Category: Ask

Fundraising in Two Steps

Steven Screen  |  Ask
Make a difference.

At its simplest, I think you can boil “raising money from individual donors through the mail and email” down to two steps:

  1. Making an emotional connection with the humans reading your fundraising (which I wrote about on Tuesday), and 
  2. Then giving people an easy, low-cost step they can take to make a meaningful difference.

This approach is easy to understand but hard to do.  And it goes against the standard orthodoxy of “make a case and describe our work in an inspirational way.”

But in my now 30+ years of looking at fundraising results, this “two step” approach is at the heart of the fundraising that works the best.  (And if you want evidence, just call me.  Better Fundraising’s clients routinely see huge jumps in revenue as soon as we help them switch them from the standard approach to this approach.)

And it makes sense, right?!?  If you “make a case and try to inspire people with your work” you have to teach them about your work and tell them why it’s inspiring.  This means your reader has to learn something before your request for support makes sense.  This is homework, not fundraising!

Or you could tell your reader an interesting story about something they care about. (And you know they care about your cause or your beneficiaries – if they didn’t, they wouldn’t be on your list.)

Once your donor is emotionally engaged, you give them a low-cost way to make a meaningful difference.  You lower the barrier to giving a gift.  You describe something great that they can do or be a part of.  You describe the meaningful difference it will make.

 Get people emotionally engaged, then tell them how their small gift today will make a difference.I share how to do this in this post, this free eBook, and it’s what McKenzie is describing in this post.

Really, that’s it: get people emotionally engaged, then tell them how their small gift today will make a meaningful difference.

Scary Data Frankensteins

Steven Screen  |  Ask
Frankenstein.

When you are reviewing fundraising data, beware any time the data contains information from two different media channels or two different audiences. 

Here’s a simple example…

Say we recently completed a campaign that included one appeal letter to current donors and two e-appeals.  Here are the results:

  • 11,000 sent
  • 124 gifts
  • 1.4% response rate.

With those numbers, we can get a vague sense of whether the campaign was successful.  But I would say that the data above hides more than it illuminates because when we go to run the campaign next year we don’t know how to improve the campaign because we don’t know which parts of the campaign worked, and which parts didn’t.

But look at what happens when we can see the results for each piece of the campaign…

Direct mail appeal letter to current donors

  • 1,000 sent
  • 83 gifts
  • 8.3% response

E-appeal #1

  • 5,000 sent
  • 31 gifts
  • .62% response

E-Appeal #2

  • 5,000 sent
  • 10 gifts
  • .20% response

OK, now we’re talking.  Look at what we know now:

  • The appeal letter is a tremendous success.  An 8.3% response in direct mail is fantastic.
  • E-appeal #1 is also a success – a .62% response in email is also a success.
  • E-appeal #2 is not a success – a .2% response is too low.

Compare that to the combined data, which gave us an average response rate of 1.4%.  That number didn’t tell us anything.

But looking at the performance data for each piece enables us to do something powerful: learn that the messaging used in the appeal letter and e-appeal #1 worked great, and then apply those the next time we do this campaign and to all our future fundraising.

Additionally, by breaking out the results for each piece, over time you’ll learn your benchmarks for each audience and each channel.  This is very powerful because it helps you identify the pieces of fundraising that are effective, and those that aren’t.

But if you keep everything together, you just get a Frankenstein.

Whose Story Is It?

Steven Screen  |  Ask
Guitar storytelling.

There’s a blogger I like named “Gabe The Bass Player” who writes primarily for musicians.  I find him thought provoking.

Talking mostly to musicians, he recently said, “You keep getting to do this because enough people continually add you as part of their story.”

I think the same thing is true about nonprofits and fundraising – your organization keeps getting to do its thing because enough people add you as part of their story.

Keep thinking about that last part: “…people add you as part of their story.”

There are a million different ways to think about fundraising.  But any way that ignores the fact that an individual donor is primarily adding you to her story is not going to work very well.

Is it true that she’s also part of your story?  Of course.

Is it true that she’s also part of the story of your cause or community?  Of course.

But at that mostly sub-conscious “give or don’t give” moment, her story is the most important story to her.

So for your mail and email fundraising to really succeed, it must be created in such a way that the donor sees herself and wants to add your organization to her story.

Your Email List is a Cross Country Team

Steven Screen  |  Ask
Cross country.

If you’re a small nonprofit and you don’t raise much money from your email list, keep reading.

Here’s an analogy that has proven helpful for many of the organizations we serve: think of your email list as a high school cross country team whose season has not yet started. 

People have signed up for your team.  Some people have been signed up for the team for 6 months.  But the team hasn’t gone on any runs yet – they haven’t had to do anything yet.

In this analogy, when the season starts and the cross country team begins going on long runs, what’s going to happen?

Three things, almost immediately:

  • People are going to drop off the team.  They are going to say, “Oh, I didn’t know we’d have to do that, turns out this isn’t for me, I’m going to drop off the team.”
  • A few people are going to complain.  “I don’t like this.  I liked it more when we talked about running.”
  • A few people are going to say, “Yes, this is what I’m here for, this is hard but good.”

The same three things are going to happen when you start to regularly ask your email list to make gifts: people are going to drop off your team (unsubscribe), people are going to complain (reply to your emails with whatever is bothering them), and people are going to know they are in the right place (donate).

But most nonprofit email lists are like cross country teams that go on one or two runs a year.  That kind of “training” doesn’t make for a very effective team.

Here’s the thing: on your cross country team, you want people who understand that they will need to go on long runs.  You want people who will go on long runs even when it’s cold and rainy.  You want people who are on the team despite the difficulty, who love the community and the joy of getting better.

And on your email list, you want people who understand that they will be asked to give gifts.  You want people who are on your list despite the difficulty, who love the community and the joy of making the world a little bit better. 

Your cross country team will be stronger when it is a little smaller, and made up of people who know what it takes.

Your email list will be stronger when it is a little smaller and made up of people who know what it takes.

So if your email list hasn’t been asked very often, be prepared for a few unsubscribes and complaints when you start.  But also be prepared for more donations than you’ve received before, more first-time donors, and an email list you can count on when the going gets tough.

How I Learned to Give Directions

Steven Screen  |  Ask
Give directions.

Back in the 90’s I received a lesson in giving directions, and I use that lesson in fundraising every day…

I was writing and producing radio commercials for a national chain of bookstores.  At the end of each ad, there were 8 seconds to describe the location of one of their stores.  And I was responsible for writing the description of each store’s location.

When I started writing these, my instinct was to start the description in the context of the store.  This resulted in descriptions like, “you’ll find us at the NW corner of Harlow and Prescott, across from the museum, in Byron Center.”

This approach puts significant cognitive load on the listener because they must remember a lot of details (which corner? what streets? across from which landmark?) before they even know what town the store is in.  And if the town turns out to be close by, the listener then has to “go backwards” and remember the details from before. 

Thankfully my boss corrected me and said something like, “don’t start the description from the store, start the description from a place the listener knows.  Always write from the known to the unknown.”

This advice changed how I give directions, and how I write.

My revised store directions were much more helpful to people: “You’ll find us South of Grand Rapids, in Byron Center, across from the museum, on the corner of Harlow and Prescott.”

My fundraising writing was better.  Before, I tended to write from the context of the nonprofit: “We have 4 programs to help people in our community.  And all our programs take a holistic approach to addressing the needs of junior high students who are behind in math.”  Today, I start with something the listener knows or understands; “There are local junior high students who are behind in math.  Our approach is holistic, and we serve them with 4 different programs.”

Going “from the known to the unknown” makes your fundraising easier to understand quickly because it reduces the cognitive load on your readers. 

This ability to meet donors on common ground – to write fundraising that they understand that then helps them see what their gift will make possible through you, is gold.

If you do this, more people will read your fundraising.  And when more people read your fundraising, more people tend to give to your nonprofit.

The Angels’ Share

Steven Screen  |  Ask
Aging barrels.

You already know that when a donor gives a gift to an appeal with matching funds, the donor’s gift is doubled.

But did you know that when a nonprofit uses matching funds, the matching funds themselves are more than doubled?

It’s kind of magic, and here’s how it works…

When a match is used in fundraising, it has two well–researched effects:

  1. “Response Rate” goes up.  So, if you normally have around 500 people respond to your appeals, if you feature matching funds, you’ll have maybe 600 people respond. 
  2. “Average Gift” goes up.  If the average gift to your appeals is usually $100, if you feature a match the average gift might increase to $120. 

In sum, more people will send in gifts than normal, and the gifts will be larger than normal.

The magical thing is that these things happen at the same time!  (Normally response rate and average gift size have an inverse relationship – when one goes up, the other goes down.)

What this means is that, when an organization or donor provides matching funds, the matching funds aren’t just doubled.  They are actually multiplied by 2.4!

Here’s how I share this idea with people:

You might think providing $1 in matching funds would cause the organization to raise another $1, producing a total of $2.

But what happens is that the $1 in matching funds causes more people to give than normal, and the gifts are larger than normal, so the organization raises another $1.40, producing a total of $2.40. 

This 40 cents of revenue appears out of nowhere!  So if you have an appeal that normally raises $10,000, if you add a match you won’t just raise a total of $20,000, you’ll raise $24,000.  That’s $4,000 out of thin air.

(By the way, if that doesn’t encourage your Board or major donors to provide matching funds to your next campaign, I don’t know what will.)

Today, I’d like to propose a name for this additional revenue that magically appears: the Angel’s Share. 

I’m “stealing like an artist” from the world of wine and whisky distilling, where the term “Angel’s Share” refers to the small amount of liquid that is lost to evaporation during the aging process in a wooden barrel.  I’ve always thought that was a beautiful way to frame the loss of a little of their product through evaporation.

And what I like about using “Angel’s Share” to describe the additional money that comes in from using a matching grant is that it’s a gain,not a loss.  It’s like a little blessing that’s given to the causes we care about. 

Now that you know about the Angels’ Share, be sure to use matching funds in your year-end campaign so you can experience this very real blessing.

And like me, I hope you’ll raise a glass at the end of the year and toast to the Angel’s Share!

Ingredients vs. Main Dishes

Steven Screen  |  Ask
Jeff Brooks blog

Today I want to point you to a fantastic blog post by Jeff Brooks over at the Moceanic blog. 

Jeff writes about one particular letter…

I’m going to show you a four-page direct mail appeal I wrote awhile back. I had an unusually strong story to work with, and I was tempted to over-focus on it by using the techniques of creative writing and journalism. Fortunately, I caught myself in time and turned it back into a fundraising message.

I’m encouraging you to read this because the letter is very good, and it’s always good to be exposed to effective fundraising.  And because, as Jeff walks you through the letter, he also shares helpful lessons about how to tell stories that move people to give. 

Give it a read!

How to ‘Keep It Simple’ When What You Do Isn’t Simple

Steven Screen  |  Ask
Keep it simple.

My previous post was about why it’s so effective to focus a piece of fundraising on a specific and low-cost part of your nonprofit’s work.

But many organizations don’t believe they have anything specific or low-cost that they can highlight for their donors.  They’ll say, “What we do isn’t quantifiable.  How can you put a price on inner peace / justice / the environment?”

So today I’d like to give you a few examples of how to identify and price a specific part of your organization’s work – even if your work seems unquantifiable. 

(I should mention that I have tried before to write down all the “rules” for how to do this well, and it results in a multi-page document with decision trees that only a deep fundraising nerd would read.  And in my experience, what people really want are real-life examples that they can learn from and apply to their own organizations.  So here are some examples that show you the process in action.)

I’ve divided the examples into work that is “quantifiable” and “unquantifiable” – though (spoiler alert) you’ll soon see that all nonprofits have work that is quantifiable.

Quantifiable

Say your organization has a goal to protect 150 acres of wetlands this year.  And that preserving these wetlands is only part of what your organization does.  Let’ see how specific we can get…

  • Make a rough determination of the percentage of your total budget that is spent on wetlands preservation.  For example, say your total budget is $1.1m, and you spend about 1/3 of your organization’s time and budget on wetlands preservation.
  • 1/3 x $1,100,00 = $366,630.  That’s how much it costs you to preserve these 150 acres.
  • Divide your cost by the number of acres you protect.  $366,630 / 150 = $2,444.  So, it costs an average of $2,444 to preserve one acre.
    • Note: this would make a great major donor offer; “If you give a gift of $2,444 you’ll preserve 1 entire acre of wetlands!”
  • There are 4,047 square meters in an acre, so divide the cost per acre by the number of square meters in an acre.  $2,444 / 4,047 = 60¢ to protect one square meter. 
  • This organization now knows that it costs, on average, 60 cents to protect 1 square meter of wetlands.

Now the organization can say things like:

“It costs less than dollar for you to protect a square meter of wetlands.  Think of all the flora and fauna you’ll help protect!  The square meter you protect might have a bird’s nest, or be part of a stream that’s full of life.  A gift of just $49 today will protect an area of wetlands the size of a pickleball court!”

I’m sure you can see how helping a donor think about their gift in that way makes it easier for the donor to envision their impact.

And I’m sure you can see how – at the moment a donor is reading your fundraising and deciding whether to give a gift or not – seeing that their gift of just 60 cents could preserve one beautiful piece of land that they can instantly envision is more likely to give a gift than a donor being asked to support an organization’s wetland preservation programs.

And the process above works for most anything that’s easily quantifiable; the number of people going to a museum in a day, the number of “nights of safety” provided to a victim of domestic violence, the number of words translated by a Bible translator, you get it.

If you don’t know exactly how many acres of wetlands you’re going to protect (or whatever), you can use the number than you plan to do this year to calculate your cost, or you can use your average per-acre cost from last year.

But now… what should you do if what your organization does is not easily quantifiable?

“Unquantifiable”

Many organizations will say something like, “Well, what we do isn’t measurable.  You can’t quantify it.”

My response to those organizations is to share my belief that every nonprofit is ultimately made up of specific, understandable actions.  Those actions may produce an outcome that is unquantifiable (think “healing” or “inner peace”), but if a nonprofit utilizes any time or money to achieve its goals, there are actions that can be quantified.

So the technique here is to take anything that feels unquantifiable and break it down into smaller, identifiable actions that individual donors will quickly understand. 

Here are some examples from my past, along with a couple of “specific, understandable actions”:

Unquantifiable:

  • “We provide justice to those who need it”

Quantifiable

  • Cost to coordinate the “matching” of an attorney who is donating their time and the person who is receiving legal counsel for free
    • This would be the “cost per hour” of the salary of the staff member who does the coordinating, multiplied by the number of hours it costs to match one attorney with a client.
      • “Your gift of $37 to CASA provides a person who needs it with an expert attorney they can trust.”
  • Cost of a legal fee paid for on behalf of a beneficiary
    • This would be the cost of the legal fee.  (You are free to include the cost per hour of the salary of the staff member who pays the fee.)
      • “Sometimes the only thing standing between a person being free of an abusive landlord is a $115 fee, and that’s what your gift will help pay today.”

Unquantifiable:

  • “We create networks of peacemakers”

Quantifiable:

  • Cost per new person added to the network
    • This could be the total budget of the organization for a year divided by the number of new people added to the network each year.
      • “The cost to add one new peacemaker to our powerful movement is just $90.”
  • Cost for training materials for one person
    • This would be the total development and printing costs of the training materials, divided by the number of people who receive them.
      • “Just $4 prints and hands our all-important training materials to a new peacemaker so they can have an even greater impact.”

Unquantifiable:

  • “Help people heal at a sacred place”

Quantifiable:

  • Cost per visitor
    • This could be the total budget of the organization divided by the total number of visitors each year.
      • “Your gift of $49 will welcome one person into the sacred land that both you and I love.”
  • Cost to maintain one acre of the location
    • This would be the total maintenance budget, divided by the number of acres.
      • “I figured out that it costs an average of $155 to maintain one acre of this special place.  Will you give a gift to provide enough maintenance funds to care for at least one acre today?”
  • Cost to maintain one walking path for one month
    • This would be the total amount of time spent maintaining paths, times the cost/hour of the people doing the maintenance, then divided by the number of paths, then divided by 12.
      • “Because we boost your gift with volunteer labor, the cost to maintain one of our beloved walking paths is just $75 for a month.”

I think you see the methodology here.  It’s breaking down what you do into easily identifiable steps, then figuring out the cost for that step.

Then, the fundraising shows the donor the value of that step. 

To borrow from my previous post, when a nonprofit uses this technique they have “reduced cognitive load for the donor, answered a question donors have (‘how much do I need to give to make a meaningful difference?’), and helped show that anyone can make a difference by giving to the organization.”

All of this works together to make your organization more accessible to more people by making it easier for a person to understand what their gift will accomplish.

The Magic of ‘Specific and Low-Cost’

Steven Screen  |  Ask
Specific-general.

You might have noticed how lots of nonprofits ask donors to donate to provide low-cost, specific things. 

Here are a couple of examples:

  • A gift of just $37 will fund our website for a day, making all the stories from our independent news site available to everyone.
  • A complete Thanksgiving dinner and care costs just $5.15.
  • The cost of an hour of equine therapy for a child with autism is only $53.

Have you ever thought about why nonprofits use this tactic?  Once you do, it’s obvious why so many nonprofits do this, and why it works to help organizations raise more money.

By focusing on something specific, with a specific price point, the nonprofit makes three things easier for individual donors:

  1. By focusing on one action, it means the donor just needs to understand the value of that action.  In other words, the donor does not need to understand the entire organization, what it does, etc.  The donor just needs to understand one simple part. 
  2. By providing a specific dollar amount, the donor now knows how much they need to give to make a meaningful difference.  Instead of donors asking questions like “Will my $50 do anything?” or “How much do I need to give to help somebody?” they know the answer.
  3. By having the dollar amount be low (say, below $50), the organization communicates that almost anyone can make a meaningful difference.  This approach makes the organization more inclusive and accessible, which increases the number of donors who give gifts.

I hope you’ll marvel with me for a moment at how much this tactic accomplishes for nonprofits.  In just a couple of sentences, the nonprofit has reduced cognitive load for the donor, answered a question, and helped show than anyone can make a difference by giving to the organization.

No wonder this tactic works so well in individual donor fundraising.

If you feel like your organization doesn’t have something that’s low-cost and specific that your donors can fund, that’s just because no one has taught you how to find it.  My next post will feature several examples that will show you how to find one for your organization.

And if you or someone on your team are worried that this tactic will cause your larger donors to give smaller gifts, don’t worry.  I talk about this very thing on page 24 of this short, free eBook.

For right now, if this has sparked an idea for something specific that your donors would love to fund, start thinking about featuring it in your next piece of fundraising, or testing it in email sometime soon.  I’ve seen many organizations identify something specific their donors love to fund and have their fundraising immediately accelerate to new heights…