Category: Repeat

Misleading Metrics (and Unintended Consequences)

Steven  |  Repeat
Metrics.

I wrote recently about a test that gives compelling evidence why nonprofits should not ask online givers to pay the credit card fees associated with their donation. 

The test reveals a very handy principle to bake into your thinking as a Fundraiser:

Trying a new tactic is likely to have unintended effects.

In the case of the test above, asking online givers to pay the credit card fees resulted in 60% of donors choosing to pay the fees.  That seems like a great result, right?  It almost feels like free money.    

If the only thing the organization measured and tracked was “what percentage of givers chose to pay the fees,” the tactic would feel like a great success.

However, the tactic also caused more people to abandon the giving form without giving a gift at all.  Many people reached the point in the process where they could choose to pay the credit card fees or not… and chose to close the page without giving a gift.

Unintended consequences like this happen all the time to nonprofits.  Here’s how to insulate your organization from them:

  • Be aware they exist.  They happen all the time. 
  • Never look at one metric in a vacuum.  It is easy to happily focus on one metric while not noticing that other things are being affected, too.  If your conversion rate is going up, celebrate it – but also check the size of your average gifts.  More conceptually, if you make changes to your fundraising that make your Board happier, celebrate it – but also check to see if your fundraising is still raising as much.
  • Always always always look at Net Revenue (and, when applicable, retention rates).  Net Revenue and Retention are the “mother metrics” – they matter more than anything else.

After you’ve done fundraising for a while, you realize that it’s relatively easy for small nonprofits to increase short term revenue if that’s all you care about.  But you’ll tend to burn out your donors.

It’s also relatively easy for small nonprofits to increase retention rate.  But if that’s your main goal, you’ll leave a LOT of money on the table and grow very slowly (if at all). 

Sales plug – this is why I’m always talking about increasing revenue and retention rates.  Increasing both at the same time is the holy grail, and our evidence-based approach is designed to do it.

Here’s my final thought for you today: pay close attention to tests run by large nonprofits and fundraising agencies.  Learning from their results will help smaller nonprofits avoid the common potholes on the road to growth.  And watch out for unintended side effects!

Your Envelope’s Job

Steven  |  Repeat
Envelope.

Say I send out 1,000 pieces of mail and you get 38 gifts back.

That gives you a 3.8% response.  Not too bad.

But I want to point out something helpful…

It’s true that 38 out of 1,000 people sent in a gift.  But it’s also true that 38 of the people who noticed the envelope and opened it responded with a gift.

It’s helpful to notice that, because you can increase the number of people who notice and then open your envelopes.  (And it’s not that hard to do.)

After all, you can’t control who is on vacation and won’t get your letter.  But you can control using a large, colorful envelope that stands out in a crowded mailbox and gets noticed.

You can’t control the post office “batch-delivering” all the nonprofit mail on one day so that your donor gets 7 appeals all at once.  But you can control writing a killer teaser that makes your donor want to open your envelope.

Your donor must notice and then open your envelope before you even have a chance of getting a gift.  And if you increase the number of recipients who notice and open your envelope, you’ll get more donations.

The ROI on the time and money you spend on your envelopes is fantastic.

This fall, with the election and the batch-delivering we’re hearing about, it’s more important than ever that your envelope get noticed and opened.  Read this post for help with your teasers, and the last half of this post for help with your envelopes. The first job of your envelope is to carry your letter. 

Then the job of your envelope is to get noticed.  Then the job of your envelope is to get opened.

Happy Fourth!

Steven  |  Repeat
fourth

This Independence Day we’re reminded of the line, “toward a more perfect union.”

Not perfect, but trying to get better every year.

Just like fundraising.

Happy Fourth!

Making Fundraising is Like Making Pancakes

Steven  |  Repeat
Pancakes.

You know how when you start making pancakes, the first couple of ‘em aren’t quite right?

Either the batter’s too thick, or the pan isn’t hot enough, or that little brown ring around the edge of the pancake that you like doesn’t happen.

The point is, you need to make a couple before you get everything dialed in, and then pancakes come out the way you want.

Your fundraising is the same way.

If you’re only sending a couple pieces of fundraising a year, there’s almost no chance they come out the way you want them to.  It’s been so long since you made the last one that you just don’t have everything dialed in. It’d be like making one pancake every week.

Contrast that to the rhythm of consistently making & sending fundraising.  Plus looking at the results to see what’s working best. And then getting that “sense” of what’s going to work and what isn’t.

Just like with making pancakes, it’s when you get in a rhythm that the magic happens.

The Power of ‘A Little Bit More’ Fundraising

Sarah Lundberg  |  Repeat
A little bit more.

As a fundraiser, it’s tempting to dream about something big and amazing that would change everything for your organization. A surprise million dollar gift. An unexpected bequest. A knockout appeal that shatters previous records.

And, I’ll admit, you can do a lot of good when those big and amazing things happen.

But there’s a simple tactic that nearly every fundraiser can employ that, over time, can be just as powerful. I call it “a little bit more” fundraising.

Here’s the idea:

Whatever you did last year, do a little bit more.

For example, you could do one or more of the following:

  • Add one or two additional e-appeals to your communications schedule.
  • Add one more direct mail appeal to your calendar.
  • Ask your major donors to give a little bit more than their previous gift.
  • Ask a few faithful donors to start giving monthly.

If you do a little bit more each year, you’re doing two important things:

First, you’re giving your donors more opportunities to support your mission.

Then, by using one or more of these tactics, you’re being proactive and taking control of your fundraising, rather than putting your hopes in a big, surprise gift or a knockout appeal.

This summer, give some thought to what adding “a little bit more” to your fundraising would look like for your organization. When you work “a little bit more” fundraising into your plan, you’ll see a lift in results without a lot of additional work.

Eight Principles for Effective ‘Design’

Steven  |  Repeat
8 Designing Principles.

While we’re talking about nonprofit Designers and design, let me share something that I found helpful.

Check out the following eight principles for effective design from product designer Taras Bakesevych. 

What’s exciting to me is that these principles apply to more than just the “graphical layout and style” of a piece of fundraising – they apply to how you “design” your entire fundraising program. 

Here’s the summary:

  • Empathy: Good design is rooted in an understanding of your audience.
  • Layout: Guide the eye effortlessly across the landscape.
  • Essentialism: Simplicity and purpose above everything else.
  • Guidance: Design should lead us somewhere.
  • Aesthetics: Communicate a feeling.
  • Novelty: “True art lies in balancing novelty with familiarity.”
  • Consistency: Don’t be confusing; build trust.
  • Engagement: Good design is like a good conversation.

Here are a few examples of applying these principles to how a nonprofit designs its fundraising program:

  • A fundraising program has empathy for donors by using language that donors understand, and design that resonates with donors.
  • A fundraising program focuses on the essentials by keeping it simple for donors, and doesn’t try to teach and tell donors everything about the organization and its approach.
  • A fundraising program is engaging by sending out surveys, and asking questions of major donors to discover their passions and interests.

You get the idea.

The whole post is interesting.  Taras gives examples for each principle.  It’s long, but I can guarantee you’ll quickly find something that could be applied to your fundraising program – whether graphically (#9 is “create a clear focal point”) or structurally (#17 is “craft engaging user onboarding”).

In my job, I get to “look under the hood” of a lot of different fundraising programs.  The fundraising programs that are reliably growing tend to be built on all eight of these principles.

How to Succeed as a Designer at a Nonprofit

Steven  |  Repeat
Graphic designer.

Someone recently asked me what advice I’d give to Designers working at and for nonprofits. 

I gave some “big picture” advice – which I’m told was helpful – so I’m sharing it here with you…

Know that different design contexts have different design requirements

One of the things that happens at nonprofits is that they come up with a design approach and they apply that approach regardless of context. 

For instance, say one of the colors in your logo/brand is a beautiful light green.  In an Annual Report, you can use that green as the color for a headline or a small block of text to make the page more visually interesting.  But in direct mail you should never use a light color for text because it’s so hard to read for older donors, and in direct response fundraising readability is directly correlated with fundraising results. 

As a Designer, you’ll be more helpful to your organization (and your beneficiaries or cause) if your design is effective for each particular context than if your design is perfectly consistent across all the contexts you have to design for.  

You keep your organization’s design accessible for your donors

The person who wants you to fit a 550-word letter on one page does not know that the resulting “wall of text” won’t be read by anyone but their Mom.  The young person who wants the reply card form to be super-tiny does not know that a 75-year-old donor with a touch of arthritis will never be able to write their credit card number in a space that small. 

It is the Designer’s job to think about these things on behalf of your donors to make it easier for them to understand and support your organization.

And if you keep your organization’s work more accessible, your organization will raise more money.

Be a partner to the writer

The best design in the world cannot compensate for lousy copy.  So if the letter you’re asked to design doesn’t have a good offer, or takes too long to get to the point, or sounds like a Ph.D. dissertation, say something. 

Speaking as a copywriter, I’ve had hundreds of ideas that sounded great in my head but just didn’t work on the page.  The most helpful Designers told me so, and helped me see why.

Note to anyone working with a Designer: if you don’t treat the Designer as a partner, and give their feedback real consideration, you won’t get to work with that Designer for long.

Design for donors, not yourself

The most effective Designers always keep in mind that the primary audience for their design work has different preferences and needs than the Designer does.

This is hard to do. 

For instance, most Designers at nonprofits are at least 20 years younger than the core audience for their work: the average age of a donor in the U.S. is their late 60’s, and I’d guess that most Designers at nonprofits are younger than 40. 

For a Designer, this means that your donors are more likely to emotionally resonate with a different design approach than you are.  Real life example: most donors at most organizations are more likely to respond to a letter that looks like a telegram than they are to a letter that looks like the cool titles on a hot new Netflix show.

Design for your audience.

Be your own advocate & Ask questions

OK, this is two pieces of advice, but they are related.

The tough thing about working in the nonprofit world, especially at smaller nonprofits, is that there’s little training for Designers.  So in most cases, you are responsible for your own growth.

The best thing you can do to help your mission and your career is to learn about the nuts and bolts of fundraising.  You will have to ask for time and budget to buy books, to take classes, to go to a conference. 

And you can ask questions that your organization likely hasn’t asked before, like “what kind of design will resonate best with our donors?” and “How should our look and copy vary from context to context?”

Ask an experienced nonprofit Designer or Creative Director to be a mentor, whether it’s just for one coffee or it’s monthly for years.  This profession is full of generous people.  Sitting here writing this, I can think of nine people who helped me over the years, and I don’t ever remember being turned down.

If you advocate for yourself, and you’re curious, you’ll cause your organization to raise more money.  Designers who do this are worth their weight in gold. 

What’s your job?

I’ll end with a picture from the cover of my favorite book on design, Type & Layout…

Are you communicating?

The designers who are communicating are gifts to their organization and beneficiaries, and will always have their plates full of interesting work.

About Younger Donors…

Steven  |  Repeat
Younger.

The next time a person at your nonprofit says, “We need to get younger donors!” have them read this:

Top 5 Mistakes: Chasing Younger Donors.

The post is from Bill Jacobs at Analytical Ones.  Bill’s been analyzing nonprofit databases and fundraising effectiveness for 25 years, and he knows what he’s talking about.

He lays out the two main arguments for why nonprofits should not chase younger donors, and I’ll add three more:

  • The research I’ve seen indicates that older donors tend to give more than younger donors.  So all things being equal, a 70-year-old donor is more valuable to an organization than a 35-year-old donor in the near-term.
  • Older donors give you a greater chance of receiving a legacy gift.  Last I heard, the average legacy gift in the United States was North of $40,000.  So a 70-year-old donor is more valuable to an organization than a 35-year-old donor in the long term, too.
  • On average, most donors don’t stay on a nonprofit’s donor file for more than 5 years.  So even if you do manage to acquire a bunch of 35-year-old donors, the vast majority of them will have stopped giving 20 years before they’ve entered their prime giving years.

Read Bill’s post and have a couple of these numbers handy the next time someone brings up younger donors.

In fact, Bill’s whole “Top 5 Mistakes” series is great.  Easy-to-read, short and data-driven, what’s not to like?

And I think we all know this, but I’ll say it to be safe: there’s absolutely nothing wrong with younger donors.  Welcome them!  But unless your cause is massively attractive to young people, trying to acquire younger instead of trying to acquire older donors is not a good financial decision.

Change the Recipe, Change the Results

Steven  |  Repeat
Recipe.

When a nonprofit is first founded, its fundraising letters / emails / personal asks tend to have high response rates and high average gifts.   

But in my experience, the response rates and average gifts tend to go down as the organization grows. 

Here’s my theory to explain this…

The recipe for fundraising right after an organization is founded is remarkably simple and goes like this:

  • The founder talks about whatever “the situation” is that caused him/her to start the organization
  • They describe what needs to be done to help, and how it will help
  • They ask the donor to give a gift to fund what needs to be done

Works like crazy.

But as a nonprofit ages and expands, it develops its own programs, approach, and expertise.  It develops an organizational ego.

In a nutshell, this results in fundraising that talks more about the organization itself than it used to.  The recipe changes to:

  • They talk about the work they are already doing
  • They describe how they do that work
  • They ask the donor to give a gift to fund their ongoing work

This fundraising recipe does not raise as much money.  It lowers donors’ awareness about whatever “need” the organization exists to serve because “the situation” is rarely mentioned.  And it lowers response rates and average gifts because the fundraising is mainly focused on work that has already been completed – most of the compelling reason to give a gift today has disappeared.

I don’t enjoy this truth, but it’s still true: fundraising to individual donors that talks about “powerful work that’s already done” will cause less money to come in than talking about “powerful work that needs to be done now that the donor can help make happen.”

Organizations that stick to the original recipe will grow faster.

Individual donors tend to give because there’s work that needs to be done.  Not because the organization is already doing the work.