The Mikuska Group  

It pays to keep your donors

We hear all the time from organizations about getting new donors. Yes, it’s important to bring new donors in, but it’s even more important to keep the donors you have.

The 2017 edition of the Fundraising Effectiveness Project results was recently published. Here are some of the sobering findings from 10,829 non-profit organizations:

  • Every $100 gained in 2016 was offset by $95 in losses.
  • Every 100 donors gained in 2016 was offset by 99 donors not giving again.
  • The greatest gains were in new donors.
  • The greatest losses were in new donors not giving again.
  • The average donor retention rate was 45%.
  • The average dollar retention rate was 48%.

(Gains are gifts by new donors + recaptured lapsed donors + increases in gift amounts. Losses are decreases in gift amounts + lost gifts by lapsed new and lapsed repeat donors.)

What does this tell us? Organizations do a poor job at keeping their donors, and as a result, they are continually chasing new donors, at great expense.

It’s much more cost-effective to keep the donors you have than to continually chase new donors.

The results vary by size of organization. Smaller organizations fare much poorly that larger organizations, which means resources dedicated to retaining donors make a difference.

The FEP site has tools to help you analyze your data so you can make decisions on where to put your time and money in keeping your donors engaged. It’s not just about the bottom line of how much comes in. You need to know who your donors are.

Don’t treat all your donors the same. Heap more love on your loyal donors and ask them to give more. But do make sure new donors know they are valued and welcome, and chances are some will give again and again.

Julie Mikuska.

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What happens when your fundraiser moves on?

There’s been a trend among social impact organizations for some time that sees development staff stay for about 18 months, then move to another organization or leave the profession altogether. For many organizations, this becomes a set-back which may take months or years to make right.

Know that this may happen in your organization, what can you, as leaders, do before and after it does?

Before:

Take steps now to understand what’s going on with major donors, where they are in the donor cycle and what the quality of the relationship is with them.

Make sure all contacts with donors are being recorded in your database. Great notes make for a great institutional memory.

Support your staff through professional development, career advancement and great working conditions. (who knows – they may not leave after all…)

Encourage a culture of philanthropy and engagement throughout the organization, so that donors may have relationships outside the development office.

After:

Do not rush to hire an experienced fundraiser, especially one who doesn’t understand your mission, as you may be in the same position in 18 months.

Do consider recruiting someone who has a passion for what you do and the skills to be come a development professional, and invest in a consultant to coach them into a new career.

Examine the reasons they may have left (as they may not be forthcoming about underlying conflicts that caused them not to want to continue working there). For example, did you pile every conceivable type of fund development activity into one job? It’s hard to expect one person to do events, major gift fundraising, direct mail, third-party fundraising, ticket sales, etc. and do any of it well.

If the departure was sudden and you didn’t have time to debrief on donors, call them and explain what the situation is. Don’t just leave them hanging.

Take steps to stop the revolving door. You and your donors will be much better off.

Julie Mikuska

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Canada Helps donors more generous – what that means for you

The AFP Foundation for Philanthropy released the results of its biennial survey of Canadian donors in March entitled What Canadian Donors Want.

For the first time this year the foundation partnered with CanadaHelps, a national social impact organization that promotes charitable giving in Canada, and provides a portal for charities’ online giving. They surveyed CanadaHelps donors and compared their giving behaviours to the general population.

Some interesting results:

  • 77% of CanadaHelps donors give to six or more causes compared to only 17 percent of the general population.
  • They are more likely than general population donors  to say they are very knowledgeable about the charities they support (38% compared to 22%)
  • Like their peers across Canada, CanadaHelps donors who gave in response to an invitation or post on social media say they gave because the posts came from someone they know.
  • They also are invested in charities that they know to be efficient with donor dollars and effective in their work, but to a much more significant extent.  82% of CanadaHelps donors are motivated by a clear purpose compared to 53% of the general population.
  • The largest proportion of CanadaHelps donors say their most recent contribution was to a place of worship and they are more likely than their counterparts in the general population to have donated to this kind of charity.
  • They are much more likely to take a proactive approach to selecting a charity – 67% vs 33% waiting to be asked.
  • They are also more likely to have given to international charities and to causes advancing the arts, culture, and the environment.

What does mean for your organization?

  • Donors give when it’s easy to do so. If you make it hard to give by not having online giving, you’re turning away donors.
  • Donors are seeking out information – how well are you presenting yours?
  • People give and give again to organizations with a clear purpose, with well-articulated impact.
  • Donors give to multiple charities – don’t assume someone won’t give just because they’re a donor elsewhere.
  • Your brand and network on social media can be a powerful driver of invitations to give – if done well.

The survey results have lots of fascinating details on donors’ actions – I recommend you check them out. There’s also a recorded webinar discussing the results, along with the presentation slides.

Do you know what your donors want?

Julie Mikuska

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Moving…on

I received an appeal from a large organization this week. Notwithstanding how awful the appeal was, what struck me first was the fact that they sent it to my former address. I haven’t lived there for almost 3 years.

People move all the time. Many of your donors are among them. If you expect to maintain a relationship with them, you must make an effort to make sure you’re sending your appeal to their current address. There are ways to do this:

  • Annual donor surveys – ask donors if the information you have on file is correct. Also ask how and when they would like to hear from you.
  • Canada Post has a National Change of Address (NCOA) Mover Data Service. Use it to check your database to make sure you have the most up-to-date information.
  • Direct mail companies will also use the NCOA database when you contract them to do your direct mail.

By not making an effort to check contact information, not only do you lose money on mailing costs, you also risk losing the donor.

That’s why I’m moving on.

Laura Mikuska

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Poverty mentality: it has to change

Organizations in the social impact sector work to change the world. Every day. Some work with the most marginalized and forgotten people, others save the environment, create life-changing art, take care of our health and save animals. Pretty important stuff.

Why, then, are they expected to constantly beg for their funds? They are having a huge impact in all of our lives every hour of every day – they shouldn’t be forced to shut valuable programs that help society, just because they are defined as charitable. They shouldn’t be forced to pay poverty wages to talented people (only to lose them when they can’t make a living) and have little to no technology to do their jobs.

It’s great to have a corps of volunteers to help deliver on the mission, but (well)paid staff  and resources have to underpin the work of those volunteers. Grant application after grant application all specify that the funds are for “programming”, with little to none of the funding directed towards staff, or keeping the lights on. Why?? And why do funders give limited-time funding for “projects” that will die when the funding runs out?

It’s time that we, as members of our collective society, start to speak out about why we have to change from a poverty mentality to one of abundance in supporting the work of the social impact sector.

We will all be richer for it.

Laura Mikuska

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New offering: Donor-focused communications course

We’re pleased to offer in-house training for social impact organizations to learn about effective, donor-focused communications, with the goal of reaching and retaining more donors. The course is for employees with responsibilities in fundraising and communications, or for those wanting to move into those types of positions.

Donors respond better to communications that are focused on them rather than on how great an organization is. The course is designed to learn about how best to talk and write to donors and to put those principles into practice, both for the students and for others in the organization. Students will also learn about the importance of storytelling and will use tools to speak to program staff about gathering stories of impact for donors.

It’s critical to engage donors and earn their loyalty, as it is much more cost-effective to keep donors than to continuous try to acquire new donors. The Fundraising Effectiveness Project through AFP shows that for 2013-14:

  • every $100 gained in 2014 was offset by $95 in losses through gift attrition. That is, 95 percent of gains in giving were offset by losses in giving for a net gain in gifts of 5 percent.
  • every 100 donors gained in 2014 was offset by 103 in lost donors through attrition. That is, 103 percent of the donors gained were offset by lapsed donors for a net loss in donors of -3 percent.
  • The donor retention rate was 43 percent. That is, only 43 percent of donors who gave in 2013 gave again in 2014.
  • The gift retention rate was 47 percent. That is, only 47 percent of 2013 dollars were raised again in 2014.

Employers are eligible to apply for the Canada-Manitoba Jobs Grant that will cover two-thirds of the cost of the course.

Students will learn about donor-focused communications through:

  • Reading assigned text books
  • Seminars
  • Viewing and discussing assigned videos
  • Completing assignments individually or in group work on:
    • Writing the case for support
    • Writing and producing the donor newsletter
    • Writing and producing annual appeal letters
    • Speaking with program staff about the importance of stories in donor communications

Interested? Contact us for more information.

 

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How much is a personally significant gift?

We ask each member of the boards we work with to make a personally significant gift. That often prompts the question of “how much is that?”

It’s what you feel is significant to you. It’s not decided around the board table, it’s decided at the kitchen table. If you have a partner, you decide together.

If you’re on a board, you should make that organization one of your top three giving priorities. After all, if you believe so strongly in the mission and work of that organization that you are giving of your time and expertise, then it also means you should invest your gifts there, too.

It should be a stretch gift – annually. Some find it easier to sign up for monthly giving as you don’t notice a small amount coming out of your account each month.

And, depending on your income, you may decide that $10 is your gift. And you should feel good about that.

Again, it’s not the actual amount that counts. It’s that you give, that it’s meaningful to you, and now you can be in a position to ask others to join you in making an impact in the community.

Now that’s significant.

Julie Mikuska.

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The case for support – it’s not about you

Contrary to conventional wisdom, a case for support is not only for capital campaigns. Your case is critical to your annual appeal, planned giving program, and corporate and foundation giving.

Think about it – if you haven’t articulated a persuasive case for support, how can you approach your potential donors? If you don’t know what they need from you so they can say yes, then you’re likely to fail in your request.

One of the gurus of the art and science of the case for support is Tom Ahern. His book, Seeing Through A Donor’s Eyes: How to Make a Persuasive Case for Everything from your Annual Drive to your Planned Giving Program to your Capital Campaign, is a must-read and must-follow for making your case.

Who needs the case for support? Everyone in your organization. It allows everyone to sing from the same songsheet, with the same words. It’s your key messages all in one document. It’s your go-to place for media releases, website, direct mail, planned giving, speeches and op-ed pieces.

According to Tom and observed in our own experience, the three most important questions for getting to the essence of your case are:

  1.  Why us? (What are you doing that’s so uniquely wonderful that the world should want more of it and support your mission and vision?)
  2.  Why now? (What’s the big hurry? What changed? Why is this crucial now? Why can’t it wait?)
  3.  Why you, the donor, might care? (Why are donors critical to your mission? Have you made them the heroes? What are your emotional triggers? What is the philanthropic opportunity you have to offer? What part of the world will the donor save or change through you?)

If you just work through the first  question, you haven’t involved the donor. If you leave out the second question, there’s no urgency to respond. And if you don’t answer the third question, you’ll never discover what will motivate your donors and they’ll feel free not to respond.

Working through this process has a profound effect on how you view donors. Because at the heart of it is the realization that it’s just not about you. It’s about the donor, and about what moves them to help you solve problems in the world.

Julie Mikuska.

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Redefining the non-profit sector

Your mother, or maybe your grandmother, taught you that if you don’t have anything nice or positive to say, don’t say anything at all. Then why do we have a whole sector that is described with a negative?

NON-profit.

It brings up negative connotations by its very nature. It puts the spotlight on financial transactions and that dreaded concept, “Overhead”. Kind of hard to get up in the morning, fired up to be a “NON”.

Yet, we have millions of dedicated people doing just that – going to work at their organizations because they believe in making a difference. Whew. That sounds better, doesn’t it?

Let’s turn the tables on NON-profits and start to talk about what is really going on here. Staff, volunteers and donors are stepping up and having an impact in their communities – turning lives around, inspiring us through art, preserving our heritage, helping puppies and kittens, saving the environment and providing good food and shelter. They’re building community centres, hospitals and schools, not to mention theatres and art galleries. Without this sector, the world would be a grim place indeed.

How does Social Impact sector sound?

A much better place for starting conversations about the work that we do, to talk about investing in social impact rather than overhead and charity. Let’s push for innovation, collaboration and partnership to maximize the good we can do. It’s not us vs. them anymore – we all live in the same community, so let’s work together. And, like mom and grandma, do it in a positive way.

Laura Mikuska and Julie Mikuska

 

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You don’t need millionaires

Sometimes at nonprofit board meetings, I hear from board members that all they need is to find a few millionaires and their problems will be solved. Boom!

As if there a pool of rich people out there who must surely be waiting to give us money. We just need to find them, right?

Sigh. It’s wrong, so wrong. Donors of all means are people, which means they give with their heart to solve problems that are dear to their hearts.

Repeat after me: It’s not about the money! It’s not about the money! It’s not about the money!

Just because you need money is not a reason for someone to give it. People give because they care, and because they think they will have an impact through your organization.

So stop hunting elusive “deep pockets” or “moneybags” and sincerely engage the donors you have and the donors you’d like. Treat them as you’d like to be treated.

Julie Mikuska.

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