The “S” Word That Is Good, Not Naughty

The letter "S" for "Segmentation"

The “S” word that I’m talking about is “Segmentation.”

It’s the art and science of not treating all of the people in your database the same. Instead, you want to break them into smaller “segments.”

Here’s why this is important: good segmentation will let you save money on what you’re currently doing while raising more money. Segmentation is a 2-for-1 improvement to your organization.

Here’s what I want to provide:

A super-simple guide to segmentation for smaller nonprofits.

And here’s why I want to do it: most of the small nonprofits I get to work with don’t do enough segmentation. They tend to treat every person in their database the same. They waste money and miss opportunities.

Here’s a simple summary. It’s not perfect for everyone, but it’s a good start:

  • Send your appeal letters to all donors who have given a gift in the last 18 months. (Don’t send them to non-donors, or to volunteers, or to in-kind donors, or to donors who last gave years ago – it’s not worth the money.)
  • Send your newsletters to all donors who have given a gift in the last 18 months. (Same as above — as a rule, you will spend more money on printing and postage than you will receive in gifts.)
  • However, send your Christmas/Holiday/Year-end letters to all donors who have given a gift in the last 36 months. This is the time to include your non-donors and your volunteers.
  • Send your e-appeals to everyone on your email list.
  • Send your e-newsletters or e-updates to everyone on your email list.

That’s it. There are about 15 ways that it quickly becomes complex. But the main thing to remember is that the people most likely to give you gifts are your donors. And organizations that really analyze their results quickly figure out that it’s not worth their money to send mail to people who haven’t donated in a while.

And here’s how you can use segmentation to raise more money . . .

Identify your “segment” of major donors and send them special versions of your direct mail.

Because your major donors can give you such large gifts, it is worth spending extra money on your mailings to them. Here’s what to spend your money on:

  1. Larger envelopes
  2. Nicer paper
  3. Customized proposals in the mailing

The purpose of spending the extra money is pretty simple: it’s to increase the chance that a major donor will OPEN your mailing. And if you do that with your major donors, you will raise more money!

[FREE RESOURCE] Storytelling for ACTION ebook

We made a free ebook to help you raise more money!

Here’s what Tom Ahern said about it: “Get it. Read it. Implement it. Make way more money.”

If that’s not enough, here’s a sample of what you’ll get. This is our “Story Type Matrix” — it’s 20 years of hard-won storytelling advice about what types of stories to tell and when to tell them, condensed into a single powerful page.

And that’s just page 13. There are 40 other pages.

I mentioned this is free, right?

Why would we give away this level of information? Two reasons:

  1. There’s a lot of un-tested information about storytelling out there. Just “being good at storytelling” or “telling stories well” isn’t the magical fundraising tool it’s made out to be. What stories you tell, and when you tell them, matters a TON.
  2. We’re sharing this because our goal at Better Fundraising is to radically improve the fundraising capacity of small to medium-sized nonprofits. That’s why we’re here. We’re constantly looking for ways, for free or at very low cost, that we can share what we’ve found (through vigorous testing) works best in fundraising.

Download your free ebook today!

The 1 Thing to Know for Year-End Fundraising

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The reason your organization raises so much money at year-end has little to do with your organization.

But it has a LOT to do with your donors.

Please, let me tell you how you can use this information to help your donors give even more. This is a big idea.

People aren’t more generous in November and December because they suddenly wake up and want to help nonprofits. Your donors are more generous because this is time of year they celebrate thankfulness and generosity. This is when they celebrate the gifts they’ve been given (personally, financially, spiritually), and focus on the things that matter most to them.

A natural outcome of your donors’ celebrations — and of thinking more about what they care about — makes them more likely to give gifts. They put their money where their heart is.

Here’s why I’m telling you this . . .

Focus your message at year-end on what your donors care about and you’ll raise more money.

But most nonprofits don’t do this! Instead, they focus their messaging on the organization itself. They talk about what the organization did during the year. They talk about the programs of the organization.

Here’s a super-simple example of why focusing on what the donor cares about is so effective. Imagine you’re an arts organization. Here’s what your donors care about, in order of importance:

  1. The arts
  2. Promoting and/or preserving the arts
  3. Organizations that promote or preserve the arts

Remember, the organizations that raise the most money tend to focus on what donors care about most.

So, this arts organization would focus their messaging on the arts themselves, and how the donor’s gift will promote or preserve them.

But most organizations write about themselves. They are focusing their messaging on the least important of the three things their donor cares about! Their letter will be all about what their organization is doing to promote and preserve the arts. Then they’ll ask the donor to “support the organization” or to “help us continue this good work.”

Here’s what works far better: talking less about the organization, and asking the donor to ‘support the arts.’

In practice, this means making your year-end letters, emails and website features more about your cause and your beneficiaries than about your organization.

I know this works. Our clients usually see their biggest gains working with us at year-end, mostly because we help them communicate more about what their donors care more about! We even sell samples of year-end appeal letters that are proven to work – and if you look at the samples you’ll notice that they talk very little about the organization that sent the letter. They talk to the donor about the cause or the beneficiaries, and about how the donor can help.

So this year more than ever, make your donor communications about what your donors care about most!

Why We Are All Hypocrites About Fundraising Plans

A close up shot of a black locomotive speeding down the tracks

“It’s like you have been in our office!”

We hear this every once in a while from new clients. It usually happens near the end of summer when we’re helping them create their year-end fundraising plan.

We make a plan and everyone is excited. Then we say to them, “This is great. But now let’s talk about what could derail the plan.” Here’s the list:

  • A board member or program staff is going to object to the way a letter is written. At the last minute. Multiple times.
  • Someone will get excited about a new opportunity. They’ll want you to drop what you’re doing and do their (untested, unproven) thing.
  • You won’t actually start early enough. Things will take longer than you expect or (more likely) there are some parts of the job that you don’t like as much as others.
  • Someone will run late. Your website doesn’t get updated or you don’t get the info you need when you need it.
  • You’ll simply run out of time, unable to get everything done because there’s too much on your plate.

It happens to everyone. We all say we want a great plan. But then we don’t actually follow the plan and it never gets completed.

It happens to us, too. As I write this, we’re about to launch an online store with products like a tested year-end fundraising calendar proven to raise the most money. The plan was to launch a month ago!

Because we know your reality, we’re not going to give you trite advice like, “Have a plan and work your plan.” You know that already.

What you (and I) really need is practical advice on how to do our best fall and year-end fundraising when you know there are going to be a ton of distractions.

Here are the three things that have helped our clients. They aren’t “tips” or “weird tricks” — think of them as accumulated wisdom from the fundraisers that have gone before us:

1. Know how much money is at stake, and what percentage it is of your income.

In a word, this is the “why” your plan exists. You need to be able to say to someone, “We have a plan to raise $3.2 million before December 31st. That’s 40% of our total revenue.” Sharing the big picture quickly — and how important it is for your organization — is a very effective way to get things done. You’ll love how people will say, “Oh, you’re right, we can try my new idea in February.” Or, “That’s right, I’ll get that to you right away.” But if it’s just business as usual, we’re busy because that’s the way it always is, say, “bye-bye” to your plan.

2. Prioritize your priorities.

In addition to knowing how much money you expect to raise, know how much you expect to raise through your major donors, your mail, your email, your website, Giving Tuesday, etc. Then prioritize your time and attention on the actions that bring in the most money. That way when something comes up (which it will) or you run out of time (which you will), you can make a smart choice about what not to do. We’ve watched organizations focus on an email that will bring in $15k but neglect following up with a major donor who always gave them $50k. These types of things happen all the time — but not as much when you and your team have a list, on your desk, of which efforts produce the most revenue for your organization.

3. Publish your plan.

By this we mean, make your plan public. Post it on your door. Show the board at your October meeting. Talk about it in your first November staff meeting. Tell people what you’re working on and what’s at stake. They will be far more likely to be helpful in November and December when they know that there’s a really good reason why you’re so busy!

So, you still need to make a great plan. But use these three practical ideas to help you stick as closely to your plan as you can during the most important (and distraction filled) time of the year!

Your Fundraising Infrastructure Matters!

Gail Perry wisely encourages you to build up a strong and effective organization by investing wisely in your fundraising infrastructure. It’s a choice, but a very important one. In her blog she lists a few examples of how you can invest in your infrastructure. Here are the suggestions I’d like to highlight and I put my own twist on why I think these are important.

  • Hire and keep competent staff. Your people make your fundraising plan go. You need to be willing to spend money to hire and retain great people. It is worth the investment.
  • Now that you have great people on your team, you should invest in their professional development. Even a seasoned fundraiser will benefit from additional training and education.
  • Purchase, use and leverage cutting-edge technology to manage and deliver your fundraising content. I’m writing this very blog post using an online software program that helps my team draft, edit and post content! How up to date is your donor database, email delivery program, social media management platforms, internal communication tools? Investing in new resources and training can create great efficiencies.

The big takeaway for me after reading Gail’s blog is that if you want to grow your fundraising results year after year, you should invest heavily in your people, systems, programs and technology.

Click here to read Gail’s blog. It is worth it.

Your Donor Should See Herself In Every Story

The following is an excerpt from our new eBook, Storytelling for ACTION. If you enjoy this, download your free copy today.

“There’s an easy way to focus on your donor’s role, and a hard way. The best fundraisers do the easy way first, and then they do the hard way, too.

The Easy Way (do this first)

Use the word “you” a LOT. Use it early and often. This simple trick makes you include the donor in everything you say and write.

  • 2-to-1 Ratio: We recommend at least a 2-to-1 ratio of “you’s” to “we’s.” That’s two of “you/you’re” for every one “we/us/our” and the name of your organization.
  • Red Pen Test: Start with this classic test—circle all the “we/us/our” with red pen, and all the “you” with blue pen. You should see a LOT more blue than red.
  • 10% Rule: Master fundraising copywriter Jeff Brooks says your goal should be to have 10% of all the words be the word “you.” It sounds crazy, but try it and then read it out loud. You sound like someone talking directly to another person that you care about—which is exactly what good fundraising sounds like.

If you do this, you’ll notice your donor will start to appear in your fundraising materials much more often. And if your donor sees herself in your communications, she’s more likely to give a gift.

The Hard Way (do this second)

Make the action you want your donor to take— the role you want her to play in the story—be specific, compelling, and powerful.

Think of it this way, when you tell the story of what your donor’s gift is going to do, get specific.

Examples of the specifics we’ve had great success with:

  • provide one meal
  • shelter for one night
  • access to an art museum for one child
  • curing one person
  • one credit towards graduating from college
  • help one teacher

It’s often hard for organizations to get specific about what a donor’s gift does. To your organization, the specifics seem less important than the whole of your programs or approach. And that’s true—from your point of view. You’re an expert!

But from the point of view of a donor— who doesn’t know nearly as much about program details as you do—the specifics are extraordinarily helpful.

That’s why in all our testing an action like “Be the difference for a refugee in need” doesn’t raise as much money as an action like “Provide medical care for a refugee for $7.”

If you’ve enjoyed this excerpt from Storytelling for Action, you can download the full eBook here.

Why Your Donors Deserve Ask, Thank, Report, Repeat

You’re no doubt familiar with Ask, Thank, Report, Repeat, the fundraising rhythm we teach here at Better Fundraising.

There are two equally strong reasons you should follow this approach to fundraising.

It probably won’t surprise you to hear that we arrived at it because it raised our clients the most money and retained their donors the longest. Both Jim and I come from competitive fundraising environments where we were pressured to raise money in the short term AND to set organizations up for long term success. And when we looked at what worked and what didn’t in fundraising — really getting deep in the data — it was clear that Asking, Thanking, and Reporting were the key elements for fundraising success.

And that Repeating the rhythm (and some of the messages) helped organizations grow over time.

So we developed Ask, Thank, Report, Repeat simply as a way to help organizations raise more money.

But there’s another line of thinking that leads you to the same place. We call it ‘treating your donor the way she deserves to be treated’ . . .

  • You honor your donor by sharing the problem your organization is working on, and asking your donor to help solve the problem.
  • You honor your donor by thanking her like crazy when she gives a gift to help.
  • And it’s really honoring her by showing her what happened because she gave a gift. To Report.

You could argue that it’s a moral imperative to Report. She gave you a gift in faith and received nothing in return but a hit of dopamine. How can you in good conscience ask her to give another gift without showing and telling her that her gift made a difference?

This is one of the reasons, by the way, that fundraisers don’t like their jobs. They have to ask and ask and ask. They know in their hearts that donors get tired of being asked! But the fundraisers who work in environments where their donors are honored with regular reports? Those fundraisers enjoy their jobs much more. And their donors enjoy the fundraising much more.

This is the heart of donor centricity. It’s acknowledging that the donor is central to the process of philanthropy, charity and your organization. It’s acknowledging that her role is not just “supporter” or “partner” but as central as your organization’s.

So ask yourself, “Have we Reported to our donors lately? Do we deserve to ask them for another gift?”

When you’re great at reporting you’ll notice three things: you’ll raise more money; you’ll keep your donors for longer; and you LOVE knowing that you’re treating your donors the way they deserve to be treated!

The Power of YOU at Shoreline Rotary

football coach

Since your job as a fundraising professional is often hectic and overwhelming, I thought you would be encouraged by a recent talk I gave to the Shoreline Rotary Club about how to move yourself to positive action and outcomes.

My work at Better Fundraising has allowed me to be a high school football coach for the past 24 years. The members of this particular Rotary Club know me as “Coach Shap.”

The group brought me in to talk since they were looking for a little “team motivation” before they set out to fulfill summer work projects in the community. I organized my talk around the three different kinds of power each of us has in our lives that can motivate positive action and produce great personal and professional results.

Here is a summary of what I shared.

The power of choice

We make choices every day that impact the outcomes and results of our day. We can choose to get out of bed on time or to be early to the next scheduled business meeting. We can choose to be kind to our spouse after a mistake has been made around the house, or give grace to our kids after a poor choice was made. The power of choice truly can drive results, actions, and our ultimately shape our perspective on life. Let’s choose to be positive and encouraging to the people we care about the most.

The power of people

I believe we become whom we surround ourselves with. If we choose to hang out with people that are positive and make good choices, they will have a positive influence on us. If we choose to hang out with negative people or friends that make poor choices, we eventually will get caught up in their way of thinking or in negative circumstances. My hope for you is that you can surround yourself with people that build you up and encourage you to be the best you that you can be.

The power of self-talk

The last area that I believe can truly make a difference in your attitude and performance is the power of self-talk. We tend to be our hardest critic. Most of us walk though our daily lives replaying in our mind self-talk that is negative and hurtful: “I’m not smart enough, strong enough, sharp enough, professional enough,” and the list goes on. The best thing you can do today to turn your day around is to fill your self-talk with positive comments. Be like the childhood story of the little engine that could. If you think you, can you will. If you think you can’t, you wont. It is that simple.

I hope these thoughts encourage you to take on the day with fervor and energy. You truly can make it a great day; it just comes down to how you choose to live your life.

Now go out into the world and choose to make it a great day!

Why Does “Ask, Thank, Report, Repeat” Work?

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I recently received an email from a woman I met at a conference I spoke at. She ended her email with this comment; “Because of your knowledge I have been kickin’ a** fundraising and will only get better as we make more money, add more staff, and implement more of your plan!”

Reading this made me ask myself, ‘Why does Ask, Thank, Report, Repeat work so well?’ Here are just some of the reasons . . .

  1. Fundraising is not a talent issue, it is a knowledge issue. The fundraising fundamentals I teach can be learned by most anyone. The key is they must have the willingness to learn.
  2. Ask, Thank, Report, Repeat puts the donor at the center of the fundraising conversation. The system honors the donor, their stewardship decisions and gives them the credit for making the world a better place because of their donation.
  3. You will communicate more often to your donors when using Ask, Thank, Report, Repeat. The system requires you to Ask with clarity, Thank promptly and Report back emotionally. Doing these things means you’ll communicate to your donors more often – which is a very good thing for most nonprofits.

My hope is as you run fast into 2017 you will consider learning more about Ask, Thank, Report, Repeat.  And that you will leverage the fundraising power behind this simple, donor-centered communication rhythm.