Steven, Author at The Better Fundraising Company

Keep Up the Urgency

Steven | March 11, 2021March 11, 2021Ask

“Urgency” was one of the reasons so many organizations’ direct response fundraising raised so much money during the pandemic.

Fundraising that was urgent tapped into donors’ wishes to do something to help right now.

But sounding urgent all the time is tiring. Fundraisers are tired of it.

So a lot of nonprofits are dialing back the urgency.

And they are going to raise less money.

This is a plea to keep the urgency in your fundraising work this year.

You Might Be Tired of It, But Donors Aren’t

You might be tired of sounding urgent all the time, but your donors aren’t.

Remember, you and your organization read every word of every thing you send out. Sometimes you read it twice or three times because you’re involved in creating it.

But most donors read less than half of the things you send out. And they don’t usually read, they scan.

So they haven’t heard it nearly as many times. Just because you and other stakeholders are tired of it doesn’t mean donors are tired of it.

Urgency is a Signal

It’s always good to remember just how many appeals your donors see on a daily or weekly basis.

My sense is that donors use the urgency of a message to help answer the question, “Does this organization really need a gift today?” If the copy and design are urgent, you have a greater chance to break through the clutter, a greater chance that the donor will pick your organization to support.

Or you can reduce the urgency and blend in with all the other appeals on her desk and in her inbox.

Stop Being Urgent When Urgency Stops Working

Keep using urgency until urgency stops working. Let your donors decide; don’t make the decisions for them.

And as I mentioned earlier, you’ll get tired of it faster than donors will, because you pay more attention and you see it more often.

Be Urgent Even If It Doesn’t Feel Urgent to You

Some organizations are so used to their work – are so used to the new world we live in – that their work doesn’t seem that urgent any longer.

But I bet what happens today and tomorrow is urgent to your beneficiaries.

And I bet it feels urgent to the vast majority of your donors, too.

Don’t Hide the Need Behind Boilerplate Copy and Pastel Design

If your organization or beneficiaries have a need, don’t hide that need from your donors.

Your organization exists in part to share the need – to make more people aware of the need so that more people are motivated to meet the need.

The urgency of the last year helped a lot of organizations stop hiding the need behind boilerplate industry jargon and lovely pastel design. They were clear about the needs facing their beneficiaries. They used urgent oranges and klaxon reds.

And it worked like crazy.

If your beneficiaries or cause are facing needs right now, don’t let up. Especially because after a year of this, the edges are fraying and the seams are showing for a lot of children … and families … and organizations.

So now, as even the media is moving on from the pandemic and won’t be reinforcing your fundraising messages, baking urgency into your fundraising is more important than ever.

It’s urgent that you do.

“You” is the magic word for newsletters

Steven | March 4, 2021March 4, 2021Report

Here’s an easy-to-follow tip to increase the amount of people who read your next newsletter:

Use the word “you” as the first word of the main headline on your cover.

That tells your donor right away that the newsletter is to her, and for her. And don’t you think she’ll be more likely to read if you signal to her that the newsletter is about her in some way? Versus what most organizations do, which is talk about themselves?

Want another tip? Use the word “you” again – in either the subhead or the first sentence of the main story.

Now you’re signaling to the donor that this really is about her. That the “you” in the headline was not just “donor-centered window dressing,” but was a signal that your organization really does care about her.

And now your donor is thinking, “Hey, this organization might be different from the other organizations I give to. They might appreciate me.”

And one final tip: use the word “you” in every single picture caption.

My rule is that picture captions should not be about what’s happening in the photo. Picture captions should be about the donor’s role in what’s happening in the photo. So instead of “Lisa and Laure enjoyed a week of summer camp at our facility” it should be, “Thanks to you, Lisa and Laura enjoyed an incredible week of summer camp!”

Now you’ve really done it. Your donor knows that you sent her a newsletter that’s about her and about what her gift accomplished.

That’s a Big Deal! Because very few (if any) of the other nonprofits she’s giving to have taken the time and money to show her what her gift did.

Some of them have sent her chest-thumping newsletters about what the organization did. But none of them have gotten in touch with her to tell her what she did.

Big difference.

And when you use the word “you,” she’s more likely to read more. And to know more about your organization. And to give more the next time you send her an appeal.

All from using the word “you” more often.

Think about it this way. As a donor, which type of newsletter would you like to receive: a newsletter that’s to everybody and all about the organization, or a newsletter that’s to you and all about what your gift did?

You know which one your donors would prefer. So follow these tips and make them one!

This post was originally published on September 10, 2019.

How to Make Sure a Low-Priced Offer Does NOT Produce Small Gifts

Steven | February 25, 2021February 25, 2021Ask

Here’s a question I get every time an organization is thinking about using a good fundraising offer with a low price point:

“OK, so our offer is $7. Are we going to get a ton of $7 gifts? Aren’t we going to raise less money this way because our donors are going to give less?”

The short answer is:

Not if your Ask Amounts for each donor are at or above what that donor gave last time.

Let me explain…

Offer Amount vs. Ask Amount

There’s a difference between your Offer Amount and your Ask Amounts.

Your Offer Amount is the cost of your offer – the cost to do the thing you promise will happen if a donor gives a gift. (We’ve talked about how those amounts should usually be less than $50.)

Your Ask Amounts are the amounts you list for your donor to give on your reply card. They often look something like this:

[ ] $50
[ ] $100
[ ] $150
[ ] $_______

Those are your Ask Amounts. (This is also often called “gift ask string” or “gift ask array” but we’re going to refer to them as Ask Amounts for clarity’s sake.)

Think of it this way:

Your Offer Amount is how much it costs for the donor to do one meaningful thing.
Your Ask Amounts are how much you’d like the donor to give today.

Make sense? Still with me?

How Smart Organizations Raise More Money

This is simple to explain, but it takes a bit of work to do. But here’s what the smart organizations do:

They customize the Ask Amounts for each and every donor.
The customized Ask Amounts for each donor are in increments of the Offer Amount.

Here’s what that looks like. Say I had recently given a donation of $100 to an organization. And they were writing me with an offer of “$35 will train one volunteer to advocate for our cause.” My Ask Amounts would look something like:

[ ] $105 to train 3 advocates
[ ] $140 to train 4 advocates
[ ] $210 to train 6 advocates
[ ] $______ to train as many advocates as possible

There’s a lot going on in that example that’s helpful.

First, the Ask Amounts are all in $35 increments – increments of the Offer Amount. Because remember, your whole letter (or email, or newsletter, or event) should be about the Offer. So it will make more sense to your donor if your reply card has amounts that are based on the offer you are writing them about.

Second, the beginning Ask Amount is at or above how much I gave last time. This is key to helping donors give how much they gave last time… or more!

Third, the description text (“…to train 3 advocates”) describes how many of the outcomes my gift will fund. This helps donors know exactly how much good their gift will do. It’s a proven tactic.

To do this, most smaller organizations use Excel to calculate the Ask Amounts and Outcome Amounts (“3 advocates”) for each donor. Then they merge in those amounts onto the reply card.

This takes real work. It’s worth it.

The Benefits to You

When your Offer Amount is low, and your Ask Amounts are at or above how much your donor gave last time, two positive things happen:

More people respond because your barrier of entry is so low. In other words, more people respond because it costs so little for them to make a meaningful difference.
You’ll raise more money because donor’s gifts will usually be at or above what they gave last time.

Increasing the number of people who respond + keeping their gifts at the same size or larger = more money for your cause!

This post was originally published on May 7, 2019 as part of a series on creating successful offers. Use the links below to read the entire series, or click here to download the e-book we created from these posts.

How to Innovate (and when NOT to)

Steven | February 23, 2021February 23, 2021Repeat

We talk often about “Repeating” the tactics and messages that work for your donors.

During one such post a while back, I brought up an important question: “how do you innovate when you’re in a culture of repeating what’s worked in the past? Because you have to innovate.”

I Was Wrong, That’s Awkward…

Let me begin by saying that I was wrong about something: you don’t have to innovate.

This might be controversial, but most nonprofits should not be innovating.

In my experience, the vast majority of nonprofits should focus on the basic building blocks of solid donor communications and fundraising before they try to innovate.

Most nonprofits should “learn the rules like a pro so you can break them like an artist” (eternal thanks for that quote, Picasso). Most nonprofits should take advantage of the incredible body of knowledge that’s been built up over the last 60 years for how to raise money effectively.

Listen, if you’re raising less than $2 million per year, you probably shouldn’t be innovating. You should focus your time on fundamentals like getting good at Asking, Thanking and Reporting, getting receipts out on time, focusing your time on major donors, having a website that’s good at receiving & tracking gifts, etc.

For instance, say you’re currently sending out 3 appeal letters per year and have a newsletter that doesn’t raise money. My advice would be to send out 5 appeals per year and start raising money with your newsletter before trying something your organization has never done before.

Those are the “long cuts” to success.

Two Paths to Innovation

Ok. You’ve fostered a culture of Repeating: you repeat tactics that work, and you invest the minimum time and money needed to update successful tactics (and not a dollar or minute more).

Then there are two paths to innovation:

When you update your materials, work to improve We call this “incremental innovation,” and it’s what most nonprofits should be doing.
Try entirely new tactics. This looks like “launching a Facebook presence” or “trying telemarketing.”

Incremental Innovation

Here’s how you innovate incrementally…

As you update materials you’ve used in the past (e.g., your year-end appeal letter, or your fall event), you do your necessary updates and then ask, “Are there any tweaks we could make so that this works a little better?”

Here are examples of tweaks you can make that almost always work:

Add matching funds
Make the language more donor-centric
Talk about your organization less
Add a deadline with consequences
Make the offer more attractive
Use customized gift ask amounts based on each donor’s last gift

Not very sexy, eh? But it’s how most of the really successful fundraising programs got where they are today. Incremental innovation over time creates a fundraising program that predictably raises more money.

Try New Tactics (but Minimize Risk)

The big idea here is to try new things without putting large portions of your revenue at risk.

Here’s a perfect example from a couple years ago: a nonprofit that regularly raised $50,000 from their Year-End appeal letter decided to not send their letter. They chose to only send emails because email was so much cheaper.

The organization saved approximately $4,000, but raised $25,000 instead of their regular $50,000. Ouch.

Any time you are considering an idea that puts a lot of revenue at risk, your goal should be to minimize the risk as much as possible.

For instance, they could have sent the letter to their Major and Mid-level donors. That’s where about 80% of their revenue came from. That would have guaranteed 80% of the revenue ($40,000!). Then they could have experimented by doing an email-only campaign to the rest of their donors.

And you know what would have worked even better? Sending the letter to all donors, and then sending a follow-up letter, and emails.

When trying something brand new, we usually follow these three principles:

Determine the “minimum effective dose.” You want to figure out the least amount you have to spend in order to get a test with reproducible results. Maybe it’s a new Facebook presence where you need to spend 15 hours per week and $1,000 per month boosting posts. Maybe that’s a radio campaign where you need to spend $20,000 on spots to really know if the campaign is working or not. Whatever it is, do the research and figure out what you need to do to make your test a good test.
Have a budget and a timeline. Define exactly how much money and time you’re going to spend on a test. If you don’t have a specific budget and timeline, you’re at risk of over-spending, or getting out too early, or running into conflict because different people in your organization have different expectations. We see this all the time in donor acquisition. Starting to do donor acquisition is hard, and usually takes at least a year to really get going. If you know that but don’t say it, and someone in the organization thinks it’s only going to take 3 months, you’re in trouble.
Define success. You have to specifically define what success looks like. It doesn’t work to say “we’ve engaged our donors more” or “we’ve built awareness in our community.” You want to use specific metrics like “our retention rate will go up 2%” or “we’ll acquire 250 new donors.” Get specific. As Peter Drucker said, “If you can’t measure it, you can’t improve it.” I’ve watched a LOT of money get wasted on new initiatives where the results weren’t really measurable.

What’s Next for You?

Hopefully this helps you a) think about what you should be doing next to raise more money, and b) avoid the common mistakes many nonprofits make.

Now, make a plan and go get ‘em! And if you want help, get in touch. You can use our experience (from successes and failures we’ve learned from) to move your organization forward faster!

This post was originally published on June 21, 2018.

Make “The Leap” to Acquire a LOT of new donors

Steven | February 18, 2021February 17, 2021Ask

This post is about acquiring new donors.

But it’s for nonprofits at a very specific stage in their development.

Keep reading if the following three things are true for your organization:

You’re actively trying to grow
You realize that to achieve that growth you need more new donors each year than you’ve been acquiring
You know that your current ways of acquiring new donors won’t achieve your new goals

I’ll give you an example. We work with a handful of organizations that have between 500 and 4,000 donors. These organizations want to grow… but the ways they acquire new donors are labor-intensive and are hard to expand:

Tours of their facility
An event or two a year
Word of mouth
A major donor connects them to another major donor
Vision Meetings

All good things – but small nonprofits can only do so many of them each year.

So the organization is stuck: they want to grow, know they need more donors, but don’t have the staff to do more.

If That’s You, What Do You Do?

If that’s you, please know that you’re in good company. A LOT of organizations are in your shoes.

But your question remains: how do you begin to acquire significantly more new donors than you have in the past?

It starts with thinking differently about acquiring donors. The Big Idea is that there is a cost associated with acquiring new donors. You’re going to need to pay for the attention of potential donors via media like radio, the mail, Facebook ads, etc.

In my experience, most smaller nonprofits never make the leap from homegrown, labor-intensive methods of acquiring donors. These smaller nonprofits don’t want to pay (or don’t think they can’t afford) the costs needed to do this.

But if they really want to grow, they need to.

Making the Leap

Below are my tips for “making the leap” to a new way of acquiring new donors.

And I need to say right away that I’m not providing the solution to your donor acquisition problem. This is not “7 easy tricks to more donors than you can count!” (That post would probably get a lot of readers, but it wouldn’t hold water because there is no silver bullet.)

The Current Situation

Most small nonprofits have no line item in the budget for donor acquisition. They also really don’t know their current cost for every donor acquired, because those costs are buried in other expenses.

For example, they might spend $50,000 on an event that acquires 100 new donors. But the expenses are only looked at in relation to how much revenue came in, not how many new donors were acquired.

What’s needed is a dedicated budget for donor acquisition.

How to Grow

Smaller nonprofits basically have two options for growth. You can pursue either one, or both:

Start a scalable Donor Acquisition program. This means doing specific activities like buying radio spots and/or mailing lists, upping your online donor acquisition game, etc.
- For example: doing a radio share-a-thon for $15,000, getting 500 new donors, then doing that every year moving forward. And this is scalable because you could do two radio share-a-thons for $30,000 and acquire 1,000 new donors. Or 3 radio share-a-thons for $45,000 and acquire 1,500 new donors.
Do more of what you’re currently doing. (For clarity’s sake, I would define what most smaller orgs are doing in donor acquisition as not scalable. Could you expand your event and get 250 more donors? Maybe. Could you add three more events and get 750 new donors? Probably not.)

In my experience, “doing more of what you’re currently doing” almost never results in the type of growth a motivated organization is looking for.

So they have to bite the bullet. They have to pay the costs to start up a donor acquisition program.

Ask a Good Question

The most successful organization leaders, when they want to grow, are asking one of these questions:

“I have $XX,XXX to spend on getting new donors in 2018. How many new donors could we get for that?”
“I need X,XXX new donors in 2018. How much is it going to cost me?”
“By 2020 I need to have our income be 50% higher than 2017. How many new donors do we need to reach that level, and how much will it cost?”

If you know how much you have to spend, we can estimate how many new donors you can acquire.

If you know how many new donors you want to acquire, we can estimate how much it will cost you.

If you know how much you want to be raising 5 years from now, based on how your current donors are performing, we can tell you how many new donors you’ll need, to reach your goals.

Helpful Big Ideas

For organizations who want to begin scalable donor acquisition, there’s a set of ideas that more-or-less must be present in your organization for it to work:

If your organization is serious about acquiring new donors, you’ll have a line item in your budget for Donor Acquisition.
Measuring the Cost Per New Donor is a sign of maturity for an organization. It means you’re running the thing like a business, with known (and measured) inputs and known (and predictable) outcomes.
Scalable methods of donor acquisition require an investment mindset. Usually in donor acquisition you lose money in the short term, but you make money in the long term. For example, you might spend $1,000 and get 10 donors who each give you $50. So you spent $1,000 to raise $500. BUT, if you do a good job retaining those 10 donors they’ll give you $3,000 over the course of their time with you. So you actually spent $1,000 to raise $3,000.
There’s no way to know exactly how much a new donor will cost for an organization without testing. But there are industry standards and deep experience for every media channel – even Instagram, believe it or not. Find somebody or some organization who is doing a lot of donor acquisition, and ask them. In my experience, people will help you.
The Cost Per New Donor is always higher when you first start scalable acquisition methods. That’s because you do not know what will work best. Over time, you figure out which messages and mediums work best, and the cost per new donor comes down over time. (This is another reason it’s so important to have an investment mindset when you start to scale your acquisition.)
There is a “minimum level of investment” to start a donor acquisition program. For instance, if a radio share-a-thon costs $20k and gets you 200 donors, you can’t buy half a share-a-thon for $10,000 and get 100 donors. And by the way, Dear Reader, I don’t think you need to hear this. But I share it because there’s always someone on a Board that says, “Could we just buy seven commercials and see if that works?” What you want to do is figure out what the “minimum effective test” is, and do that. Not half of that.

Moving to this type of donor acquisition is a great sign of growth and maturity for an organization. It’s almost always a sign of a nonprofit being run like a business – and I mean that in the best way possible. It’s being a great steward of the resources given to us by donors to maximize their impact.

Good luck out there – and get in touch if you’d like to talk about donor acquisition!

This post was originally published on September 13, 2018.

“If you serve one audience, you’ve let another down.” – Seth Godin

Steven | February 16, 2021February 16, 2021Ask

That quote explains why some organizations have trouble “making the leap” to their next level of fundraising success.

Too many nonprofits create fundraising that serves an internal audience. And their fundraising lets another audience down: their donors.

Here’s how this happens. An organization’s fundraising is often written and designed to make internal audiences happy. Members of that “audience” tend to be Executive Directors, the program team, the Board, or a Major Donor who is super-involved.

We can’t ever forget that their intentions are good. They’re trying to help.

They prefer fundraising to be a certain way. And they hold sway. So fundraising is created to serve that internal audience.

But… “If you serve one audience, you’ve let another down.”

The audience that gets let down is their donors.

Want to Make the Leap?

Create fundraising that serves donors and “lets down” internal audiences.

Creating fundraising that serves donors instead of internal audiences is often a seismic shift for organizations. Seth calls this “the difficult choice of disappointment.”

It’s hard to choose who to disappoint. It creates conflict. I’ve seen people lose jobs and leave jobs.

I’ve seen organizations become aware of the choice, yet continue to let their donors down. Even despite testing data that shows that donor-serving fundraising would raise more money and allow the organization to do more good!

And I’ve seen organizations who shift their fundraising to serve donors and very quickly make the leap to their next level of fundraising success.

What to Do?

For the “internal audiences” reading this, I hope you’ll make the difficult choice to create fundraising that serves your donors. Set aside what you like and what you think will work. Then research what donor-serving fundraising looks like. Follow this blog. Sign up for Free Review Fridays. Make the Big Shift. Be willing to try things that will make you uncomfortable.

I often encourage Fundraisers to do the “hard, other-centered” work of creating fundraising that generously “crosses the gap” to meet your donors where they are.

Because fundraising is supposed to be for donors. Not for internal audiences.

My 25+ years of experience tells me that if you choose to disappoint the internal audience by choosing to serve donors, you’ll raise more money and do more good.

Quick Thanks & Encouragement

Steven | February 11, 2021February 11, 2021Crisis

Today’s post is a little different: it’s the text of an email I sent out yesterday. It made a number of Fundraisers like you “feel seen and encouraged” — and I hope it does the same for you.

— Steven

Dear NAME/Fundraiser,

If there’s one thing I know right now, it’s that Fundraisers are tired.

Most of us aren’t “about to quit” tired. But there are a lot of us who are second-week-of-December-tired even though it’s only February.

There are a lot of us who used to push hard until 5:00 or 6:00 each day… and are now finding themselves (finding myself) kind of… losing steam around 3:30.

One day last week I had three meaningful, unprompted conversations with Fundraisers who were tired. A high-powered V.P. An experienced leader with a long track record of success. The founder of a growing organization.

Then the next day I spoke to a young woman who’s been in fundraising for two years. She can’t decide if working in fundraising is the best thing ever, or it’s going to burn her out before she’s 30.

I won’t get into comparisons – most of us haven’t been in PPE on the front lines this last year – but I will say that fundraising is more emotionally draining than many jobs because of the amount of empathy required.

But I’m not a motivational speaker. Nor am I a counsellor. So why am I writing you today?

Two things.

First, if you haven’t recently, I encourage you to talk about the tiredness at your organization or team. And if you aren’t more tired than normal, thank your lucky stars – and then ask if other people are. Because chances are, they are.

Naming what’s going on will help us all have a little more grace for each other.

Second, I just want to say thank you for being a Fundraiser.

Thanks for all the good you’ve done for your beneficiaries or cause, especially over the last year. Thanks for all the times you’ve shown #donorlove and let donors know the difference they’ve made. And for all the times you’ve shown #donortoughlove by reminding donors about real needs and injustices, and asking donors to help meet those needs and right those wrongs.

Your fundraising makes a meaningful difference for your cause or beneficiaries. Your fundraising makes a meaningful difference for your organization. Your fundraising makes a meaningful difference in the lives of your donors.

That’s pretty good news for Fundraisers to hear. All of us Fundraisers should hear it more often. Not because we’re more virtuous or heroic than anyone. But because we’re part of the solution. And that should occasionally be called out and honored.

I love the MLK quote, “Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly.”

In this “inescapable network of mutuality,” you are making everyone’s world better.

Thank you.

Steven & the Better Fundraising team

All Cars are the Same and Unique

Steven | February 9, 2021February 9, 2021Ask

When we work with nonprofits for the first time, we run into a situation again and again.

We present fundraising we’ve created for them and someone will say…

“But… this will make us look like all those other organizations. How can that be good?”

(Perhaps weirdly, when I hear them say it, I know we’re on the right track. But I’m getting ahead of myself.)

There’s a deep vein of distrust of fundraising that “looks and sounds alike.”

Many small- to medium-sized nonprofits I know actively work hard to make their fundraising look and sound different from other fundraising they see.

They want their fundraising to be unique.

Unfortunately, in their pursuit of uniqueness, most nonprofits cause themselves to raise less money than they could.

The best way to illustrate this is through a simple analogy. I want you to think about cars…

What Cars Can Teach Us About Fundraising

From one perspective, there’s a remarkable amount of uniqueness among cars. There are two-door cars, there are four-door cars. There are trucks. There are family cars. There are sports cars. There are different colors, there are different curves. Massive differentiation.

But from another perspective, all cars all “look and sound alike.” They all have four wheels. They all have windows on the front, back, and sides. They all have doors. They all have steering wheels. They all have mirrors so you can see behind you. Cars are all the same!

That “sameness” is a result of 100+ years of trial and error as the car industry identified the common set of attributes that a car needs to have to be functional and successful.

And after a car has those attributes, it gets customized to become unique.

The same is true for direct response fundraising…

The “sameness” of successful direct response fundraising is a result of 70+ years of trial and error as the fundraising industry identified the common set of attributes that an appeal or e-appeal needs to have to be functional and successful.

And after an appeal or e-appeal has those attributes, it gets customized to become unique.

The trick is to know what the attributes are. And to start with them.

These are things like “an appeal needs to be easily readable by a 75-year-old” and “the writing has to work for people who read and for people who scan.”

Those – and a host of others – are the windows, the steering wheels, the four wheels.

What happens too often is that nonprofits design cars that have five wheels, no windows on the left side, and the steering wheel in the back.

Can you get somewhere in that crazy car? (In other words, will you get some donations?) Sure. But you’re not going to make it as far as you could.

So What Do I Do?

I wrote this to help the organizations who “don’t want our fundraising to look like those other guys” to have another way to approach this situation.

Here’s my advice:

Know that doing direct response fundraising (appeals, newsletters, e-appeals, etc.) is different from other types of fundraising.
Learn the “attributes” and best-practices
As you create your direct response fundraising, focus first on the attributes that will increase your chances of success.
Then (and only then) focus on how those attributes look and sound coming your organization.

All successful direct response fundraising tends to look, sound, and feel the same. When your fundraising starts to sound like other professionally-produced fundraising, it’s a sign of success, not failure.

Uniqueness in fundraising, in and of itself, usually leads to raising less money.

But you know what’s unique and successful? Your organization sending out fundraising that has all the attributes of successful direct response fundraising. You are the only organization in the world who can do it. And when you do it, your donors will respond far beyond your expectations.

Offer Amount vs. Ask Amount

Steven | February 2, 2021February 2, 2021Ask

Today’s post shares an email exchange with the Executive Director of an organization on the East Coast.

I’m sharing this with you because the ED had a very common fear: if he highlighted a low dollar amount in his appeals and e-appeals he would cause his donors to send in lower gifts than usual.

This fear often happens to organizations who are using a strong fundraising offer for the first time.

The email exchange below helped the ED set aside his fear enough to try what we were recommending. And our conversation helped him understand two helpful ideas:

The “offer amount” is different than the “ask amounts.”
Having a lower “offer amount” will not result in high-value donors giving lower amounts of money.

I’ve placed the emails in the order they were sent. I’ve edited them lightly for clarity and to anonymize the organization.

Hi Frank,
Great meeting today. At the end of our time together it was suggested that we have the offer for our first appeal be based on the cost for one of your team members to learn Spanish.

I would not focus the offer on this. Given the list of powerful activities you guys are doing this summer (working in hospitals, caring for the poor, volunteering in food banks, etc.) I think that learning Spanish is not the most impactful thing in the list that’s included in the letter.

In our experience, the best place to focus the offer is on an outcome or action that your donors will immediately see and feel the value of.

So I’d be working to find the cost to serve in a hospital for a day. Or to serve the poor.

I think those things would be more likely to result in a gift.

Steven

Note: I know from experience that it’s important (and even vital) for members of their team to learn Spanish. However, most donors would be more likely to value the acts of service performed than they would value learning the language that allows for the act of service.

What I’m trying to do is focus the fundraising on the outcome (the act of service) as opposed to focus the fundraising on the process (learning Spanish in order to provide the act of service).

Hi Steven,
I totally get that point. However, the reality is that we don’t pay much of anything for a team member to serve in a hospital or a soup kitchen. All we pay are the travel costs to and from our HQ for the summer assignment. The real costs are the language study which involve sending a team member abroad to learn the language in the actual culture.

This year, we are spending $20,000 for the team members to do language studies. But since the language study is not the real motivator to donors, could we perhaps say something generic like “The average cost of supporting a team member in a summer of service to others is $400.” ($20,000 divided by 50 team members)

What do you think?

Frank

My Reply to Frank . . .

Hey Frank,
Totally get it.

I like how you broke down the cost per team member to arrive at the $400 number. (It’s always a great service to your mass donors to help them see impact.). However, I wouldn’t recommend using the $400 amount because it’s too high. To have the most success, the amount we use needs to be low enough (usually below $50) so that any donor can afford it.

Here’s what I’d do; divide the travel costs for the team members who serve at hospitals/soup kitchens by the number of days served. That gives you the “cost per day of service” for a team member in those places.

Two reasons:
1. As mentioned earlier, the type of service offered in hospitals and soup kitchens is far more interesting to donors (in my experience) so it would be crazy not to focus a donor’s attention there.
2. Because all your organizations pays for is the travel, the “cost per day” is going to be really low. That will feel like a great deal to donors – which is always a good thing. I would even say something like, “Their food and lodging costs are covered, all we need to pay for is their travel and they’ll serve people for the entire summer! And if we write the letter correctly the funds will be undesignated and can be used for all of the team members this summer and anything else your organization needs the money for.
That’s my reasoning. Does it hold water with you?

Frank replied…

Okay. The approximate travel costs for all of the team members is $15,000. If we divide this by 35 (the number of team members doing the service work), and then divide that by 40 (number of work days), that comes to a little over $10 per day, per team member. Since the $15k above include some other things besides travel from HQ to the different cities, e.g. lunch money, commuting expenses to the work sites, etc., I think we could simply say it costs $10 per day to support a team member in their service.
I understand the pitch you want to make. My concern is that we’ll get lots of $10 gifts, but very few larger gifts that will make the mailing profitable.

Can you help ease my concern here?

My reply…

Your concern is reasonable, and I think can ease it.
First, let me call out the difference between the “offer” and the “ask amounts.” The offer is “$10 provides one day of service.” The offer shows donors a) what their gift will accomplish and b) how much it costs to make a meaningful difference.

The gift ask amounts — how much we ask for — will be higher than the offer amount. For example, the suggested gift ask amounts on the reply card will be something like “$30 to provide 3 days of service” and “$70 to provide a week of service” and “$300 to provide an entire month of service.”

When you have a low offer amount and higher gift ask amounts, a couple things happen:
- More people give because the barrier of entry is so low. If we’d gone with the “$400 supports a team member for a summer” offer – that’s a high barrier of entry and fewer people would have given.
- - - At risk of repeating myself but to make a point: if we provide a low offer amount then almost all donors will see that they can make a meaningful difference with even a small gift. This will increase the number of people who respond.
- We have tons of experience seeing that the majority of donors will give about the same amount that they gave last time — or higher. (Will you get a couple $10 gifts? Sure. But the overall revenue is consistently higher.)
I hope that helps. We wouldn’t recommend this technique if we didn’t have a LOT of experience with it working.

Finally, to make this technique work even better, we will customize the gift ask amounts that each donor receives based on the size of their most recent gift. This is done by taking each donor’s last gift, then calculating the appropriate-sized gift ask amounts for that donor, then printing those amounts on each donor’s reply card.

Does this help? Does it prompt any questions?

Frank was still slightly worried that focusing the letter on a low offer amount ($10 provides a day of service) would result in lower-than-normal gifts. However, he was willing to try it once.

And thankfully the appeal was a great success. It raised more money than it ever had before, completely funded the program for the year, and even raised additional undesignated funds.

After a string of successes, the organization now looks for low offer amounts for every appeal they send.

I realize that focusing on a low dollar amount is counterintuitive. But organizations who switch to this approach with their mass donors reliably raise more money than they previously did.

If you’re interested in trying this out for your organization, get in touch!