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Fundraising Strategy - useful tools that really work IoF 2011
- 1. Strategy – useful tools that really work Simon Burne July 2011
- 4. Thinking inside the box
- 7. 80% Rule: Roughly right – not precisely wrong
- 9. Petronius Arbiter 210 BC We trained hard… but it seemed that every time we were beginning to form up into teams, we would be reorganised. I was to learn later in life that we tend to meet any new situation by reorganising and a wonderful method it can be for creating the illusion of progress, while producing confusion, inefficiency and demoralisation
- 10. “ I always leave my strategy on the train in the hope that a competitor will pick it up and believe that’s what we’re really going to do” Denis Stevenson
- 11. “ However beautiful the strategy, you should occasionally look at the results.” Winston Churchill
- 12. “ Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.” Sun Tzu 500 BC
- 13. “ A satisfied customer is the best business strategy of all.” Michael Leboeuf donor fundraising
- 16. In times of crisis… The horizon gets closer So strategies get shorter
- 17. Too much to deal with!
- 18. Risk Management Death by risk aversion Bright idea Risk assessment Final product Electricity – oo er Bright lights - aargh Non-recyclable Tut tut Broken glass – danger!!
- 19. Risk Management Paralysis by analysis Strategic options Internal analysis No change
- 20. How do we escape?
- 21. Or… 8 things to do with a box
- 22. 1. SWOT Strengths Weaknesses Opportunities Threats
- 23. Internal Bridges & Barriers
- 28. 2. PEST Political Economic Social Technical
- 32. 3a. Boston Matrix (Products)
- 33. Product Development Cycle Need Audience Product Evaluate Innovate!
- 34. Product Lifecycle Time Profitability R&D investment maintenance cull
- 35. Product Lifecycle Time Profitability R&D investment maintenance cull
- 36. Product Lifecycle Time Profitability R&D investment maintenance cull
- 37. Building your fundraising £ Time
- 38. CASH COWS DEAD DOGS Renewals Special Appeals Legacies and Planned Gifts Internet Upgrade Mail Acquisition Annual Giving (High Value) Major Donors Foundations Merchandising DRTV Acquisition Monthly Giving Direct Dialogue Boston Matrix PROBLEM CHILDREN
- 39. Boston Matrix CASH COWS DEAD DOGS Renewals Special Appeals Legacies and Planned Gifts Internet Upgrade Mail Acquisition Annual Giving (HV) Major Donors Foundations Merchandising DRTV Acquisition Monthly Giving Direct Dialogue RISING STARS PROBLEM CHILDREN
- 40. Value (ROI) vs. Volume (potential) value volume Internet Upgrade Mail Acquisition Annual Giving (HV) Major Donors 1 2 3 value 2 PROBLEM CHILDREN
- 41. Ease of implementation vs. impact ease impact Must haves Quick wins Sinks Low-hanging fruit Internet Upgrade Mail Acquisition Annual Giving (HV) Major Donors PROBLEM CHILDREN
- 42. 3b. Boston Matrix (Problems) Mysterons Devils Sacred cows Sad sacks Level of impact + - Level of understanding + -
- 44. 3c. Boston Matrix (Competitors) Rising Stars Problem Children Cash Cows Dead Dogs Potential threats Learn from mistakes Ideas to improve Best practice Ideas to copy Real threats
- 45. Competitors What I will do with the information What I want to know The questions I need to ask How can I find this out? Develop new products New ideas or products from my competitors that I could use/adapt. Which new products are being developed or tested? How well are they performing? Speak to them, share information. Mystery shopping. Research. Be first with my appeal for xxxxx Which competitors also raise money for xxxx. Timing. What are their plans for launching an appeal for xxxx? Speak to them, share information. Improve performance of my current products Ways in which competitors are offering my products more successfully. How well are their current products performing compared to mine? What are they doing differently to me? Mystery shopping. Financial reports. Conference presentations. Research.
- 46. market/audience current new current new offer/product existing product new products to existing supporters 4. The Ansoff Matrix taking them to new audiences ? new products for new supporters?
- 47. market/audience current new current new offer/product Direct Dialogue New areas Older age profile New creative Upgrade Campaign action Special Appeal Text appeal ? E.G. Monthly Giving
- 48. Different Audiences from Different Media ABC1s - traditional core supporters Face to face mail, door drop, inserts DRTV Income Age On-line Telephone
- 49. Prioritising your investment choices
- 51. 5. Investment Sailing Boat Level of risk Net return Market potential Market understanding Good investment!
- 52. 5. Investment Sailing Boat Level of risk Net return Market potential Market understanding Very dodgy
- 58. 7. Brand positioning Modern Old-fashioned Conservative Innovative Where we want to be Where our supporters think we are
- 59. 7. Strategic Risk Analysis Finances Processes Culture/skills Stakeholders Impact Probability
- 60. 8. Vulnerability Index Insignificant Very important Relatively safe Very vulnerable
- 61. Last thoughts…
- 63. “ If we don’t make utter fools of ourselves from time to time, we grow smug - that is, we do not grow at all.” Ref.: Tom Peters Innovation
- 66. “ We’ve made a lot of mistakes. And we’ve been very lucky at times. Some of our products are things you might say we’ve just stumbled on. But you can’t stumble if you’re not in motion.” R.Carlton
- 69. The truest word… Henry Ford Whether you believe you can or whether you believe you can’t , you’re right
- 70. Go for it!!!
- 71. Thank you The two most important words in fundraising
- 72. Any questions?
Editor's Notes
- When you turn the case for support around, it is actually seeking to answer 9 questions that donors frequently ask us.
- When you turn the case for support around, it is actually seeking to answer 9 questions that donors frequently ask us.
- When you turn the case for support around, it is actually seeking to answer 9 questions that donors frequently ask us.
- When you turn the case for support around, it is actually seeking to answer 9 questions that donors frequently ask us.
- Second, the Product Lifecycle. The idea behind this is that ALL products go through this cycle. Think of a car. A company spends time and money on Research and Development (R&D). When they have a winning model, they invest in producing lots of them, fast. Every year they make changes to make it more up to date. New colours, new features. This is the “maintenance” phase. Keeping the product alive so people want it, and it still sells. And then there comes a time when no-one wants it any more. Time to stop making it and invest in producing the next car that has been in R&D. (BMW bought Rover cars in the UK. Rover had already killed off the Mini. BMW re-developed it, invested in it, and it is a new cool car) How does this help you? Well, it is important to know where in the cycle your fundraising programs sit. And it is important to have some product in EVERY phase. If everything is in “maintenance” - being kept alive - what have you got in store when you have to kill them, if you have nothing in R&D?
- Let’s look at where you should be paying attention. 1. R&D. Make sure you have some ideas in development. Test things. 2. Investment. When you have developed something that you know from testing is a winner, then INVEST IN IT. Spend money. This is a big decision. 3. Maintenance. When you’ve got something that works, extend its life. Change the colours of the car so it looks up to date. This could be your most successful mailing pack. How do you make sure you can keep using it? In my last job, we had a donor acquisition mailing, that lasted 10 years. We tested over 50 new packs against it in that time but it always won. We kept testing changes to it to keep it alive.
- What a surprise! These stages in the Product Lifecycle fit with the Boston Matrix. Invest in R&D (some of your Problem Children have potential and deserve it) Invest in Rising Stars. It’s a huge opportunity cost if you do not. Pay attention to maintaining your Cash Cows - keeping them alive. But when they become Problem Children, be brave in deciding if you can do any more with them, or whether you need to turn them into Dead Dogs. A final thought. You see the curve? You could plot different programs on the same chart if you wanted to see how they compared. Maybe the profitability of some programs is less, so the curve will be lower. Maybe the timeframe is different. Maybe you have a Rising Star that will crash just as fast. It doesn’t matter if you know that it will. Maybe it’s just a good short-term opportunity. Use the chart to help you think.
- So this is how the GPUSA program looked a year ago. Renewals, Special Appeals and Legacies - all respectable sources of money. Nothing too exciting. Certainly not special. Cash cows. Rising Stars: Monthly Giving and Direct Dialogue. Monthly Giving is new in the USA. GP is a market leader. Monthly giving provides 65% of our membership income. Direct Dialogue is new in the USA too, and we’re one of the few doing it. But it is expensive. And we’re dependent on it. Problem Children. A string of programs that aren’t happening, aren’t doing much, where we have questions about what to do about them. Are some potential rising stars and cash cows? Are any dogs? Dogs. DRTV was too expensive. Merchandising is a waste of time (you should know that, and if you don’t, listen to everyone else. You’ll lose money!) Do you get the idea? It tells you what your safe bets are. And where you need to think some more.
- Aha! Now for some fun with the spots. Give each program a large, medium or small spot according to the program’s financial value, or scale. It gives you an idea of opportunity and risk. Stopping DRTV might be a big risk if it was a big program. But it could mean there’s more investment to put into something else. Of my Problem Children, some things look more valuable than others. Does that mean I should concentrate on them? I’ll come back to this.
- Back to the Problem Children. How to choose between them? We’ve already given them some spots to see how valuable they are. Here is another 2 x 2 matrix, to map Value (ROI) and Volume of income. So, how COULD our problem children perform? Click on ...
- Here’s a good chart to use. It is easy to spot the things that might deliver a lot of money, at high value. BUT HOW EASY IS IT TO IMPLEMENT THEM? This 2 x 2 chart helps you map out the same products to consider the IMPACT (value/volume of income) and EASE OF IMPLEMENTATION. Those things that deliver a lot of money, might cost a lot of money, take a lot of time, need a lot of time and resources. (Uh - think about putting in a database for your monthly giving program. A sore point in the USA)
- When you turn the case for support around, it is actually seeking to answer 9 questions that donors frequently ask us.
- Imagine two examples, one commercial, and one fundraising. First, we’ll extend our market by selling new things to our existing supporters. Coca Cola sells Coke. That is the current product to its existing customers. Coca Cola can extend its market by advertising other things it makes to it’s existing customers. Maybe 7-Up, Fanta, or whatever. If people like the Coca Cola brand, maybe they will trust the name on other things. Greenpeace sells membership to its existing donors. It can make more money from its existing supporters by using programs like Upgrade, by promoting other fundraising products, like credit card, legacies and so on.
- Here’s an example at a more detailed level, looking just at our membership acquisition. Our main product is Direct Dialogue. We can extend our relationship with our existing members (and extend our market) but getting our supporters to buy or do more. Upgrade. Take an campaign action. Give to an appeal. And we can find new supporters by doing it in different ways. Mail, DRTV, Events, On-line. Supporters are not all the same, and experience from the UK says that the way people sign up to support you, is the most important indicator of how they will support you in future. It’s worth thinking about.
- Here’s a model based on the experience in the UK of recruiting supporters from different media (this is not based on Greenpeace UK, so don’t ask them about these techniques). The average age for charity supporters in the UK, and in other countries, has always been on the old side. 50-65+. Why, because these are the people who responded to DIRECT MAIL, which was the only way supporters were recruited. New techniques opened up new audiences. DRTV reaches young and old, but they tend to be low income. Direct Dialogue reaches younger people, of mixed income. Internet can also reach young and old, of mixed income. The important lesson from this, is that new communications media opened up new audiences because we started talking to them through media that they used. Remember that. There is no point mailing people who like talking on the street, using the phone and e-mail, but do not read direct mail.