Sector Report: Fundraising 2009-2010

Mistake No. 2: Cutting back on acquisition.
Acquisition is an easy place to look for cost savings. After all, acquisition often costs more than it brings in. And yes, the pundits are saying that "retention is the new acquisition." Baby boomers are living longer than their predecessors, and they are staying in the workplace longer, giving them more discretionary income to give to the charities they support.

But acquisition continues to be critical for your organization's long-term health. Normal attrition will drain your donor file on an ongoing basis unless you infuse it with new donors. If you acquire donors at an acceptable average gift level, your acquisition costs will be paid back in 12 to 18 months — and the long-term donor value will make acquisition even more profitable.

One caveat: Don't settle for acquiring lots of donors at low dollar levels. While the infusion of donors might give you momentary euphoria, the cost to maintain and try to secure a second gift from a low-end donor will drain any long-term gain. If this is your strategy, have a clear plan for how often you will mail to these new donors, what offers you will make to them and if you will recoup your cost of acquiring through list rental.

Mistake No. 3: Letting program experts dictate the fundraising message.
Good programs might or might not make good fundraising offers. Donors need to be able to visualize what you're doing and believe it is meeting an urgent, basic need. The reality is that the funding of some programs is best left to one-on-one solicitation.

It's natural to want to trumpet our most sophisticated programs, but more often than not, donors want to give to meet the most basic needs. Let's not bite the hand that feeds us. The simplest offer is often the engine that drives direct-response fundraising. For example, food banks provide education, advocate on hunger issues and help low-income families enroll in government programs. These are all important programs. But they aren't going to tug the heartstrings like telling someone that for a dollar you can provide a meal to a hungry person.