiser worth their salt would knowingly pass up a free opportunity to discover a way to slay the beast of donor defection!

So today only, we’ll give you the benefit of the doubt … you must have simply overlooked our invite!

Tom

Says Facebook: “This Page is a resource for non-profits and other organizations for social good. We built it to help you harness the power of Facebook and bring positive change to the world. Facebook empowers non-profits by enabling them to mobilize communities, organize events, increase fundraising, reduce costs with free online tools, and raise awareness through viral networks.”

All the help you need for creating pages, adding ads and apps, promoting events, creating groups, adding social plug-ins to your website, and more. Plus success stories.

As I was looking through the section, 419,396 people had already liked it. That’s a bit fewer than read The Agitator, so I know at least some of you haven’t checked out this resource yet

Facebook reports that over 30,000 nonprofits use Facebook Pages and through the application Causes more than $5M has been raised since 2006 benefiting over 150,000 different causes.

Tom

P.S. Don’t forget Roger’s free webinar on Mobile Fundraising & Engagement today, May 19, 1pm eastern. You can still register for his session, with DonorTrends colleague Kevin Schulman. It’s titled “Calling on Mobile” and is part of  the Fundraising Success Virtual Conference and Expo.