Are You Marketing and Raising Funds the Right Way for Today's Donors?

Sometimes it is the shortest discussions that can really make you think hard and deep about what you are doing.

Last week, I had that experience. I was happy to be among a group of colleagues hearing some thoughts from leaders in the industry. One such leader (Dr. Susan Raymond, Ph.D., executive vice president, research and analytics, Changing Our World) shared some amazing information, and I was rapidly trying to capture as much in notes as possible. But one of her conversations was not about facts and figures and predictions, and it was a relatively short one.

In comparing how the commercial word markets to how nonprofits market and raise funds, there was a distinction made between being "outward-focused" and "inward-focused." Raymond's assessment was that most commercial companies are outward-focused and most nonprofits are inward-focused. Here's my version of the difference between the two:

• Outward-focused: This type of marketing and sales is focused primarily on identifying the needs of the customers and matching the products and services to the consumer need. This doesn't mean that companies follow customer needs into areas that are not primary focus areas for them — but it means they build the features and benefits of their key products around meeting the needs and solving the challenges of their key customer bases.
• Inward-focused: This type of marketing and sales is focused on what the company believes is its best product and what it can do/serve/produce in the way of customer benefits. In some ways, you could call this type of marketing focused on the company and what the company wants and thinks versus the customer.

The example that was given last week was pretty simple. The "outward" company that sells socks approaches the customer base to find out what color socks consumers want and need. Then it promptly identifies all the socks that are the perfect match for those needs. (What color do you want? Blue? Great — we have blue.)

The "inward" company that sells socks approaches customers and tells them what they believe are the best socks and offers what they believe is right. (We have red socks, green socks and blue socks — hope you buy from us because ours are the best and we work really hard to make them.)

Raymond stated that the majority of nonprofits are "inward-focused" with their marketing and fundraising approaches. In other words, it is perceived that most nonprofits are focused on their missions, the great work they do, as well as the benefits and progress of their work. And, in turn, they look to their constituent bases to help them continue to make progress.

Some of you may be thinking this is not a problem. Here's where the problem comes into play:

1. We all know that boomers are very focused on themselves. Boomers want to be courted. Boomers want to be marketed to in a way that recognizes who they are and what their contributions are to life in general. Boomers want to be "known." Boomers want to have their needs AND expectations met through their buying/engagement relationships.
2. Boomers have the largest amount of financial capacity of all the generations, and they represent the largest portion of nonprofit donors compared to other generations.

This all sounds familiar, right?

Well, today's donors are consumers of goods and services in much greater ratios than they are supporting charitable missions. And, according to Raymond, they are being "trained" by the commercial world to react and engage based on "outward-focused" marketing.

Today's donors, who are already unique in their expectations of financial transactions and relationships with brands, are becoming more and more accustomed to being courted and catered to relative to what they "buy". And, in case you are wondering, I'm not talking about major donors — I'm talking about all of our donors. The difference between how companies focus on selling to consumers to create behavior and how nonprofits are "presenting themselves" to donors to create alliances will become more and more of a challenge.

There's a simple answer. Nonprofits need to review their marketing and fundraising strategies and determine if they are outward- or inward-focused. I guarantee that the majority are inward-focused. It's why donors continue to question where money is being spent (even in some of the world's top charities), how progress is really being made and why they should continue to support.

Here are five easy questions to ask when you are reviewing your donor communications:

1. How much of the focus is centered on what the organization does and how the organization measures progress?
2. How much of your focus is centered on how your donor benefits from being involved with you?
3. How much of your focus is on helping your donor understand his/her involvement and his/her part of the greater picture (versus telling donors how they can help the organization)?
4. How much of your overall strategy is focused on the profiles of your donors — are you marketing to your donors through their eyes or just marketing about your organization?
5. How much of your overall strategy is focused on recognizing the strength of the relationship the donor already has with your organization BEFORE you simply ask for more?

If you have determined that you spend a lot of time talking about your organization and your work and less about your donors and their needs and expectations with your brand, I suggest you start to make changes.

This is about all of our donors, members and volunteers and how they are changing, especially the changes by brands much, much bigger than nonprofits.