Fundraising or Money-Raising?

Clerk:  Your total is $blahblahblah, would you like to add a dollar to support children puppies hungry old homeless high-school band?

Me:  Uhhh, no, not today.

Clerk:
aggressive-1748701_1920

Yeah, cheers, thanks, thanks a lot.  *sigh*

I know these kinds of programs raise a lot of critically-needed money for a lot of great organizations – and the beneficiaries who need them.  I totally get that.  But I think they detract from the profession of Fundraising & Development, create a false sense of “do-gooderism” and make it harder, ultimately, for us to do the real work of development and advancement.

Plus Ca Change . . . 

We live in an age where just about anybody can engage in any profession as long as they have a device and an internet connection.  You can diagnose your own illness on any number of health sites like WebMD, be your own accountant on TurboTax or TaxAct or act as your own travel agent on hundreds of different platforms.

My photographer friends tell me their jobs are much, much harder now that everyone carries a pretty decent camera in their pocket.  EVERYBODY’S got an artistic filter.

Fundraising is the same.

Fundraising has always been this way, though.  Bake sales, lemonade stands, change jars at checkout counters, taking up a collection for Sally Sue at work . . . . as long as we live in a money-based economy, somebody will always need to raise money for something.  It’s just now we have – like other professions – more sophisticated online tools to do it.  GoFundMe, Kickstarter, Indiegogo . . . . the list goes on.

Here’s where I get worried . . . more worried . . . when nonprofits (read: Board Members/CEOs, etc.) start saying, “We need more donors and more dollars; we should do a GoFundMe.”  And fundraisers do it. Because LOOK AT ALL THE MONEY COMING IN!

money-1428594_1920

Maybe we need to start differentiating now between Fundraising and Money-Raising.

Take a moment, sit down, pour yourself a nice cup of whatever relaxes you because I’m about to commit blasphemy:

Money-raising is easy.  Fundraising is hard.

What?  What’s that you say?  Raising money is easy?  If it’s so easy, why isn’t everyone doing it?  If raising money is so easy why are we working so hard at it?

Getting money for something is pretty easy . . . put something out there that tells the world what the need is and SOMEBODY will give money to it.  And they might give a lot of money or they might give a little, but then they’ll got and give their spare change to someone else.

But what’s hard – really hard – is building sustainable, long-term relationships with people and organizations who are deeply committed and passionate enough to give of themselves to fund the causes they care about.  That’s hard.

That’s day-in, day-out.  That’s technique and experience and trial and error and great success and wild failure.  That’s strategic excellence vs. widespread mediocrity.

There are days when I think professional fundraisers should rail against the bake sale and the change jar and the GoFundMe for Baby Jimmy’s college fund.  And sometimes I think we should shake our fists to the heavens and decry the latest gift-wrap/car-wash/cupcake sale/give-a-dollar-at-the-register program.  But, no, they have their place.

And sometimes they have their place in a well-developed, comprehensive professional fundraising program.  Part of, not instead of.

But we should hold our heads up high and say what we know is fundraising.  We know Development and Advancement and we know how to be strategically excellent.  We know how to use an online giving tool in the context of the whole, not just a “if you code it, they will give.”

We know the difference between money-raising and fundraising.

 

 

 

Rant on Retention

I like to think that professionals in all fields get together and rant and complain about their profession.  I have to believe that there are forums for pipe fitters and physician’s assistants and marketers to get together and go, “They’re hiring people with no experience as experts! Nobody takes the profession seriously!  These CEOs think they can hire somebody with Fundraising experience and that’s as good as 25+ years in Marketing!”  Grumble grumble, rant rant, etc.

Because it can’t just be us.  Can it?

And every other rant lately is about Donor Retention.  It’s the most significant problem facing the profession today.

I agree.  It is.  Based on the data and reports we’ve all seen.

But . . . .

BUT . . . . . . .

First – can we just stop beating each other up?  Please?  “The worst fundraising mistake you can make!” OR “Fundraisers aren’t paying attention to the fundamentals!” or any other number of alarming headlines.

There’s a lot of fundraisers doing really great work, making great relationships and helping find the funding to tackle some of society’s toughest issues.  Should they be paying a little closer attention to their retention rates?  Sure.  But let’s praise what they ARE doing.

And just because a development officer is not measuring specific retention rate, doesn’t mean that they’re not conducting great donor stewardship, wonderful relationships and hitting goals.

Objection:  If development officers are doing great stewardship, why are renewal rates across the industry so low?!?

Me:  I haven’t seen the actual data those reports come from, but I do think they’re approached with pretty broad brushstrokes.

Second – some donors aren’t MEANT to be retained.  And most CRMs and reporting tools just take a straight, one-shot look at it on a year-to-year basis.  I have yet to see a report that said, “Retention rate was 47% for annual fund donors.”  Maybe there was a whole lot of campaign giving or specific project funding that went on last year and those donors very specifically gave a stretch gift and that CDO is already working the next gift for five years from now.  Some gifts, some giving just ISN’T multi-year.

Is a fundraiser a failure because they didn’t renew their capital campaign donors?  They are if you take a one-shot approach to measuring retention.

Third – and most important – measuring retention is not as straightforward as it seems.  The CRM that I use is possibly the #1 or #2 most popular.  It does not have an extant donor retention report, but recommends you compare the results of a query of last year’s donors to this year’s.  Just compare the counts in each query and you’ve got it.  Indeed, the instructions for this do not factor the fund/allocation of the gift – JUST the year it was given.

Another way to do it is to export the data into Excel and run a VLOOKUP (after pivot tables, the fundraiser’s most useful analysis tool, but I digress).  VLOOKUP will compare Unique IDs (or names or other fields) between two worksheets.

Hang on . . . . first is the time, here.  I’m pretty decent with Excel, but that takes me about an hour or so to do.  And so many shops don’t have a dba or analyst to run these kinds of reports, or the Excel skills to do it.

“But if you knew your retention rate and focused on retention, you wouldn’t have to work so hard acquiring new donors.”  True.  That’s truth.

But . . . let’s look at an example from real life (true story – names changed):

– In 2014, Jack Spratt made a personal $1,000 introductory gift, God love him;
– After some extended cultivation, Jack made an additional $10,000 gift from his family foundation, later in 2014;
– In early 2015, Jack’s wife Eileen leveraged a $5,000 gift from her company restricted to a specific program
– Later in 2015, Jack renewed his $10,000 and made it through a donor advised fund
– Eileen did not renew her $5,000; Jack, however, increased their support to $20,000 which he made through a mixture of soft-credit from a corporate gift and a gift from a different source . . . . .

Guess who doesn’t show up in a retention report?  Jack and Eileen, because they change the source every year and Accounting requires gift entry to be tied to the actual source of the gift and soft-credited to the donor.  Every year they look like new donors and would get “lost” in a direct unique identifier comparison.  But guess who was also the subject of intense stewardship and cultivation – isn’t that focusing on retention, too?

Unless the retention report recognizes soft-crediting OR the query/export combination you use appropriately designates soft-credited gifts to the donor . . .

Does this account for a lot of gifts?  No, not on the overall whole.  But I’ve seen situations like this be 5% – 6% of a database, so it has an impact.  And I’ve seen it – a lot – at lower levels.  One year one person in a household gives, the next it’s the spouse who writes the check.  (And householding (how a database looks at individuals in the same household, i.e. spouses, domestic partnerships, etc. ) is a massive problem in fundraising CRMs – that’s a whole other blog post.)

The point?  Donor Retention is incredibly important and we should be doing everything possible to hold on to the donors we have.  We DO need our Boards and Leadership to understand that keeping a donor is a far, far better investment than seeking new ones.  And, yes, that is our job to tell them.  More importantly, it’s our job to show them.

 

What we’re really saying is, “We – as a fundraising industry – NEED to take better care of our donors.  We need to thank them more, get our arms around them more and treat their giving with the respect and care and awe that it deserves.”  Like all things, if we focus on the metric and not the action, we miss the point.

So, yes, absolutely – focus on donor retention.  But spend less time tracking the number and more time loving on donors.