Donor-Centered

I write a semi-monthly web column for the Nonprofit Quarterly, one of my favorite publications. In fact, I strongly urge all nonprofit executives out there – CEOs, fundraisers, etc. – to subscribe to NPQ. Subscribe as an organization and then pass it around. The quarterly print edition is a keeper. For example, an issue might focus on governance, with multiple articles from experts. Another issue might focus on the nonprofit sector and democracy. And the daily web issue is also great. Subscribe now! This is the Harvard Business Review of the nonprofit sector. Read it!

But I digress.

One of my NPQ web columns is about the rich … and their irrelevancy, so to speak. I’ve written about that twice already in my own blog right here. Tom Ahern wrote about the rich and fundraising, too.

In response to my NPQ column, here’s a brilliant statement from Seattle’s Susan Howlett: 

“The top of the pyramid isn’t people with money. It’s people with deep connection to the mission. We’ve all seen instances where people without a lot of dispensable income really stretched to make a significant gift to something that matters to them — to an organization where they feel engaged in the work, connected to the leaders, on fire about the impact. My husband and I have done that, when we were leaders on boards, and we’re not rich. If we think about the top of the pyramid (or triangle) being the people with fire in their belly about our work, it takes the focus off rich people. I’d rather have a donor base full of people without a lot of resources who care deeply, than with rich people who don’t.”

The thing is, giving a major gift according to your organization’s definition of a major gift does not embrace all those who are hugely committed to your organization. Those who leave bequests are hugely committed. You might not know about that gift till the donor dies. And even then, you might not consider the gift size “sufficient” to qualify as a “major gift” for your organization. But for that donor – loving you so much that she wants to give after she is dead – I suspect that is pretty major.

The donor defines what a major gift is for her or his life. The donor chooses how to demonstrate huge commitment and love for the impact your organization can have.

Let’s build a donor pyramid that doesn’t include money. Instead, let’s build a donor pyramid that focuses on donor loyalty and Adrian Sargeant’s research. How about a “love” pyramid?

Thank you, Susan.

Read Adrian Sargeant’s article in Summer 2013 Nonprofit Quarterly. “Donor Retention: What Do We Know and What Can We Do about it.” And then do it!

Dip into the Agitator series on Donor Retention. Embrace that, too!

Compare your board’s performance to Board Source’s  Nonprofit Governance Index 2012. Yes, it was published in September 2012. But refresh your memory!

Now take a look at NPQ‘s online article by Rob Meiksins, “Is Dr. King’s Dream Realized? Not on Boards.”

Check out “Missing Pieces: Women and Minorities on Fortune 500 Boards.”

And then, read Delia Ephron’s 09-07-13 New York Times piece, “You Can’t Have It All, but You Can Have Cake.” A commentary on having it all (which may be a particularly American perspective).

Malcolm Sproull, Fundraising Manager  for SHINE, New Zealand, posted the following on LinkedIn:

“I came to the philanthropy/non-profit sector after 25 years in relationship selling and marketing in the commercial world. I never knew anyone could ask anyone for money if the asker wasn’t customer centric. It’s the fundamental DNA of relationship selling, which was the foundation for Ken Burnett’s book Relationship Fundraising.

“But your book [Keep Your Donors: The Guide to Better Communications and Stronger Relationships] was the first I came across in the non-profit sector illustrating the need to be so focused and to put one’s energies into seeking out the “pre-disposed”.

“It was the first time I had confirmation that the relationship selling principles I was then applying to the non-profit sector were not off the rails. At that early entry into the non-profit sector on many occasions I thought I had stepped into the Twilight Zone. Your books and those of Tom Ahern’s were and are a brilliant help.”

Thank you, Martin, for that marvelous testimonial about Keep Your Donors, written by Tom and me. But more importantly, thank you for your insights. Hey everyone, pay attention to what Martin says:

• A donor is a customer. Think customer centric. Then you’ll understand donor centric.
• No one can ask for money unless they are donor centric!
• Customer centric and donor centric are the DNA of relationship building.
• For heavens’ sake, read Ken Burnett’s seminal book Relationship Fundraising.
• Focus. Identify those that you suspect might be predisposed to your cause. Avoid cold calling.
• Once you’ve identified some predisposed, qualify them as prospects…or leave them alone! A prospect means someone who has actually expressed interest. Don’t confuse the predisposed and actual prospects.

Did you read Tom Ahern’s, archived on his website? “Proposed: A new set of messages for nonprofits.” He talks about emotional triggers and other tricks of the trade – and how we need to use them.

Well, I’m the “senior expert” explaining “fundraising 101” that he references in his e-news. I’m the one who apparently smiled warmly. (He should know; he was in the room watching me.) After Tom’s usual great presentation, I told people not to take the negative approach and think that these “tricks of the trade” are manipulative. Instead, we’re talking about basic principles and best practice.

I said, “Don’t worry. This isn’t manipulation. You’re plugging into people’s own values and emotions.” As you saw in his e-news, Tom thought, “What’s wrong with manipulation? I think manipulation is great.”

So what, exactly, is manipulation or manipulate? My old Webster’s Dictionary says: “Manage or utilize skillfully.” Well, that’s good.

But then, of course, what we all seem to think of mostly is, “control or play upon by artful, unfair, or insidious means to one’s own advantage.” I don’t like unfair or insidious. Actually, insidious is a somewhat odious word, isn’t it?

Then there’s that final phrase, “to one’s own advantage.” That’s really, the problem, I suspect. I trap you into doing something you don’t want to do. I make you act in ways contrary to your own interests.

But that isn’t good fundraising. Good fundraising honors and respects people’s values and interests. Good fundraisers don’t keep chasing people who aren’t interested. Good fundraisers don’t even think in terms of “hitting up” people for gifts. Good fundraisers don’t misrepresent or lie.

Good fundraisers and the most effective fundraising are ethical and respectful, donor-centered and caring. And good fundraisers and effective fundraising apply the body of knowledge and research, and use the best tools.

I’m in Paris presenting at the French fundraising conference hosted by l’Association Française des Fundraisers. But first, I went to l’Orangerie and saw the Monet water lilies. In all my visits to Paris, this is the first time I’ve viewed them. Lovely, lovely, lovely.

If I were really creative, I suppose I could figure out a way to link Monet’s repeated paintings of water lilies into some ode to loyalty. Obviously, Monet was loyal to his water lilies. But it’s a stretch to make a good fundraising metaphor out of the paintings.

However, we could think about raising money for important causes, like museums that preserve and show important works of art. And theatre that curates Shakespeare and features new plays, too. And universities that operate great international programs, exposing their students to other worlds. Worthy causes. Committed donors.

And it’s the fundraiser’s job – and the organization’s honor – to build loyalty, retain donors, and demonstrate the donor’s impact.

Effective donor-centered communications produces significant money – whether through direct mail letters or an extraordinary donor newsletter. (Donor newsletters done well can even produce more money than a direct mail solicitation letter.)

What’s the secret to spectacular donor communications? Being donor centric. But what does being donor-centric really mean? What does donor-centric writing look like (and sound like, t00)?

Ask Tom Ahern, one of the world’s leading experts in donor-centric communications. His writing raises a ton of money. And Tom has just created a brand new set of DVDs…that completely demystify how to write donor-centered communications.

This set of DVDs can revolutionize your donor communications, develop loyal donors – and just plain raise more money. Get your own Tom Ahern DVD by clicking here, http://www.TomAhernDVD.com

Learn to write with your donors in the center, as the hero. Yes, you will raise more money.

Everyone wants to be “known” – I mean understood and respected. How wonderful – as a donor – to be known and understood. Our life partners and friends can do that for us. Our family sometimes.

But how about that place I give my money and my time? How about that nonprofit that I give through to achieve my own aspirations, to fulfill my dreams, to demonstrate my own values?

To be known.

And to be remembered. Yes, that official first thank you that is timely and personal is essential. Hopefully engaging. And that newsletter that is donor-centered, which I receive regularly.

And another thank you later. A board member call. A handwritten note. An alert that I’m celebrating 5 years of giving – or how about 20 years of giving? Thanks, EMILY’S List when you called me to tell me that in just 4 more days, I would be a 20-year donor. I’ve never forgotten that call back in April 2013.

And how about showing me how you used my gift? Maybe the video featuring the activity. Or a spontaneous note because the executive director was thinking of me, the donor, when looking at the great stage production or the cute kid or the kittie or the new building.

To be remembered later. After the initial thanks. To be remembered again and again. See Andrea Kihlstedt’s lovely blog.

Colleague Pam Grow forwarded a question to me from one of her subscribers. That inspired me to write about giving societies. So here goes:

Giving societies or gift clubs or levels of donor recognition with benefits — no matter what you call them — they’ve been around forever. I imagine that lots of organizations find these useful. I suspect that it appears as if these societies / clubs work.

But – and this is a pretty big but – like so much of fundraising, we have only observation but no real research. No extensive, quality-controlled academic research to prove to us that whatever is happening is happening because of the gift club/society/etc. I remember asking fundraising research guru Adrian Sargeant about giving clubs and research. His response was, essentially, “Ah yes, another thing that the fundraising profession has not actually researched.”

So here’s what we intend these societies/clubs to do: Retain donors. Help donors move up the ladder of giving. Of course, the question is, does a society or club help do that? Or did something else produce that result?

What we do know – from research – is this: Loyalty is the holy grail of fundraising. (Thanks to the the Agitator for that glorious statement.) Loyalty is the holy grail of any business. It costs an estimated 10 times more to acquire a new donor than it does to keep a current donor. Loyal donors do, when treated well, often increase their investment. And loyal donors (even giving $50/year for 10 years) are the best bequest prospects.

Research tells us that that loyalty depends upon operating as a donor-centered organization and nurturing relationships with those donors. Read Adrian Sargeant’s research (Building Donor Loyalty, authored by Sargeant and Elaine Jay) to learn about why donors remain loyal. See also, Fundraising Principles and Practice by Sargeant, Shang, and Associates to learn about donor psychology. Read Keep Your Donors by Joyaux and Ahern to learn all about nurturing relationships with donors through donor-centered communications and cultivation, which I now call extraordinary experiences. Check out Pam Grow’s Donor Retention Project, which includes 12 action guides, 12 interviews on CDs, and more – from experts in donor retention.

Just to whet your appetite, here’s a bit of what Adrian’s research tells us about what builds donor loyalty.

• Donors are aware of consequences, e.g., believing that “someone might be hurt if I don’t give.”
• Your service quality (to the donor) is good, e.g., anticipating questions, acknowledging gifts promptly, easy to work with, focused on the customer (donors are the customer!)
• Donors are learning, e.g., you’re taking them on a journey … like through extraordinary experiences that help them feel your impact.
• And there are more reasons and strategies to build donor loyalty. It’s your job to learn this stuff. Read the resources mentioned above.

If you don’t operate as a donor-centered organization, you will lose donors. If you lose donors, you won’t have any loyal donors who will increase their gifts over the years. If your don’t have an intentional relationship-building program, you will lose donors – and donors will not increase their gifts.

Nurturing relationships (donor-centered communications and extraordinary experiences) is how we show and tell donors their impact. Nurturing relationships is how we produce the 4 bullets above – and everything else that the research shows.

Some relationship-building strategies must apply to all donors, e.g., the donor newsletter that tells donors what a great impact they have. If you don’t tell the donor of $25 how important she is and what impact she and her gift produced, why would she ever give again or give more? If you don’t regularly keep in touch with stories and offer experiences to “live” your mission and donor impact, how will the donor feel and engage more?

Some relationship-building strategies should focus on loyalty. For example, when you recognize donors (by name) on your website, in your newsletter and annual report – wherever – use a special icon to designate loyal donors. Loyal donors are very important. Remember, loyalty is the holy grail. In fact, I might even say that loyal donors are more important than Ms. Big Bucks. I just might say that.

Obviously, you have to balance workload and resources. Blah blah blah. You figure it out.

Now back to gift societies / clubs specifically: I don’t like them. Yes, I might choose to recognize donors in “categories” by gift amounts. But I don’t attach benefits. I want maximum flexibility. I want to ask those loyal $25 donors to the insider update along with a bunch of donors who gave $1,000 and a $10,000 donor, too. I invent relationship-building strategies and invite various donors at different times for different reasons.

I don’t do big monstrous parties. I nurture some relationships one-on-one. Some some in small groups of 5 or 10 or 20. And maybe some annual appreciation event. I invite a few people over for coffee and tea and an insider update about how we’re spending their money. You’ll find tons of ideas for relationship-building … a big long list (with no gift societies) … in my book Keep Your Donors. See more ideas in my blogs. See other ideas in my NPQ web column, Unraveling Development.

Here’s the bottom line: If you think some gift club is a quick and easy way to offer a few benefits to get donors to stick around and increase their gifts — then gift societies won’t work. If you think of your donors as ATM machines that finance your mission — then nothing will work to retain donors and increase their gifts.

This is about actually caring about your donors. This is about helping your donors fulfill their aspirations. First get your head on straight about donor centrism and donor loyalty. Then decide if gift societies is a useful strategy.

Hi there. It’s Simone, your information curator. Have you seen / read these? You might find them reaffirming or informative. You might use them with your executive director or board.

• Interview with Roger Craver, 1/2 of The Agitator duo. Donor retention. Social media in fundraising. Changes in the profession. And more. 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. Thanks to Jeff Brooks, May 23, 2013.

• New! I want something new. Read Tom Ahern’s e-news about “new” and other variations like (secret and insider and launch and…) But also read Seth Godin when he talks about “neophilia.” And check out Jeff Brooks’ reprise. The bottom line: What works matters more than what is new.

• And that leads to this next item, “When your common sense leads you astray,” another Jeff Brooks posting. Some uninformed person – knowing nothing about fundraising – criticizes a fundraising letter. This makes me so angry. Stop the ill-informed and uninformed expression of opinion when expertise actually matters!

• Now here’s an amusing little tale for your board members who “don’t like your fundraising.” It’s the story of Green Eggs and Ham by Dr. Seuss…translated into fund development. It actually goes along with the opinion versus expertise issue.

• Here’s another amusing little tale, “Snow White and the Seven Small Woods People.” A fairy tale of fundraising from our Agitator pals.

• I just received my copy of the Donor Retention Project. Action guides. 12 interviews on 6 CDs. 2 CDs with mp3 and pdf files. Advice from Adrian Sargeant, Marc Pitman, Lisa Sargent, Simone Joyaux… Good stuff.

• I just finished this book by Dan Ariely: The (Honest) Truth About Dishonesty: How We Lie to Everyone – Especially Ourselves. I liked it. I learned. It’s part of professional development to learn about life and community and the economy (yes), etc.

• Check out this blog, “Why Social Media Hasn’t Replaced the Traditional Marketing Funnel,” by Dianna Huff. Remember, fundraising is really good marketing/sales. By the way, Dianna is a really good search engine optimization specialist. She changed my website to the well-organized, easy-to-use site that it is now. And Dianna introduced me to the web designers who created my wonderful site.

• Another by the way, based on Dianna’s blog: Subscribe to the Stanford Social Innovation Review. And, read Jen Shang‘s work about social proof. Jen is the world’s first PhD in philanthropy – and the world’s only philanthropic psychologist.

• And finally: Check out Bloomerang if you need a donor database. Designed with Adrian Sargeant’s donor loyalty and lifetime value research. Coupled with Tom Ahern’s donor communications expertise. And the ease and intuitiveness of iPad and iPhones.

Loyalty is the holy grail of fundraising. Thanks to The Agitator for that great statement.

For us fundraisers, loyalty means donor retention. Focus on donor retention! Now! Stop treating donors like ATM machines. Stop rushing around trying to acquire new donors. First, keep the ones you have.

Do you want to retain donors? Then learn from the experts. Check out Pamela Grow’s Donor Retention Project.

Experts like Adrian Sargeant and Gail Perry. Marc Pitman and Lisa Sargent. John Lepp and Jonathon Grapsas. Pamela Grow herself. And me, too.

Pamela’s Donor Retention Project gives you proven donor retention strategies and techniques. You can follow templates and step-by-step instructions. You’ll hear expert interviews.

Get your own copy! 12 action guides. 12 interviews on 6 CDs. And more.

Please please. Keep your donors. Focus on retention. Remember, loyalty is the holy grail of fundraising – and all businesses.

Read Larry Johnson’s book, The Eight Principles of Sustainable Fundraising. Use the principles to help guide your fundraising. For example:

Principle #1: Donors are the drivers. That’s donor-centrism. And how many times have I told you that you have to focus on donor interests and their aspirations? Read my blog, Simone Uncensored. Read my NPQ web column and my book Keep Your Donors. Begin each day by reciting Larry’s first principle: Donors are the drivers.

Principle #2: Begin at the beginning. Larry talks about “know thyself,” e.g., the impact that your organization has. He talks about donors as investors. And he makes this important statement: “Investors trust your organization with more than their financial resources. In fact, they trust you with their values and higher life purpose.” As I always say – and so do so many others: Donors give through your organization to achieve their aspirations and fulfill their desires. Donors don’t give to your organization to meet your needs.

Principle #3: Leadership leads. This is another favorite of mine. And Larry reminds us of what Woody Allen said, “Eight percent of success is showing up.” The principle focuses on the role of board members in fundraising. Always useful. Sadly, too often not done very well. Just remember the UnderDeveloped Report released in January 2013. Check out my response to this report in my January blogs, and also posted as an article in the Free Download Library.

Lots of good stuff in The Eight Principles of Sustainable Fundraising.