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Mythbusters IFC14

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Slides from my MYTHBUSTERS presentation at the International Fundraising Congress, October 2014.

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Mythbusters IFC14

  1. 1. MYTHBUSTERS! Damian O’Broin Ask Direct #ifc2014 @damianobroin
  2. 2. MYTH #1 Every presentation at #IFC2014 has to include the words “ice”, “bucket” and “challenge”
  3. 3. MYTH #2 You can’t replicate the ice-bucket challenge so you shouldn’t bother trying.
  4. 4. #icebucketchallenge
  5. 5. #icebucketchallenge
  6. 6. 47% of Rovio’s revenue come from licensing
  7. 7. 2013 Profit: $568 million
  8. 8. How to replicate the ice bucket challenge Guaranteed! 1. Invest very heavily in idea development - properly resource innovation teams and buy in outside expertise if necessary 2. Develop a ruthless culture of fail-fast and be prepared to fail repeatedly. 3. Practice Zen-like levels of patience. This could take 10 years. 4. (Buy a couple of lottery tickets, just in case.) 5. Implement robust online and mobile tools to be ready for when it takes off. 6. Develop top-of-the class social media strategies and tactics so that you can amplify the message when it goes viral. 7. Cross your fingers. 8. Sit back and wait for the money to roll in.
  9. 9. MYTH #2 You can’t replicate the ice-bucket challenge so you shouldn’t bother trying.
  10. 10. MYTH #2 BUSTED You can’t replicate the ice-bucket challenge so you shouldn’t bother trying. (Well, kind of...)
  11. 11. MYTH #3 Sending thank you letters to all your donors for every donation is a waste of time
  12. 12. “It appears no one has any empirical evidence that thanking donors, promptly or otherwise, makes the slightest difference...”
  13. 13. “On average, we get more than one fifth of our net income from direct mail from our thank you letters...” - Angel Aloma, Food for the Poor (No ask, but envelope & reply device)
  14. 14. Test Group A Test Group B Q = 25,000 Q = 25,000 Control Additional thank you piece at start of year (no ask, envelope or reply device) – + $450,000 in gifts
  15. 15. “The closest I've come to testing that was when a client of mine accidentally turned off their acknowledgement program. It stayed off for about three months — donors not getting any thanks for their gifts — because nobody noticed. We saw retention drop during that time, and we had no idea why, until we learned about the missing acknowledgements. Of course, it wasn't a test with a control group, so we couldn't say for sure that not sending the receipts is what caused the drop in renewal.” - Jeff Brooks, TrueSense Marketing
  16. 16. The 7 Key Drivers of Donor Commitment 1. Donor perceives your organisation to be effective in trying to achieve its mission. 2. Donor knows what to expect from your organisation with each interaction. 3. Donor receives timely thank yous. 4. Donor receives opportunities to make his or her views known. 5. Donor is given the feeling that he or she is part of an important cause. 6. Donor feels his or her involvement is appreciated 7. Donor receives information showing who is being helped
  17. 17. The 7 Key Drivers of Donor Commitment 1. Donor perceives your organisation to be effective in trying to achieve its mission. 2. Donor knows what to expect from your organisation with each interaction. 3. Donor receives timely thank yous. 4. Donor receives opportunities to make his or her views known. 5. Donor is given the feeling that he or she is part of an important cause. 6. Donor feels his or her involvement is appreciated 7. Donor receives information showing who is being helped
  18. 18. The 7 Key Drivers of Donor Commitment 1. Donor perceives your organisation to be effective in trying to achieve its mission. 2. Donor knows what to expect from your organisation with each interaction. 3. Donor receives timely thank yous. 4. Donor receives opportunities to make his or her views known. 5. Donor is given the feeling that he or she is part of an important cause. 6. Donor feels his or her involvement is appreciated 7. Donor receives information showing who is being helped
  19. 19. ASK THANK REPORT
  20. 20. Who’s saying thank you?
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“When people ask me what difference a donation can make, I reply that donations to Starship transform lives. “Parents have told me with tears in their eyes what it means to know their child is receiving the best possible care at Starship. And behind every one of those children there are compassionate people like you dedicates to helping. Thank you. Your donation will help Starship support children and their families at their moment of greatest need. It is at these moments, when a child’s life can hang in the balance, that your donation becomes truly transformational.”
  22. 22. THE BIG QUESTION: Why don’t we test thank-yous more?
  23. 23. MYTH #3 Sending thank you letters to all your donors for every donation is a waste of time
  24. 24. MYTH #3 BUSTED Sending thank you letters to all your donors for every donation is a waste of time
  25. 25. MYTH #4 If you mail your donors too often you’ll drive them away
  26. 26. “There is absolutely no evidence that frequency of solicitation negatively impacts retention and lifetime value. Period.”
  27. 27. This is at least 24 mailings per year Lots of charities are here
  28. 28. Typical response rates
  29. 29. Mailing arrives from your favourite charity
  30. 30. Mailing arrives from your favourite charity Take out your cheque book and make a donation
  31. 31. Mailing arrives from your favourite charity Take out your cheque book and make a donation Receive warm glow from beautifully penned thank you letter and satisfaction that charity has explained exactly how they’ve spent your money
  32. 32. Mailing arrives from your favourite charity Take out your cheque book and make a donation Receive warm glow from beautifully penned thank you letter and satisfaction that charity has explained exactly how they’ve spent your money Mailing arrives from a DIFFERENT charity
  33. 33. Mailing arrives from your favourite charity Take out your cheque book and make a donation Receive warm glow from beautifully penned thank you letter and satisfaction that charity has explained exactly how they’ve spent your money Mailing arrives from a DIFFERENT charity Write cheque to YOUR COMPETITOR
  34. 34. MYTH #4 If you mail your donors too often you’ll drive them away
  35. 35. MYTH #4 BUSTED If you mail your donors too often you’ll drive them away
  36. 36. MYTH #5 You need to give people concrete facts and figures to persuade them to give
  37. 37. The Rokia Experiment
  38. 38. Food shortages in Malawi are affecting more than 3 million children. In Zambia, severe rainfall deficits have resulted in a 42% drop in the maize production from 2000. As a result, an estimated 3 million Zambians face hunger. 4 million Angolans – one third of the population – have been forced to flee their homes. More than 11 million people in Ethiopia need immediate food assistance.
  39. 39. Food shortages in Malawi are affecting more than 3 million children. In Zambia, severe rainfall deficits have resulted in a 42% drop in the maize production from 2000. As a result, an estimated 3 million Zambians face hunger. 4 million Angolans – one third of the population – have been forced to flee their homes. More than 11 million people in Ethiopia need immediate food assistance. 23% of earnings donated
  40. 40. Her life would be changed for the better as a result of your financial gift. With your support, and the support of other caring sponsors, Save the Children will work with Rokia’s family and other members of the community to help feed her, provide her with education, as well as basic medical care and hygiene education.
  41. 41. Her life would be changed for the better as a result of your financial gift. With your support, and the support of other caring sponsors, Save the Children will work with Rokia’s family and other members of the community to help feed her, provide her with education, as well as basic medical care and hygiene education. 48% of earnings donated
  42. 42. 50% 40% 30% 20% 10% 0% Emotional Rational Combination Small, Loewenstein & Slovic Proportion of Earnings Donated
  43. 43. The Mother Teresa Principle
  44. 44. The Mother Teresa Principle If I look at the mass, I will never act. If I look at the one, I will.
  45. 45. The Joe Stalin Principle
  46. 46. The Joe Stalin Principle One man’s death is a tragedy, but a million deaths is a statistic.
  47. 47. MYTH #5 You need to give people concrete facts and figures to persuade them to give
  48. 48. MYTH #5 BUSTED You need to give people concrete facts and figures to persuade them to give
  49. 49. MYTH #6 You need to invest in brand awareness to drive up fundraising income
  50. 50. Fundraising Spend €500,000 €300,000 Awareness Spend – €200,000 Cost per Response €125 €100 # Responses 4,000 3,000
  51. 51. Fundraising Spend €500,000 €300,000 Awareness Spend – €200,000 Cost per Response €125 €100 # Responses 4,000 3,000
  52. 52. Fundraising Spend €500,000 €300,000 Awareness Spend – €200,000 Cost per Response €125 €100 # Responses 4,000 3,000
  53. 53. Fundraising Spend €500,000 €300,000 Awareness Spend – €200,000 Cost per Response €125 €100 # Responses 4,000 3,000 Awareness campaign would need to improve performance by 40% to justify spend
  54. 54. Jeff Brooks isn’t as optimistic as me... “...for the awareness campaign to be worthwhile it would have to improve fundraising by 67%...”
  55. 55. You can’t compete with these people
  56. 56. “The consumer approaches impulse items, like Coca Cola, as a PULL .i.e., they go and buy a soft drink, and Coke is (or is not) their choice of beverage. They get a new car and choose between a Ford and a Toyota. These brands spend millions on ‘Top of Mind’ marketing, which makes sense. However, charity fundraising is different. Statistically speaking, people don’t give without being asked. The only exception is a media disaster story such as an earthquake, or, bizarrely, Princess Diana dying. Outside of emergencies, fundraising is a pure PUSH exercise. Being top of mind definitely makes asking easier, but a charity that asks effectively and is not top of mind, beats the charity that is top of mind, but doesn’t ask effectively.” - Sean Triner (101Fundraising.org)
  57. 57. Cash Acquisi+on Results December 2010 – May 2012 When Number Mailed Response Rate Average GiC Number of new donors December 2010 77,000 1.8% $58 1,474 April 2011 85,000 1.9% $55 1,675 September 2011 43,500 5.8% $46 2,608 March 2012 150,000 2.7% $46 4,328 May 2012 156,000 3.9% $48 6,298 TOTAL 511,500 3.2% $51 16,383
  58. 58. MYTH #6 BUSTED You need to invest in brand awareness to drive up fundraising income
  59. 59. MYTH #7 Take major donors out of your direct mail programme
  60. 60. The Black Hole of Almost Major Donors
  61. 61. 1% of the response - just 21 people - generated over 35% of the total income from the appeal.
  62. 62. MYTH #7 Take major donors out of your direct mail programme
  63. 63. MYTH #7 BUSTED Take major donors out of your direct mail programme
  64. 64. MYTH #8 There’s no point investing in direct mail unless you’re a large charity with a big database of donors
  65. 65. $3,900 million €40 million €12 million
  66. 66. 4.4million 4.9million 5.4million Ireland Barcelona
  67. 67. There are advantages to being small...
  68. 68. Use the Pareto principle Personalise Make it feel homemade
  69. 69. Ask for REALLY big gifts
  70. 70. €600,000 €400,000 €200,000 €0 €800,000 2007 2008 Annual Direct Marketing Income 2009 2010 2011 2012
  71. 71. MYTH #8 BUSTED There’s no point investing in direct mail unless you’re a large charity with a big database of donors
  72. 72. MYTH #9 Women are from Venus and Men are from Mars
  73. 73. Delusions Of Gender: The Real Science Behind Sex Differences – Cordelia Fine (2010)
  74. 74. Control No priming men outperformed women Male Primed “men perform better than women in this test, probably for genetic reasons” men outperformed women Female Primed “women perform better than women in this test, probably for genetic reasons” no gender difference Delusions Of Gender: The Real Science Behind Sex Differences – Cordelia Fine (2010)
  75. 75. Control No priming men outperformed women Male Primed “men perform better than women in this test, probably for genetic reasons” men outperformed women Female Primed “women perform better than women in this test, probably for genetic reasons” no gender difference Delusions Of Gender: The Real Science Behind Sex Differences – Cordelia Fine (2010)
  76. 76. Control No priming men outperformed women Male Primed “men perform better than women in this test, probably for genetic reasons” men outperformed women Female Primed “women perform better than women in this test, probably for genetic reasons” no gender difference Delusions Of Gender: The Real Science Behind Sex Differences – Cordelia Fine (2010)
  77. 77. Women students in business trying to organize a humanitarian action in Togo. We are relying on your support DONATING = HELPING
  78. 78. Women students in business trying to organize a humanitarian action in Togo. We are relying on your support DONATING = LOVING
  79. 79. CONTROL €0.54 DONATING €0.62 LOVING €1.04
  80. 80. “One possible explanation is... the loving concept acts as a prime that leads to activation of further concepts associated with compassion, support, or solidarity that, in turn, lead participants to offer donations more favorably” The effect of the word “love”on compliance to a request for humanitarian aid: An evaluation in a field setting – Dr. Nicolas Guéguen & Lubomir Lamy (2011)
  81. 81. Asking for time vs asking for money Control Time-ask Prime Money-ask Prime – “How interested are you in volunteering for HopeLab?” “How interested are you in making a donation to HopeLab?” $4.42 $5.85 $3.07 Activates emotional mindset Activates value-maximization mindset
  82. 82. MYTH #9 Women are from Venus and Men are from Mars
  83. 83. MYTH #9 BUSTED Women are from Venus and Men are from Mars
  84. 84. MYTH #10 I’m buying free drink for everyone in the bar in... oh, about 5 minutes time
  85. 85. MYTH #10 BUSTED I’m buying free drink for everyone in the bar in... oh, about 5 minutes time
  86. 86. @damianobroin damian@askdirect.ie
  87. 87. THANK YOU @damianobroin damian@askdirect.ie

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