Do you use sales funnels in your fundraising?

I asked a prospective nonprofit client that question.  She replied "what's that?"

In its simplest traditional business sense a sales funnel is a parameter for identifying the customer or target market that is most likely to be interested in what you are selling.

The value of using it is that it produces more sales for less initial investment in marketing.

Here's an example of what happens when you waste time and money on a campaign that doesn't adequately define a market.

Bill, a very well-to-do businessman, was approached by a nonprofit as a part of their major donor development after he was mentioned in an article as being interested in helping to provide food for needy people in his town.

The nonprofit's mission was to send food to starving people in Africa.

He responded politely to the letter by indicating that he had no interest whatsoever in feeding people in Africa while children, the disabled and the elderly in the United States are going hungry every night.

That should have been the end of it. They tried, he refused, end of story.

Instead he began to get letters and even phone calls asking for his support. After a year or so of that, he hopped on his jet, went to their headquarters and deposited a stack of mail and phone messages on the receptionists desk, with a not-so-polite note to take him off their mailing and call lists or face the consequences.

The problem was that the nonprofit qualified him simply because he was, well, rich and had an interest in feeding the needy.

All that did was to cost them a lot of money and time and made an enemy out of him.

The sales funnel, i.e. their parameters for qualifying major donors for further development was both overly broad and poorly maintained.

It doesn't matter if you are selling cars or a mission proposal…it behooves you to target your efforts to people who are likely to buy what you are selling.

In general, if you are sending out general appeals, monitoring your response ratio for both quality AND quantity and distilling your mailing list or media campaigns down to the essentials will serve you far better than just buying a mailing list. It also helps if your staff takes the time to really read any personal responses they get.

Cross referencing the donations against your contact or mailing lists can save you a lot of money and time, not to mention improving your response ratio from the customary 1 to 3% up to 20% or more.

Grants that are meant to produce tangible outcomes

Those who follow me, both here and on my other blog know that I am a supporter of a diversified educational strategy.  STEM is great, but someone has to build and run the machinery and use the stuff engineers dream up!

It won't do a lot of good to get more manufacturing and assembly jobs back into this country if  we don't have anyone trained to do them. Not to mention the fact that working with your hands as well as your brain is good for the economy, good for your personal financial situation, and may give workers a reason to pursue other education to progress up the career ladder.

Today's manufacturing jobs are not those of the mid-20th century, and often blend in well with more formal STEM educational goals.

Personally, I find that payng for a kid to go to college to "find themselves and their life work" is both fiscally and socially irresponsible, particularly given the dismal report of the emotional readiness of students to enter college.

If I had my way, every person would have to work for two years before they even considered college.

That's just me, but hey...I'm entitled to my opinion too.

To that end, I highlight grant opportunities that fall into that arena, and here is one that fits. To give credit where is is due, this came to my attention through Grant Gopher, and the lead paragraph reads like this:

"Nuts, Bolts & Thingamajigs awards grants annually to trade schools and community or technical colleges capable of hosting a summer camp program for girls and/or boys ages 12-16. Summer camps have been a successful way of introducing middle- and high-school students to the fascinating, high-tech career choices available to them in today's automated manufacturing industry."

The website is http://www.nutsandboltsfoundation.org.  It doesn't offer tons of money, but it could be a good fit for their target partner demographic. The closing date is November 15, 2015. You can visit their grants page at: http://www.nutsandboltsfoundation.org/camps/grants/

Is your grants dept.ready for the election?

OK.   I can hear it now.

OMG!  Enough about the cotton-picking election already!

Seriously though, if your nonprofit depends on government grants, and even if it doesn't, now might be the time to put some "what-if" scenarios in place.

In case you are new to the world of grants, an awful lot of the funding tends to follow what's hot politically and tails off when it comes to what's not.

For instance, if the Democrats retain the White House, you can expect that all of the current funding for STEM, social justice issues and the like will continue and even accelerate.

Conversely, if the Republicans win, their pet projects will receive the bulk of the funding.

If you're saying "Well, we get all of our money through private funding" you still need to look ahead.

While it's unlikely that Dems would immediately get a 90% income tax rate in place, there is little doubt that the wealthiest Americans are going to take a hit in the pocketbook.

Who funds private foundations? The wealthiest Americans.

Of course all the politicians would love to have us believe that all of the "new" revenue streams they are cultivating will be immediately returned to the people in the form of better jobs, or free college, or a host of other voter-friendly  programs.

The truth is, it just never works out that way.

For one thing, there's that little thing called the national debt, currently headed north of 18 Trillion dollars.

 

It's a funny thing, but when people (or governments) lend money they usually expect to be paid back.

Interest payments on that money are forecast to eat up ONE TRILLION dollars in just five more years.

That's up nearly 5 times from $220 Billion reported for  2012. If we do in fact add all of the free stuff envisioned by the Democrats, the debt amount could double again in just ten years.

Not paying that amount isn't an option. Given that many of the current and proposed entitlement programs are forecast to grow exponentially simply due to having more users, it stands to reason that discretionary spending will suffer at every level.

No matter which party wins out in 2016, the funding landscape is sure to change in the next decade.

The nonprofits and small businesses that weather the storm will be the ones that plan for it now.

If you are just thinking of starting a nonprofit, it might behoove you to either wait a year or so, or at least run two opposing SWOT analyses before jumping in with both feet.

If you are an existing organization, you may want to factor in significantly higher costs and lower revenue projections when evaluating old programs and before launching new ones.

Another trend may be that local governments will be looking for revenue of their own to replace any missing Federal dollars.  That could lead to the repeal of many of the traditional nonprofit perks, including tax breaks for property used for charitable purposes.

In spite of the handwriting on the wall, many nonprofits will choose to wait to plan until it is too late.

 

Don't let your organization be one of those wringing your hands and holding "going out of business" sales.   

Don't be guilt-tripped into changing your mission.

In an article posted to their website today, Philanthropy News Digest passes on the information that a report has found that family foundations lag behind in social justice funding.

Reports like this abound in every sector. In general they tend to reflect the bias or mission of the agency or organization that commissioned and compiled the report.

Most people and organizations know that and just will shrug this off and move on, but inevitably some will react by deciding that they are somehow in the wrong.

A few years ago, a client was profiled in a newsletter as being "unsympathetic" to minorities because they chose to focus on developing job skills and teaching low-income folks the value of having marketable workplace skills. The gist of the original article was that their programs didn't reflect  the national ratios regarding racial distribution.

Their programs were not defined by race or gender. The only qualifier to participate in the training was to be un- or under-employed and have an annual income below the poverty level.

Unfortunately for the NPO, the majority of the people that responded were white females. Not too surprising, since females are normally the caregivers in single parent homes and the minority population in their area was low, but it gave the group that published the newsletter ammunition for the presses.

After several weeks of heated social media back-and-forth, the board of the targeted NPO  met and decided to develop a minority-only program within the main program. They reasoned that would not only get the critics off their back, but open up new and perhaps better sources of funding.

It didn't work out very well.

First, they had trouble attracting minority participants. Since that had been a problem from the start, a disproportionate amount of time was spent to reach out to that segment of the population, and the main program outreach suffered accordingly.

Second, when they had to provide racial breakdown information for their program participants and graduates, i.e. their outcome results, they remained weighted toward white females. Hardly surprising, since the total minority population, i.e. all other races, of their service area was under 27%.

After struggling with the problem for three years and watching their funding fall by 35%, the board voted to resume operations as they had been prior to the bad press

The moral to this tale?  Do what you do and do it well. You can't please all of the people all of the time.

Political winds change constantly. If your programs are sound, needed and most of all effective, the money will be there.