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Donor Acquisition Is Old Model Fundraising

By The NonProfit Times - April 9, 2013

Some people say that flat is the new up when it comes to donor acquisition. Participants of a panel discussion during the Direct Marketing Association Nonprofit Federation’s 2013 Washington Nonprofit Conference begged to differ.

“The old growth model is acquiring more new donors than we lose,” said panelist Josh Whichard, a partner at Washington, D.C.’s DonorVoice. The old model, said Whichard, is like a leaky bucket, but one with more water and fewer holes.

“Even if we are better at acquisition, are we delivering a better experience?,” he rhetorically asked attendees. “We’ve got to stop losing as many people as we are because we don’t deliver a good retention experience.”

Operation Smile in Norfolk, Va., experiened a 371 percent growth in new donors making a single gift of less than $10,000 between 2003 and 2012. However, it also saw a “corresponding difficulty in retention,” said Jann Schultz, associate vice president of donor services. “Our challenge was to move those donors beyond one and done.”

Whichard identified four failings of many marketers.

  • Some nonprofits’ brands suffer from sameness; they don’t do enough to differentiate themselves from their competition.
  • The donors’ experience did not match expectation. Donors will leave if they expect to be engaged after a donation and are not.
  • The information they received wasn’t relevant. That’s a function of mass marketing, said Whichard, and a one-size-fits-all approach won’t work.
  • No one asked what the donors think. Many would like to share their opinions and experiences and never get the opportunity.

“The key to retention is thinking about how donors feel and think,” said Whichard. “To get into the relationship business, you’ve got to ask better questions, listen to the answers and act on them. Strong relationships are created, not born.”

Whichard recommended conference attendees do a relationship assessment of the donor files that he called “the new who.” Break your file into four metrics: high commitment, potential, transactional and at-risk. Give each donor a score from 0 to 100; the higher the score, the higher the intensity of their commitment. Whichard stressed that this “new who” would not replace other segmentation metrics such as Recency Frequency Monetary value (RFM), but rather simply provides another look at your file.

After determining the new who, it’s time to figure out “what the leaky holes are,” said Whichard. He said to concentrate on “data reduction, focus on the things that matter,” which goes back to donors not wanting to be mass marketed to.

Operation Smile surveyed donors in last August, and found that it was trying to present too much to their donors. “First, we validated that images of children before and after their operations and the opportunity to make that transformation possible resonate,” she said. Instead of focusing on providing donors the opportunity to make an immediate and life-changing impact on a child, the organization was trying to cram its entire mission into its direct mail pieces, and donors weren’t responding.

“Our effort to explain our entire mission — to serve the whole child, post operative care, training of doctors and nurses, etc., — diluted the message that resonated with highly committed donors,” said Shultz. “We knew we needed to streamline the messaging and share with donors how their donation provide immediate, life changing results.”

Conducting primary donor research with surveys is essential to understand where you’re going wrong and why your donors are leaving. Break the results into a graph, with the x-axis being importance and y performance. The bottom right quadrant, important things your organization is not doing as well as donors would like, is where you want to focus. “Refine in the top right (quadrant), repair or refine the bottom right, and repair or replace everything to the left of the y-axis,” said Whichard.

Schultz said Operation Smile convened a workshop with members of its direct response team, major gifts, its mid-level donor stewardship department Donor Care, communications and many of its partners. “We learned about things to do immediately, in the short-term and in the long-term,” she said. “Something we did immediately was changed the messaging and started to incorporate language that resonates with high commitment donors.”

Messaging around “global standards of care” was underperforming, said Schultz, because donors didn’t know what that meant. “It was an internal term that made its way to outbound direct mail,” she said. Donors felt that Operation Smile having high standards of safety and care was important, and Schultz said that’s what global standards of care meant. “It was something we were already referencing, but we made a change in how were presenting it,” she said.

Schultz identified three key takeaways from the assessment process.

  • Feedback is priceless. Spend as much time as possible with the donor services team capturing information. Listen and respond to donors.
  • Your mission is not your offer. Define and identify key experiences that drive revenue and response.
  • Customer service matters. You have to be helpful, have knowledgeable service and support, thank your donors quickly and provide timely receipting.

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