A little bit about myself before we begin:I’ve been with Blackbaud for 6 years and during that time I’ve spent it helping nonprofit organizations implement technology solutions that increase their revenues and operational efficiency so they can spend more time focusing on their missionI live in Charleston SC so ask that you please forgive the over use of the word “y’all”
According to the 2012 Charitable Giving Report published by Blackbaud, overall giving increased 1.7% in 2012. For Arts and Cultural organizations, giving grew just below average at 1.5% With an inflation rate around 2% in 2012, most organizations don’t feel like they grew at all. When putting together organization growth strategies in this ‘new economy,’ arts and cultural organizations are trying to figure out what they can do to overcome these low revenue growth rates to not only survive, but thrive. During this brief discussion, we hope to shed a little light on this issue facing our vertical.
From 2011 to 2012, online giving, across all nonprofits, grew at 11% year over year. For Arts and Cultural orgs, it grew at 10.9%, so right at average. Many fundraisers and development officers use this statistic to justify significant investments in their website and social strategy, and they’re right. These are very valid places to invest as it allows you to reach more people, and especially younger people. HOWEVER, this next stat is equally important. Online giving makes up 5.9% of total giving for arts and cultural orgs in 2012. So, while it’s a key component of fundraising organizations, it’s not the silver bullet. For example, if you have a $1M in donations, that means that $59,000 came through your website and that 10.9% growth only gave you a lift of $6,800 last year. Again, online strategy is a key component of your fundraising strategy (in fact, donors that give offline exclusively give twice as much if they also receive emails from your organization), but I want to stress that a “Donate Now” button won’t solve your problems and personal fundraising is NOT dead.
With these trends, it begs the question of “how are you going to hit your goals in 2013?” Ford Bell, President of the American Alliance of Museums, summed it up well with this quote: “Museums of all kinds are looking for ways to engage a broader mix of prospective donors and to engage them in new ways.”Most of the arts and cultural organizations I talk to express this same concern. They are competing for a share of their customers’ wallets, not only for admission, but also as a donor. How do you do this? How do you find new ways to gain revenues? Let’s take a look at two keys organizations are relying on: personalized interaction and creativity.
So, how are we going to hit our goals in 2013? We discussed that a “donate” button on our website will help, but isn’t necessarily going to move the needle enough to achieve your growth goals. For that, I submit that we should start with our focus on our constituents, not on our organization.
Regardless of the medium, we need to be giving our donors the information they need to be passionate about our organization. If we are communicating our mission and our values to our constituents, they will be telling us why they should give (and their friends too). How do you do this? You know your constituents.If you’re anything like me, you like hearing your name. You like when people remember your birthday. And you like when people treat you like a friend. You also get annoyed when people only want to talk about themselves. My guess, your donors are the same way. In our hustle and bustle world, the thing that never changes is that people appreciate a personal touch and being recognized. When someone is with you, they like to feel like they are the most important person to you at that moment.
When you’re working with your donors, visitors, and members, you want to personalize everything you can. Not only does this help their customer experience, but it makes them more likely to donate and participate at your organization. Studies have shown that people get involved, with time and money, at places where they have personal relationships. This is a screenshot of a database record. These come in different sizes, shapes, and forms, but the goal is the same. This record should provide you insight into key elements about your constituent: their interaction with your organization (how often they visit, when was your last conversation), their giving history, and their contact information. These are the minimum requirements that will allow you to have personalized interaction with your constituents.
What are you doing for your visitors to encourage them to become members? Do you know why a membership would be attractive to them? Are you tracking this information? You should be!As we mentioned before, focus on the constituent, not your organization. You want to be able to have the conversation with your constituent that highlights why a membership is beneficial to them, not just a pitch of why you need their money.
The second thing successful arts and cultural organizations are doing is thinking outside of the box for their fundraising and revenue ideas. The most successful ones accomplished this step with the first one in mind, focusing on the constituent before the organization.These growth organizations offered new tours, unique naming opportunities, including loading docks, and member benefits that had never been offered before.
We discussed that knowing your visitors and constituents is key to your fundraising efforts, but you can’t have one on one conversations with every one of your donors. So, how do you adjust your strategy to appeal to segments within your entire constituency?You get to know your constituency at a macro level, taking that personal information and looking for trends across your constituents. Do some reporting to see who like to frequently visit your organization, who is volunteering and visiting but isn’t a member, or who has visited multiple times but never given a donation. Do you have people that have taken every tour you offer? Is there a group of people who make a purchase in the gift shop every time they visit? These are some of the basic questions you can ask to identify your constituent segments.For example, I worked with a museum that found that the majority of its visitors came on Tuesday, Thursday, Friday, and Saturday. Because of this trend, the museum decreased the price of their tickets on Monday and Wednesday and started offering promotions like “Mom’s Monday Mornings” in the summer where they offered an educational program for children while mom toured the museum or went to the coffee shop for an hour. Offering these promotions encouraged more traffic at low traffic times and allowed them to add additional revenue on high margin items in the gift shop. Having the ability to segment their database and identify families that have participated in kids programs before, people who like going to the museums in the morning, and constituents that have made purchases in the past, allowed the museum to focus their marketing message to people who would be most interested.
Once you’ve identified trends in your constituency, you can start to tailor your exhibits, appeals, and promotions to provide things they are interested in. This query menu shows different functions for segmenting your constituents.The ability to segment and report on your donors is a key ingredient to successfully fundraise with them. Being able to run a report and identify people who would benefit from becoming members, have the potential for a major gift, or have expressed interest in an upcoming exhibit is a great way to deepen your relationship with those constituents. If revenue growth is the goal, robust reporting is the map that will guide you there. This screenshot demonstrates just some of the reporting options you should have, for example the ability to combine reporting parameters, such as people who are members OR donors, or exclude parameters, such as people who are members but not donors.
In conclusion:We saw the state of the market. You won’t hit your goals if you’re an “average” organization. You need to stand out.We discussed that you need to know your constituents and put them first. Nobody likes hanging out with people that only talk about themselves, don’t make this mistake as an organization.And, lastly, get outside the box. When you hear things like “we’ve always done it this way,” challenge those things and look for new ways to engage your constituents based on what they want.
If you would like to discuss how your organization can achieve its revenue growth goals, and making sure that you have the systems in place to reach those goals, we would love to talk with you. You can email us at email@example.com or call us at 800.443.9441.
How’s Your Revenue Growing?
2HOW’S YOUR REVENUE GROWING?
3• Ryan King• Channel Marketer for Arts and Cultural• firstname.lastname@example.org• @Wryan_Ki
4• Industry Revenue Growth Trends• The Art of the Ask• Getting CreativeAGENDA
Is the Internet the Answer?• Online giving grew by 10.9% for Arts andCultural organizations in 2012• Online giving made up 5.9% of total giving forArts and Cultural Organizations
How will you hit your goals?“Museums of all kinds are looking for ways toengage a broader mix of prospectivedonors, and to engage them in new ways.”-Ford BellPresident of the American Alliance ofMuseums
THE ART OF THE ASKFocusing on your constituents
“You don’t want to tell your donors why theyshould give. You want them to tell you why theyshould give.”-Kimberly KubikDirector of Institutional Advancement,Shady Hill School
“What fundraisers have to understand is thatdifferent donors come to the organization withdifferent interests and priorities, and you haveto organize your fundraising strategies aroundthose different types of donors.”-Bob OttenhoffPresident and CEO,Center for Disaster and Philanthropy
15• You won’t reach your goals with the status quo• Put your constituents’ goals ahead of your own• Get outside the boxIN CONCLUSION