Fundraising Land Grab
On Valentine’s Day, it’s fitting that The Agitator focus on fundraising’s equivalent of the ‘going steady’ relationship — the sustaining, committed or monthly giving donor.
Chuck Longfield, founder of Target Analytics and chief scientist at Blackbaud, is one of my favorite fundraising analysts and observers. He preaches a lot about retention and how monthly giving programs relate to it.
Like many of us, he urges organizations to get about the business of building monthly giving or sustainer programs without delay. Of course, that’s because if you can communicate with someone monthly and also receive a contribution from them every 30 days or so they’re among the most likely donors to stick with you.
Chuck fervently believes sustainers are so important that he’s labeled the imperative to enlist them as “fundraising’s last land grab”. By this he means that, like the Oklahoma Land Rush, there’s only so much land and only a limited number of donors out there likely to make a monthly commitment.
Although ‘normal’ donors may give to 5 or even 10 organizations a year, a monthly donor will usually limit her or his giving to 2 or maybe 3 organizations. Thus, Chuck’s admonition to get there first.
Unfortunately, not many American organizations seem to recognize this concern. Or, more fairly, not many seem to be able to do much to protect their position in the donor land grab race. The Canadians, Europeans and now Asians are way ahead of the Yanks.
Why? Some excuse-prone or misinformed American fundraisers blame it on America’s banking system. The U.S. equivalent of direct-debit elsewhere in the world is the more cumbersome Electronic Funds Transfer System or the old-fashioned U.S. credit card system.
To use the American banking system as an excuse is nonsense. Fact is, most American nonprofits lack both the skill and the patience to invest in building meaningful monthly giving programs, failing to secure their future.
Those U.S. groups that have demonstrated the skill and staying power — groups like Greenpeace, The Southern Poverty Law Center, and ASPCA, to name a few — are rockin’ and rollin’ in committed monthly donors. [For a good discussion on all this see my earlier post — Why Chuck Longfield Is Worried — and note especially the comments of Matthew Sherrington, the British fundraiser who built the highly successful U.S. sustainer program for Greenpeace.]
If you care about retention … if you care about sustainability … significant net income and, eventually, massive bequest income, it’s time to invest some of yourself in mastering the art and finance of monthly giving in hopes you can convince your CEO or CFO into getting some of fundraising’s beach front property before it’s all gone.
Here’s my first suggestion. Order a print copy or e-book version of Erica Waasdorp’s Monthly Giving: The Sleeping Giant from Amazon today.
If ever there were a step-by-step cookbook on monthly giving that contains winning monthly giving recipes, this is it. Erica has taken the seminal work of Canadian fundraiser Harvey McKinnon — Hidden Gold — the basic primer on monthly giving, and updated it with the latest techniques, including the use of social media.
Erica is not a Janie-Come-Lately. She won her direct response spurs at Readers Digest years ago, went on to perform great work for the International Fund for Animal Welfare in Europe, and now runs the fundraising firm A Direct Solution.
But back to ‘Why’ you should be buying Monthly Giving in the first place. As Harvey McKinnon alerted fundraisers a generation ago:
“Monthly giving appeals not only to younger donors who find it convenient and easy, but also to older donors, who are more likely to live on a budget. But, regardless of their age monthly donors will often give for decades, are more loyal than even the most consistent annual donors and are far more likely to leave bequests.”
As Erica illustrates:
“Beginning with a $25 gift in 1983, a generous individual made a total of 279 monthly gifts of $25 or $30 for a total of 279 monthly gifts over a 22 year period. The donor passed away and one year later organization received a $25,000 bequest. Total value of these 280 gifts. $31, 250!”
Whatever you call them — monthly givers, committed givers, sustainers, direct debits, Friends of…, Circles of…, Champions, Partners — the point is to get started. Now.
Drawing on her own experience plus that of pioneers like Harvey McKinnon, copywriter great Jerry Huntsinger, strategist Daryl Upsall and a score of fundraising’s household names, Erica details everything you need to know about:
- Conversion rates. [Expect from 0.5% to 5%]
- Branding or naming the sustainer program. [Don’t go crazy over it]
- The use or non-use of Premiums [Depends on the type of premium and type of organization]
- Targeting best prospects. [Plenty of ‘how to’]
- Giving/Asking Levels. [Again, lots of practical advice]
- Channels — mail, face-to-face, radio, tv, ads and inserts, events, and SMS. [Loaded with examples on the most effective use of channels]
You’ll discover the pros and cons of various channels. Direct Mail. Telemarketing, both inbound and outbound (including sample scripts) and DRTV. Erica even deals with the oft-troublesome issue of data base management for sustainer programs.
I’m not kidding. This book is loaded with goodies. So many that if your consultant hasn’t already been cribbing from it you should probably be seeking a new ‘expert’.
Monthly Giving: The Sleeping Giant contains copy samples, financial models, and case studies.
Best of all from The Agitator’s viewpoint, Erica addresses the issue of retention. How to hold on to and deal with monthly donors. Something our European readers could sure benefit from, if my reading of their monthly giving stats is any indication.
So, when you hear or read Chuck Longfield’s prognostication that the next ‘land grab’ in fundraising will be monthly donors, you now have Erica’s road map for staking your claim.
And Erica, you get an Agitator raise!
P.S. To all our Agitator readers, Happy Valentine’s Day. Tom should be delivering the chocolates and roses any minute now.