Category: Repeat

Fundraising Success Story

Steven Screen  |  Repeat

Fun success story for you.

We’ve been working with a small nonprofit on the East coast for a little over a year.

Each year they do a summer appeal, and this summer the Better Fundraising team wrote and designed the appeal.  In past years their summer appeal has raised around $5,000, and our appeal this year raised $22,000.

Another thing that’s happening for this organization is this year they’re receiving more unexpected major gifts through the mail.  (This happens often to our clients during the first year we work with them.)  One of them was a $10k check from a donor whose highest previous gift was $1,000.

In a nutshell, here’s what we’re doing for this organization:

  • We’re sending more fundraising to their donors.  We’re making sure their donors are regularly being given opportunities to help (by making a donation), and are regularly hearing about the effects of their giving.
  • We’re being clearer about what happens when funds are not raised.  We’re not sensational in the least, just speaking the truth about what happens when people are unable to receive the help they need.
  • We’ve added printed newsletters to their annual plan.  Each newsletter raises twice what it costs to print and mail.

That’s it. 

And this organization’s fundraising is WAY up! And hey, if you want to talk about how Better Fundraising can help your organization do the same thing, get in touch!

You’re Not Fundraising to a Pond, You’re Fundraising to a River

Steven Screen  |  Repeat

Here’s a quick tip, borrowed from the world of advertising, that will help you with your direct response fundraising:

You’re not sending your fundraising to a pond, you’re sending it to a river.

A pond holds the same water year after year.  A river doesn’t.  The water going past you today is not the water that went past you last spring.

Here’s what that looks like in your donor file.  Say your organization has a 60% donor retention rate and a stable overall number of donors.  That means 4 out of every 10 donors on your file right now were not there for last year’s Fall campaign or last year’s year-end letter.  They didn’t see it.

Now turn it around.  Of the donors who did see last year’s Fall campaign, 4 out of 10 of them have left the building.

So the group of people receiving your fundraising is not a fixed, static audience.  It’s a constantly changing group.  To add even more uncertainty, you don’t know which donor saw which pieces of your fundraising.  Maybe they were out of town during last year’s Fall campaign and never saw it.

This means that, the next time someone in a meeting says, “But we’ve already said that to our donors,” you have an accurate answer: “No, we didn’t.  We said it to about half of our donors.  And we don’t know which ones.”

Why ‘keeping it fresh’ isn’t as helpful as it feels

The desire to keep your fundraising fresh assumes your donors are a pond.  The same people, sitting in the same place, hearing the same message over and over.  (And there’s usually a fear that the donor’s finger is hovering over the “unsubscribe” or “complain” button.)

But a large share of the people who read your Fall campaign this year have never seen it before.  For them, the campaign that you are tired of is brand new to them.

Worth noticing: your staff and Board receive more of your fundraising than your donors do.  You saw all of it.  Donors saw some of it, and sometimes while busy doing other things at the same time.

You might feel tired of a message or campaign, but the feeling isn’t shared.

Instead

Find something that works and repeat it each year.

Put a higher value on finding something that works great – then updating it as needed – than on keeping things fresh each year.  The river keeps bringing you new people every year who haven’t heard it.  And the people who gave last year will likely give again.

The Soft Skills and Leadership Needed to Acquire a Lot of New Donors

Steven Screen  |  Repeat

Earlier this week I shared how nonprofits acquire significant numbers of new donors every year through paid acquisition.    

But to acquire new donors through paid acquisition, a nonprofit needs to demonstrate a high-level of what we might call “vision and steadfastness.”

Here’s what I mean, and I think you’ll see why a nonprofit needs some of those “softer skills” in order for paid acquisition to be a success:

  • The nonprofit must create a new line item in your budget specifically for donor acquisition.
    • This is hard for a nonprofit that already feels low on money!  This feels like a big new expense when you’re trying to run as lean as possible.
  • The acquisition program will lose money in year #1.
    • You more than make up the loss in future years.  But the people with the longer perspective will have to be just as vocal as the people who are fixated on short-term ROI and want to cancel the program.
  • Usually a nonprofit needs to do paid acquisition for at least a year before they get good at it.
    • Because buying ads, creating offers, and creating acquisition ads is a skill you have to learn through practice, your results the first year will likely be low – but you have to keep going for the investment to be worth it.

It’s easy to see why not very many nonprofits sign up for this!

I say all this because for a smaller nonprofit to start an acquisition program is a real effort in leadership and faith.    

So, How Do You Succeed?

Thankfully, tens of thousands of nonprofits have successfully gone down this path. 

Here’s what their experience tells us is necessary to succeed…

  1. The leader of the program, and often of the entire nonprofit, must talk about what the plan is, why it makes sense, and why it’s worth it.  And because all the outward signs are negative, the leader has to talk about it a lot more than they expect to.
  2. The organization must have an investment mindset.  They must look past the short term; they must think in business growth terms like “cost per new donor” and “lifetime value.”  If the Board or anyone else is overly focused on short-term ROI, the nonprofit will cancel the program too early, leaving itself with most of the expenses and almost none of the new donors.
  3. Finally, the person leading the effort must get good advice.  Talk to acquisition experts.  Pick the brains of larger nonprofits who have established donor acquisition programs – they will happily share the lessons they’ve learned.

The chances of figuring out scalable donor acquisition on your own is unlikely, but thankfully it’s unnecessary.  You are not alone – other organizations have been down this road before!

If You Really Want to Acquire More New Donors, Read This

Steven Screen  |  Repeat
Make “The Leap” to Acquire a LOT of new donors

We’ve been asked a LOT lately about acquiring new donors.  (I don’t think this is a coincidence given that the number of individual donors in the U.S. decreased last year.)

If you want to learn about how bigger nonprofits acquire significant numbers of new donors every year, please take a look at the blog post below.  I wrote it in 2018 and every word is still relevant. 

Spoiler alert: there is no silver bullet.  There’s a skill you have to learn.  But the path is knowable.  And the great news is that lots of nonprofits have gone on the path before and will gladly share what they’ve learned to help you.

Happy reading!

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:

  1. 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.
  2. 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.

Yes, You Want Transactional Donors

Steven Screen  |  Repeat

I’ve heard the following multiple times this year:

“But we don’t want transactional donors.”

If you’ve ever heard this at your organization, or even thought it yourself, please keep reading.

Because you absolutely want transactional donors.  Not only are they a good source of revenue, but transactional donors are where you find many of your future major donors.

I mean, sophisticated organizations think it’s so important to acquire “transactional” donors that they have line items in their budgets expressly for doing so!

Here’s why, summarized:

  • The term a large fundraising organization would use for “transactional donors” is “mass donors.”
    • A well-run mass donor program generates $3 or $4 for every $1 spent on the program. 
  • Most of your mid donors are mass donors who start giving more.  More mass donors + well-run annual fund = more mid donors!
  • Likewise, most of your major donors are simply mid donors who start giving more.  More mid donors + well-run annual fund = more major donors.

So the next time someone says, “no, we don’t want transactional donors,” you now know that you absolutely do want them.  You’ll raise money from them today, and you’ll raise a lot of money from them tomorrow.

Assume They’re Smart

Steven Screen  |  Repeat

As someone who cares about your beneficiaries and your donors, you want your fundraising materials to be special.  You want your fundraising to stand out, to look great, to show everyone that your nonprofit is different and better.    

I’m writing today to say one thing: as you do this, be careful.

I say “Be careful” because the things that professional nonprofits do – things that might look generic or wasteful or even dumb – are almost never accidents.  The “rules” they seem to follow are the results of millions of dollars and years of testing, and the rules are followed on purpose because they work great.

Let me show you what I mean with two quick examples.

A person at a small nonprofit receives yet another letter from a large charity.  They think, “Why does the large nonprofit keep wasting so much money mailing me?  I never want to be like that.  I’m going to send fewer letters.”

But that large nonprofit is raising hundreds of thousands of dollars with every letter they send.  Each letter has a return on investment of around 4:1, meaning for every $1 they spend on the letter, they raise $4.  That letter might seem like a “waste” to you, but to assume the nonprofit is wasting its money is to assume that a team of deeply experienced fundraisers doesn’t know what they are doing.  They know.  The letters keep going out because they keep raising money.

Second example: the Board member who says, “I don’t like all this bolding and underlining, it makes our fundraising look like everyone else’s.  Our fundraising should look different!”

But the fundraising from the big nonprofits is formatted that way – the bolding, the underlining, all of it – because testing keeps showing that one particular formatting approach (large type, large margins, underlining, etc.) tends to raise the most money.

It is absolutely OK to make your fundraising your own.  I want you to!  But as the line attributed to Picasso goes, “Learn the rules like a pro so you can break them like an artist.”

Leaders and Letters

Steven Screen  |  Repeat

Quick note for all my friends out there in small nonprofits:

The Leader of a larger nonprofit is not usually involved in creating the letters and emails that go out with their signature.

Let that sink in for a bit.  An e-appeal can be brainstormed, written, designed and sent without the Leader even seeing it.

Is that because the leader doesn’t care?  Nope, they care deeply about how the fundraising is doing.

Is that because the Leader is so busy?  Nope, if the Leader’s help was necessary for the fundraising to go well, the Leader would make the time.

The Leader doesn’t see the fundraising before it goes out because the Leader has delegated that task to experts.

Then the leader lets those experts do their jobs.

The Leader knows that a staff member (or agency like Better Fundraising) who is focused on the art and science of direct response fundraising is going to create letters and emails that raises more money than the Leader himself or herself would write.

It makes all kinds of sense that when a nonprofit is just getting going, the leader is deeply involved in the fundraising messaging.  The Leader is also probably handling the data entry, the accounting, and negotiating the lease the first time the organization rents an office.

Then, just as a Leader hands all of those functions off to subject matter experts, they hand off fundraising message creation to experts in fundraising messaging.

Should there be check-ins on content and results?  Of course.  Can the Leader express their will and preferences?  Of course.

But hand it off to the experts.  Trust their expertise.  Hold them accountable by reviewing results.  Let them do their jobs.

You don’t become a big nonprofit and then hand your fundraising off to experts.  You hand your fundraising to experts so that you become a big nonprofit.

On Developing Younger Donors

Steven Screen  |  Repeat
Young donor.

I’d like to give you permission to not worry about something.  (As a Fundraiser, you have plenty to worry about already.)  

So… don’t worry about “developing younger donors.”

The biggest reason a person becomes a generous donor has nothing to do with any nonprofit.  People become generous donors because they age into it: 

  • They reach their peak earning years
  • Their kids move out
  • Expenses are lower and they have more disposable income
  • They have more free time
  • They start to value meaning more than they value status

As people age they tend to have more money to give, and more motivation to give it.

I say this because when I tell nonprofits to focus their efforts on older donors, someone always pushes back: “But we need to develop our younger donors, too!”

I understand the worry beneath that statement.  When you’re at a nonprofit and you look at your donors, you see a lot of grey hair, and you wonder what will happen when those friends are gone.  That’s a fair and reasonable thing to feel responsible for.

However, the thing that turns people into donors is not under your control.

So, with your limited time and resources, focus on the donors who can give you the most now, and let demographics take care of developing the next generation of donors for you. 

Here’s how that happens.  As people age into their giving years, they start to pay more attention to fundraising messages.  They’re more likely to stop by your website.  They’re more likely to open your mail.  They’re more likely to go to your event.

So the best thing you can do to develop tomorrow’s donors is to develop a fundraising program that works great for today’s best donors.  Then, as the next generation ages into its prime giving years, they will find you.

Your job is to be ready for them, not to get them ready.

The Authenticity Trap

Steven Screen  |  Repeat

I’ve written before about how making sure your fundraising is “authentic” isn’t always useful. 

And here’s a new idea: to grow, most nonprofits must do things that do not feel authentic.

  • Keeping detailed records about each major donor doesn’t feel authentic – in fact it feels weird at first.  Yet it’s part of a professional approach to major donor fundraising and is part of any major donor management system.
  • Sending 70+ e-appeals a year doesn’t feel authentic – what kind of person would do that, and who even has the time to do that?!?  But it’s part of a professional email fundraising program, and has been for several years.
  • Having an appeal letter that’s not in the Executive Director’s “voice” doesn’t feel authentic.  Yet at larger organizations the ED doesn’t even see the appeals, because there’s a staff of professionals who have been given the authority to replace the ED’s voice with whatever tactics and approaches raise the most money. 

Here’s the thing: none of those activities feel authentic, but they sure are effective.

They might not feel authentic to you at your stage of growth, but they absolutely feel authentic to the larger organizations that do them every day.

So as your nonprofit thinks about how to grow, don’t get stuck in the authenticity trap.  Focus instead on what will get you to your next stage of growth and impact.