Tuesday, June 9, 2009

Does Your Fundraising Strategy Match Your Donors?

Sometimes, fundraisers become so enmeshed in daily operations they don't have time to stand back and analyze whether their fundraising strategies match their donors' needs.

Consider Happy Homes for Kids. Let's fast-forward 20 years – they've hired several staff and have expanded to include a summer camp for their foster youth. College students staff the summer camp.

Say Happy Homes notices year-over-year declines in revenues and decides to hire Arrowhead Management to analyze its fundraising strategy.

We'll take this hypothetical example and tell you how we'd evaluate, plan and implement a strategy to improve Happy Homes's annual revenue:

Evaluate

Early into our analysis of Happy Homes, we discovered a not-so-startling trend: the vast majority (85%) of donors had been Happy Homes counselors…and a few had even been campers! Yet, when we analyzed Happy Homes's fundraising strategy, you'd have thought Sociology PhD were donors: appeals spanned several pages, were text-heavy and focused on the rampancy of "Nature Deficit Disorder" among youth.

Happy Homes had no Web engagement for donors, yet campers – low-income youth – were expected to register online.

As we dug deeper, staff confessed they couldn't figure out why donors only gave once. Staff showed us compelling, tug-at-your-heartstrings stories about former campers who became judges and entertainment executives…stories that were typed up and mimeographed (don't pretend you can't recall that delectable scent of purple ink from elementary school).

It was clear: Happy Homes's fundraising activities were misaligned with its donors.

Unfortunately, mismatching fundraising strategy with donors is an all-too-common mistake among nonprofits.

Plan

Once staff understood the importance of aligning donors with fundraising strategy, Happy Homes realized its donors wanted to: reconnect with counselors, see pictures of current kids at camp and hear camper success stories.

Together, we created an annual plan that re-aligned Happy Homes's fundraising activities:

  • Create a group on Facebook, featuring pictures from recent and earlier camp sessions;
  • Retell the mimeographed stories in email appeals, and;
  • Reserve all references to Nature-Deficit Disorder outbreaks to grant proposals.

Implement

Over the next twelve months, Arrowhead Management executed on this plan by:

  • Soliciting various donor segments, on a quarterly basis, using targeted email and snail-mail appeals;
  • Creating an online web footprint;
  • Identifying 10 current donors who were likely candidates to upgrade their gifts, and;
  • Launching a monthly e-newsletter featuring photos of current campers, counselor get-togethers and first-hand stories from campers

Outcomes

As a result of modifying its fundraising strategies, Happy Homes experienced:

  • Overwhelming response on Facebook: within 48 hours of creating a group, over 300 members joined – at least 75% were former counselors Happy Homes had lost track of;
  • Decrease in its lapsed donor rate from 50% to 35%, and;
  • Increase of 15% in overall revenue from individuals.

Take a good hard look at how well your fundraising strategy matches up to your donors…does your fundraising strategy need to be realigned, so you too can increase your fundraising success?