stewardship – Page 9 – The Healthy Non-Profit

How many undiscovered “diamonds” exist in your donor database?

October 5, 2012 erik Donor-centered fundraising, Fundraising, organizational development

Welcome to O.D. Fridays at DonorDreams blog. Every Friday for the foreseeable future we will be looking more closely at a recent post from John Greco’s blog called “johnponders ~ about life at work, mostly” and applying his organizational development messages to the non-profit community.

In a recent post, John re-told a story about an African farmer, who sold his farm to go in search of diamond mines, only to find out that the farm he sold turned out to be one of the worlds largest diamond mines. John applied the story in OD terms to your co-workers and all of their talents (aka diamonds that are unmined in your organization).

When I read this story, my mind naturally wanders to fundraising and all things having to do with donors. I think of your organization’s donor database and imagine all of the undiscovered diamonds that exist in those data records.

I commonly get asked by agencies how they can better mine those diamonds out of their donor database. After all, we’ve all heard stories about those $100/year annual campaign donors who go on to give millions of dollars to capital campaigns and endowment campaigns.

Of course, the easy 30 second answer is investing in donor analytics services like Blackbaud’s Target Analytics or WealthEngine.

I am a data-kinda-person, and these services are amazing, but . . .

The more complicated (yet amazingly simple) answer is exactly what John encourages you to do his post about the African diamond farmer. Before investing in expensive data analytics services, you really need to commit yourself to “getting to know people”. It starts with you and that is the easy part. The harder part is changing your organizational culture to embrace this idea.

I am by no means an “OD expert,” but it seems to me that changing your agency’s fundraising culture will entail some of the following:

hiring the right people (e.g. people who like people)
looking at all of your systems, identifying obstacles, and eliminating those barriers to change
aligning your systems (e.g. performance management systems, compensation, recognition, etc) with your new vision of “getting to know donors”

If you want to read more about change leadership, click over to John’s blog and thumb through a number of his posts on change and culture.

All of the data in the world won’t help you identify your donor database diamonds if you aren’t willing to get out of your office, sit down with your donors, and get to know them and understand their passions.

Do you subscribe to a donor analytics service, but find it a little disappointed that the big gifts aren’t magically appearing? What do you love about your analytics services? What don’t you like? How have you inspired your organizational culture to celebrate “getting to know” donors?

Please scroll down and share your thoughts and experiences in the comment box below. After all, we can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
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What is your non-profit agency’s year-end stewardship strategy?

September 26, 2012 erik Donor-centered fundraising, Fundraising, Planning, resource development

Yesterday, I posted about the importance of developing your organization’s year-end fundraising strategy and doing so ASAP (by which I mean get it in writing by the end of this week). As I reflected on my post all day yesterday, I started thinking about all of the great holiday opportunities with regard to donor stewardship activities.

Over the years, I posted a number of articles immediately before, during or after a holiday talking about how organizations could have piggy backed on the holiday to implement some effective stewardship activities. After each of those posts, I remember thinking . . . “Hmmmm, perhaps I should’ve posted this a few weeks or months ago and readers might have had some time to put thought and planning into such an idea.”

With this in mind, let’s go back in time and revisit two blog posts from the fourth quarter of last year that spoke to the idea of using holidays as stewardship opportunities. Here they are:

Another thought that I’ve shared with a number of clients throughout the years is the idea of taking the “Twelve Days of Christmas” song and using it as a December theme for “The Twelve Days of Stewardship”. It can be as simple as doing 12 stewardship activities in December or as complicated as the song suggests (e.g. giving the donor two of this, three of that, etc etc etc).

If you’re rolling your eyes at this suggestion, I encourage you to stop and think about it for a moment. I bet that right now off the top of your head, you’ll be able to rattle off three or four stewardship things your agency does around the holidays, such as:

mailing holiday cards
hosting a holiday party for supporters and donors
thank-a-thon (e.g. stewardship thank you phone calls)
annual report
Running a “A few of my favorite things . . .” essay contest with your clients about your services and sharing the results with your donors.

With a little bit of thought and creativity, I bet you can weave things that you already do into a 12 day tapestry of stewardship opportunities.

The bigger point that I am trying to make today (and yesterday) is that these things don’t just happen. They require some thought and planning (and more than just a few days before).

The fourth quarter and holiday season offer unique and fun opportunities to steward donors, and it is something you need to start thinking about this week because the fourth quarter will be here starting Monday of next week. (Eeeeek! Talk about a scary Halloween gift)

What is your organization doing to steward donors for Halloween? Thanksgiving? Hanukkah? Kwanzaa? Do you have thoughts or ideas to help flesh out the aforementioned 12 Days of Stewardship concept?

Please scroll down and share your thoughts, plans and questions in the comment box below. We can all learn from and inspire each other.

Here’s to your health!

Non-profit inside-the-box thinking: Sell-Sell-Sell ! ! !

September 20, 2012 erik Board development, Fundraising, organizational development

As promised in last Friday’s post, I dedicated Tuesday, yesterday and today to challenging proponents of “outside-the-box thinking” and examining various “inside-the-box thinking” principles. This week’s posts were determined by DonorDreams blog subscribers who took the time to voice their opinions via a poll last Friday. Thank you to those of you who voted. Additionally, the foundation of these posts are rooted in Kirk Cheyfitz’s book “Thinking Insider The Box: The 12 Timeless Rules for Managing a Successful Business.”

DonorDreams blog subscribers voted to hear more about chapter six of Cheyfitz’s book, which is titled “The Marketing Box: Unifying the Whole Business”.

I love how the author starts each chapter with a short sentence that serves as “food for thought”. The following is how chapter six started:

“You should be selling all the time.”

This is a complex chapter and a little mind-bending because the author contends that the average person’s idea about marketing is all wrong. Most people equate marketing with advertising, when in reality it is much bigger. He says in the book:

“Economists, academics, and marketing professionals have come to see marketing this way — as the single discipline that embraces and unites virtually every aspect of business activity. Marketing: Guides production . . . Governs distribution . . . Controls advertising, promotion and all marketing communications . . . Peter Drucker has written that business’s only purpose is “to create a customer,” and because of that, “marketing and innovation” are the two basic functions of business”.

Well . . . WOW! In a nutshell, Cheyfitz is saying:

Marketing is everything and

successful businesses do it all the time!

As I said in yesterday’s post, this concept is a little difficult to apply to non-profit corporations because the word “customer” usually conjures up images of clients and donors (or both) depending on which chair you sit in. Unlike yesterday, I won’t limit today’s blog to just talking about donors. I will attempt to GO GLOBAL.

I could probably write pages and pages on this topic because there is a lot of ground to cover. Instead, I will start a laundry list of examples and hand-off the baton to you so you can continue it in the comment section.

The following are just a few examples of marketing (and you will see how it unifies everything we do):

How your program staff talks to and treats clients is marketing because it shapes the perceptions of your brand in the community among volunteers, donors, potential staff, prospective donors and future board members.
The decision to create a new program and write a big grant to get it off the ground is marketing. You are sending messages to people around you about what is important and what is a priority. These messages get picked up by volunteers, staff, clients, and donors. They in turn amplify these messages throughout the community. These actions and messages will even impact the long-term sustainability of your new program depending on donor perceptions.
Sticking with the creation of new programming from the last bullet point . . . talking with clients and prospective clients before making the decision to offer that new service is marketing. If your new program doesn’t fill a community need and your actual or potential clients, then it is your initiative will likely failure (which will likely have a ripple effect among donors, etc).
How and what the executive director says to or does with their staff is marketing. When they tell co-workers that the agency has challenges, it impacts staff turnover and in turn affects program quality and how the donor community’s perceptions of their investments.
Talking to volunteers and donors before developing another special event fundraiser is marketing. You need to determine if people will support this new idea before investing time and money into developing it.
What an executive director includes in the board packet and says in the boardroom is marketing. All of those messages get amplified by your community ambassadors (aka board volunteers) on the street when they’re networking.

Cheyfitz tells us that marketing happens pre-production, during production, and definitely after production. In non-profit terms, it happens before the donor writes the check, during the solicitation process, and in-between gifts for the duration of your relationship with that donor. More specifically, marketing happens during every waking moment of a non-profit professional’s life in their dealing with staff, volunteers, clients, board members, donors, and the community-at-large.

At the end of this chapter, Cheyfitz offers six different tips on how to build your organization’s box rather as opposed to thinking outside of it. I won’t ruin the surprise (because you should buy this book and read it), but I will share two of his tips to whet your appetite:

Marketing (in other words everything you do) must unify every aspect of a business around one purpose: creating a customer.
Every time a company touches a customer, there is an opportunity to win or lose that customer. These opportunities must be maximized, not avoided.

How does your organization see and approach “marketing”? Are you trying to thread the idea of marketing throughout everything you do? If so, can you share a few examples? How do you prepare others (e.g. staff, board members, etc) to communicate and demonstrate what your agency is all about? Please share your thoughts in the comment box below.

Here’s to your health!

Non-profit inside-the-box thinking: Donors are the boss

September 19, 2012 erik Donor-centered fundraising, Fundraising

As promised in last Friday’s post, I am dedicating yesterday, today and tomorrow to challenging proponents of “outside-the-box thinking” and examining various “inside-the-box thinking” principles. This week’s posts were determined by DonorDreams blog subscribers who took the time to voice their opinions via a poll last Friday. Thank you to those of you who voted. Additionally, the foundation of these posts are rooted in Kirk Cheyfitz’s book “Thinking Insider The Box: The 12 Timeless Rules for Managing a Successful Business.”

DonorDreams blog subscribers voted to hear more about chapter five of Cheyfitz’s book, which is titled “The Box Top: Customers Are The Boss”.

I love how the author starts each chapter with a short sentence that serves as “food for thought”. The following is how chapter one was started:

“Give customers what they want, not what you want to give them.”

Most of this chapter talks about how the “customer experience” has been the foundation of our economy for centuries and is easily traced back to the Middle Ages. Cheyfitz does a great job telling readers about customer-centric lessons we can all take to heart that were developed by the silk merchants in the 1300s, the town butchers in the 1700s, and the department store barons like Sears and Wards in the 1900s. It was eye-opening to see how the author took seemingly “modern” business practices (e.g. using CRM to segment customers into niches, using customer loyalty programs to reduce turnover, etc) and trace them back to pre-Magna Carta days.

As I attempt to make heads-or-tails out of this chapter for non-profits, it strikes me that non-profits have a more difficult challenge than their for-profit cousins when it comes to focusing on customers and thinking inside-the-box.

Why? Because when a non-profit reads the word “customer,” two different images are conjured up . . . “donor” and “client”. I believe that successful non-profit leaders are able to balance these interests and develop customer-focused approaches for both audiences. However, for the balance of this blog post, I am just going to focus on the donor side of this equation.

For those of you who routinely read DonorDreams blog, it won’t be surprising to learn that everything Cheyfitz talks about in chapter five aligns perfectly with what Penelope Burk espouses in her book “Donor Centered Fundraising“. You can see this is clearly the case from the following language on page 74:

“Simply put: Find out what customers really want, then give it to them. Make sure they have plenty of choices — in what they buy, where they buy, how they buy, and how they pay for it all. And address them personally, talk to them honestly, and treat them well every step of the way.“

The bigger question for me is: “How many non-profit organizations are really doing this?”

We work hard to convince donors to give us unrestricted gifts rather than funding a specific program.
We write funding proposals aimed at telling donors what we need.
We solicit donors using tactics that fit our needs and match our resources rather than how the donor feels most comfortable being solicited.
We fire off a database generated thank you letter and skimp on the transparency when it comes to showing donors exactly what their contribution paid for and what good it helped do.

As I think back to some of the most successful donor relationships that I’ve personally built, it really goes back to personal interaction, building a relationship into a friendship, understanding what the donor really wanted to get out of the relationship, and treating them like I treat members of my family.

So, how can non-profit organizations get back to the customer service principles used by the small town butcher or general store owner? How do we build our box and think inside of it rather than trying to “think outside-the-box”?

At the end of this chapter, Cheyfitz offers six different tips on how to build this box. I won’t ruin the surprise (because you should buy this book and read it), but I will share two of his tips to whet your appetite:

Never assume you know the reason a customer does anything. Always ask. Always listen. Always use the resulting information.
When creating a customer relationship plan, ask . . .

Who needs to be talked to and courted?
What different groups do they fall into?
What outcomes are desired?
What messages will be delivered?
How will success be measured?

Not only will these tips help you craft an awesome stewardship plan for your donors, but they are the basis for almost any plan you will ever write for you organization (e.g. strategic plan, marketing plan, business plan, board development plan, etc).

It is easy to conclude after reading this chapter that if you’re not personally sitting down with at least one donor every day, then you’re not living “inside-the-box” and your organization is not donor-centered.

How do you meet your donors’ needs? How do you know what those needs are? How do you successfully align donors needs with your clients’ needs? What are you doing to keep this “inside-the-box” principle in front of you every single day? Please use the comment box below to share answers to these questions or any other thoughts that this post may have inspired.

Here’s to your health!

Non-profit “inside the box thinking” — Understanding change

September 18, 2012 erik Fundraising

As promised in last Friday’s post, I am dedicating today, tomorrow and Thursday to challenging proponents of “outside-the-box thinking” and examining various “inside-the-box thinking” principles. This week’s posts were determined by DonorDreams blog subscribers who took the time to voice their opinions via a poll last Friday. Thank you to those of you who voted. Additionally, the foundation of these posts are rooted in Kirk Cheyfitz’s book “Thinking Insider The Box: The 12 Timeless Rules for Managing a Successful Business.”

DonorDreams blog subscribers voted to hear more about chapter one of Cheyfitz’s book, which is titled “The Basic Box: Some Things Never Change”.

I love how the author starts each chapter with a short sentence that serves as “food for thought”. The following is how chapter one was started:

“Know the difference between what will change and what won’t, and pay attention to the former.”

Most of this chapter talks about how some economists and many pundits are flat wrong about what they see as a “new economy”. He points to the dot-com bust of 2001 and talks about how ignoring human behavior and the basic principles of capitalism will get you and your company in trouble all of the time.

This chapter got me thinking about Gail Perry’s recent post titled “Post Recession Donors Have Changed” over at her Fired Up Fundraising blog.

After reading Perry’s post about donors, I realized the following:

There will always be donors regardless of how good, bad or sluggish the economy is. This will never change.
The mindset of those donors and conditions upon which they will donate is always evolving. This is constantly changing.

Cheyfitz’s encourages us to pay attention to “what will change” because not focusing on the ever-changing landscape is what puts too many companies (both for-profit and non-profit) out-of-business.

Gail Perry tells us in her blog that post-recession donors . . .

trust non-profit agencies less than they used to,
crave more information about ROI,
want to see more transparency, and
want to contribute to fewer unrestricted fundraising campaigns.

Read Gail’s blog for a few great tips on how to use “inside-the-box thinking” to address these perceived trends in the donor community.

There are also many other interesting trends occurring in the donor community:

technology’s impact on giving,
technology’s impact of cultivation and stewardship activities, and
donor communications moving from one-way to two-way communications.

Cheyfitz urges us to not focus on “the shiny object” (in this case it would be technology) and throw what works out the window for what we don’t understand (e.g. ePhilanthropy). However, he does not tell us to ignore the changes that are starting to happen. Instead, he point to the words that are chiseled above the entrance of the National Archives in Washington, D.C.:

“The past is prologue”

He ends the chapter by saying, “Paying attention to history, in short, can save a lot of time and pain and produce a lot of gain.”

The non-profit sector has seen this kind of change in communication technology before, right? I am thinking about the rise of “direct mail” and how that changed how we cultivate, solicit, and steward donors today.

I suspect that non-profits, who tossed their special events and peer-to-peer annual campaigns onto the trash heap and invested everything they had into direct mail, probably went out of business. Those who survived kept their eyes on the trend, engaged their donors in thoughtful discussions about their preferences with direct mail, and proceeded forward with caution and strategic focus.

Again . . . outside-the box thinking will sink you, and inside-the-box thinking will keep you afloat.

At the end of every chapter, Cheyfitz provides a few tips on how to “build your box” so that you can think inside of it. He offered four tips at the end of chapter one, but the last tip struck me as very appropriate for non-profit organizations during these challenging and changing times (read the word “customer” as “donor” to help with the non-profit translation):

“Use your time to focus on how your customers’ lives are changing and how you can serve their emerging needs with new products and services (delivered using the same old business models).”

Are your donors behaving different after the economic crash of 2008? What is your donor data telling showing? What are donors telling you? What kinds of “inside-the-box” best practices are you employing to thrive in this new economic climate? Please scroll down and use the comment box to share a thought or two with your fellow non-profit professionals this morning.

Here’s to your health!

Don’t sing the ‘goodbye song’ to your non-profit donors

September 7, 2012 erik Donor-centered fundraising, Fundraising, organizational development

Today, I am focusing on a post that John wrote about attribution theory and contingency theory based upon a “classroom song” story that a friend shared with him over a fierce game of Scrabble. After reading his post, a song jumped into my head from my days at Grace Pre-School in Mount Prospect, Illinois. It goes something like this:

“Grace Pre-School is over and its time for us to go home;
Goodbye, goodbye;
Be always kind and good;
Goodbye, goodbye;
Be always kind and good.”

That was the song we sang at the end of the day when it was time to pack-up and go home. I can’t believe how four decades later that song sprung into my head as conveniently as if I had just sung it yesterday.

At the ripe old age of four, that pre-school song helped me bring the school day to a close. It reminded me to put my toys away, say goodbye to my friends, get my coat and bag, find my Mom, and leave the building without shedding a tear. It only worked within the confines of the church that housed my pre-school program. It didn’t result in me being “kind and good” . . . you can ask my Mom and she’ll tell you that I could be a terror on certain days.

To think that singing my pre-school — anywhere and anytime — would yield the same results or “cause” me to be “kind and good” is quite simply misattribution.

In the non-profit fundraising world, we do this all the time with donors and it goes something like this:

Contribution comes into the office,
The contribution is entered into the donor database,
The computer generates a thank you letter that is sent to the donor,
The donor gets added to a newsletter mailing list, and they receive a few newsletters,
Another solicitation is made that results in another contribution.

Cha-ching! The donor is conditioned. The money rolls in. It is oh so simple. I can almost hear fundraising professionals singing a song that goes something like this:

[youtube=http://www.youtube.com/watch?v=Wq3tVrTFcKk]

Cause and effect is such a great thing until you realize that you’ve attributed the wrong stimulus to the wrong results.

Penelope Burk, CEO of Cygnus Applied Research, does a great job in this interview with The Chronicle of Philanthropy of debunking the myths associated with singing the donor song. She points to research illustrating how the average non-profit loses 50% of donors somewhere between their first and second contribution to their agency.

Huh? I wonder if those fundraising professionals mistakenly sang my pre-school “goodbye song” to their donors instead of the “money song”. LOL

All kidding aside, Burk is the queen of “Donor-Centered Fundraising” which tells us that cookie cutter approaches to donor stewardship result in high turnover rates. Donors stop donating because they feel “over-solicited”. Many fundraising professionals hear this and think that fewer solicitations are the remedy. This conclusion is simply not true. Burk does a great job of explaining the subtle nuances behind “over-solicitation” in The Chronicle of Philanthropy interview:

“. . . over-solicitation is not a frequency of asks in a set period of time; rather, it is being asked to give again before donors are satisfied about what happened with their last gift.”

Let’s bottom-line this . . .

Every donor is like a snowflake — they’re different.
Everyone has a different threshold for what they need to see in order to be satisfied about what happened with their last gift.
No one responds to the same stewardship activities the same way.

When Burk talks about being “donor-centered,” she is really saying that we need to get to know our donors individually. We need to craft stewardship strategies around donors’ needs and preferences in order to avoid “over-solicitation”.

Am I hearing some of you mutter words like “crazy” and “impossible“? If so, then I encourage you to dwell and explore the following ideas:

database contact records
segmentation
surveys
discussions
focus groups
stewardship plan

My parting advice to you is stop misattributing the “money song” to securing donations because you are losing half of your donors after their first contribution and 90% by the fifth gift. Read up on the concepts of “Attribution Theory” and “Contingency Theory” and stop singing the “Goodbye song” to your donors.

How does your non-profit organization customize its stewardship activities to individual donors? Do you just do so for your major gift prospects? Where do you store your individualized stewardship plans? What role does your donor database play in managing your Moves Management program? Can you share your success results? Did your donor loyalty rate improve?

Here’s to your health!

Email is the foundation of your non-profit resource development program

September 6, 2012 erik Fundraising, technology

A few days ago, while vacationing in Michigan for the Labor Day weekend, I started reading “The Social Media Bible” by Lon Safko. As the pages turned and I read about marketing within a social media framework (including tactics, tools and strategies), I can’t tell you how many “ah-ha” and “hmmmm” fundraising moments that I experienced. On Tuesday, the book inspired me to post about the costs associated with bad word of mouth and how this should evolve into a “generative question” around which to organize your board meetings. Yesterday, the book had me wondering how many of your donors are “lurkers”. Today, we end this week’s series with a tip of the hat to the importance of email.

Safko reminds readers on page 62 that email is a lot older than you may remember. Sure, the first email was sent “around 7:00 pm in the autumn of 1971 as a test . . .” However, when you stop to think about it, many of us have actively and heavily been using email as an information tool (and many times inappropriately as a communication tool) for two decades.

On page 63, Safro shares a chart comparing direct mail to email marketing. I’ve tried to re-create that chart for you below:

Table 3.1 Direct Mail versus E-Mail Marketing
(Source: The Social Media Bible 3rd edition, page 63)

Measurement	Direct Mail	E-Mail
Development Time	3 to 6 weeks	2 days
Cost per Unit	$1.25	$0.10
Response Rate	0.1 to 2 percent	5 to 15 percent

In the table underneath this one (table 3.2), Safro lists a number of primary goals that businesses reported in a benchmark survey on MarketingProfs.com.

Can you guess which primary goal topped the list for companies email marketing programs?

If you guessed “Build relationships with existing customers,” then you are correct!

So, I suggested in today’s blog post title that email is really the cornerstone of most non-profit organization’s resource development programs. I came to this conclusion (kind of like those old forehead slapping V8 commercials) after reading the last few data points. Let’s do the math . . .

It takes less time to develop a stewardship piece that you email compared to the one you drop-off at the post office.
Communicating ROI to donors via email is significantly cheaper than a paper newsletter or mail piece.
More people will read your email piece; whereas, your letter or newsletter is likely bound for the shredder before it is even opened.
Our for-profit cousins (who have all of the money and calculate every ROI angle) have determined that email marketing programs are great for “building relationships”.

As I think back to my days on the front line, I start counting how many emails and html email documents I sent donors compared to stewardship letters and paper newsletters. From a pure “tally ’em up” perspective, it is now obvious to me how important email has become to most non-profit organization’s resource development programs.

So, here is the kicker . . .

When I speak to the average small non-profit organization about how many email addresses they have in their donor database and the size of their email house file, it is typically very small.

Are you asking donors to provide their email addresses on your annual campaign pledge cards? Maybe.
Are you including an email field on your special event registration forms? Not typically.
Are you asking donors to provide their email as part of an eNewsletter request on your website. No.
Do you use online donor surveys as a way to capture donor email addresses? Huh?
Do you run online contests to secure donor email addresses? Never.
Do you flat-out just ask donors to provide their email address to you? No.

If email marketing is a relationship development tool according to the for-profit industry, then non-profits need to focus their efforts and start catching up.

In fact, email is more than just a cornerstone for your organization’s resource development program . . . it forms the foundation of your agency’s social media strategy (which is the funnel you need to get donors to the info on your website and that coveted “Donate Now” button).

Before some of you burn me at the stake for this blog post, please understand that I am not advocating elimination of your more traditional marketing and mail strategies. I am suggesting that the future is all about cross-channel communication and putting the decision-making into the hands of donors. THAT is what I call being “donor-centered”!!!

How many email addresses does your organization have in its house file or donor database? How did you acquire them? What strategies worked better than others? Have you tracked and compare your donor retention rates between donors who receive ROI info via email versus other traditional methods? Do you see a difference?

Please share your thoughts in the comment box below.

Here’s to your health!

How many of your non-profit donors are “lurkers”?

September 5, 2012 erik Fundraising

A few days ago, while vacationing in Michigan for the Labor Day weekend, I started reading “The Social Media Bible” by Lon Safko. As the pages turned and I read about marketing within a social media framework (including tactics, tools and strategies), I can’t tell you how many “ah-ha” and “hmmmm” fundraising moments that I experienced. Yesterday, the book inspired me to post about the costs associated with bad word of mouth and how this should evolve into a “generative question” around which to organize your board meetings. Today, the book has me looking at your donors very differently.

In the very early pages of this book (page 29), the author describes the various “phases in the membership life cycle” for social media users:

Lurkers — These users view content, but don’t participate.
Novices — These users view content, and periodically provide content.
Insiders — These users are regularly providing content, commenting, etc.
Leaders –These users are veterans and everyone watches what they do.
Elders — These users have left the network for any number of reasons.

After reading this page, I found myself thinking about donor database segmentation practices (because the social media content provider pyramid graphic reminded me so much of a tradition range of gifts chart donor pyramid).

In a white paper written by Roy Wollen and Bonnie Massa, they talk about five ways to segment a donor database (including why to do it). They describe various donor groups as follows:

Low dollar donors, volunteers, constituents, past & present employees
Buyers (e.g. those people who attended an event, bought something from you, subscribed to something, etc)
Lapsed donors
High dollar donors
Members, benefactors, patrons
Institutional givers

In the end, we segment people into groups because we understand that different groups have different dynamics and needs. Once this revelation hits us, we understand that “one-size-fits-all” fundraising solicitation strategies don’t work. Sending a letter to an institutional giver might get you a handful of dollars, but it will fall short of what they can and will donate to your cause. For this reason, a major gifts strategy is probably the right tool.

Conversely, employing a major gifts strategy is overkill and too expensive for the legion of low dollar donors that reside in your donor database.

Once you realize how important segmentation is to the success of your resource development program, a flood of new questions come down the pike, such as:

How many database records exist in each segment?
What characteristics and needs exist for each group? (e.g. what makes them tick)
Which solicitation tools in my fundraising toolbox work best for each group?
What stewardship activities do I need to employ with each group to maximize the odds of moving them from one group to the another?
Are there things I can do to increase each groups “frequency” of donation and “size” of contribution?
What is the ROI (e.g. the cost of raise one dollar) for each group? If I shift my attention ratio around, will I raise more money?
What metrics should I be tracking?

Ahhhhh, yes. It suddenly becomes a brave new world and your fundraising perspective changes quite quickly. Perhaps, that resource development audit or donor database review takes a different shape or level of importance now? 😉

Does your non-profit organization segment its donors? How do you do it? Into what categories do you use? What metrics are you tracking and how? Has your approach changed as a result? How many social media “lurkers” exist on your agency’s various social media platforms, and how many “lurkers” exist in your donor database?

Please scroll down and share your answers and thoughts using the comment box below.

Here’s to your health!

Good word of mouth or bad word of mouth?

September 4, 2012 erik Fundraising, technology

So, I managed to sneak away to Michigan for the long Labor Day weekend. During that time, I started reading “The Social Media Bible” by Lon Safko. As the pages turned and I read about marketing within a social media framework (including tactics, tools and strategies), I can’t tell you how many “ah-ha” and “hmmmm” fundraising moments that I experienced. Over the next few days, I will share a few of those moments with you and hope to spark some discussion.

In the very early pages of this book (page 6-7), the author shares a statistic that is probably very familiar:

“Studies have shown that: An angry customer will tell up to 20 other people about a bad experience. A satisfied customer shares good experiences with 9 to 12 people. . . With the use of social media like blogs, Twitter, and Facebook, those 20 people can quickly become 20,000 or even 200,000!”

The next few pages contain social media stories about scorned customers who used social media to exact justice. One scary example involves a musician, Dave Carroll, who had a bad experience with United Airlines and told the world by producing and posting a music video about it on YouTube. I’ve embedded the video below so that you can become one of the 12 MILLION people who have viewed it.

[youtube=http://www.youtube.com/watch?v=5YGc4zOqozo]

As I read this portion of the book and viewed the YouTube video, I realized this is one of the big reasons that your non-profit organization needs to get involved in social media. You need to know what people are saying about your brand, especially before it becomes a YouTube video that gets viewed by millions of people.

However, this first thought passed quickly, and a second thought came into focus:

Does your non-profit organization know whether its clients, volunteers and donors are having good experiences or bad experiences?

And I am not just asking this question within a social media context. This big picture question struck me as one of those “generative questions” with which your non-profit board of directors should be OBSESSED.

Do we know the answer to this question?
How do we know?
What data are we collecting?
What is the data saying?
How do we improve what the data is telling us?

Generative questions promote creative thinking and create new knowledge. Good board meetings and boardroom discussions should be centered around these types of questions.

This feedback from clients, volunteers and donors is gathered in a number of different ways from a number of different sources and places.

Are your board volunteers meeting with donors outside of the solicitation process?
How are you capturing that feedback from those stewardship meeting?
Are you using surveys or focus groups with your clients and volunteers?
Are you asking the right questions?
How do you aggregate that data and report it back to the board in a meaningful way?

Too often, our under-resourced non-profit organizations get focused on the very basics of just providing service to clients, recruiting volunteers and soliciting donors. We don’t take a step back to check-in with people to see if we’re doing a good job.

What is the harm of not doing so? Circle back and re-read the first few paragraphs of this blog post . . . high turnover rates and extremely bad word of mouth that can spread like wildfire.

In the end, this generative question gets to the root of everything and answers this question:

Are you on a sustainable path?

Let’s talk about this today. Please scroll down and take 60 seconds of your time this morning by asking a question or answering any of the previous or following questions.

Does your agency have a social media presence? How do you listen to social media conversations? Is someone specifically tasked with this job? How do you monitor what is being said on the street? Do you have an example of how you intercepted “bad word of mouth” and addressed it before it spread like wildfire? How did you do so?

Here’s to your health!

Labor Day 2012: An opportunity to steward your donors

September 3, 2012 erik Fundraising

Happy Labor Day 2012, everyone! Well, Marissa is camping and I am visiting an old, dear friend in Michigan. So, I dug back deep into the DonorDream archives and thought you might enjoy reading about how Labor Day can be a stewardship opportunity. Enjoy!

Labor Day can be a stewardship opportunity. In fact, non-profit organizations can turn most holidays into stewardship opportunities for their donors.

When I was a young executive director, I used to write a letter to the editor of our local newspaper on Labor Day thanking the community’s labor unions for all of their support. In that open letter to the public, I tried to remind people that those unions were part of our community’s fabric and did “good works” that oftentimes didn’t get any press. For example:

The local Service Employees International Union (SEIU) chapter provided all of the volunteers and muscle necessary to run our duck race fundraiser.
The International Union of Painters and Allied Trades Home (IUPAT) once marshalled their apprentice program to paint our facility for free.
The International Brotherhood of Electrical Workers (IBEW), the Laborers’ International Union, as well as other unions in town were all at one time or another outright donors to our annual campaign.

I chose Labor Day to write that letter to the editor, send letters of appreciation and make thank you phone calls because the stated purpose behind Labor Day is to celebrate “the economic and social contributions of workers”.

Many non-profit organizations struggle with stewarding their donors and instead become solicitation machines (which ironically burns out donors and creates a cycle of turnover). When I’ve talked to my non-profit friends and asked WHY, the most common answer I’ve heard is that time is a limited resource.

So, I encourage you to look at the myriad of holidays on your calendar and ask yourself this simple question: “How can this holiday be used to steward our agency’s donors?” I assure you that with a little effort, you will find the opportunities are limitless.

Does your non-profit organization have any fun and effective stewardship activities and best practices wrapped around holidays? If so, please use the comment box to share because we can all learn from each other.

Here is to your health! And oh yeah . . . Happy Labor Day!!!