The Latest Wake-up Call

July 7, 2008

At the very time when the stock market is dropping, unemployment is rising and fundraisers are attempting to read the tea leaves in preparation for next year’s budgets, Target Analytics has released their Index of National Fundraising Performance for the 1st Quarter of 2008 … and the picture ain’t pretty.

Not only did the number of direct response donors continue to decline, but, for the first time, the increases in revenue per donor that have compensated for the decline in number of donors failed to prevent an overall revenue drop.

The Index’s authors say the falling donor populations “may be due to a mix of factors including economic changes, a changing generational profile in the United States, changing attitudes of donors about giving, and a change in focus by fundraisers toward higher-dollar donors.

Whatever the reasons the numbers are a bit spooky:

·The number of new donors has declined 7.6 % over the past two years. (However, the rate of decline has slowed from 5.3% in the first quarter last year to 2.3% in this first quarter of 2008.)

·Retention rates continued to fall with first-year donor retention dropping 6.6% in Q1 2008 over the same quarter a year before.
·And reactivation rates declined 5.0% from Q1 2007 to Q1 2008.

Among the 72 organizations included in the Index only those in the environmental and animal welfare sectors escaped the pain. For advocacy groups (what Target Analytics calls the “Societal Benefit Sector) there is sunshine among the clouds. New donor growth rose 6.1% in Q1 2008 with 69% of the organizations in this sector showing positive donor growth.

The news wasn’t as encouraging for groups in the International Relief Sector where new donor acquisition declined 23%–the greatest decrease of any sector –and reactivation rates were down significantly as well, falling 21.6% from Q1 2007 to Q1 2008.

And we shouldn’t be looking for clear skies and a return to growth in the near-term future. As the economy slows, so does giving.

Now’s the time to take another look at next year’s budget and make sure you’re spending more, not less, to achieve on donor satisfaction and loyalty to hold on to your base.

Roger

 

Posted by rcraver | Filed Under Don't Miss these Posts, Hot Research, Measuring Up, advocacy, charities, demographic trends, direct mail, donor retention, fundraising, loyalty, nonprofit management, nonprofits, research | Leave a Comment 

Is Anyone Wearing Your Tatoo?

January 3, 2008

MarketingProfs published an intriguing piece on Dunlop Tires and an offer Dunlop made at a recent trade show … let them tattoo the Dunlop logo on your body and you got a free set of tires. Apparently hundreds of Dunlop enthusiasts are now on a tattoo waiting list.

Talk about brand loyalty!

This got me to wondering …

Given that tattoos are rather mainstream by now, crossing demographic lines, surely there are plenty of progressive donors wearing one (or more). Think Angelina.

But is anyone out there sporting a tattoo with the logo of their favorite nonprofit? Not a peace symbol or some such generic insignia, but an actual organizational logo?

What might it take to make you sooo loyal to a nonprofit that you would take the plunge? You wear their hat, you use their mug, you wear their t-shirt, you “wear” their fundraising “badge” on your Facebook page. Why not a tattoo?

Sports teams and military units evoke this level of loyalty … what about MoveOn, Amnesty International, Habitat for Humanity, NARAL or the NRA? Lots of emotion in those organizations … plus, they could offer a free life membership to tattoo'd evangelists.

Still, probably no match for Dunlop Tires.

If getting a logo tattoo ranks 10, the top rung of the loyalty ladder, what is the highest loyalty rung you believe any nonprofit cause can aspire to? What is the highest loyalty rung you believe your nonprofit can aspire to?

If there's not a lot of emotion expressed in your organization, I'd say 5 — halfway up — is about the best you can hope for.

Tattoo-less Tom

P.S. Too bad The Agitator doesn't have a logo. Hmmm!

Posted by admin | Filed Under Don't Miss these Posts, branding, loyalty | Leave a Comment 

The Secret Sauce Of Brand Loyalty

November 20, 2007

Here's a report on top brands as researched by marketing consultancy Brand Keys.

#1 on the list is Google; #2 is Yahoo. Catalog-driven companies do well, led by L.L.Bean at #4 and J. Crew at #6 (Sears, Eddie Bauer and Land's End were in the top 25).

The report cited above mentions convenience as a driver of brand loyalty. It's tough to conceive of (and nurture) loyalty to a nonprofit brand in terms of convenience, since most nonprofits do not deliver a service or products to their donor constituencies.

But loyalty is really built upon something deeper than “convenience” in the sense of facilitating or easing a purchase. And nonprofits can deliver on that “something deeper.”

The “something deeper” is trust.

A consumer would not pick up the phone or click the mouse if she did not trust L.L. Bean to meet her expectations of quality, service and suitability without question. That trusting relationship would have been built over time through a series of “successful” interactions between the consumer and the company, where her expectations were indeed met … and even better, exceeded.

Most interactions between nonprofits and their donors (sticking with that single constituency for this post) consist merely of the former passing along information to the latter, in the form of emails, web content, letters, newsletters and other publications. And at occasional junctures, a financial transaction occurs.

During that process, the donor forms an impression and draws a conclusion based on that impression. Ideally something like this …

“This organization knows what they're doing … they are effective and successful … they use my contributions with care and efficiency … they are accomplishing (or making discernible progress against) the needs/goals I had in mind … they appreciate me … I've begun to trust them … I feel good about 'them'.”

And where the organization offers meaningful paths and opportunities for donor involvement (e.g., volunteering, online networking), the process can and should reach even further, to … “I am one of them.”

How well do your interactions with your donors lead them down that path, which for them begins with an emotional need (save this, fight that, help them), proceeds through a “test” stage with practical questions and observations, and hopefully ends with an emotional commitment … at least trust, and maybe a sense of belonging?

Examine your nonprofit's interactions with donors through this lens. Are your communications meaningful and instrumental in terms of building a relationship of trust?

If so, you're on the way to building brand equity — and loyalty — for your nonprofit.

Tom

Posted by admin | Filed Under Don't Miss these Posts, donor retention, loyalty, nonprofit management | Leave a Comment