Imagine overhearing this conversation in the hall at a fundraising conference: “We’ve decided to invest more on donor retention than donor acquisition this year.”
Oh, wait, that never happened. In fact, that conversation probably rarely happens, if at all.
Research consistently shows that only 40 percent of donors give to a cause more than once, meaning 60 percent don’t give a second time. After five years, only 10 percent of donors are still giving to that cause.
This isn’t just a problem. It is a spectacular type of failure. It doesn’t get the attention it needs and deserves because it upends the rhythms and precepts of fundraising’s conventional wisdom.
The fundraising industry is an enormous triumph of transactional churn over relationship building. The result is that too many fundraisers are failing at their most fundamental job; safeguarding and securing the future of their organizations.
Fundraisers say they work this way because, well, it works. M&R’s annual survey of online fundraising in 2016 appears to confirm this: “And yet, email revenue grew by 25 percent in 2015, faster than the 19 percent rate of online revenue growth overall. Email giving accounted for 29 percent of all online revenue last year, and nonprofits received $44 in donations for every 1,000 fundraising messages sent.”
That’s interesting until you read the next paragraph: “With open rates, click-through rates, and response rates all declining, this increase comes down to volume. Volume, in two ways: more people, and more messages. Email lists grew by 14 percent in 2015, and nonprofits sent more fundraising messages.”
This is not a technical problem; it’s a culture problem. Transactional cultures value efficiency and speed above all else. They have the least amount of relationship building baked into them by design. Round and round the turnstiles go, looking for a tiny percentage increase in funding and donors each fiscal year.
Not only do transactional cultures turn people into ATM machines, only valued for their last donation, paradoxically to their architects, they are very expensive. “As a general rule, retaining and motivating existing donors costs less than acquiring new donors,” wrote Wilson Levis of the Urban Institute.
There are real and important costs associated with transactional cultures that get lost within the technocratic language of open rates and click-throughs. The primary cost is the missed opportunity to build strong and lasting relationships with donors.
Focusing on retention rates and relationship building requires asking and answering different questions than usual. Questions such as:
• Why didn’t you open the email?
• What stopped you from sharing our message with your friends?
• How do we make you feel when you give to us? Do you feel included and valued? Or do you feel marginalized and anonymous?
And, what about those lapsed donors? What are they thinking about your organization? How about asking them that rather than asking them for money again?
In the analog days, trying to talk to non-responders was difficult and time-consuming. However, there is no excuse for not being in conversation with your people in a digital world. Digital platforms are opportunities for interactions with your people. We humans call these interactions conversations.
What if a few of those emails and self-celebratory posts on social media were questions that reflect the reality that staff can’t have all the answers to difficult issues? What should we be working on? What do you think we do well? Where are we falling short?
Where are the nonprofit conversations? On Facebook? Nope. Getting “Likes” is not the same as having a meaningful conversation with people. Even getting comments is not the same as having a back-and-forth discussion that informs both parties.
There are great examples of organizations and leaders using social media to build relationships. Jim Canales at the Barr Foundation asks his Twitter friends what he should discuss at an upcoming conference, and circles back to tell them how it went.
The Los Angeles County Museum has fun, chatty posts on Snapchat such as a photo of François Boucher’s 1742 canvas “Leda and the Swan” with the caption: “Stop looking at me, Swan,” from the ’90s film “Billy Madison.” Think of how different this communication is from the weekly direct mail to join the museum or donate to it.
And if you think it’s hard to be conversational online, check out Planned Parenthood’s various social media channels. Honestly, if the constantly-attacked Planned Parenthood can be conversational, why can’t you?
It takes a different kind of leadership to be relational. You have to be open to real input of constituents and unafraid to reveal your real flaws and vulnerabilities. Relational leaders know that their job is to facilitate conversations with crowds of people online and on land and that by doing so financial and social capital will flow.
Your people are waiting to talk to you. They are anxious to help, and create and share and celebrate with you. It’s time for you to let them.
Allison Fine is the author of “Matterness: Fearless Leadership for a Social World,” the award-winning Momentum: Igniting Social Change in the Connected Age, and the bestselling “The Networked Nonprofit.” Her email is firstname.lastname@example.org