Making better fundraising decisions

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Making better fundraising decisions

  1. 1. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Making Better Fundraising Decisions Nowshad (SHAD) Ali, CFRE, CPBA, CPVA August 14th, 2012 Our Presenter – Nowshad (Shad) Ali  President & CEO On Purpose Leadership  CFRE; CPBA; CPVA  Former senior development roles at: – Canadian Diabetes Association – Big Brothers & Big Sisters – Osteoporosis Canada – The Lung Association  Volunteer roles include; – AFP Fdn for Philanthropy Canada – AFP Int’l Professional Advancement – AFP Int’l Research Advisory – AFP Canada Research Chair – Saskatchewan Association of Human Resource Professionals – Canadian Society of Association Executives Making Better Fundraising Decision – Thought Leadership Seminar| Page #2 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 1
  2. 2. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Journey for this Session  Making Better Decisions – Key elements|  Components of Strong Organizations  Fundraising Strategies  Applying the 3-S model  Improving results with better Information Making Better Fundraising Decision – Thought Leadership Seminar| Page #3 © 2007 On Purpose Leadership Inc. Begin With the Fundamentals  AFP Code of Ethics http://www.afpnet.org/Ethics/EnforcementDetail.cfm?itemnumber=3261  Donor Bill of Rights http://www.afpnet.org/ethics/enforcementdetail.cfm?itemnumber=3359  AFP Ethics Assessment http://www.afpnet.org/Audiences/MemberNewsDetail.cfm?ItemNumber=6126  AFP/Ipsos Reid – What Canadian Donors Want http://afpcalgary.afpnet.org/International/RepResdetail.cfm?ItemNumber=11841 Making Better Fundraising Decision – Thought Leadership Seminar| Page #4 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 2
  3. 3. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Connecting To This Webinar  The audio for this webinar will be broadcast through your computer. Once you join the presentation, a small audio broadcast box will appear on your screen and you will hear the host through your computer speakers.   To join an Audio broadcast in WebEx, click on the Communicate menu in your WebEx screen and select Join Audio Broadcast. If you are having problems connecting with the audio broadcast server you can still join using the teleconference. To join the teleconference follow the steps below:   1.Leave the audio broadcast by clicking on Communicate > Leave Audio Broadcast.  2.Get the teleconference number, click on Communicate > Join Teleconference.   If you are unable to listen to the audio through your computer and wish to dial into the conference line, please use the information below:   Teleconference information:  Call-in toll-free number: 1-866-4106539 (US) Call-in number: 1-660-4225471 (US) Conference Code: 364 005 6 Making Better Fundraising Decision – Thought Leadership Seminar| Page #5 © 2007 On Purpose Leadership Inc. Making Better Decisions – Key Questions  Is the Quality of the decision important?  Is commitment from others important to the decision?  Do you have enough, and the information needed to make the decision?  Is the problem the decision seeks to resolve well structured and well defined?  If you make the decision yourself how will it affect others and or the commitment of others? Making Better Fundraising Decision – Thought Leadership Seminar| Page #6 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 3
  4. 4. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Making Better Decisions – A Simple Process Set Objectives Implement, Explore & Monitor, Prioritize Adapt Options Generate Choose Controls Best Needed Options Making Better Fundraising Decision – Thought Leadership Seminar| Page #7 © 2007 On Purpose Leadership Inc. Albert Einstein “The significant problems we face today cannot be solved at the level of thinking we were at when we created them.” Making Better Fundraising Decision – Thought Leadership Seminar| Page #9 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 4
  5. 5. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Components of a Strong Organization  Operate from sound financial base  Good understanding of shared roles and responsibilities  Effective use of all resources  Capacity to be creative, flexible and adaptable Making Better Fundraising Decision – Thought Leadership Seminar| Page #10 © 2007 On Purpose Leadership Inc. Components of a Strong Organization  Clear understanding of environment  Constant focus on the mission (business, where we are going and how we plan to get there  Communication, Communication, Communication Making Better Fundraising Decision – Thought Leadership Seminar| Page #11 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 5
  6. 6. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Peter Drucker “ Management exists for the sake of the institution’s results. It has to start with the intended results and has to organize the resources of the institution to attain these results. It is the organ to make the institution, whether business, church, university, hospital or a battered women’s shelter, capable of producing results outside of itself.” Making Better Fundraising Decision – Thought Leadership Seminar| Page #12 © 2007 On Purpose Leadership Inc. Strategy - Three Strategies in all of Fundraising  Acquisition  Renewal  Growth  Cultivation Making Better Fundraising Decision – Thought Leadership Seminar| Page #13 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 6
  7. 7. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Traditional Pyramid Making Better Fundraising Decision – Thought Leadership Seminar| Page #14 © 2007 On Purpose Leadership Inc. Structure - The Real Donor Pyramid Making Better Fundraising Decision – Thought Leadership Seminar| Page #15 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 7
  8. 8. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Systems - Success will require that you:  Understand your donor and supporter markets and segments that can be the most productive.  Focus resources on those revenue generation opportunities that offer the most growth in income.  Use proven successful strategies and tactics to attract and keep a donor and supporter base that shares your organization’s vision and believes in your mission.  Be clear about your success to date and the challenges before you.  Recognize your capabilities as well as skill and resource gaps.  Know from whence you came and to where you wish to go. Making Better Fundraising Decision – Thought Leadership Seminar| Page #16 © 2007 On Purpose Leadership Inc. Sound Fund Development Vision  A corporate-wide, donor relationship plan that focuses on developing long-term donor relationships that create loyalty  Knowledge-based marketing plans that evolve through constant learning and feedback  Efficiencies and effectiveness in all donor contacts through intelligent use of donor data  Developing a behaviour based (trigger based), consistent, routinized donor plan for every donor relationship Making Better Fundraising Decision – Thought Leadership Seminar| Page #17 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 8
  9. 9. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Objectives in Support of Vision  Integrated activities and systems resulting in knowledge- based donor contact strategy  Donor Contact management systems  Full reporting capabilities  Good stewardship & ability to effectively manage quality donor relationships  Fund development efficiencies and effectiveness (ROI) Making Better Fundraising Decision – Thought Leadership Seminar| Page #18 © 2007 On Purpose Leadership Inc. Data Management Plan to Support Vision  A fully integrated corporate-wide information system to enable: – Systematic processing and routinized management of donor information across all levels – Quick and easy on-line access to donor information – Systematic treatment of all donor points of contact – Continuous refinement of fundraising efforts using timely, accurate and insightful information Making Better Fundraising Decision – Thought Leadership Seminar| Page #19 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 9
  10. 10. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Stage 1 Stage 2 Stage 3 Stage 4 Communal Serial Symbiotic Integral Collation of Information Gaining insight into donors Developing an understanding Real-time response to from past behavior of likely future behavior donor’s needs  Data in different  data more likely to be  Database centralized  Integral coordination places centralized (in rare cases different among all relevant –  Data entry de-  Controls, procedures, databases) across divisions, centralized protocols, coordination  Controls, procedures, geographies and other  Low level of controls, higher protocols, coordination boundaries procedures, protocols,  Some standards formalized and  Sophisticated and or coordination formalized implemented established major gifts  Standards not  Security levels  Standards formalized focus formalized moderate and managed,  Formalized  security levels low  Usage broadening measured sales/solicitation  Usage narrow  Security levels high process  Usage broad  Multiple contact points managed, number of solicitors  Integrated Development Program  Development staff  Development Director,  Symbiotic  Development staff, IT  IT Staff  IT Staff, coordination between Staff, Cross  Analytics experts, collator, analytics Department Marketing experts and line integrators organizations Making Better Fundraising Decision – Thought Leadership Seminar| Page #20 © 2007 On Purpose Leadership Inc. Solutions that work  CRM, Internet Solutions  Data Management Solutions – use of Action Tracks and Prospect tabs  Financial Management Solutions  Giving Scores & Custom modeling  Online/Net Community – Cultivation and Acquisition online  Friends Asking Friends – Grow  Guide Creative - integrate into web design Making Better Fundraising Decision – Thought Leadership Seminar| Page #21 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 10
  11. 11. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Alvis Sweeney “Relationships are the first order of business and the only business you’re in.The reality is, everyone is going after the best customers; protecting your customer base is critical. It is economic suicide to concentrate on acquiring new customers without doing everything in your power to retain existing customers.” Customers: (donors/members/volunteers) Making Better Fundraising Decision – Thought Leadership Seminar| Page #22 © 2007 On Purpose Leadership Inc. If this is so simple why is it so hard:  Transaction VS Relationship  Expense VS Investment  Income VS Equity  Get VS Give  Overnight VS Over Time  Us Vs Them  Disease/issue VS People Making Better Fundraising Decision – Thought Leadership Seminar| Page #23 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 11
  12. 12. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 “Every organization is perfectly designed for the results they get.” (Peter Drucker) Making Better Fundraising Decision – Thought Leadership Seminar| Page #24 © 2007 On Purpose Leadership Inc. Benchmarking research indicates  A donor can be defined as reaching the loyal donor threshold when he or she has given to your organization in a minimum of three of the past five years, or 60 percent of the time. Once people achieve this threshold, they are much more likely either to advance to a higher level of annual giving or to make a planned or major gift.  after six solicitations per year, the likelihood for long-term loyalty diminishes significantly. As a result, it is important for charities to focus on building long-term relationships rather than on squeezing an extra $20 from donors in any given year. It is time to realize that seventh fundraising letter sent in a year is likely to alienate the same small donor who might otherwise be a good prospect for a large gift a few years down the road. Making Better Fundraising Decision – Thought Leadership Seminar| Page #25 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 12
  13. 13. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 A few Key things to be looking at  Are retention rates increasing or decreasing? Which donor segments have the best retention?  Is my donor upgrade strategy working? For particular lifecycle stages, are my donors giving more today than in past years?  What is the lifetime value of donors acquired through the web versus those acquired through direct mail?  Are increases in average gift having a negative effect on donor retention?  What is the impact of a sub-par acquisition year on future years’ revenue?  How have my heavy lapsed reactivation efforts impacted my donor portfolio and affected retention and donor value? Making Better Fundraising Decision – Thought Leadership Seminar| Page #26 © 2007 On Purpose Leadership Inc. http://www.afpnet.org/Audiences/ReportsResear chDetail.cfm?ItemNumber=3113  Overall* donor retention was 41 percent in 2010 (Median). – That is, only 41 percent of 2009 donors made repeat gifts to participating nonprofits in 2010  Overall* donor attrition in 2010 was 59 percent. – That is, 59 percent of 2009 donors did not give again to participating nonprofits in 2010. These donors are also known as ―lapsed donors‖ or ―LYBUNTs‖ [Last-Year-BUu-Not-This]  Repeat* donor retention was 70 percent. New* donor retention was only 27 percent  Database* donor retention in 2010 was 10 percent. – That is, only 10 percent of all prior donors of record in participating nonprofits’ donor databases gave again in 2010. Making Better Fundraising Decision – Thought Leadership Seminar| Page #27 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 13
  14. 14. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 http://www.afpnet.org/Audiences/ReportsResear chDetail.cfm?ItemNumber=3113  Overall* donor retention was 41 percent in 2010 (Median). – Donor retention is less than the FEP survey median of 41 percent for groups of donors making gifts of under $250 and significantly higher for groups of $250-and- over donors where retention can range up to 70 percent or more  Adrian Sargeant and Penelope Burk report in their books that donor retention can be increased by 50 percent -- or more – by investing in communications to donors about their gifts at work and other aspects of donor relations. A 50 percent increase in the FEP survey‘s 45 percent gift$ retention for 2010 would increase gift$ retention to nearly 70 percent  Such increases in retention rates alone can significantly improve the annual rate of growth in giving in the nonprofit sector as indicated in Figure 7. For the average FEP 2009-10 survey respondent, an increase in gift$ retention from 45 percent to 70 percent would mean an increase in net growth in giving from -2 percent to 23 percent. Making Better Fundraising Decision – Thought Leadership Seminar| Page #28 © 2007 On Purpose Leadership Inc. Path To Improved Results •Assumptions Research Improved Assumptions •Behaviour or Improved Action Behaviour •Results Improved Results Making Better Fundraising Decision – Thought Leadership Seminar| Page #29 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 14
  15. 15. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 The Impact Donor Modeling Is Having Making Better Fundraising Decision – Thought Leadership Seminar| Page #30 © 2007 On Purpose Leadership Inc. Done Well Donor Modeling Helps  Increase return rates  Increase gift sizes  Accelerate major and planned gift programs  Plan and prepare for campaigns  Improve targeted marketing  Identify the best prospects for various giving levels and types Making Better Fundraising Decision – Thought Leadership Seminar| Page #31 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 15
  16. 16. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Done Well Donor Modeling Helps  Better prospect identification for major gifts, planed giving and annual fund programs  More appropriate target gift ranges for solicitation strategies and timing of communications  Increased success rates in securing appointments with Planned Giving and Major Gifts prospects  Increased response rates in DR programs  Decreased cost of mailings and telemarketing programs  Enhanced engagement of solicitation volunteers and staff Making Better Fundraising Decision – Thought Leadership Seminar| Page #32 © 2007 On Purpose Leadership Inc. Different Forms of Data Analysis  RFM Analysis  Data Mining  Cluster Analysis  Predictive Modeling Making Better Fundraising Decision – Thought Leadership Seminar| Page #33 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 16
  17. 17. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Breakdown of a model… Graduate School Age Constituent Code Per Capita Income High Retail Credit Home Value > $500K Years of Giving Making Better Fundraising Decision – Thought Leadership Seminar| Page - 34 #34 - © 2007 On Purpose Leadership Inc. Understanding Annual Fund Potential 30,000 Actual 25,000 Potential # of Donors 20,000 15,000 10,000 5,000 - $1-50 $51-100 $101-250 $251-500 $501-$1,000 $1,001-2,500 $2,501-5,000 $5,001- 10,000 Giving Range Making Better Fundraising Decision – Thought Leadership Seminar| Page #35 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 17
  18. 18. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Where is good data coming from  Inside your own database  Access studies and papers like FEP, What Canadian Donors Want, and other research results  Giving scores and custom modeling  Talk with your donors including surveys,(segment based on common traits not just gift levels or response mechanisms)  Use internal and external data sources. Create a profile for your donors and look for other people like them  Focus foremost on building the relationship with existing donors and maximizing the support from them. Making Better Fundraising Decision – Thought Leadership Seminar| Page #37 © 2007 On Purpose Leadership Inc. Some Helpful Resource links http://www.supportingadvancement.com/revenue/samples/samples.htm http://www.malwarwick.com/assets/pdfs/successful10-07.pdf “Monthly Donors: Why you want them, how to get them, how to keep them.” Canadian Fundraiser eNews. April 30, 2003. http://www.canadianfundraiser.com/newsletter/article.cfm?ArticleID=787&ClientID=9697 http://www.mastercardmerchant.com/cgibin/orderform.cgi?form=market_acceptance http://www.blackbaud.com/resources/white-papers.aspx Making Better Fundraising Decision – Thought Leadership Seminar| Page #38 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 18
  19. 19. Blackbaud Thought Leadership Webinar Making Better Fundraising Decisions- August 14th, 2012 Final Thought!  "Research is like a lamppost to a drunken man - its just as vital for support as illumination."  A point of view can be a dangerous luxury when substituted for insight and understanding…… (Marshall Mcluhan) …see over Making Better Fundraising Decision – Thought Leadership Seminar| Page #39 © 2007 On Purpose Leadership Inc. Thank You for allowing me this luxury to express my point of view on the subject. Nowshad (Shad) Ali, CFRE President & CEO I On Purpose Leadership 1-866-644-7673 Direct: 306.652.1417 I Mobile: 306.220.7764 lead@onpurpose.ca I www.onpurpose.ca Craig White Manager of Sales, Blackbaud Canada Direct: 843.654.3278 | Mobile: 843.323.8111 craig.white@blackbaud.ca | www.blackbaud.ca Making Better Fundraising Decision – Thought Leadership Seminar| Page #40 © 2007 On Purpose Leadership Inc.Nowshad (Shad) Ali; lead@onpurpose.caCraig White: Craig.White@Blackbaud.com 19

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