A New Fundraising Classic
This morning the publisher officially released Data Driven Nonprofits, a book I believe will become a classic in our sector.
Researched and written by Steve MacLaughlin, Blackbaud’s Director of Analytics, Data Driven Nonprofits is to the ‘science’ of fundraising what Ken Burnett’s Relationship Fundraising is to the ‘art’ of fundraising.
This book is long overdue. Or, more accurately, the well-researched, clearly-delivered information and insights contained couldn’t be more timely — and needed. Most of today’s nonprofits are woefully unprepared to make the most of the opportunities that have emerged with the new, inexpensive technologies and their proven capacity to significantly brighten the future of fundraising.
Sadly, too many organizations continue to use this marvelous technology only as a simple electronic filing cabinet. They fail to capture the power of today’s software to do what really can and should be done to grow the organization.
Why? Because most fundraisers don’t understand what can be done with it. Ours is still by and large an innumerate trade. Most of us shy away from numbers or mask our ignorance by whistling past the graveyard proclaiming that “I prefer to focus on the ‘art’ of fundraising, not those emotionless numbers”.
For this reason alone, Data Driven Nonprofits is must reading, because it will not only change your mind, it will inspire you — by fact and example — to start measuring the right things for the right outcomes, and begin experiencing real growth. You’ll quickly understand why numeracy is the new normal for nonprofits.
For 40 years I worked as a successful copywriter smug in my belief that it was the emotion-laden stories, skillfully delivered with the proper offer, that made all the difference between success and failure. And I really did believe that all those numbers and segments and spreadsheets were really a yawn — an unimportant yawn.
Such delusion. Fortunately, but rather late in my career, I’ve come to the full understanding that the use of relevant data, properly applied is every bit as important — probably far more important — than anything else we do.
Happily, you’ll discover that Steve’s Data Driven Nonprofits is anything but a dry, formula-laden, statistically-saddled tome of calcified calculus and algorithms. Rather it sings with fascinating insights into the early history of organized fundraising in the last century — with the identification and description of significant philanthropic and demographic trends and indexes of which we all should be aware — and makes a most persuasive case for how and why to move your organization into a solid position for future growth.
There’s no way any fundraiser can legitimately claim to be ‘donor-centric’ unless she/he is data literate. No way! You’ll find out why in Data Driven Nonprofits, where the methods and mindsets of truly donor-centered organizations are illustrated.
Here’s a sampling of some goodies packed into Data Driven Nonprofits. Great stuff you won’t want to miss.
- Hidden Treasure. Chapter 3 offers one of the clearest listings and explanations of essential data an organization must maintain and the importance of keeping it clean and updated.
You’ll also find out why you should be using predictive analytics and how to use data to set asking amounts that make a winning difference.
- The Path toward becoming data driven. Steve lays out the five key steps any organization must take if it’s going to succeed in the 21st century. From meaningful hindsight to actionable foresight, you’ll find it in Chapter 4.
- The Magic of Chuck Longfield. Packed in and distilled in Chapter 5 is 35 years of my favorite nonprofit analyst, Chuck Longfield. You won’t want to miss Chuck’s explanation of where and how to find the hidden treasure in your file … why RFM (recency, frequency, monetary value) is NOT the end all and be all … and what little known data points in your file can make a remarkable difference in results. Chapter 5 alone is worth the price of the book.
- Fools Gold. In Chapter 6 Steve strips away the façade of ‘Vanity Metrics’, used by too many nonprofits, and outlines what data really matters. In addition, he gives a clear and quick course on “How to Become Data Literate” with practical insights into how to distinguish meaningful data from ‘fools gold’ by understanding such concepts as methodology and sample size.
Data Driven Nonprofits offers a stunning array of examples of how a change in organizational culture can make an enormous difference. In seven example-packed chapters, Steve covers everything from seeking leadership buy-in, to using data to empower staff.
My guess is that among the ‘culture types’ you’ll be able to identify yours from among the: Culture of Champions, Culture of Testing, Culture of Change, Culture of Sharing, Culture of Growth, Culture of Agile and Culture of Data.
The book doesn’t leave us hanging with hypothetical or wistful generalities. Each of the culture types and steps an organization took to change their mindset, methods and metrics is accompanied by examples.
- In Chapter 8 you’ll find the transformation undertaken at Memorial Sloan Kettering from a nearly singular focus on direct mail to a multi-channel, multi-program, culminating in a $3.5 billion capital campaign. All made possible by the skillful application of analytics and data.
- In that same chapter you’ll see how the University of South Dakota is putting artful fundraising together with predictive analytics and data modeling, dramatically increasing giving and the efficiency of its operations.
- Fundraisers concerned with multi-channel integration won’t want to miss Chapter 9 and the detailed story of Worldwide Cancer Research and its 35 years of experience transitioning from one form of acquisition to another — from direct mail, face-to-face, digital, peer-to-peer and social media.
- Get the inside story on how analytics and predictive modeling eliminated some blind spots at WWF (World Wildlife Fund), not only in their acquisition and appeals program but also planned giving. In this example is also a text-book perfect tale of how to involve staff to accomplish more effective testing.
- You’ll see in Chapter 11 how Michael Heiplik of the Contributor Development Partnership (CDP) used the power of benchmarking and data analytics to develop, along with Chuck Longfield and the folks at Target Analytics, a program that has added hundreds of thousands of monthly donors to the rolls of public broadcasting supporters.
- And don’t miss how Jann Schultz, a self-proclaimed generalist fundraiser (“I still have nightmares about flunking third-grade long division”), turned around Project HOPE by developing KPI’s, using benchmarking, and focusing all her staff on key metrics.
There are plenty of other examples you’ll want to study and learn from. In fact you might want to purchase several copies of Data Driven Nonprofits and start discussing its key points with your colleagues. I can assure you it won’t be dull.
Here’s the deal, as summarized by Steve in the closing paragraphs of Data Driven Nonprofits:
“We can choose to be overwhelmed by the data or we can choose to turn it into treasure. We can choose to rely on tribal knowledge, or we can be enlightened by information and insights. We can choose to believe that our culture is set in stone or that it evolves and adapts to its environment over time. We can choose to accept low donor retention rates or we can ignite a growth mindset that drives performance. We can choose to treat data as a foreign object or we can put humanity in the data.”
I commend this new classic to you. Order Data Driven Nonprofits today.
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