5 Nonprofit Myths – And Tall Tales

There’s an old myth in fundraising: Loki will one day kill direct mail. The Tree of Nonprofit Life, Individual Giving, will wither and die, thus ushering in the eternal winter of fundraising Ragnarok.

Well, perhaps fundraising myths aren’t that grand or poetic, but myths do abound in fundraising. Tom Gaffny, principal of Tom Gaffny Consulting, was on hand at the Direct Marketing Association Nonprofit Federation 2015 Washington Nonprofit Conference to dispel five enduring misconceptions people have about the current and future states of direct marketing fundraising.

  • MYTH 1: The donor pyramid tells you everything you need to know.

FACT: The donor pyramid does not take into account one vital piece of information. While you’re ranking your donors, where does your donor rank you? “Rather than rank attributes and giving, let’s select high passion people who never would have gotten selected if just the traditional pyramid is used,” said Gaffny. That segment could have response rates of up to three times higher than the overall list, he said.

  •  MYTH 2: I own a donor base.

FACT: You don’t own the donor; the donor owns you. You can control a couple of things: What to send, when to send it, and by what channel. But the person who receives your message can control far more. Whether to open your package, when to open it, whether to read it, whether to respond to it, how much to give; those are all out of your control.

  • MYTH 3: Acquisition is the key to growth.

FACT:  The nonprofit sector might be the only industry that doesn’t view retention as the key to growth. “The biggest issue isn’t acquisition, it’s file growth and retention is the key,” said Gaffny. He said it’s better to cut acquisition and invest in multi-year retention than invest heavily in acquisition and just the status quo in retention. “In terms of revenue growth, the myth of growing our way out of something by acquiring more $15 donors isn’t the case,” Gaffny said.

  •  MYTH 4: I’m doing everything I can to cultivate my major donors.

FACT: Most major donor mailing programs consist of first-class postage…and that’s about it. “The top of your file is a treasure chest, but in too many cases they’re treated like everyone else,” said Gaffny. It’s easier to convince one person to do something than it is to convince 500.

  •  MYTH 5: I can’t rely on direct mail as a viable channel for many more years.

FACT: Older donors, those most comfortable with direct mail, are still going to be around for a while. If you’re over 65, life expectancy charts say you’ll live to 85. If you’re 70, you can live to age 87. “We need to stop thinking that direct mail is dead or dying,” said Gaffny.