Maximizing Revenue, Minimizing Competition
Have a fundraising challenge you want to crack? Weary of doing the same old, same old yet hoping for different outcomes? Do you want the over-the-top results that come from superior strategy?
Email me with your particular problem, and I’ll arrange a quick consultation offering you a practical solution you can implement. I may even use your situation to share with my readers. Names are changed, of course!
McKenzie recently took me up on my offer for a brief consult. It was a pleasure to speak with her. She’s the director of development for an organization that has multiple fundraising outreach initiatives.
Her challenge is an all-too-familiar one. The challenge for her organization is not too many fundraising programs.
It’s the attendant results of all of these programs running on their own rails independent of the others.
Everyone wants to be successful. Everyone wants to raise the most money. Absolutely nothing wrong with either of these goals.
The rub comes when those running the programs—or worse those setting goals for these programs—lose sight of who is really driving the results.
What McKenzie is seeing is perhaps the only time an organization can be in competition for donors. They’re in competition with themselves.
Each of the fundraising programs McKenzie described to me during our conversation has its own, individual goal, its own measure of success, which is independent of the other fundraising initiatives or the overall revenue results.
The results are predictable. She’s seeing the building of silos. The “not with my donor base” outlook. And yet, all of these people are presumably on the same team. I say "presumably" because that’s not how they currently see each other.
The other outcomes from this intense rush for the max in each program?
Donor fatigue and stagnant revenue growth. Continue this state of affairs long enough and you’ll see worse: donors leaving, renewal rates tanking, overall revenue declining. And when that happens, please, please don’t blame it on “too many nonprofits” fundraising!
Remember who is driving the results. Principle 1 of The Eight Principles™ is "Donors are the Drivers®." Donors are driving the train. Fundraising outreach must be constructed with donors in mind if it’s to deliver sustainable and scalable philanthropic revenue.
Not every donor will give to every fundraising appeal. Don’t expect them to. Don’t even give them the opportunity. The No. 1 negative expressed by donors, year after year, is too-frequent solicitation.
So, how do you change this situation?
Recall Principle 8 of The Eight Principles™ "Invest, Integrate & Evaluate™". We must integrate every fundraising initiative so that it appears to be seamless and focused on each particular donor. In short, reach out with the donors in mind. Not program or revenue goals.
Perhaps the first step in making this a reality is to construct goals for each fundraising program from a total donor-base perspective. Calculating your system capacity is the place to start. Work backward from this number—not what you think you “need.” There are several steps to doing this effectively. But they’re not hard. The calculations aren’t nearly as difficult as changing the goal-setting mindset of your organization.
Once you know what each outreach can produce, you can begin to divide the donor base by known interest. The techies among us call this “lead scoring.” Here again, the hard part isn’t mastering the technical pieces, it’s getting staff to buy in.
So how do you do the hard part?
I could wax here about the need for a healthy staff culture, a culture of philanthropy and so forth. These aren’t bad things. They tend to be the result of good management decisions rather than the cause, however.
The quickest way to see change in the right direction is to tie staff performance to overall fundraising performance and donor renewal rates. Once this is done, it’s amazing how you have the right kind of attention and cooperation from fundraising staff.
I was frank with McKenzie, making this sort of change is akin to doing a 180 with a battleship. It takes time and a steady—and resolute hand—at the wheel.
I invited McKenzie to get back with me in a few months. I’m looking forward to hearing of her progress.
Remember what Woody Allen said, “Eighty percent of success is showing up.” Just deciding on the course and setting down the right road is the hard part.
Let me hear from you. Please share your situation and the challenges you face in developing sustainable revenue streams. Email me, and I’ll arrange a brief consult providing you with practical guidance. I’ll choose some of these thorny obstacles to share, along with my insights, in upcoming columns.
Success is waiting. Go out and achieve it.
Larry believes in the power of relationships and the power of philanthropy to create a better place and transform lives.
Larry is the founder of The Eight Principles. His mission is to give nonprofits and philanthropists alike the opportunity to achieve their shared visions. With more than 25 years of experience in charitable fundraising and philanthropy, Larry knows that financial sustainability and scalability is possible for any nonprofit organization or charitable cause and is dependent on neither size nor resources but instead with the commitment to create a shared vision.
Larry is the author of the award-wining book, "The Eight Principles of Sustainable Fundraising." He is the Association of Fundraising Professionals' 2010 Outstanding Development Executive and has ranked in the Top 15 Fundraising Consultants in the United States by the Wall Street Business Network.
Larry is the creator of the revolutionary online fundraising training platform, The Oracle League.
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