Future Fundraising Now

What donors really want from your fundraising

No matter what you sell, you're not really selling that thing, but the attributes or benefits of that thing. That includes fundraising. Here's a good way of looking at that fact from Copyblogger, at The 5 Things Customers Actually Want:

1. Ease
2. Physical comfort
3. Mental stimulation
4. Identity reinforcement
5. Social acknowledgement

Charitable giving is great at satisfying the last three.

• Mental stimulation: Are you giving donors information about what you want them to give to accomplish?
• Identity reinforcement: When donors give, they're saying (to themselves and/or to others) I'm the kind of person who ... You can talk openly about those things in fundraising.
• Social acknowledgement: Do you recognize your donors for all they do in satisfying ways?

9 ways to be an anti-donor fundraiser

If you're in a real hurry to drive your fundraising program into the ground by driving away your donors, here are some common nonprofit practices that can help you along the way:

1. Write and design to please yourself. If you think success in fundraising is gauged by how it makes you and your colleagues feel about it, you're missing the boat. And missing your donors. What really tickles your fancy is unlikely to motivate them. What works for them will probably annoy you and your pals.
2. Have a braggy, self-centered brand. Fundraising that works shows donors what they can accomplish by giving to you. Not what you can accomplish with their giving. That's a subtle but key difference -- one that's lost in a lot of branding initiatives. They are all about making sure everyone knows how awesome the organization is. Which is amateur fundraising.
3. Educate your donors. The urge to make them into better people (i.e., more like you) is arrogant and misguided. They don't want (or need) to be educated. If they're interested in the finer points about your work, they'll find out. But most of them aren't' interested, and there's nothing wrong with that.
4. Don't tell stories. Donors live for stories. They want to be part of stories. If you just hammer away with facts and statistics, you aren't meeting them where they really are.
5. Don't offer your donors choices. Yes, you know what you need. And they probably don't. But they deserve the power to direct their generosity where they want it to go. The funny little secret about this is that when offered choice, most donors pick "where most needed." They respond well to be offered choice, but most don't take it.
6. Take a long time to acknowledge gifts. If it takes you more than 48 hours to drop a paper receipt in the mail, you are not only being discourteous to your donors, but you are missing the key window for making them feel good about their gift -- which means you are losing subsequent gifts.
7. Send your donors generic acknowledgements, not genuine thank yous. You knocked yourself out to get the ask right. And it worked! The people who gave are the ones who got it. They are special people, critical to your success. They deserve thanks that are specific, clear, emotional, and rewarding.
8. Never report back to donors what their giving accomplished. You're constantly asking donors to help you accomplish things. Do they have any idea that their giving "works"? Silence on that matter only feeds their skepticism about your effectiveness. You also miss the key way you build the relationship.
9. Let your donor data be sloppy. If you have multiple names or addresses for the same donor, you are sending a very clear message: You are not important (and I am not competent).

What to do about overhead

Like just about everyone else in our industry, I stood up and cheered when I saw Dan Pallotta's recent TED Talk The way we think about charity is dead wrong. (If you haven't seen it, you should. It's below.)

I've watched again and again as effective organizations capped the amount of good they could do by under-spending on fundraising and other forms of investment. It's like watching a trained sprinter put on cement shoes before every race. They do that because watchdogs, boards, and many others sustain a belief that spending on "overhead" is bad, wasteful, and undesirable. It's a crime, really.

The question is, what should we as fundraisers do about this, especially now that the issue is more in the open?

First, let me tell you what we should not do: You should not use your fundraising to fight anti-overhead prejudice. That would be irresponsible.

Your fundraising program is not your platform for fighting political or social fights. It's your platform for raising funds.

Many donors have the wrong attitude about overhead. And your direct mail piece or email is not going to change their attitude. You might as well send a letter to a bunch of libertarians and tell them Ayn Rand was a foolish clown. You won't change their minds. You'll just annoy them.

Many more donors don't really care or think about overhead. With them, you'll just be raising a confusing issue.

And in the process, you'll get much worse fundraising results. Any time a fundraising tries to raise funds plus do something else -- it hurts response, often dramatically. Every time.

Using your fundraising as a platform to fight the overhead misconception will only do these things:

• You'll raise less money for your cause, which is dereliction of duty for a fundraiser.
• You won't help improve the situation by changing minds. You might even make it worse.

If you have good watchdog ratings, trumpet that. Even if you understand their criteria to be bogus. If you have low overhead, brag about it. A significant number of donors want that -- right or wrong.

The right way to fight the overhead battle is as a citizen, not as a fundraiser. That means:

• Every time you see one of those bogus stories in the media about overhead, write a letter to the editor and set 'em straight.
• If harmful overhead-related legislation is rising in your state, fight it politically.
• With your institutional donors -- foundations, corporations, even high-end individuals you have a strong relationship with -- have that nuanced, complex conversation. Tell them they need to embrace and support overhead! (In fact, you could make the case that donating to support overhead is the best "deal" of all.)
• Same with your board. They have no business destroying the organization they're supposed to be promoting.

Webinar: The secret to effective fundraising appeals

Don't miss this one: I'll be teaching a Chronicle of Philanthropy Webinar this Thursday, June 27, at 2 p.m. (Eastern), along with Sarah Hesshaus of American Leprosy Missions.

Join us for Fundraising Appeals That Inspire Action. You'll discover:

• The most common cause of failed fundraising.
• The 4 characteristics of effective fundraising.
• How one organization stays donor-focused.

Hope to hear you there! Register here.

How educating your donors can put you in a financial death-spiral

The purpose of fundraising is to raise funds. I only bring it up because it's not as obvious as it sounds. Many organizations believe they should use their fundraising program to educate donors. To tell them things they don't know, but we've decided they ought to know.

Most fundraisers have a handful of offers that work well. If they're on top of things, they're always testing to find new offers to expand their portfolio. But they consistently use the winners, those offers their donors respond to best.

Educate-the-donors fundraisers have a different approach: They use fundraising offers whether they work or not, because the goal is to give donors a "rounded" picture of the work.

That means they trot out calls to action that most donors don't understand and don't respond to. Donor-educators believe it's worth the price. Some claim it will pay off over the long term as non-responding donors have aha moments. Others just seem to want to be understood, despite the cost.

So let's look at the cost.

Let's say you have 100 current donors. You send them 12 fundraising appeals a year.

• 10 of those have strong offers, with an average response of 8%
• 2 are not as good, with an average response of 5%

Over the course of a year, that's 90 responses. At an average gift of $40, you get $3,600. Since many donors give more than once, that nets out to 45 donors giving in the course of a year.

The other 55 lapse. You will never again hear from most of them. The following year, the 45 who didn't lapse will give $1,600.

Let's try that again, but apply educate-the-donor metrics:

• 2 strong appeals, averaging 8%
• 5 mediocre appeals, averaging 5%
• 5 weak appeals, averaging 3%

That set of donors got a broad education of the organization's activities. But at what cost?

• Total giving: $2,240
• 56 gifts
• 28 donors giving

That's a 37% drop in revenue and number of gifts. Which hurts. But here's the big hurt: Instead of 55% of the donors lapsing, 72% of them lapse. The remaining 28 will give just $1,000 in the following year.

Unless they're pulling off miracles in new donor acquisition, that organization is in a financial death-spiral.

An educate-the-donor fundraising program has extremely high costs. Short term, and even more so for the long term.

And here's the really sad part: Poor response is mostly a product of low involvement. Those weak appeals you send out to teach -- nobody even reads them! They fail at teaching just as miserably as they fail at raising funds. There's no education, no aha moments, no deeper understanding. And you lose your job in the bargain.

If you don't want that, use your fundraising program to raise funds. Donors are in charge of their own education. They don't want -- and seldom accept -- your help.

Podcast: What fundraisers should measure for success

Peter Drucker said "What's measured improves." Want to improve your fundraising? Here are the two most important things to measure:

1. Net revenue
2. Donor retention

There are a lot of other key performance indicators in fundraising, but if you measure (and thus improve) these two numbers, your fundraising program will be in fine shape.

Don't miss these insights from the front lines of fundraising!

To listen, click here to download the audio file or visit the Fundraising Is Beautiful page here, where you'll find several listening and subscription options.

Or subscribe with iTunes:

Try this useful tool for keeping fundraising copy simple

Simple writing is good writing. If you think people like you better because you use lots of big words, think again. The bigger your words, the less people understand. The less they even try to understand. The less they care. If they don't care, they won't give. So please keep your writing simple.

The above paragraph uses only words from among the 1,000 most common English words. I used The Up-Goer Five text editor, which immediately flags any word you use that's not in the top thousand.

It's an interesting diagnostic tool for simplifying your writing. Just don't think you need to use it to remove every word that's #1,001 or higher from your vocabulary. You'll end up with some really awkward circumlocutions. You'd be in deep trouble if you're a cancer charity: the word "cancer" is not in the top thousand. The editor itself has to refer to the top "ten hundred" words, because "thousand" is not among them.

However, if you check out your copy and find a majority of your words flagged -- you may have a problem: Copy that's hard to understand.

Thanks to Bad Language for the tip.

How to make your donation form better

Poorly built donation form pages will cost you a lot of lost revenue. And what constitutes poor built may surprise you. Here's a post from npENGAGE you should read: Donor Acquisition: 3 Donation Form Tweaks that will Quickly Improve Online Fundraising.

1. Ask only for the information you need. Don't ask donors for information you don't absolutely need. Each extra field you make them fill out sends more of them away. (More on that here: How Many Fields Belong On Your Landing Pages?.)
2. Don't distract from the act of donating. Don't have links away from the page, and don't put a lot of information beyond what's needed to get the gift.
3. Be sure it's secure. Many donors are still nervous about giving out their credit card information online. Make sure you have the "https" in the URL and the "lock" symbol visible.

Make your nonprofit website usable for seniors

If you're a fundraiser, you should also be conversant in "elder marketing." These are the people who drive the charitable giving bus. And they're steadily moving online.

That's why you should look at this study at Jakob Nielsen's Alertbox: Seniors as Web Users.

Key findings (among many):

• Reduced visual acuity is probably the best-known aging problem, and yet websites with tiny type are legion.
• Pull-down menus, hierarchically walking menus, and other moving interface elements are problematic for seniors who are not always steady with the mouse.
• Seniors also have a harder time using unforgiving search engines and forms.
• Seniors often had problems reading error messages, either because the wording was obscure or imprecise, or the message's placement on the page was easily overlooked.
• Drastic design changes hurt seniors the most.

Barriers to web usability are barriers to participation. That means less revenue for your cause.

How to make an ad man jump out the window

Another great cartoon from Marketoonist:

Why can we imagine an advertising creative director ending it all because someone wants to see proof that his work actually accomplishes what it's meant to accomplish?

Easy: He knows it won't come out looking good.

He knows that what he does is a flimsy construction built on a bad combination of wishful thinking, BS, and artistic self-expression. He knows it!

Take the warning: don't work with standard ad agencies. Too many are not about accomplishing your goals. They have their own goals. They've been misusing their commercial clients for decades. They'll do the same to you.