Category Archives: advancement services

Advancement technology satisfaction survey

Zuri Group and EverTrue recently conducted a thorough survey of advancement users’ satisfaction with their systems. The central finding was that users are unimpressed with their resources. Dissatisfaction with databases, reporting tools, analytics resources, and other important fundraising tools was often 40% or more. And, the typical response for nearly all of the questions was “it’s ok”, which means that “Meh” is the average sentiment among our users. You can check out the report here: The Advancement Technology Landscape 2017 – EverTrue and Zuri Group

Here’s a sample of the report that highlights the challenges faced by our advancement technology environments:

Advancement technology satisfaction
Reporting, a central solution for advancement programs, is failing to meet demands.

The trend for the survey suggests that “common” issues (like gift processing) received better satisfaction scores whereas more innovative and new areas, such as social data management (which only a few companies, like EverTrue, really address) and analytics, received lower satisfaction scores. Some of this may simply be the typically slow technology adoption our industry experiences. However, it is important to move beyond the “we don’t have the money/time” argument and start to examine the roots of these issues and how your institution can begin to improve satisfaction.  Our users clearly want more and better solutions.

 

There are some solutions and some ongoing obstacles to improving the advancement technology landscape. To solve the issue, non-technical tactics like building trust and negotiating expectations are more important than you might think. Delivering on the fundamentals–accurate, complete and timely data–and adopting a PR-style, metrics-driven strategic information management approach will gain some favorable survey points. However, the lack of funding for, and innovative technical solutions to, fundraising applications remain pretty substantial problems. Thus, expectation management will be a critical component of your effectiveness.

What is your team experiencing? How have you improved user satisfaction at your institution? Share your best tips and tricks to help tackle this ongoing challenge.

 

The New Fundraising Calendar: NOW!

Consumer experiences shape much of our constituents’ fundraising lens. For example, I’ve written extensively about the #iPhoneProblem. This “problem” doesn’t mean iPhones are bad; to the contrary, they are so good our nonprofit tools simply can’t keep pace with users’ expectations (see our recent technology satisfaction survey for details: https://goo.gl/M1PIy5). This spreads to issues like use and reliance on mobile functions, which are creeping up the charts for donor giving preferences, for example. All of this consumer experience impact increasingly affects how we plan, schedule, and execute our fundraising strategies.

One need look no further than “Giving Tuesday” (i.e., philanthropy’s response to “Black Friday” and “Small Business Saturday” gimmicks) to see how our strategies and calendaring are being shaped. Giving Day efforts by universities (which I appreciate, for the record) feel a little like GroupOn specials. The provenance of GoFundMe pages is becoming harder to discern….am I giving to my alma mater or some guy at my alma mater? Overall, urgency and immediacy are prime objectives in this new approach. “Act now, before it’s too late!”

An interesting article in the Atlantic (https://goo.gl/jRfajb) assesses the impact of constant marketing to prospective students. For fundraising, the trend is similar. The days of a year-long direct response calendar are numbered. 24/7/365 strategies like peer-to-peer efforts are starting to look as if they can outstrip time-honored phonathon efforts. For example, one university’s recent Giving Day resulted in 1,800 new donors among the 12,000+ donors to that effort, totals that far surpassed the more tedious phonathon efforts to date.

So, what does this mean for nonprofits? For starters, rather than that year-end pitch to all of your constituents, more and more immediate solicitations (ideally conducted by peers, such as alumni reunion classmates) are to be expected.

As this GivingUSA chart suggests, giving is remarkably stable and generally finite and therefore nonprofits must try their best to get as much of the pie as possible. Now! That year-end big mailing? Do it sooner. That email communication plan? Start it today. That reunion fundraising effort? Get it moving. Don’t have a good peer-to-peer tool? Get one, fast!

Some of this is hyperbolic, of course, yet the message should be clear. If your fundraising schedule calls for raising most of your money with calendar and fiscal year-end pushes, by the time you reach many of your prospective donors, they will have already given….just not to your organization.

Subtle Clues to Leverage for Gift Administration

How to Leverage what we Learn
How to Leverage what we Learn

The Wall Street Journal’s article on JP Morgan’s new $10,000,000 cap for accounts in their private banking area. On the surface, this seems like an issue only for the 1%, but philanthropy, of course, is affected substantially by this group. So, their banking issues are our philanthropy issues. And, this particular issue can be leveraged to improve operations and gift administration.

“How so?” you might ask. One specific consideration is how gift administration can learn from and leverage details about donors’ bank accounts. Here’s how:

  1. Banks Matter. If a donor is nice enough to write a $50 check to your organization on a JP Morgan Private Banking account (look at the middle left of the check, typically, to find the account type), that donor might have easily added a few zeroes to the gift. After all, those account holders are deca-millionaires!
  2. Numbers Matter. Have your team check the check number. That nice donor writing check number 35780 likely has substantial cash flow; the average donor will likely write just a few thousand checks in their lifetime (and Millennials may write nearly none at all).
  3. Name that Donor. Check accounts held in trust, with “TTEE” listed, and other such naming conventions likely mean that the donor has enough assets to have placed them into a trust. This is a typical move for those who will be affected by probate court upon their death…and, right now, that means having more than $5 million in assets via your estate.
  4. Pictures are worth a thousand words. Have the gift team look at what else the check tells us. If there check has puppies and mentions the Humane Society, for example, you know where the donor’s heart is.

These tips and tricks should be applied to improve your day-to-day operations. Establish a process whereby gift analysts can forward such findings to the research team or gift officers so you get some added movement on these donors.

What other tricks would you suggest to improve gift administration? Your comments on this would be welcomed. Happy fundraising!

Facebook is making some game-changing tools available

If you haven’t checked out https://nonprofits.fb.com/, do it. Now. This is Facebook’s effFacebook's Nonprofit Support Pageort to streamline a bunch of useful resources. Some of this is new but much is tried-and-true. How to reach your constituents. How to make it easy to give a gift. How to activate supporters.

Well, what are you still reading this for. Check out the site. And, let me know what you think. It may not change how some of us fundraise, but it will change fundraising for the better.

007+Q=Awesome Advancement Services

Have you seen Spectre, the newest 007 edition? It’s great fun. As with recent Bond films, Advancement Services and 007technology and data play an increasingly important role in achieving success. Sound familiar? I had an “ah-ha” moment during the film that the great and vital coupling of 007 and Q  (Bond’s resident tech-leveraging geek) is like the best advancement services shops. It might help your team to think the same. Here’s why:

  1. Partnership. The movies show a team that works together for a common cause. Each team member has a role and, if they perform it well, the other is clearly buoyed.
  2. Anticipation. Q is working hard in advance of requests from 007. In our profession, we should be, too. Instead, I see too many of us waiting for specs from folks who frankly may not know (how to ask for) what they want until they see “it”. So, with Q, he has “it” produced so 007 can assess and use what makes his job easier.
  3. Acceptance. Bond will be Bond. He steals a car, oh well. He escapes a government-mandated lock-down…well, what did you expect, he has to go save the world. Does Q stop supporting his colleague? Nope. He realizes that 007’s skill set is such that following the rules may not fly at times. The same goes for our best fundraising colleagues. Instead of chastising, Q enables in order to get the most out of a top performing employee. We should do the same with better service (such as via admin support), better self-service, and more understanding of the rigors of international spy…er, fundraising work.
  4. Quality. At the end of the day, Q produces amazing products that serve 007’s needs, which keeps 007 coming back for more. That sort of quality-based symbiotic is what we all need in our shops. Brand, look-and-feel, ease of access, accuracy–all of these play a role in our colleagues’ perception of the quality we produce.

Am I missing a few key details? Yes. At one point in the film, Q mentions a prototype cost the Queen 3 billion pounds. Most of us don’t have that budget lying around, do we? Our work is sometimes more mundane than saving the planet from evil, so the urgency and intensity of our roles will be different. And, we all know that not everyone in the British intelligence agency gets as much attention as Bond, which is similar to what happens in our own teams. But, as with any good film, we shouldn’t let reality get in the way of a good plot.

Those potential obstacles (and probably dozens of other objections) notwithstanding, think for a minute about your advancement services shop as Q partnering with 007, anticipating needs and accepting “shortcomings” while delivering the level of quality that keeps the user coming back for more. Sounds pretty good doesn’t it? Get to it, Q.

4 Indicators that Caging is Right/Wrong for You

Gift processing is the core of fundraising operations. The steps to carefully and quickly

From Cannon's An Executive Guide to Fundraising Operations
From Cannon’s An Executive Guide to Fundraising Operations

handle our donors’ contributions are at the heart of our business processes, databases, reports, and technology. Some of us in the industry have been seeing an interesting shift in this core business process: the rise of caging. It is an important alternative for you to consider.

As an alternative to in-house gift processing, caging outsources gift intake, batching, entry, and receipting. The approach is not new, particularly among high-volume, low-average gift processing outfits supporting cause and cure organizations. The new shift has been among those universities and healthcare organizations that see an opportunity to streamline operations while improving outcomes. Additionally, the technology available for scanning, remote entry, and data import has improved so rapidly, off-site entry is surprisingly simple to implement.

But, is it right for you? Perhaps. Consider these four indicators:

  1. High-volume, low-average gifts. Caging companies create economies of scale, so some volume is needed to make this approach profitable. Once you’re in the 5-figure transaction range, it may be worth a look. As you approach and fall into the 6-figure transaction range, you owe it to your organization to evaluate these options.
  2. Donor and donation make-up. The business processes designed by caging companies are efficient. However, a majority of your donors need to frequently use reply envelopes and standard devices to make the process scaleable. It’s even more important that you consider what your donors might think if they mail off a gift to a PO Box in another state (imagine a Sooner sending a gift to processed in the Longhorn state!).
  3. Complexity of the front-of-the-line. This issue is counter-intuitive. The more complex your important gifts and pledges are at the front of the line, the more sense it makes to establish a caging approach. Such a practice will remove the tendency to “plow through the pile” of work that can drain a processing team and distract them from the truly important items in the pile. Instead, a caging company can siphon off the small donations and allow the team to focus on what matters most.
  4. Desire to strengthen strategic analysis. Finally, if you want your gift processing team to move form “entry” to “analysis”, you should consider a move to caging. When the mundane, day-to-day entry grind is assuaged by a caging partner, your professionals can start to analysis gifts more thoroughly. The resulting increases in prospecting, analytics, and stewardship will be significant.

Caging isn’t for every institution. However, it is an increasingly viable alternative to the typical, in-house approach. Having helped organizations evaluate and then implement the approach, I can attest to the value of this model and the likelihood its application will increase in the years to come.

Prospecting, Analytics and Data for Gift Planning

The St. Louis Planned Giving Council was a terrific setting to discuss changes (and continuations) in prospect development. The group discussed what’s the same, what’s new, what’s working and what’s on the horizon.

You can find my presentation on the topic here: SLPGC – Prospecting Discussion, November 2014.

Best of luck with your fundraising initiatives as year end approaches.

 

 

3 Analytics Challenges: Context, Endogeneity and Spurious Results

Donor Analytics ContextAn interesting visual depiction of spurious correlation (check it out here) reminded me of my grad school days and the rigor with which I would build hypotheses. Rather than let R, SPSS, or Excel correlate away and then proclaim some amazing finding, I started from the reasons and results I expected to validate with data. The difference is, all too often, that the former approach tells you very little due to endogeneity, spurious results, and the lack of context.

Some organizations–Google is known for this–will say “don’t worry about the why”. Some have referred to this approach as “theory-free“, a nice euphemism to indicate how little long-term value we might find in these correlations. Now, for consumer behavior where Big Data is truly present  perhaps this works. But, data points are rarely available for nonprofit analytics in the same way as, say, Target and Wal-Mart have data…although there are new options underway, like David Lawson’s newsci.co.

And, if you talk with a gift officer who’s been disappointed with predictive modeling results, you see a different picture. From that vantage point, the analytics results are frequently devoid of context. The result confirm what we already knew (“these prospects look rich! they live in a nice neighborhood!”) or reflect a pattern we already see (“they gave last year! let’s ask them again!”). Yet, modeling doesn’t typically improve relationships with prospects.

A big culprit: Context. Donor context is critical in building relationships. And, context is quite challenging to incorporate into modeling. The following are real examples of discussions about potential prospects surfaced by a context-free model:

  • “Sure, Jane looks promising, but we don’t have a phone number to reach her and no volunteer connection, so how likely is it she’s approachable?”
  • “Absolutely, Ed looks great, but did you know he just filed for divorce?”

The solution to this issue isn’t to cast off analytics. It’s to improve it. Start with and add in theory. Guard against spurious results. Don’t elevate an endogenous variable as meaningful. And, most of all, our industry needs resources that can actually add context to results. As a student of philanthropy, I am anxiously awaiting the time when our new science of analytics better delivers on the hype and improves our understanding of donor behaviors, while avoiding endogeneity and spurious results.

3 Critical Concerns with Cost Per Dollar Raised (CP$R)

ProductivityProductivity is vitally important to nonprofits but none of us in the social sector are able to spend enough time, energy, and…well…dollars on being productive. Instead, for decades, we have been more focused on efficiency at the expense of effectiveness and impact. We stuff envelopes at night to save money, then lose overworked staff for a 5% pay increase at a nonprofit in town. Our boards embrace online innovation but funding is often on a shoestring budget. Some great studies and presentations have highlighted some of the drivers for this. After years studying this dilemma, I submit that the over-reliance on and misapplication of the “cost per dollar raised” (CP$R) metric is the clearest example of this problem. While we want to raise more, we penalize ourselves if we invest too much.

The industry needs to change and here are three critical concerns with CP$R and its sometimes negative effect our industry:

  1. Growth: Fundraising is a long-term endeavor. Expanding fundraising results takes time, consistent marketing and messaging, and investment. The current industry emphasis on CP$R diminishes the ability to weather a tough year, offset a big gift’s impact in year-over-year evaluation, or properly fund our efforts. Organizations whose strategies rightly focus on major and principal giving are particularly vulnerable to scrutiny over CP$R issues depending on the timing of a big, strategically cultivated gift.
  2. Staffing: The professionalization of fundraising is changing the math on what is reasonable for budgets. Most nonprofits will spend about 65% of their operational fundraising budget on staff and benefits. Low CP$R targets, though, mean that we may not have enough to invest once/if we get the right people on place as this mix relies heavily on the typically market-depressed salary bases provided to fundraising professionals. We might secure top talent committed to our missions, but instead we seem to experience a costly turnover rate and stunt our fundraising efforts in the process.
  3. Infrastructure: I’ve written about the “iPhone” problem–that is, people’s expectations for work-related technology and processes are shaped by their consumer experiences using tools and apps designed by the world’s biggest companies. The result is “relative deprivation”; we want from our fundraising tools what we get from our consumer products. Unfortunately, collectively, our industry simply doesn’t generate enough demand for vendors to supply tools that match our consumer experiences. Imagine if we were empowered to demand better tools that could be shown to increase our bottomline, even if we would sometimes eclipse the currently-too-low CP$R thresholds. Imagine if we could invest an extra $0.01-per-$1.00 raised or so each year as an industry. That would be a great start.

Our industry’s efficiency mantra can be overwhelming. Funders’ expectations to deliver more with less are difficult to manage. The nature of fundraising efforts, while akin to sales, is different in its non-transactional nature. Nonprofits are directed to invest less than for-profits. And, our industry’s focus on CP$R is a root cause of our challenges.

Alternatives and Additions

While CP$R is a common measure of nonprofit evaluation, there are important alternatives to CP$R. These can be taken in conjunction with costs to present a more balanced, nuanced evaluation of the effectiveness of a nonprofit.

  • Raised per Full Time Employee/Equivalent (FTE). I’ve written at length about the value of measuring “Dollars Raised per FTE.” It is a surrogate for CP$R in some ways, but it gets at a better way to position productivity and effectiveness. Study after study shows that nonprofits raising $1 million per FTE in fundraising are performing in the top quartile. Would you rather raise more by adding more people, or save money at the risk of losing people?
  • Net Gain: Imagine this scenario—you can net $10 million or $20 million in a year, but the former costs you $2 million and the latter costs you $10 million. $20 million beats $10 million, right? Not if it costs “too much” to generate. We need to be able to choose the latter but our industry, through charity watchdogs and other traditions, rewards spending less even if you provide less to your cause. There is a balance needed here. Different organization types at different stages of growth, staffing, and infrastructure require a nuanced evaluation.
  • Impact of Dollars Raised: Recent innovations by groups like GiveWell reinforce the value in looking at what was accomplished because of the funding generated by fundraising. Can more kids experience an open MRI that donors’ contributions helped fund? Can a community see a decline in diabetes because of charitably funded education efforts? These are organization-specific so don’t lend themselves to a nice, simple number, but the current reliance on CP$R too often results in overly simplistic evaluations.

Moving forward with new measures will take guts. We need to push back against the myopic focus on annual CP$R. We need to seek investment in infrastructure and technology in line with expectations of those who sit on our boards. We need to fervently battle to retain talented staff by properly funding roles. We need to clearly define the terms of the debate so definitions like “raised” retain their fundraising meaning and are not reduced to more simplistic notions defined on a general ledger. And, most importantly, we need a message that reminds our constituents of the old adage that “you get what you pay for.” More net funds for our amazing missions is more meaningful in the long run than delivering less, but more efficiently. Because our missions are so important, adopting a more effective set of evaluation tools is vitally important.

Have you succeeded in altering the focus toward productivity and away from CP$R? If so, share your story.