Steven, Author at The Better Fundraising Company

Remind, Don’t Persuade

Steven | October 23, 2018Ask

When I said it, everybody in the room wrote it down.

That’s generally how I know I’ve said something helpful. Here’s what it was:

“At the end of the year your job is to remind, not persuade.”

Here’s why I said that. We’ve done a lot of year-end campaigns for a lot of organizations. We analyze the results of every single one.

When you look at them as a whole a pattern emerges. The successful campaigns? They aren’t beautiful writing that would make Shakespeare weep. They aren’t powerful case statements or success stories.

Here’s what the best campaigns tend to do:

Remind donors of the problem that your organization exists to help solve
Ask them to give a gift before the end of the year to help solve that problem

That’s it. You’re going to want to talk a lot of other things. And that’s fine — as long as the main messages you send — the first things your donors see and read — are the Need and your Ask for a gift.

You see, you don’t have time to persuade. In November and December, your donors are moving FAST. Your donors love it when your organization is clear about what you want the donor to do and how their gift will help. Because your donor is also getting a lot of other mail — mail that spends three paragraphs talking about the color of the leaves this time of year, or how excellent the year has been, or telling a story that makes it sound like they’ve already helped everyone.

The time for Thanking and Reporting to your donors for their previous gifts? That was before. Make sure you’ve done that by mid-November. Year-end is a time for Asking.

In our tests, year-end fundraising that spent significant time Thanking or Reporting raised less money

This is not just theory. This whole post is an attempt to explain testing results!

It may be hard. It may be counter-intuitive. (And it’s especially hard for smaller organizations that don’t communicate with their donors more than a couple times a year).

But trust me. The job of your fundraising from mid-November on is to remind your donor to send in a gift, not to persuade them. Just Ask. Ask Boldly. Ask without fear. Ask knowing that your donors love your cause and your organization’s role in helping them make the world a better place!

The Simple Outline for Appeals That Raise Money

Steven | October 16, 2018October 15, 2018Ask

I noticed a pattern that I want to share with you.

We see a LOT of appeals around here and I read them all. And we spend a lot of time with the results because we want our coaching to be based on what works, not on what we like.

About a week ago I noticed the appeals that did not work well tended to follow the same general outline. It goes something like this:

Thank you for helping in the past
Let me tell you a story about someone we already helped
Please help us continue this good work

I think this is fascinating because every step of that outline makes sense:

Of course you should thank your donors for their previous giving. That’s just being polite, and it reminds them that they’ve given before.
Of course you should tell them a story about a person (or thing) that’s already been helped. That shows the donor that their past gifts made a difference, that the donor can trust you, and that your organization is effective.
And of course you should ask them to help you continue the good work. You need their donations, and the work is good.

But here’s the thing; even though every step in that outline makes sense, appeal letters and e-appeals that follow this outline don’t raise as much money as they could. We know this from years of experimenting and testing. This is one of those places in fundraising where common sense isn’t the best sense. What you need is data.

So what’s the alternative? Here’s the outline that works best for our clients:

There’s a problem right now
You are needed to solve it
Here’s how your gift will solve it

When our clients adopt this outline, their appeals and e-appeals immediately start to raise more money.

The next time you are appealing for funds, follow this model. You’ll raise more money. And your donors will love knowing that they helped solve a real, urgent problem.

I mean that. If you honor and respect your donors by sharing real problems that your beneficiaries and your organization are facing, Donors will love helping you. Be vulnerable with your donors, and they will reward you with their generosity!

If you want to go deeper on this issue, download our free eBook!

The Three Things to Become Great At

Steven | October 11, 2018October 11, 2018Ask

I love getting into the tactics and details of fundraising. Things like “5 Tips for the First Sentence of Your Next Appeal Letter” and “How to Choose What to Underline and Why.”

Those tips really help people. They make a meaningful difference in fundraising results.

But tactics and details are not the most important things small and medium nonprofits can do to raise more money.

Keep It Simple

I’m a big fan of keeping things simple. Here’s a quote that perfectly describes fundraising success:

“Simple, clear purpose and principles give rise to complex and intelligent behavior. Complex rules and regulations give rise to simple and stupid behavior.” Dee Hock, Founder of VISA

So for the small nonprofits out there (and for new fundraisers), I propose three “simple, clear purposes” that create fundraising success…

**#1 – Become great at Asking people to make donations**

Your ability to know what your donors care about, and then Ask them in a way that makes them more likely to take action, is core to successful fundraising.

Super Simple Rules:

Ask with vulnerability, as if you actually need help today.
Be honest and clear about the bad thing that’s happening in the world today that your donor can help fix.
Show your donor how their gift will make a difference.
Even Harvard Business Review agrees: keep it simple.

**#2 – Become great at Thanking a person who makes a donation**

Making a donor feel your gratitude and appreciation is the key to Thanking – and keeping – your donors.

No donor has ever given a donation and thought, “Gosh, I hope this organization sends me an impersonal, boring letter to ‘acknowledge’ my gift and tell me more about the organization!”

But that’s what organizations do ALL THE TIME in their receipt letters and Thank You notes.

Here are my Super Simple Guidelines for Thanking:

Make sure the letter in your receipt or thank-you feels like it is about the donor who gave the gift, not about the organization.
No matter what vehicle you use to thank her (card, phone, in person, etc.)…
- Make sure she knows that her gift was needed.
- Make sure she knows that her gift was appreciated.
- Tell her how her gift is going to help (not what your organization has already done).

People! A great Thank You is about what the person did, not about what your organization is doing and how you do it!

**#3 – Become great at Reporting to your donors on the impact of their gifts**

Each donor gives a gift to you in faith that you are going to use it to make the world a better place.

Are you going to show her that she helped make the world a better place? Doesn’t she deserve that? Or are you going to just keep Asking her for more gifts?

Take off your ‘fundraising hat’ for a second and put on your ‘donor hat.’ How would it feel to you if the organizations you support never took the time to show you what your gifts helped accomplish?

Listen, if you want to increase the chances your donor will give you another gift, you need to powerfully show her how her first gift made a difference. Make her feel it.

After all, if she never feels like her gift made a difference, what do you think her likelihood is of giving again?

My Super Simple Rules for Reporting:

Have a printed newsletter.
Do it at least four times per year.
Tell your donor what she did, not what your organization did
Show her impact by using stories of beneficiaries.
(Keep statistics in your top desk drawer for when foundations and high Organizational-IQ major donors come to visit.)

Reporting is the least-understood part of effective long-term fundraising. And believe it or not, it can be done so well that your donors will send in money in response to your newsletters. The manual for this is Tom Ahern’s book. Or watch this free webinar.

Fundraising’s Virtuous Circle

If your organization does those three things well – Asking, Thanking and Reporting – all kinds of good things happen.

Revenue goes up. Donor retention goes up. You “close the loop” on fundraising’s Virtuous Circle.

Of Course There Are Other Things

Things like segmentation, your online fundraising strategy, donor surveys, donor engagement, etc.

But in my experience, doing your Asking, Thanking and Reporting well are the main things that make the biggest difference. So focus on becoming great at those things first.

For instance, if your organization doesn’t know how to Ask well, having a great online fundraising strategy is expensive and inefficient. If you can get 500 people in the ballroom for your event, great. But if you don’t know how to Ask well, you’ll raise far less than you could.

As an organization, make sure your organization is good at Asking, Thanking and Reporting, because you’ll raise more money and be able to help more people.

And as a Fundraiser, make sure you are good at Asking, Thanking and Reporting. Because if you can do those three things well you will rise in the nonprofit sector and make an even bigger difference than you’re making now.

Resources For You

Last week we released our brand new eBook to help nonprofits get better at Asking. It’s free, go download it.

Our previous eBook, Storytelling For Action, is also a free download. It has the helpful “Story Type Matrix” that shows the research-based guidelines for what types of stories you should tell, and when you should tell them.

My friend, becoming great at Asking, Thanking and Reporting is a knowledge issue, not a talent issue. You can learn this stuff, raise more money, be more confident that your fundraising is going to be successful, and help more people!

Five Tips for the First Sentence of Your Next Appeal Letter

Steven | October 9, 2018October 9, 2018Ask

The first sentence of your next appeal letter is really important.

Most readers will use it to decide whether to keep reading . . . or start thinking about whether to recycle or delete your message.

So yeah, it’s important. We’ve written hundreds of appeals and e-appeals over the years, and studied the results. Here are five tips to make your first sentence GREAT:

1. Short and Sweet

Your first sentence should be short and easy to understand. If your first sentence is long, complex, has lots of commas and clauses, and maybe a statistic or two, would you want to keep wading through? Remember, your reader is using it to decide whether to keep reading . . . or not.

2. Drama, Drama, Drama

Fill it with drama or make it interesting to your donor. Drama and tension are two of the best tools you have for engaging their interest. Or make it something that would be interesting to your donor – which is likely something different than would be interesting to you!

The worst example of this I ever saw was a first sentence that said, “Recently we hosted a staff leadership seminar.” Ouch.

3. What’s The Point?

One of the best first sentences is, “I’m writing to you today because . . .” That sentence forces you to get right to the point – which donors really appreciate. Do you want to know why so few donors actually read fundraising letters? It’s because they know how long it takes most nonprofits to get to the point! So if you and your organization get to the point quickly, your donor will be far more likely to read more.

4. Who Cares?

Another great tactic is to make the first sentence about the donor. Think “I know you care about Koala bears” or “You are one of our most generous donors, so I think you’ll want to know . . .” Listen, most of the other organizations she donates to wax poetic about totally unrelated things or about how great they are. When you write her and talk about her, she’ll love it!

5. Less is More

After you’ve written the first draft of your appeal, you can often delete your first couple of sentences or paragraphs. This happens to me all the time in my own writing, and in appeal letters that I edit for clients. In the first draft, the first couple sentences or paragraphs are often just warmup. They can be deleted and your letter will be stronger because now it gets right to the point.

So next time you’re writing, pay special attention to your first sentence. Keep it short and easy to read. Fill it with drama if you can. And when more people read your writing, more people will donate!

PS — For more on writing appeal letters that move donors to action, check out our free e-book!

Stay Vulnerable, My Friend

Steven | October 2, 2018Ask

I laughed out loud when I heard Tom Ahern say, “A lot of charities could be mistaken for egomaniacs.”

Egomaniacs

It’s true, right? You’ve seen it. You’ve heard from some of those nonprofit egomaniacs. You’ve even given to some of those egomaniacs.

And you and I know the antidote: those organizations need to be more donor-centric.

But I have to admit that “donor-centricity” never quite captured how I think about fundraising. I felt like it was missing an idea that I couldn’t quite put my finger on.

So I inhaled audibly when I heard Brené Brown say, “Through my research, I found that vulnerability is the glue that holds relationships together. It’s the magic sauce.”

Vulnerability

“That’s it,” I thought. “That’s what nonprofits need. Nonprofits need to be donor-centric and they need to be vulnerable to their donors.”

Trust me on this, it will make sense in a second.

The dictionary says vulnerable means “capable of or susceptible to being wounded or hurt.”

Most nonprofits tend to communicate as if they are in-vulnerable:

Nonprofits rarely say to the donor, “you are needed now.”
Nonprofits rarely say, “All these good things that happen, it’s because of you.” (Instead they say “look at what we did” and then tepidly say, “thank you for your support.”)
Nonprofits almost never admit that ‘programs will be cut’ or ‘fewer people will be helped’ if the funding does not come in.
Nonprofits rarely talk about the people not being helped / the work not being done. Instead they only talk about successes.

I know this sounds weird because it feels like all nonprofits are asking all the time.

Go look at a lot of nonprofit communications all at once (like most donors experience it in their mailbox and inbox each day). What you’ll see is that most nonprofit fundraising communicates that everything is going fine for the organization, but they do kind of need your support, and it would be special if you’d “join” them.

Does that sound like the nonprofit really needs the donor to take action right now?

Nope.

And then the nonprofits are surprised that they don’t get more donations.

What Does “Vulnerability” Look Like in Nonprofit Fundraising?

Here’s what it looks like in practice. And weirdly, this is exactly what works best most of the time when organizations Ask for donations.

Ask as if they actually, really need help today. Like really, really need the donor to send help! Not hiding the need behind phrases like, “Please consider making a contribution” but boldly saying, “You and your gift are desperately needed. Please send in a gift today, or go online right now to www….”
Communicate that there are reachable people who need help right now. This is telling the donor that there are people in need right now who can/will be helped if the donor responds. Note: this is NOT hiding behind a big number like “4,317 children die of preventable causes each day.” That’s a statistic, not an example of reachable people in need.
Communicate the consequences of not giving. Share with your donor what will happen if she (and others like her) don’t give. Donors almost never hear these consequences. You know them because you’re an expert and you’ve seen it. But the consequences aren’t top of mind for your donor. Remind her. (NOTE: I’m convinced the % of Income donated to charity – a number that has remained basically the same for 40 years – would increase if donors were clearly told the consequences of not giving.)

This Will Feel Awkward and Scary at First

Folks will be worried that “donors won’t think we’re professional if we talk like this” or “we will scare people away” or “donors will think we aren’t good at helping people.” Or even the one I hate the most, “talking about people in need is emotionally manipulative.” (How is it emotionally manipulative to tell the truth, again?)

I cannot tell you what your donors will think. No one can. But I can tell you that the results from test after test are clear: if you are vulnerable and do the things I describe above, you will raise more money in the short term and the long term. With Mass and with Major donors.

Remember: Report

The other side of this coin: if you Ask with vulnerability, you need to Report to your donors what happened because of their gift.

You need to show them how their gift made a difference to your cause or your beneficiaries.

Because Asking powerfully with vulnerability over and over and over again – and never making your donor feel the results and the progress – that’s what makes people tune out over time.

We all have people like this in our lives; they only ever call you when they need help.

You don’t want to be that type of person. And nonprofits don’t want to be that type of nonprofit.

So on a regular basis, you need to send your donors a newsletter that shows them what they’ve done and expresses gratitude for their doing it. You need to send regular emails (not e-news) that share a single great story that shows how the donor’s gift made a difference.

Share the good news and give the donor the credit. This is another example of being vulnerable to your donors. Give them the credit.

Close the loop. Donors will love you for it.

How It Works

You Ask with vulnerability, like you really need help. You show the donor how bad things are happening in the world, but good things will happen if she gives a gift.

She’s emotionally moved. She’ll give you a gift.

Then you Report back to her. You show her an example of how her gift made the world a better place. How her gift helped somebody.

She’s overjoyed! Partially because you told her she made a difference. And partially because most nonprofits usually send her some chest-thumping marketing materials (“Look what we did!”) instead of telling her that she made a difference.

Now she trusts you. She sees that her gift made a difference. She’s FAR more likely to donate to you again.

Now you raise more money with each appeal. Now you keep more of your donors for longer.

Now you raise even more money with each appeal. More people become major donors.

It’s all a cycle. And it starts by telling a donor that she’s needed right now, and that her gift will make a difference.

Nobody said fundraising was easy. But at the core, I think it’s pretty simple to understand.

Want to Go Deeper?

We just released our brand new eBook, Asks That Make Your Donors Take Action. It’s free – go download it.

And in the meantime, be vulnerable!

Lessons from 25 Year-End Fundraising Seasons

Steven | September 25, 2018Ask

This year will be my 25th year-end fundraising season. (In related news, I have a lot of grey hair.)

That means I’ve been a part of about 250 separate year-end campaigns for different nonprofits around North America.

Let me share with you what I’ve learned. Because we do lots of testing, pay close attention to what works, and have a pretty good handle on what works the best.

But before I do, allow me a brief aside. The thing I’m personally most excited about this year is the four low-cost products we just released. They take complex year-end fundraising campaigns and break them down into simple, easy-to-follow steps. They are written and designed so that you’ll learn what to do, when to do it, and how to say it. I couldn’t be more proud.

Today, I want to share how to think about year-end fundraising. It’s a short set of ideas that put you on the path to happy donors and full bank accounts.

Idea #1 – Your donors love to give, but they are busy

Before you do anything, just think about this for a moment. Your donors love to give! Share this idea with your staff and board. If you want to have a great year, you must remember that your donors love to give, but they are busy!

Most nonprofits think two unhelpful things:

Our fundraising makes people give gifts they don’t really want to give.
Every donor receives every message we send.

Neither of those things are true. And if you think those two things, you will only communicate with your donors a couple times in December. That’s a HUGE mistake.

Instead, remember that your donors love to give, but they are busy. They need to be over-communicated with during this busy season. (And if there’s a donor or board member who has already given their year-end gift, by all means remove them from the mailing list!) But for everyone else, you need to communicate to them often enough to break through all the noise, get their attention, and remind them to give you a gift.

Idea #2 – Think of your year-end fundraising as a service

That’s right. Not as fundraising, but as a service to your busy donors who love to give.

You are reminding them to do something they would love to do.

So what makes a good reminder?

A clear focus on the action you want them to take. In all your communications (letters, emails, your website, social) get to the point very quickly. Ask them to give a special year-end gift before the end of the year.
A clear focus on the deadline. Remind donors, again and again, that their special year-end gift is needed before the end of the year. Deadlines are magic in fundraising, and this is the best deadline you’ll ever have. Mention it early and often!
Remind them what their gift does. This is NOT a reminder of what your organization does with their gift. For instance, if you’re an Arts organization, don’t remind them that their gift ‘supports our programs to promote the arts…” Instead, remind your donors that their gift ‘supports the arts so that our community has a thriving arts scene and culture.’

Idea #3 – The only other ideas to add are reasons to give now

Resist the urge to talk about your upcoming capital campaign, or tell a story about somebody you’ve already helped.

The only other ideas to add are reasons your donor should give a gift right now. Things like:

Their gift will be doubled by a matching grant
Your organization has a shortfall and you need to ‘close the gap’ as quickly as possible
You have a big need for funds early in 2018 and the donor’s gift will help

The Main Point

You can do these things and still write a warm, personal letter or email. Really, it’s a matter of focus. Make sure you communicate the main things in a way that donors who just briefly glance at your letter will still get the point.

So, of course, you can talk about how it’s been a good year. And you can thank your donor for their previous generosity. You can even talk about how pretty the snow is.

But those should not be the main, most noticeable parts of your letter. If you write and design you year-end fundraising following the principles above, you’ll raise a lot more money!

This post was originally published in November 2017.

Is Your Annual Report Worth it?

Steven | September 20, 2018Report

If you’ve been thinking about no longer printing and sending your Annual Report, keep reading.

But for you “Steven, just tell me what to do” people, here’s the summary: if you have a good donor-centered newsletter, published multiple times per year, you don’t need to send your annual report to the vast majority of your donors.

Because they don’t need it. And in all likelihood, it’s a waste of money.

Annual Reports Meet a Need… in the PAST

My personal theory is that in the past, annual reports served a useful purpose for donors:

They made the organization look professional
They made the organization look like they are good at what they do
They showed some of the impact that the organization made

All good things.

But here’s the Main Thing: most donors, most of the time, don’t make their giving decisions based on whether an organization is professional or good at what they do.

Smart fundraisers have figured out that most donors make their decisions based on how you make them feel. On emotions.

(I should mention that annual reports are very good at generating one emotion in donors: boredom.)

A Better Idea: Make Your Donors Feel Their impact

How do you make donors feel strong emotions? Send them a donor-centered newsletter that focuses on the donor’s role in the work your organization does, not on your organization’s role. Tell stories of individuals, and tell the stories with emotion.

Those emotional stories that show a donor what her gift did are what makes so many people give gifts in response to receiving a newsletter.

Listen to that again: when you send donors a good newsletter, donors respond with gifts.

When you send them an annual report – no matter how good it is – what do they respond with?

Nothing.

So you get to pick. The choice is pretty clear.

The Two Mis-directed Arguments to Send Your Annual Report

There are two arguments against cancelling your annual report. Neither hold water (in my experience) and they go something like this:

“Even though donors don’t respond, we know they like it and it helps drive future gifts.” I have cancelled a bunch of annual reports over the last ten years. We have NEVER seen a drop in giving. Not even once.
“We must give it to Major Donors, they need it.” No, they don’t. They do need regular Reports on what their giving has accomplished. The annual report is, at best, an OK Report. What’s far better? Customized reports that are aligned with the donor’s passions and interests. Stories of beneficiaries. Pictures of beneficiaries. Meetings on site. Etc. All higher effort than sending an annual report, and all more effective.

The Real Reason to Keep Your Annual Report

There’s one very good reasons to keep your annual report:

You have some Foundation partners, and/or large grantors, who require an annual report.

Then, by all means, make them one. But figure out exactly the requirements and just do that. Don’t do anything else. And print it only for them (if they even need it!).

What to Do With Your Freed-Up Time and Money

Create a donor-centered newsletter. Or if you already have one, make and send another issue. A great newsletter will outperform – and cost less than – an annual report.

Another idea we’re seeing that’s working: about once a month, have your ED send out an email that tells the story of one beneficiary. Make it feel really personal. Strip out as much of your organization’s standard email formatting as you can.

If You Are Forced To Do an Annual Report

If the Powers That Be require you to make an annual report, try to make it a Gratitude Report.

I first heard this idea from Agents of Good in Toronto. It’s a bit of a mind-hack, because the simple reframing of the name helps people see that even though the content is largely the same as an annual report, the goal of the content is to express gratitude to donors for their role. So the “Letter from the Executive” gets written to express gratitude, rather than the standard chest-thumping. The headlines are written to use the word “you,” which makes the content more likely to be read.

But here’s the thing; I think a Gratitude Report is pretty much the same thing as a donor-centric newsletter. Both of them focus on the donor’s role, not the organization. Both of them give credit to the donor.

You can do either one. Do both!

If you can’t do that, do the work to get your annual report stakeholders – the people who feel powerfully about it – to clearly define the purpose of the report and how you are going to measure success. Then measure it to see if it achieves that purpose. And think hard to see if there’s something else you could do to achieve that purpose for less money.

I bet you’ll come back to two ideas: a donor-centered newsletter or a Gratitude Report.

A Big Opportunity…

If you’re still doing a classic annual report, you have a big opportunity in front of you. How are you going to use it?

How to Tell Unfinished Stories

Steven | September 18, 2018September 17, 2018Ask

I’m going to tell you something that is counter to what most nonprofits think.

But it’s tested and proven. Hundreds of times for hundreds of organizations, large and small. Here it is:

If you want to raise the most money, tell a story that is not finished and ask the donor to finish it with a gift today.

That’s a bit conceptual so here’s an example. Most fundraising appeals tell stories that go something like this:

“Lisa was homeless and in dire straits. But thanks to our 4-step program, Lisa is doing great today. Will you please give a gift to help us continue this good work?”

Notice how Lisa’s story is finished? She’s already been helped. The only role for the donor to play is to ‘help the organization continue the work.’

We talk about this in detail in our free ebook on storytelling that we’re launching soon, but that type of story works OK at best. Your best donors might give to it. But most of your donors won’t.

If you want to raise more money — and catch the attention of more people — tell an unfinished story of need like this:

“Lisa is homeless and in dire straits. Will you please give a gift today to help her stay in our shelter?”

Do you see the difference? Lisa still needs help! The donor feels that and sees exactly how a gift today will help Lisa.

Lisa’s story is unfinished, so your donor has a role to play. And your donor sees how her gift will do something simple and powerful — providing a night of shelter — which donors love.

Here’s another way to think about it:

Most nonprofits ask donors to help them do more of what the nonprofit has already done.
What works better in fundraising is to ask donors to help people who have not yet been helped or are currently being helped.

The is one of the fundamental principals we teach in our training on how to Ask powerfully. Use it in your next appeal and watch your results soar!

This post was originally published in July 2017.

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

Steven | September 13, 2018Uncategorized

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!