Acquisition Ideas for Small Nonprofits

Acquisition Ideas for Small Nonprofits

A friend recently asked me for some ideas on how to start growing a donor base for a small nonprofit who doesn’t have a lot of money to spend. This seems like that’s always a question, whether you’re working with a small nonprofit or a large one: What are some creative ideas to acquire new donors without spending a lot of money? As I told her, I’m always great at coming up with ideas as long as someone else will do the hard part – doing the work. So, I thought I’d pass along some thoughts. One of the first things I would recommend to look at is any resources that the organization has for an online campaign to start to build up a donor file. Who are your board members and what resources do they have? Do they have companies with websites and could they devote a section to your cause? Do your board members or does your organization have a relationship with local media like the newspaper or a radio or TV station that could help with a campaign to drive people to your website? Do you have a way to launch a concentrated online campaign around a particular issue? In addition to a lightbox on your home page, you could have other sites (like those board members’ company sites) drive potential donors there. I once had a client who launched a big campaign in conjunction with a car dealership (the owner was a board member) and the car dealership sponsored TV commercials for the organization to drive people to give (pun intended). Just some thoughts to...
The Correlation between Direct Response ROI & Net Revenue

The Correlation between Direct Response ROI & Net Revenue

Any of us that have been in the fundraising agency business have had the following meeting a least a dozen times: There are a bunch of somber looking board of director types from the nonprofit organization in the main conference room. They distrust agencies. Unlike development people who see how much money agencies bring into the organizations, the board only sees the checks that are sent to the agencies. The board’s one and only metric is ROI. Somewhere along the way, they tend to get this idea that the direct response fundraising ROI and net revenue have a 1:1 correlation. They don’t. Actually, the correlation looks more like this: We have found the optimal ROI for direct response fundraising is around 4.00. Sure it’s going to vary a bit by organization and which donors you are including in your appeal letters. But generally speaking, if your ROI is under 4.00, chances are that you are mailing too deep. Or in other words, you are spending too much on mailing and you need to be looking at your segmentation selection process. Conversely, if your ROI is above 4.00, you are likely leaving net revenue on the table because you aren’t mailing deep enough. Sure, your board might be happy with those ROIs (that GuideStar and Charity Navigator place far too much emphasis on IMHO) but the fact of the matter is, those high ROIs are hurting your ability to accomplish your mission. So please don’t manage to maximize your direct response ROI. Manage to maximize your net...