Comments on: The Toughest Fundraising Calculation http://www.theagitator.net/dont-miss-these-posts/the-toughest-fundraising-calculation/?utm_source=rss&utm_medium=rss&utm_campaign=the-toughest-fundraising-calculation Fundraising and advocacy strategies. Trends, tips ... with an edge Thu, 24 May 2012 10:11:30 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: non profit marketing strategies http://www.theagitator.net/dont-miss-these-posts/the-toughest-fundraising-calculation/comment-page-1/#comment-14698 non profit marketing strategies Sun, 20 Dec 2009 04:47:05 +0000 http://www.theagitator.net/?p=1308#comment-14698 Great tips it really is important to have your calculations down especially if you are going to be spending a lot in investing in your non profit. If you know what your return on your invest will be on average you can put more more into the marketing methods that really do bring in new supporters and donations. Great tips it really is important to have your calculations down especially if you are going to be spending a lot in investing in your non profit. If you know what your return on your invest will be on average you can put more more into the marketing methods that really do bring in new supporters and donations.

]]> By: Matthew Bregman http://www.theagitator.net/dont-miss-these-posts/the-toughest-fundraising-calculation/comment-page-1/#comment-14344 Matthew Bregman Thu, 17 Dec 2009 04:52:58 +0000 http://www.theagitator.net/?p=1308#comment-14344 I just wrote a long comment on the last post, so I'll try to make this one shorter. Why do so many professional fundraisers feel they need advice from a marketing guru who doesn't seem to have much experience with fundraising? In my experience, if you spend a lot of money cultivating someone who hasn't yet made a contribution, you're likely throwing your money away. While most of us have few metrics to back this up, we have the battle scars to prove that inviting people to free lunches, cocktails, site visits, theater experiences, catalogues, folders filled with color photographs, DVDs, etc., usually leaves you with a list of people who like to get things for free. A prospect needs to indicate they're philanthropic and have an interest in what you do. If they're a prospect worth their salt, they probably won't let you spend a lot of money on them before they make a gift. So what are we talking about? If by cultivating, we're really talking about investing in donor acquisition in a larger sense (e.g., conducting research, building a database, paying for first class postage, designing good looking printed materials, etc.), then I agree that we need to spend money to make money. But doesn't everyone? I just wrote a long comment on the last post, so I’ll try to make this one shorter.

Why do so many professional fundraisers feel they need advice from a marketing guru who doesn’t seem to have much experience with fundraising?

In my experience, if you spend a lot of money cultivating someone who hasn’t yet made a contribution, you’re likely throwing your money away. While most of us have few metrics to back this up, we have the battle scars to prove that inviting people to free lunches, cocktails, site visits, theater experiences, catalogues, folders filled with color photographs, DVDs, etc., usually leaves you with a list of people who like to get things for free.

A prospect needs to indicate they’re philanthropic and have an interest in what you do. If they’re a prospect worth their salt, they probably won’t let you spend a lot of money on them before they make a gift.

So what are we talking about?

If by cultivating, we’re really talking about investing in donor acquisition in a larger sense (e.g., conducting research, building a database, paying for first class postage, designing good looking printed materials, etc.), then I agree that we need to spend money to make money. But doesn’t everyone?

]]> By: Andrew http://www.theagitator.net/dont-miss-these-posts/the-toughest-fundraising-calculation/comment-page-1/#comment-14277 Andrew Wed, 16 Dec 2009 16:55:22 +0000 http://www.theagitator.net/?p=1308#comment-14277 I disagree, slightly with this, if you embed the cost of cultivation into the costs associated with running your program. That is--if your cultivation of donors is entirely based on their participation in your programs, then the costs of cultivation are easy to bear, even at an initial loss. So, my objective as a fundraiser is to get people to come to our events, in prison, and interact with our participants and graduates. That's part of our mission, so we have more incentive to get people involved--and cultivated--than to just look at everyone as a "donor" and only a donor. When our volunteers come to prison and work with our guys, they are costing us money--we have to have food, staff, materials, etc--but that money almost always translates into huge revenues--roughly every dollar spent on prison events yields $19 in revenue since almost all of our donors, major and minor, come to our events at some point. We maintain a healthy positive cash balance, but in effect, it makes sense for us to spend a lot of money on cultivation because it's really just programming. Too many organizations don't look at the ways to make sure that they involve and cultivate their donors--and also usually fail to see that a reduced cost because a volunteer is doing work you would otherwise have to pay for is a donation--just not one that can be receipted and counted for the IRS. I don't donate much money to organizations, but I do "donate" a ton in the form of referrals, consulting, and other benefits. There is one organization that I work with that is able to provide free executive level consulting services to nonprofits--I consider making the connections and making sure that the follow-through is done on both ends a form of donating because my referral is free for the nonprofit consulting group (otherwise they would have to pay for it in advertising, networking or staff time) and it yields substantial benefits for the nonprofit. Both nonprofits win--and so do the executives who get to see how great most nonprofits are--but I never get a receipt for the economic benefit captured and created because of the pairing. I think that's really, really important, especially when we look at cultivation--if you are only looking at the monetary value captured and not the actual value captured and created by "donors" then don't even bother to worry about whether or not you're doing cultivation correctly. We thank our volunteers lavishly--pictures, emails, follow-up calls, increased opportunities to get involved more deeply--because they create the most value for us. In fact, we treat our volunteers many times better than our donors because the real value is in the time and effort and not in the money that is what is generally considered the fundraisers objective. One last thing--since foundations account for a pretty big part of our revenues each year--it's important to keep in mind the kinds of cultivation that you do. Even with our foundations, the objective is never just to look at them as pools of cash for our benefit--the real value is in the fact that they require us to think about our programs and offerings, and then again that throughout the year they require us--sometimes in very thoughtful ways--to measure and assess what we're doing. I've learned that most foundations treat honesty and candid feedback about what happened as their primary form of involvement in our organization. They've never come to us and said that we should run our program a certain way, they just ask us to think about what happened and there is tremendous value in that since most individual donors never do that. I disagree, slightly with this, if you embed the cost of cultivation into the costs associated with running your program. That is–if your cultivation of donors is entirely based on their participation in your programs, then the costs of cultivation are easy to bear, even at an initial loss. So, my objective as a fundraiser is to get people to come to our events, in prison, and interact with our participants and graduates. That’s part of our mission, so we have more incentive to get people involved–and cultivated–than to just look at everyone as a “donor” and only a donor. When our volunteers come to prison and work with our guys, they are costing us money–we have to have food, staff, materials, etc–but that money almost always translates into huge revenues–roughly every dollar spent on prison events yields $19 in revenue since almost all of our donors, major and minor, come to our events at some point. We maintain a healthy positive cash balance, but in effect, it makes sense for us to spend a lot of money on cultivation because it’s really just programming.

Too many organizations don’t look at the ways to make sure that they involve and cultivate their donors–and also usually fail to see that a reduced cost because a volunteer is doing work you would otherwise have to pay for is a donation–just not one that can be receipted and counted for the IRS.

I don’t donate much money to organizations, but I do “donate” a ton in the form of referrals, consulting, and other benefits. There is one organization that I work with that is able to provide free executive level consulting services to nonprofits–I consider making the connections and making sure that the follow-through is done on both ends a form of donating because my referral is free for the nonprofit consulting group (otherwise they would have to pay for it in advertising, networking or staff time) and it yields substantial benefits for the nonprofit. Both nonprofits win–and so do the executives who get to see how great most nonprofits are–but I never get a receipt for the economic benefit captured and created because of the pairing.

I think that’s really, really important, especially when we look at cultivation–if you are only looking at the monetary value captured and not the actual value captured and created by “donors” then don’t even bother to worry about whether or not you’re doing cultivation correctly. We thank our volunteers lavishly–pictures, emails, follow-up calls, increased opportunities to get involved more deeply–because they create the most value for us. In fact, we treat our volunteers many times better than our donors because the real value is in the time and effort and not in the money that is what is generally considered the fundraisers objective.

One last thing–since foundations account for a pretty big part of our revenues each year–it’s important to keep in mind the kinds of cultivation that you do. Even with our foundations, the objective is never just to look at them as pools of cash for our benefit–the real value is in the fact that they require us to think about our programs and offerings, and then again that throughout the year they require us–sometimes in very thoughtful ways–to measure and assess what we’re doing. I’ve learned that most foundations treat honesty and candid feedback about what happened as their primary form of involvement in our organization. They’ve never come to us and said that we should run our program a certain way, they just ask us to think about what happened and there is tremendous value in that since most individual donors never do that.

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