Our world has evolved and so has fundraising. It’s time for organizations to embrace these three, new realities for cultivating bigger donors.
Our rapidly evolving, super-connected world has introduced new realities for visitor-serving organizations – particularly with regard to admission and affordable access opportunities. Similarly, the information age has created new opportunities for organizations to more successfully approach fundraising. Maximizing these opportunities requires that organizations embrace many of the challenges currently affecting how nonprofits operate. Fundraising is no exception to this need for evolution.
When organizations consider the evolved role of fundraising, they often seem to think of crowdfunding campaigns aimed to raise money from (often small) donations from a large number of people. No doubt, crowdfunding campaigns can be powerful! (And cultural organizations are benefiting from them, too!) But what about cultivating bigger donors and more directly building long-term affinity for the organization as opposed to a specific project? Well, those realities have shifted a bit as well. Here are three fundraising realities- contemplative of the fast-paced, connected world in which we now live- that organizations should consider if they want to reach bigger donors:
1) Donor targeting can be done more intelligently than ever before (but this is not done often enough by nonprofits)
I’m big on the fact that optimal admission pricing for cultural organizations is a product of data sciences. While not exactly the same, donor targeting is becoming more of a science, too. There’s reason to consider that soon the days of casting the general “Make a donation today!” net to all audiences may be long gone.
Much like certain people profile as likely visitors to cultural organizations more than others, some folks profile as more likely donors than others. Increasingly, organizations can research current and potential donors (or members!) in order to identify the demographic, psychographic, and behavioral attributes that indicate a likely donor. And, while the nuance of this profiling effort will vary by specific organization, extant data reveals terrific insight into the type of people who are currently engaging with cultural organizations as donors. The table below indicates a High-Propensity Donor profile based on member/donors annually contributing at least $500 to a nonprofit, cultural organization (e.g. zoo, aquarium, museum, science center, botanical garden, symphony, theater, etc.) If you’re a cultural organization, your $500+ donors will fit this profile, but the specifics of your organization may lend additional attributes to the mix.
Once an organization has an idea of what kind of people are most likely to be their respective high-propensity donors, then the organization can focus on identifying and targeting specific individuals who possess those same attributes and may have an affinity for the organization. And organizations can deploy the same targeting methods for potential donors as cultural organizations do for potential visitors. (Side note: Why don’t more organizations do this beyond the few at the top? From what I can tell, a contributing factor may be the fact that marketing and fundraising are often separate, siloed divisions that tend to consider their own expertise as singular and sacred. How can we do that “we’re better together” thing more often within the same institution?)
Data, analytics, and technologies allow organizations to identify, target, and deliver highly-customized messaging to high-propensity visitors and donors alike. Many smart organizations are already doing this to engage onsite audiences – it’s a natural extension of the same best practices to leverage these resources to support contributed revenue categories. It’s time to invest in fundraising data and intelligence… and then consider this information in the formation, targeting, and deployment of fundraising strategies. Data-informed audience identification and targeting are every bit as useful to development departments as they are for marketing teams.
2) Cultivating donors is a time-investment strategy with a new twist
Today, the speed of information sharing and the ease of connectivity allow for potential donors to hear about the work of organizations long before those organizations reach out to potential donors. It also becomes easier to form an opinion about an organization before an organization is aware of it. This means that fundraising departments are less able to “curate” a donor’s pathway of engagement with clear certainty than in a pre-digital era. In the past, a fundraising department could be relatively certain of a donor’s interactions with an organization. Today, a donor may check out an organization on Facebook, share a post, or even “hide” posts from an organization that is not of interest to them. Donor opinions of organizations can be formed earlier than they were in the past because of our increased connectivity.
This is important to note because a major gift (such as one that is seven figures or above) may require decades of careful donor cultivation. Fundraising big bucks is not like an annual advertising campaign – it requires a substantial investment of time. For more robust fundraising success, organizations benefit by investing for a sustained period of time and actively building a relationship on the potential donor’s desired platforms. (As you can see in the chart, high-propensity donors are “super-connected” via the web, so know what you’re doing with donors on social media.)
Many organizations measure giving amounts in years, not decades. It makes sense that we measure progress on an annual basis, but when we don’t look at fundraising over longer periods of time, we tend to promote a culture wherein we focus on this year’s giving and fail to prioritize long-term potential donors. If it takes ten years to cultivate a ten million dollar donor and fundraisers are primarily focused on the current year, then an organization may never receive that ten million dollar donation. Though the instant gratification of today’s society may be making us perpetually impatient, we must remember that fundraising and building meaningful relationships (still) cannot often be rushed.
3) Competition for donor engagement has gone global
Competition for donors can now be more global and intense. Potential donors need not be more involved with or committed to organizations in their backyards. We live in a world where a donor in New York can be cultivated by an organization in Los Angeles. Being “local” matters less- or at least, it doesn’t necessarily make an organization a shoe-in for a potential donor’s support. In the past, it was more difficult to connect with organizations that did not reside in a donor’s community. There may be a bit of a lag in this development for cultural organizations, as many donors appreciate having the ability to attend these institutions. However, as cultural organizations necessarily focus more on their social missions instead of their existence as straightforward attractions, they may see the same fate as other types of nonprofit organizations when it comes to global competition for donors. Being a local organization can still be important to a donor , but in our world of increased connectivity, it isn’t necessary and may matter less than the efficacy of mission execution.
The fact that donor competition has “gone global” means that it’s even more critical for organizations to realize that if a donor is giving in a big way to one organization, he/she often cannot give big in the same way to another. This is true across organizations and causes. Big donations are often zero-sum games. A donor who makes a major gift to one organization has that much less giving wherewithal to donate to another organization. Is it possible that this same donor may reach further into their well of largesse to support your organization with a similar, significant, bit-time gift immediately after giving to another organization? Yes. Is this a good strategy to bank on? No.
Think about your own giving! You probably have a kind of overall, annual giving quota based on what you feel comfortable with and what you can afford. Once you max out, you max out. Again, that’s not true for everyone, but it’s probably not a good idea to build a strategy around an exception. Know that there’s competition, and be contemplative of the donors gifts to other organizations and causes as well. As much as we romanticize big givers, most are not – actually- bottomless pits of never-ending cash.
The digital era has changed more on the fundraising front than simply bringing us crowdfunding campaigns and social media communication. It’s increased opportunities for effective donor targeting, altered traditional donor engagement pathways, and increased global competition for big donors. It’s time to get serious about evolving to more informed methods of fundraising – because if you’re not doing it, then another organization likely is. Let’s take these new realities into account and move forward with the important work of finding and connecting with those who have a passion-match with our mission.
Let’s update our thinking about finding and communicating with people who can help us make the world a better place.
Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:
- Three New Pricing Realities for Visitor-Serving Organizations in the 21st Century (DATA)
- The Game Has Changed: Nonprofits Now Compete with For-Profits (DATA)
- Finding: Museums That Highlight Mission Outperform Those Marketing Primarily as Attractions (DATA)
- Admission Pricing is a Science- Not an Art (Fast Fact Video)
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