Fundraising’s Solid Ground

As I write this, we literally live in a world filled with uncertainty. While us analysts cannot predict the future of fundraising, we are pretty good at studying past donor behavior, and that can help us better understand how we should respond in times of uncertainty. In my career as a fundraising analyst, there have been numerous “hold your breath” moments: The dot.com bust, Y2K, 9/11, the anthrax scare, and the Great Recession. Each of these events did adversely affect fundraising. But after each event, donors and revenue rebounded. In the past days, I have gone back into some of our data vaults and have studied each of these events, and here’s what I learned that may help us in the months ahead: Overall, fundraising revenue declined in the year of these events. In the worse cases, by up to 20%. But most organizations were in the 3-5% range.There were fewer large gifts secured in the year of the crisis.New donor acquisition suffered the most, dropping as much as one-third.Multi-Year donors continued to give faithfully throughout the period of uncertainty. Multi-Year donors – those that have given to your organization year in and year out – typically generate two-thirds of a nonprofit’s revenue. They also provide the best return on investment. However, they can only do that if you continue to communicate to them and ask for their support. Your Multi-Year donors know you. They believe in you. It’s now time for you to believe in them and give them the opportunity to help your organization through this period of...

Fundraising in the Time of Coronavirus

As all of anxiously watch the spread of COVID-19 from China to the rest of the globe, we are all holding our breath on how this is going to affect donor behavior. Fortunately, December 2019 giving was particularly strong for most organizations. However, early data suggests that first quarter trends are soft. Anytime there is uncertainty, and the virus is contributing to stock market volatility, giving declines. It’s possible a recession, which is defined by lagging indicators, is already here. While there is no need to panic, it might be wise to start doing some contingency planning. If the virus continues to gain a foot hold in America, one of the first places nonprofit organizations are going to feel it is in their fundraising events. As big sporting events and large conferences, like SXSW, are cancelled this spring, you can expect that people are going to be hesitate to attend your galas and run/bike/walk events – even if they are not outright cancelled. Your organization may want to consider substituting in-person events with “virtual” online events. Of course, your organization will have to communicate potential changes to your events to your donors. And while e-mail is inexpensive, the medium is particularly crowded and easy to miss. In our view, more emphasis is going to be placed in direct mail both as a communication tool and as a fundraising tool. Many organizations still rely on this tried and true channel for a large chunk of their revenue. In these uncertain times, it likely that direct mail will become an even more important tool in your fundraising arsenal. Hopefully, we will...

The Hard Work of Volunteering

Seems like one of the constant topics in the nonprofit blogosphere is this idea of growing your donor base through providing volunteer opportunities. My personal experience has been quite the opposite really. Being an introverted analyst, I am always hesitant to volunteer for anything because that likely means some type of social interaction with strangers will be part of the experience. But last fall, I found a local organization that I was really interested in. I reached out to them, and they said they needed a long-term volunteer with a very particular skill set, one that I had and was excited to share. They were excited too. Three-times I followed up with them to set a time to get started. And each time I heard the same thing: Someone will get right back to you. And no one ever did. Sadly, I don’t think my experience is that unique. One has to be very persistent to become a volunteer. Now, I understand that people at nonprofits have a lot on their plates. I get that. But by not following through, I went from someone who was super interested in the organization to “forget them” in three short calls. So, rather than volunteering being a path to becoming a donor, if an organization is not careful, it will became a shortcut to becoming a lapsed...

My Fall In-Box

I don’t know about you, but I received far fewer direct mail appeals this fall (between October 1st and December 31st.) Last year, I received an even 50 direct mail appeals. This year, I received only 30. That’s a 40% decrease in volume, which is significant. During the last week of the year, I received 99 e-mail appeals (this is the first year I have tracked this metric). Half of those came on the final two days of the year. Here is a recap of the direct mail I received this year, and the insights I noted: Of the 30 pieces of direct mail, 15 mailings were appeals from 8 organizations I have previously supported, while 15 pieces were new donor acquisition kits from 11 organizations. Once again, I received the most pieces from The Salvation Army (7) – though four of the mailings were duplicates. I have supported The Army in two different Divisions, both of which sent me identical appeals. I contacted one Division about this issue last year, but the message must not have reached the right people. World Vision and World Wild Life Found sent me the two catalogs I received I did not receive any newsletters.For acquisition, I received three premium packages. One was from St. Jude with address labels and a notepad, and I received two handbags from Doctors Without Borders. My team and I are looking forward to analyzing all the end of year data these fall appeals have generated. We’re looking forward to seeing your data,...

A Cautionary Tale of Stopping New Donor Acquisition

As I’ve shared before, one of our most common analyses, sadly, is projecting what happens to a donor file’s active counts if an organization decides to discontinue new donor acquisition – after all, new donor acquisition is just too expensive. Well, today’s graph is not a projection . . . but a real-life example of what happens to donor file when an organization stops acquiring new donors for just two years. Figure 1: Active Donor Counts Not sure I need to say anything else. What a total unmitigated disaster. In just two years of not acquiring new donors, this organization’s active donor counts were cut in half. This organization now faces the dim prospect of having to invest more in new donor acquisition over the next several years just to get back to where they were in FY17. So unnecessary. If you (or your client) is considering such a decision, please, please, show them this...