Archive for March, 2011

Fund Raising Basics

DATE: March 24th, 2011

The greatest challenge of non-profit organizations is donor acquisition.

The investment into acquiring new donors is costly: on average to acquire a single donor requires an investment of $50 – $100. To acquire a monthly donor requires and investment of between $300 and $600. These just industry averages. There will be many exceptions.

But when the data is analyzed, these figures provide a great starting point.

So, if you want to increase your monthly donor file from 100 – 500 people, you will need an investment, on average, of about $200,000. If you want to receive new income from 1500 new donors, you will have to invest between $125,000 and $150,000. Yes, there are some exceptions. I have a client who is regularly acquiring new monthly donors at between $75 and $100 per new donor. But their activities are highly subsidized and they are still very small.

Revenue growth is increasingly difficult, and small non-profits struggle to understand the principles behind a solid strategic plan. Many reports they read in magazines and at conferences are misleading . For instance, I once heard a speaker say they could creative, print, personalize and distribute an appeal at the cost of 0.55/package.  The gentle murmur in the heightened — that was pretty exciting. Someone asked if it would include a small run of, say, 1000 names. The speaker assured the audience that it would. Frankly, that’s extremely bad information, considering Canada Post will usurp about 90% of that budget.

One agency reported a 41% response on a cultivation  appeal. That’s unbelievable. And, without a question, non-profits flock to get those results. But the report did not disclose a few factors. First of all, the appeal went to a segment of the data base that was extremely loyal, had given to this particular appeal before and had a large personal investment in the program. Secondly, the appeal contained a premium that the donor was asked to return, whether they gave or not. The results in the report included all returned premiums (we call it a bounce back). It did not distinguish between gifts and non-gifts.

Another client asked us to increase the offer in  the appeal because the average gift for their cultivation appeals hovered around the $100 mark. Traditionally, the offer was $30, $50, $100, they felt, because $100 was the average, that we should pop it up to $100, $150 and $250. When we analyzed the data, we discovered that the median gifts (the amounts most often given) where $30, $50 and $100. Changing the dollar handles on the offer would impact overall giving. In order to respond to the multiple levels of donors in their data base, we began using a segmented dollar offer for each appeal that reflected the giving structures of their data base.That way, we could personalize the dollar handles without offending the donors or appearing overly greedy.

Early in my career, a potential client came and asked what they should expect for an average cultivation appeal. I glibly said 7 – 12%. The response to their appeals were coming in at around 3%, so they were quite impressed at the strong response that most of our clients were experiencing. What they forgot to tell me was that more than 50% of the names on their data base had either not given for five or more years or had never given, but were just names that happened to be in the data base. Looking back, they were really fortunate to get a 3% return.

Each non-profit has a unique group of donors. Most organizations have several groups which require special attention. Organizations that have concentrated on monthly gifts and not developed a single gift stream will be much less successful in their special project offers. Monthly donors have committed a monthly gift, they are not motivated to give often beyond that or spontaneously. There are exceptions. When the project appeal is directed at a program that is especially interesting to them and relates strongly to their monthly giving offer, they will consider an extra gift. They will also respond to emergency needs. Donors acquired by strong, emergency oriented offers like: “This child will die unless….” tend to give small amounts and more frequently — but not to the same organizations. Especially if the acquisition offer is at a low dollar value. Unfortunately, these donors rarely become strong, loyal supporters. They are more likely to respond to other organizations with similar, strong urgent, low cost offers.

Other organizations have collected reams of names from trips, walks, “a-thons” and events. While the organization may be strong in data, the value of these names in subsequent offers have the same performance as buying a cold list. That doesn’t mean that we should ignore these people — we just need to understand that they are not loyal to the organization.

The web, while fabulous for emergencies, events, “a-thon” registration and revenue, polls, surveys, holiday programs and engaged activities — still is not a strong acquisition tool. The on-line space is cluttered and people don’t tend to happen upon an non-profit site, but have to led to the site. We still have a lot of work to do to build engaging sites that draw donors back again and again. For the most part, most sites are large brochures of unwieldy information — often written from an organizational stance that is not easily understood by the donor.

I truly enjoy the challenge of acquiring new donors and cultivating them as they grow to really feel inspired by the charity. I believe that each organization has its own value — its own personality — and the fund raising strategy must be built around that. Most of all, the charity must build a strong offer, a healthy way of incorporating overhead and fund raising costs.

A New Idea

DATE: March 23rd, 2011

When am I old enough to be called an expert?

Honestly? I hope I am never an expert.

You see, as soon as I consider myself an expert, I forget to look for new ways of looking at things.

Several years ago I was at the zoo. It was a gorgeous spring day. A small boy was tugging at his mom’s hand, pulling her along. “Come on, mom,” he said. “We have go; the animals are calling – they want to look at us.”

That’s marketing.

Taking something we know and understand and making it new – fresh. Marketing is turning something familiar on its head so that we look at it differently.

If I could have just one gift for the rest of my life, it would be to have the creativity to be consistently dissatisfied with the mundane and the energy to look at things from a new angle.

That’s challenging.

You already know the old adage: If it ain’t broke don’t fix it.

I’m not sure why we are so set on that in marketing – we don’t believe it in our real lives. Few of us are working on a 2001 computer or on a DOS based system. I got rid of my trustworthy Nova years ago. The top loading washing machine, which still worked fine, has been exchanged for a front loading machine. I want a PlayBook – I already have a smart phone, computer and multiple TV’s (none of which are broken).

If we don’t try new things, we will not take the leap into the next generation of ideas.

Now, I don’t recommend dumping your direct mail strategy – especially if it is working for you. But I do recommend that you consistently try new things, testing them out.

I challenge you to look for ideas in strange places: in a busy mall; in a bright, sunny zoo, in a day care centre……

This afternoon I took 10 minutes to listen to a TEDS Talk. The speaker, Hans Rosling, was amazing. The talk: the magic of washing machines, was a riveting new look at the world of poverty and environment:

The washing machine changes the lives of women and girls in the developed world. That simple machine frees mothers from the time consuming task of getting water, heating water and washing the family’s clothing and linens by hand. Today, only a small fragment of the world has a washing machine. Most women go to the water source and fill a pail or basin, carry it back to their home and heat the water over an open fire. Then they wash their family’s clothing and linens by hand.

They don’t have time to read to their children, to go to children’s programs or even to learn to read themselves.

It’s such a little thing – something you and I take for granted every day as we toss in a load before we go to work (and then re-wash is 4 days later because we forgot about it).

So marketers of the world revolt – resist the mundane. Engage your minds in thinking about the world in which you live in new and fresh ways.

Data nightmares

DATE: March 18th, 2011

I have a very simple data base — it’s on my blackberry and it is the hub of my business.

And it is a mess.

How could I — who constantly harps about data integrity — get into such a mess?

At risk of being simplistic, garbage in garbage out pretty well describes my CRM system. The nifty little voice activation system is rendered useless because of lack of consistency throughout the data. That’s in spite of the consistency prescribed by the  system itself. But, after a series of syncs with other systems, the data has mushroomed, duplicated and multiplied.

Basically, the problem of data is it has to be accurate.

So each one of my entries for Larry — all which include slightly different, albeit accurate, information — is entered again, giving me 14 contacts for the same person.

I use this very simple example of CRM gone mad, because of the challenges I am seeing every day.

Data is the marketing team’s most important asset.

Yet in almost every case data is poorly managed, dirty and has a lack of historical integrity. 

Sometimes I think that people just don’t understand the value of the data that they are already collecting — without even thinking. Because many organizations we speak to have not cared for their data bases.

Here are a few quick tips:

1. Stay away from “robust” systems with high powered sales teams and “unlimited” modules to add. It means that for the system to really be robust, you have to buy the modules. Too often these robust systems are complicated to use and, while they are capable of doing miracles, if you don’t have the secret code, the secrets are still secrets.

2. Beware of customization. The key to effective customization is to know what you want and understand how to convey that to a software company. Trust me, that’s not as easy as it seems. Seldom are custom builds intuitive to the user and often core elements are forgotten. We just built a web site that was based on data. The client assumed we had built it with a specific capacity because we had their process guide to understand the core functional requirements. Unfortunately, that critical exception was not in the process guide so we had no idea it existed. It was  a simple lack of communication…. but it caused challenges in using the web site.

3. Employ someone who knows how to use a data base.Changes in protocols, exceptions and creative use of fields have long term consequences. The foundational principal of a healthy and useful data base is: every cell contains only 1 piece of data.We had one client that wanted us to do a personalized mailing for them. They sent us their list. The title, first and last name and street address were in one cell. We had to take it completely apart to build a list. This is unnecessary work if your data base has been well constructed.

4. Develop a data base protocol text book of your personal data base. Record those protocols. Enforce those protocols. Resist exceptions.Even simple things can affect your ability to use your data effectively. Spelling, formats and numerical coding have to be accurate or the data base considers them another entry.

5. Run meaningful reports regularly. Make sure your senior teams understand the meaning behind the numbers you give them. Data can be manipulated to give different messages. For optimum growth and effectiveness, you need to set evaluative standards that are consistent and comparable.

Data is complex. Use experts. In the next decade, as technology becomes more sophisticated, the leaders in marketing will have strong data that is neat and tidy and, most importantly, usable.

Good Writing is…

DATE: March 4th, 2011

Underneath the veneer of the creative director/business owner, I am a writer. I am interested in ideas, the story, the characters — I am very intrigued by the creative process.

A recent interview with Salman Rushdie in the February issue of Canadian Business caught my attention. As I read, I realized that sometimes, in advertising writing, we forget the art and the discipline required for great ad copy.

Rushdie says that great writing is all about the ear: “You have to be able to hear the world, you have to hear how people talk to each other.” I think that’s true about advertising copy.

Few of can forget the MAC/PC wars. Mac produced clever scripted ads that caught the conversations that go on between the Mac and PC users. They really got the voice of both sides. (If you forget, here’s a link:)

I have no idea what the advertising team for Microsoft was thinking when they produced the Sienfeld/Gates series. But I think they didn’t hear the voice of  the people — and missed the mark.

In addition to hearing the way people talk, Rushdie says that writers have to have a good eye: “You have to be able to look at the world in a way that’s unusual, or particular to you.”  Philosophers tell us that artists and creatives help people see the stoniness of the stone. Each of us understand the stone — but we may not understand the very essence of what stone is. I think this sight — seeing beyond what the ordinary people see and helping others see it too, is critical to the advertising writer. When I tell you about a product, I need to see it in a new way. Yesterday I was in a meeting with a client to gather information on a specific product that they wanted to launch to the public. The client gave me the tangible information on the product: service options, elements of the product and literal details of the process of service. But as I listened, I realized that the biggest challenge we faced was to write about the product in a way that caught the attention of the audience — and none of these details we were given in the meeting would really do that.

Finally, Rushdie says that “there’s something more intangible, which has to do with having a kind of vision….” That vision is the underlying foundation of good writing — understanding where we are heading.

As I started writing this blog I did what I usually do — just jumped right in. I pulled the article a couple of weeks ago because it was interesting and really resonated with my philosophy of writing — so I wanted to share it. But as I say down in front of the computer, I realized that the blog — while designed to be a kind of blurting out of things — is really much more successful when it was thoughtful and well written.

So I took out a pencil and outlined my thoughts. (Something that I used to tell my students at the university to do.)

I get asked about the future of writing a lot. It seems that many people are fearful that in the world of blogs, facebook and twitter good writing will be lost. I don’t think so. I think that good writing is still about hearing, seeing and a foundational vision. There has always been bad writing — that’s not new. Perhaps it’s more hopeful if we can confine it to 140 characters!