How should you court a major donor?

Most solvent nonprofits today have long since gotten over the idea that they can exist solely on income from grants. They have developed a diverse funding strategy that accesses funding from various sources, and that often includes major donors.

So what is a major donor?

There is no hard monetary definition of a major donation.  For one organization it might be $1,000, while another may define a major donor as anyone donating over $10K or even $50K.

Of far more importance is the connection, the relationship if you will, of the donor to your organization.

Developing a major donor is not about a predator-prey relationship. It is about developing long-term friendships that can result in contributions to your income stream.

All nonprofits struggle with maintaining a minimum constant income stream. Whether that's $5,000 or $500 million, the income has to at least equal the outgo. Grants are nice, but they don't last. Even fee-for-service or fee-for-performance government contracts or grants have a fairly short life cycle.

Major donors on the other hand can remain interested and involved in your organization for a lifetime.

When I review a new client's revenue sources,  I look for evidence that they have major donors, or at least someone who could become a major donor.  That's why I strongly recommend that you record every donor's contact information, even if their donation is well under the threshold that requires you to give them a receipt.

Let's say you receive a new donation from someone prominent in your community. It's only $50, but hey, it's nice to know they've noticed you.

If you stop there, you could be throwing away a chance to make a long-term friend for your nonprofit.

That person could be a candidate for your major donor database. So, what now?

Of course you want to acknowledge the gift, but you should be doing that for every donor. How do you move beyond the pro forma receipt?

One way is to add a little something extra.  Write a nice letter of thanks, and include some additional information on your program or organization. Invite them to a meeting or a tour of your facility.

Take some time to research the person. If you have any people in common, you might mention that connection. Perhaps they have a personal connection to your mission, such as a family member who once needed the type of help you offer. Or you might invite them to your next event.

Don't get too pushy.  People with money have heard every pitch there is from people and organizations that want to relieve them of some of it. Concentrate on developing a relationship.

One strategy is to develop a list of major donor prospects and send them a special newsletter or invitation to an event. It's not that they won't understand the motivation behind the invite, but if it's done tastefully and the event (or the other attendees) piques some interest for them, they may show up.

Look for areas of common interest.  Maybe someone on your board also serves on a board with the prospect. Perhaps you belong to the same gym or country club. Look for ways to connect where you can share more information on your mission and goals.

In some cases, it might be wise to wait and see if they donate again, which can show some genuine interest in your mission.

In short, you have to do the same things you would do to cultivate any other relationship.  Building rapport and mutual respect will benefit everyone. 

The politics of funding – Is your program relevant to grantors?

The reality of nonprofit funding is that sometimes your mission isn't trendy enough to attract support.

Take the current interest of increasing participation in post-secondary education, and contrast it with the goal of helping low-income people get jobs.

One the one side you have millions being poured into missions supporting STEM education, such as instruction in how to access financial aid for college.

On the other hand you have more local nonprofits struggling to get enough funding to do things like improving access to the workplace for people who just need a steady paycheck.

One group with the latter mission focuses on providing decent clothes for interviewees and training to improve interviewing skills and focuses primarily on workers aged 40 and up, displaced from the job market during the recession. Typically they purchased clothing from local retailers and made it available to interviewees. The program budget was in the low five-figure range annually.

This group is starting to find that even jobs which shouldn't require any sort of post-secondary degree are suddenly being restricted or at least are preferential to college grads only.

An example of this is seen in an advertisement for seasonal employees for a major home improvement supplies retailer. The specific opening was for a seasonal week-end position assisting customers in the lumber department.

The ad reads as follows:

"Preferred Qualifications:  Associate's Degree in Business, Retail Management, Specialty related to department (e.g., design, appliances) or related field OR Certification in trade related occupation required."

Most potential applicant's never get past that sentence, although much further on in the ad it does say a minimum of one years experience is also acceptable.

The low-income-focused nonprofit had several people available who had actually done the job for other employers, or who have experience in other types of sales, but they don't have any of the paperwork required. No degrees, no certifications, just decades in the building material or building trades. Several of their people applied, but none were even interviewed.

That matters, because it lowers the impact, i.e. the provable results of their program, making their program appear less effective.

The aforementioned NPO working with the older jobseekers stated that most of their previous funding sources had switched over to what the frustrated ED called "more media-attractive" support. Their funding has dropped by over 50% since 2010, due to grantor mission realignment.

I suggested that perhaps they needed to incorporate programs that were more, shall we say, "funding-friendly" such as programs to get their people into some type of educational setting or training to make a complete career change.

His answer was that maybe funders need to start looking at the world his people lived in today.

He said "These are people with an excellent work ethic and fully marketable and useful skills, who have from another 15 to 25 years left in the labor force. They have families to support NOW. They have household expenses NOW. They haven't done a thing wrong except to become politically and socially irrelevant. Maybe by the time they can retire or die, we will all be replaced by robots, but that time isn't NOW"

Unfortunately that conundrum is the reality of funding. Sometimes, no matter how worthy or timely the cause, it doesn't resonate with grantors.

That reality will eventually impact your results, so getting a handle on a solution will definitely affect your future.

The answer is to either pursue a shift in your own focus or seek out new funding streams and new supporters, and continue to educate the public on the value and relevance of your mission.

In the end, we designed a campaign to appeal directly to individual donors, utilizing both direct clothing donations and a crowdfunding appeal that ultimately raised enough money to meet goal. Longer term, the NPO is seeking to develop relationships with new grantors.

If I can help you with funding solutions, drop me a line at rightwords@ida.net. 

Do you understand donor retention?

It's funny how blogs work. You post something, people read it that day, and you think OK, that's nice, a bunch of people apparently got something useful from this.

Then out of the blue several weeks or months later you get a comment or email about a post that you had sort of forgotten about.

 So it is with my blog post of April 28, "Marketing Your Mission".

Apparently "Tom" took issue with it. "This is the most stupid thing I've ever read" would tend to indicate that Tom doesn't find the use of the word "marketing" to be congruent with "nonprofit mission".

According to Tom, mission is all about emotional engagement. All that other stuff about being a good "investment" for the donor doesn't matter. People just "know" that you will use their money well, because after all, you're a charity.

In Tom's defense, the emotional characteristic is what drives donors to investigate your charity further. It is the thing that defines the need to give that they want to fill. At some level, they have an interest in helping something or someone. Maybe they Google "animal rescues" or "battered women's shelters" or whatever.

At that point they get thousands, if not millions of returns. So then they add their state or county or town to the search terms, and they get a few to a few dozen more specific returns.

That's still a lot, and it's unlikely they are going to send a check or donate online to all of them. There has to be some way to decide which one to support.

At that point they are probably going to be looking for a website or social media page. Who are you, and what are you all about? What real impact or change are you accomplishing?

That process is exactly the same as it is for someone looking for a product. You want to buy a used car so you search "used cars". At that point you may not know if you want a Chevrolet, or Ford or Toyota or whatever. You get a list of used car dealers that are within your search zone, and then you check to see if they have a website and look at what's for sale. There are dozens of bright, shiny cars that fit your basic criteria to pick from on each site. You don't want to visit, much less drive all of them, so you start looking for a way to zero in on just a few.

What happens next?  Well, I don't know about you, but I start looking for the dealer that is going to give me the best value for my dollar. Is their price lower, do they give you a free gas card if you test drive their car, or do they offer a free oil change for a year? I also look at the general premises if they have a picture of their lot or showroom. Does it look clean, organized and at least somewhat permanent?  Have they been in town for a while? Do they have good online reviews?

In short, why should I  pick one car lot over all the rest?

Why would a donor be any different?  There are lots of charities that all focus on the same problem. Their "bright shiny cars" are the stories they tell about who or what they have helped, and 90% of them are going to have good stories, because they really try to do good work.

At that point, two things happen. Maybe one story connects emotionally with the donor more than others, and they just hit the donate button. Those are the "impulse donors". They drop a few bucks and promptly forget about it. Those are "Tom's" donors.

Other visitors do some digging to see how many people have been helped in total and investigate  how much money it takes to help them in a significant way. These can be your long-term supporters.

The latter are probably the people with more money to donate. Nobody misses a single $5 donation even if it is misspent or the charity goes out of business, but if they want to spend $1000 or $10,000 dollars or more, they are going to look under the hood of that bright shiny car. Or maybe they can't afford that much, but they want to send a small donation every payday. They are looking for a connection, not a moment of satisfaction.

And that's where the marketing mindset comes in. The sooner you step out in front and say "We helped change the lives of 100 people for a day at a cost per person of just $10.00/day" the easier it is for the donor to see that $1000 will help one person for more than three months, or all 100 for a day.

Contrast that with the group that says, "You can help more people like Jane. Please give generously". How many more people? What do they really need to help another Jane?  Exactly what is a generous donation? They don't say.

Yes, it does reduce the giving to a dollars-and-cents equation. And yes, the emotional appeal was the catalyst between the donors desire to give and solving your money problem. But the donation was assured by the concrete statement showing the value delivered for the donation. It gives the donor a reason to select your charity to support at a much higher level than just an impulse donation.

Of course, you have to continue to connect with that donor to retain their interest. Maybe through a website, a blog, a newsletter or just by keeping fresh stories on your social media page. But first you have to cultivate the desire for an ongoing relationship.

In the retail world, they call that building brand loyalty. In the nonprofit world, it's donor retention. Whatever you call it, it is all a form of marketing. With all due respect to "Tom" I think you ignore that at your peril.

Need help with your messaging?  Check out my website at http://www.cloudlancerwriting.com

Why should your nonprofit have a blog?

I look at a lot of nonprofit websites, Facebook pages and other online communication mediums while working on messaging or developing a grant narrative for clients. About half of them have a blog. After reading them, I sometimes wonder if they truly understand their audience, or the purpose of the blog

.

Business-related blogs today are not about posting a note about an up-coming event or a notice of a sale. There are too many short-form ways to communicate to use a blog for that reason.

Blogs today are a way to provide a way to keep customers or in the case of nonprofits, donors and supporters, interested in supporting your organization and recruit new supporters.

To do that you need to provide something that takes more than three seconds to read, and while there is an SEO (search engine optimization) element, good blogs are more than that.

    

Savvy for-profit businesses know that a good blog engages, educates and informs as well as selling something. The blog should integrate with another facet of the business.

For instance, a business selling safety equipment for homes might link to their blog from their product description page like this:

"Item Description: Home fire alarm. Do you know how long you have to escape a residential  fire?  Check out our blog(link here) to see how long you can safely stay in your house when a fire starts."

The blog post then goes into detail about how long you can safely stay in a burning room, why and how to escape and offers a link back to the product ordering page.

The blog post does two things. First it provides factual information that makes the purchase of the item they are selling seem imperative.  Second, it keeps the business name connected to the customer in a very personal way.

Nonprofit blogs usually don't seem to be written for the right reasons or the right audience.

I recently checked out a nonprofit blog for an organization that provides a type of monetary assistance for medical needs. The last few posts were all about how this or that legislation affected this organization, and it contained a lot of industry jargon and acronyms that only a health care-savvy insider would understand. Yet, on their SM page they were complaining that they were having trouble getting their message out. Other than the URL, the nonprofit name, mission and  program title wasn't mentioned in the blog.

The audience I would think they would be interested in is one that can use their help or support their mission, but they seemed to be writing to effect some sort of political change at best, or just complaining to the world in general at worst.

Perhaps a more useful approach would be to engage donors by explaining how their support could provide X dollars for Y medicines or medical devices.  Or, they could engage their potential beneficiaries by offering information on support groups that they work with to reduce medical costs, or show how much their help had increased access to care or equipment. Even better, they could have done the occasional in-depth feature post about a person they had helped.

The point is, there was no reason for someone to engage with them vs.some other nonprofit.

If I was a donor looking for background on them, I might worry that my contribution would be used to lobby for something, or that the organization was about to go under because of the legislative pitfalls they described. That's not a good message to send.

Good blogs bring good results. Think about what outcome you want your blog to have, and write it for the right audience. Don't assume that they know all about you. Offer them some reason to remember you, and to connect with you regularly.

 Don't be afraid to have some length to the posting if the topic warrants it. Most of the blog posts I write for clients are from 350 to 800 words.  If you'd like a free review of your blog, send me an email.  Let's make your blog a truly effective outreach medium.