Frankly, I’m exhausted from preparing this, but I really hope you’ll invest the  time to read the whole post. Believe me, it’s worth it if you care about the future of your organization.

Here’s why.

Blackbaud has just delivered a “must read” report on Growing Philanthropy in the U.S. Read and heed.

The report, a view of the future we all face, is a distillation of a ‘brainiacs’ session hosted by Blackbaud and moderated and summarized by Adrian Sargeant. They’ve addressed the fact that giving is flat and what to do about it.

You really have to read the whole thing, written by Adrian, a bright light in our universe. But, for the slothful who won’t take the time to read it all, here are the key takeaways:

• Redefine Relationships. Stop being selfish. Focus on giving for giving’s sake.

• Re-orient toward longer term measures of fundraising performance. Immediate measure of ‘success’ (response rates, immediate ROI, giving totals for the year) doom us. Look at long-term values.
  

• Enhance focus on retention and building supporter loyalty.  Listen up! With retention rates in the dumper too few nonprofits really understand that a 10% improvement in retention results in a 200% improvement in lifetime value.  Time to get real.

• Develop a more integrated approach to fundraising. It’s not the method, Stupid, it’s  the message. And the message must focus on the donor’s concerns, not yours.

• Break down organizational silos and encourage greater collaboration between teams. The authors are too kind to say it, but you should be ashamed of your territoriality.

• Give supporters greater control over the relationship. Ken Burnett, The Agitator, DonorVoice and scores more have been preaching this for years. This is the arena where you can quickly add the most value.

• Promote the development of shared back office facilities. Small organizations need to stop whining and get together and share in the development of good stuff in the back room.

• Tackle high turnover rates in the fundraising profession. Face it. It’s not the pay it’s the lack of respect from CEOs and board members that drives folks out of this trade. We have an identity crisis and have to deal with it.

• Educate all stakeholders about the necessity of a longer term and integrated approach. I know, I know, it’s like playing Mozart to a cow, but we have to do it. It’s a real challenge, but we must not allow Boards to be stupid about fundraising, stewardship and philanthropy.

• Empower the regulators to enforce 100 percent filing of Forms 990 to increase their utility. Hey, I know this seems picky, but the fact is that some organizations don’t file, some lie, some don’t.  Transparency is key to the future of philanthropy. Get with it.

• Blow the whistle on organizations claiming to have zero costs of fundraising. As long as watchdog organizations reward ‘zero’ costs, organizations will lie. It’s time to call out the phonies in the watchdog groups and blast the nonprofits that play this game. There simply ain’t no thing as ‘zero’ fundraising costs.

• Fund the development of a website in the U.S. to educate the public, boards, and other stakeholders. Philanthropy is a big business, a significant part of our GNP. Let’s make it as transparent as possible.

• Encourage nonprofits to develop complaints schemes. Anyone who knows anything about donor retention and commitment is familiar with the importance of feedback. (See http://thedonorvoice.com)  This report reminds us of the absolute necessity to provide multiple methods for donor feedback.

• Develop new and more appropriate measures of performance.  Efficiency and cost of fundraising sucks as a measurement of anything.  There are far more appropriate measures.

• Develop the self-regulation of fundraising. Ethics be damned.  There’s a whole host of scum bags out there. But, we can do something about them.

• Encourage the adoption of monthly giving. No shit! Serious Monthly Giving or Sustainer programs produce 600% – 800% more revenue. Get to it. Now!

• Improve the sector’s engagement with young people. This is a loser, from a fundraiser’s perspective. But the report does have some good suggestions. Check ‘em out.

• Encourage and promote best practices in social media.  Importance of social media isn’t $, it goes to building loyalty and commitment.

• Encourage asset-based giving. The Report claims that 93% of a person’s giving potential is realized with a bequest or other planned gift.  Get  at it!

• Develop expertise in broadening participation in giving. Pretty weak tea. Don’t spend much time on this unless you need a kumbaya moment.

• Improve the quality of bequest fundraising practice. Death is our friend. But, with at least 8% of our donors willing to make a bequest, this just has to be taken out of the incompetent (marketing-wise) hands of planned giving officers and placed in the hands of those capable of selling.

• Challenge the wealthy to plan their own philanthropy. Stop bitching. The rich are rich and they’re gonna do pretty much what they want. This section of the report seems to think that enlightened advisors to the rich will help. Not!

• Create a nonprofit mutual fund. Nothing new here given the prevalence of donor advised funds at virtually every fund manager like Fidelity or Vanguard. Not sure what new is recommended. Fuzzy at best.

• Leveraging companies to promote philanthropy. Not sure that this adds much to the body of knowledge re employer matching, cause related marketing, etc, but well to keep in mind for that afternoon you have nothing better to think about.

• Invest in fundraising research institute. Seems  a bit self-serving to me, but because we’re also in the donor research biz. I guess it can’t hurt.

• Redesign the system of professional development and certification for fundraisers. Important stuff here. Knowledge and understanding of donor behavior is key for the future, not the number of AFP merit badges.

• Encourage the development of academic qualifications in fundraising. Jesus! They want to put in a curriculum for fundraising. I couldn’t disagree more, but you may have other ideas. I would simply settle for the fact that more than 50% of all fundraisers understood math or even simple arithmetic..

• Appoint a “sales force’ for the fundraising body of knowledge.  Ignorance is bliss (as is the case for too many CEOs and fundraisers), but this recommendation to gather best practices and the knowledge within the trade is spot on.

• Call out institutions offering certificates purporting to be qualifications. “Hey Mom, I’m  now a certified fundraiser.” An interesting discussion on stopping faux degree or course offerings by some colleges and universities.

• Educate board members about the intricacies of fundraising.  Among all the barriers to successful fundraising and philanthropy, the ‘board’ is the mightiest barrier and pain in the ass. This report rightly targets the boards for education and improvement.

Thanks for reading all this.  And it’s just the summary. Do yourself, you CEO and Board, a big favor and download (and read) the full report.

Roger

P.S. By the way, Adrian Sargeant and Blackbaud, you both deserve a raise.

Ontario Nature — bridging the ‘hard’ and ‘soft’ sides of legacy giving

WWF — innovative communications

University of Oxford — excellent legacy brochure

Heaps of great advice from Mal Warwick.

And look here for a report on the International Legacy Survey conducted by Give Green Canada and CharityVillage.

Thanks SOFII!

Tom

But he recently wrote this article — Donors Love 60:40 — with  which I beg to differ.

Fraser argues that donors care primarily about what you do (i.e., the need you are addressing), and very little about how you do it (which he treats a sort of institutional ‘inside baseball’). These words crystallize his point:

“When I was a young fundraiser, I learned an expression that has stayed with me to this day. It remains my most important piece of philanthropic wisdom. It goes like this: “the institution has no needs”.

That’s right. Your charity has no needs. The people or trees or animals you help have great needs. Your charity is simply the organizational vehicle that gets the donor’s gift to those in need. It’s a three link chain. The donor. Your organization. The need. In this chain, your organization is very small – while the donor and the need are very big.”

He then makes this recommendation:

“Everything you write or say to your donors should follow the 60:40 rule.Sixty per cent of what you say should be about the cause. Forty per cent of what you say should be about your organization.”

Now, I accept the main thrust here. Yes, the need is uppermost in your donor’s mind. Jeff Brooks blogging in Future Fundraising Now reminds us of that in virtually every post. Got it.

But consider two further points.

First, donors are becoming far more performance-oriented. They are scrutinizing organizations much more closely on your results … and your strategies and effectiveness for achieving those results (see BayBuzz post, Fundraising Perfection). In other words, many donors do want to know how your nonprofit will meet the need they’re concerned about better than your competitor, who’s also knocking on their door. Talking about ‘how’ need not be mind-numbingly ‘institutional’; that’s merely a wordsmithing issue.

Second, I submit that for two specific types of donors, the ‘institution’ is awfully damn important — donors making bequests and donors committing to sustainer programs (i.e., monthly gifts). In both of those cases, the donor has moved beyond an immediate response triggered by perceived need, and has moved on to make an assessment about the recipient organization. They’ve decided that that specific organization is the one they trust to get the job done … even after their death in the case of a bequest. They know the need will persist; the question is … will you?!

That’s an institutional commitment. And if you’re going to try to raise that kind of money — money from genuine loyalists — you had better make sure your prospect knows why/how your nonprofit is the better bet.

That said, maybe this is a timing issue. In which case, I’d still disagree with Fraser’s 60:40 rule.

Perhaps to win that first gift, it’s all about need. In which case 90:10 (cause:organization) might be more appropriate than 60:40. But as the cultivation process moves along, make no mistake, your prospective donor begins to evaluate your organization. And your communications ‘ratio’ will need to shift to address their further questions about your effectiveness.

Other thoughts? Weigh in!

Tom

Here’s the story of a donor (Gail) whose loyalty I find truly remarkable, under the circumstances …

• She’s been giving to several groups continuously for thirty years, generally in the $25-$50 range, and generally unrestricted.
• None of the groups has ever acknowledged her cumulative giving.
• Thirty years older and gainfully employed throughout, she sees herself as a viable planned giving prospect.
• She lives in a major metro area where there are probably many donors to the organizations she supports, making face-to-face events probably feasible.
• Two of the groups have about one million active ‘members’ each — that is, these are not organizations that are starved for resources or ‘professional’ fundraising staff.
• Nevertheless, when she called these two groups to find out why they ignored her, their excuses included … limited staff resources, incomplete gift records, no focus to date on ‘donor relationships’.

Gail, your patience and loyalty to these groups is astounding. Clearly, you are much too nice a donor.

I implore you to reveal these groups to me and Roger, so that The Agitator can officially fire them — the fundraising staff, the CEO, the Board … the whole lot of them!

Tom

1. The important giving potential of mid-level donors is explored here, with Kristin McCurry of MINDset Direct as our guest expert. These are the donors who tend to get lost between your direct response and major gifts programs.

2. Roger discusses planned giving with Phyllis Freedman of Smart Giving here. They cover overall strategy, segmentation, donor stewardship, and measuring success.

3. Feeling the heat from your nonprofit competitors? Roger discusses ‘Mission Competition’ here with David Lawson of DonorTrends. Learn how to determine your nonprofit’s ‘Giving Share’ and how to use that intelligence to inform your fundraising strategy.

4. And finally, catch-up on the world of mobile fundraising and engagement with Roger and Stephen King of Direct Intelligence here. And while you’re at it, take a look at our Agitator Mobile app.

Each webinar is one hour in length, with slides.

Check them out.

Tom & Roger

This headline, given to a speech by a Facebook exec at the recent International Fundraising Congress, has created a minor stir around the fundraising blogging world.

Here’s the analysis of blogger and fundraiser Bryan Miller at Giving in a Digital World, who attended the session. He points out that the exec, Canadian Elmer Sotto, was making a far less sensational point — Sotto was merely noting that Facebook was better at relationship building and donor stewardship than direct fundraising. He said that direct mail and email fundraising were the better tools for actually asking for money from established donors. Most of us wouldn’t dispute Sotto on that. Read more on Sotto’s presentation here.

That said, Miller’s article give several illustrations of successful Facebook fundraising campaigns that you might want to look at.

Tom

P.S. Heads up for next Monday — The Agitator’s own Roger Craver and Phyllis Freedman, veteran fundraiser at SmartGiving and formerly Epsilon, are hosting a DonorTrends webinar on ‘Build a Successful Planned Giving Program’ on Monday November 1 at 2:00 pm ET. Here’s a link for registration.

.

[Admission: I used to work there.]

An article titled Honoring A Quiet Hero jumped out at me.

It tells the story of an EDF donor, Anita Goldner, who had made small annual contributions to EDF for 25 years. When she died at age 58 from cancer, she left a gift of $1 million to EDF. According to EDF, the gift “came as a complete surprise to all. No one knew she had named EDF as a beneficiary in her will.”

This story, which most fundraisers have heard their own version of, raises two points.

First, you always wonder when your hear these stories, how could no one know the donor’s commitment or potential? The truth is, in the past, the tools and data didn’t exist to spot potential major donors like Anita from amongst thousands of modest donors to an organization, unless perhaps they displayed obvious wealth. [Anita didn't ... she taught college math for 30 years.]

The gifts just ‘happened’.

But now the analytic tools do exist, including some developed by my fellow-travelers at DonorTrends. Sure, they won’t identify all the prospects, but without question they will significantly improve your ability to target and cultivate.

Second, savvy development officers realize that the “small donor” pool supporting their organization is not a competitor, and not the poor country cousin. Instead, they recognize and nurture it as their seed bed. That was the case at EDF, with Paula Hayes as head of development. Paula always supported investment in the EDF membership program … because she knew how many major gift and bequest prospects were generated from that membership.

Does your development director appreciate that point? If not, tell her this story.

Tom

The tools I described that can give you a look at your donors’ actual giving to other organizations — and tell you how much you’re leaving on the table — have been developed by DonorTrends, parent of The Agitator.

Here are three actions readers can take immediately to find out more or get started:

1. Download a sample Giving Analysis Profile (GAP) Report.  This report quickly allows you to evaluate how your organization is doing compared to others.  It is provided free of charge so organizations can satisfy themselves as to the value in the data.

2. Contact Corky for more information:  cmiller@donortrends.com or 1.866.948.9363.

3. Ready to get started? Click to upload your donorfile and your free GAP report will be available for your review within ten business days.

Honestly, I think you’ll be impressed.

Tom

Then you read she passed away and left $1 million to your competitor.

But suppose I had handed you a piece of paper well before that sad event showing you that specific donor gave substantially more money per year to each of seven specific other organizations … three of them direct competitors of yours. In fact, she had already made a $100,000 bequest to one of them, and supports the other two at the $25,000-$50,000 level.

[Oh … did I say “competitors?” Excuse me. We don’t have competitors in the nonprofit space, do we?]

Are you still content?

The fact is, the tools exist to match your existing donors and their actual giving to your organization against tens of millions of other donors and their actual giving, yielding several rather important insights …

First, for the specific donors matched, you can see exactly what share of their giving wallet you are getting … and what other organizations are getting the larger contributions you might be getting. You might ask: What are they doing right … either programmatically or fundraising-wise? Or, what are we doing wrong?!

Second, looking at the numbers in the aggregate, you can see the full giving potential of your existing donors … not based on some wealth formula or estimate, but on their actual total philanthropic giving to other organizations both inside and outside your “category.” In other words, you’ll see how much money you are leaving on the table. You might want to re-think the fundraising investment you’re not making.

Third, you can also see how those specific donors of yours, who are giving you a pittance, give to the organizations to whom they are more generous. Is it capital campaigns, bequests, special projects, events? Are you making the right asks?

As I noted above, this isn’t a fantasy. The tools exist right now.

Applied recently to two nonprofits, here’s what they indicated …

• For Group A, an advocacy group, 120,000 of 1.4 million donors were exactly matched to a 50 million donor database … those donors gave Group A $74 million over the years; they gave other groups $355 million, which you could examine donor by donor, recipient by recipient.

• For Group B, a nature center, 26,000 of 205,000 donors were exactly matched … those donors gave $36 million to
  group B; they gave other groups $172 million, again with “drilling down” to individual donors available.

So I ask you … are you using tools like this? If not, what’s your excuse?

If you’re not aware of these tools, who should find out about them first … You or your competition? You or your boss?!

Tom

Per the website, “The SOFII collection aims to be the most comprehensive, best organised, and most inspiring collection of fundraising related content from around the world.” We think they deserve those bragging rights.

The collection consists of three types of content:

• Exhibits: well-documented examples of fundraising campaigns, organized thematically into “Halls” and “Showcases;”
• Articles: written material from some of the best in the business on the art and science of fundraising; and,
• Resources: a variety of useful links, interactive content and other resources.

Each exhibit is catalogued according to type of charity or cause (arts, political, seniors, etc.), intended audience (individual volunteering, corporations, etc.), type of campaign (legacy, membership, capital campaign, etc.), medium of communication, and country of origin.

Or you can search the material on your own, filtering the collection to list only ‘direct mail legacy campaigns from Canada’, for example, or ‘broadcast campaigns benefiting seniors’. Or you can search by keyword – the entire collection is full-text indexed.

And if you register (to be added shortly), you’ll get regular updates on new material added to the collection.

The Agitator loves this resource. SOFII, you deserve a raise!

Roger & Tom