Sue’s Muse

Yes it’s that time again … time for the Target Analysis Industry Sector Performance Index.  This quarterly update focuses on performance in defined nonprofit sectors … and shares trends of how national and international organizations are performing with their direct mail fundraising programs during a given period of time vs. previous years.

Sectors include: Societal Benefit, International Relief, Human Services, Health, Environmental and Animal Welfare.  So let’s jump right in!

Societal Benefit- according to the Index, this group has experienced some of the greatest challenges.  They saw greater revenue and donor declines than other sectors.  Why?  According to Target - declines in new donor acquisition, retention and reactivation - in other words, the burden of revenue is falling on fewer and fewer shoulders.

International Relief- The positive performance of 2007 was due to the slow performing year of 2006 (post 2005 disasters) … let’s face it - where do you have to go, but up?  That along with two significant international disasters in May 2008 in Myanmar and China.  New donors declined in this sector (second only to the health sector) - but supporters of international relief efforts came back to the fold, raising renewal and reinstatement rates. 

Human Services - Although this group saw a decline in donors, they performed better in other sectors with a smaller decrease in existing donors.  They also did better in new donor acquisition.  But don’t get excited yet - they too saw relatively flat growth.

Heath -This group saw both declining revenue and donors.  These declines were the largest of any group in the index.  They also had the highest increase of revenue per donor … again, depending on a few for overall revenue dollars while investing less in new donor acquisition.

Environmental - 62% of the organizations that participated saw a positive growth in revenue for the 2nd quarter of 2008.  Losses in early 2008 appear to be due to declining renewal and retention rates - not acquisition.  Wonder if the “Gore Effect” is wearing off?

Animal Welfare -This sector saw the highest revenue growth of any group in the study.  They were also the only group to show positive new donors growth, as donor acquisition increased 4.7% from 2007. 

Summing it up … strategies are varied!  Some groups are digging deeper to raise more from their existing donors, some are investing more in acquisition and some are remaining static or flat, while riding out the storm. 

Whatever strategies are used … organizations, as Target points out, are faced with economic challenges, generational shifts, changing donor attitudes and organizational priorities. 

The index simply continues to point out that fundraisers and direct response marketers need to remain actively engaged by evaluating and reevaluating their current strategies and tactics in order to meet these fundraising challenges.

You can read more about Target’s findings and see how your organization fared during the 2nd half of 2008!

Regards,

Sue

P.S. I will be on the road for the next week - Sue’s Muse will return October 8th.

I am certain each of you has seen article after article regarding the state of the economy and its potential impact on your nonprofit and particularly your end of the year fundraising efforts.

Doom and gloom abound!  Folk throughout the industry (including this blogger) have shared what organizations are facing and some suggested steps that should be taken immediately to limit what is expected to be an under performing year-end.  But what about solutions and strategies for further down the road?

As I was going through my files the other day trying to glean more ideas for my clients … I came across a White Paper that had been forwarded to me by a former colleague.  The paper discussed the “Five Challenges to Customer Centricity” and was produced by Harte Hanks 2007 - a worldwide direct marketing and targeting agency. 

It is probably one of the most insightful white papers I have come across in a number of years … just replace “Customer” with “Donor” “Constituent” or “Supporter”, and you have the five challenges that nonprofit organizations face in today’s marketplace.

Sadly, I can only include a brief summary in this blog … hard as I tried, I could not find this white paper anywhere on their website.  Shame on you, Harte Hanks!  Read on to find out more about Customer Centricity!

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Customer Centricity has become a business imperative across all industries.  Why?  Because loyalty to a given company, product or brand is no longer assured thanks to increased competition, easy access to information, and a large and growing variety of choices.

Challenge #1 - Defining Ownership

Customer Centricity cannot reside in a single department - it must be the focus of executive leadership and every department.  Solution - Put a leader in charge.  A department leader may be able to start the process and address the relationship challenges, but organizations need a senior-level executive to lead the effort if it is to transform the enterprise. 

Challenge #2 - Managing Change

The optimization process will change how an organization aligns, measures and compensates as well as changes in staffing, increased training of personnel, and more collaboration across the enterprise.  Solution - Plan & Focus.  Create the plan in bite-sized pieces … mapping your journey from product centric to customer centric.  Set priorities and start achieving more immediate objectives.

Challenge #3 - Adopting New Perspectives

In customer-centric organizations, decision makers always consider what is in the customer’s best interest.  Engaging in customer-focused activities that enable more personal interactive such as ‘face to face’, focus groups, blogging, empowering advisory boards, and collecting customer preferences.  Solution - Train, Reward & Deploy the Best People. In identifying effective ways to engage with customers and shift focus, it is critical to train staff in problem solving, teamwork, collaboration, conflict resolution and management as well as setting up employee reward and recognition systems.

Challenge #4 - Building the Foundation

True customer centricity can not happen in one calendar year … that is why it is important to implement a phased approach where shorter-term “wins” can be measured and delivered.  The Solution - Build a Strong Foundation.  It takes time to understand what customers want and which programs they prefer - and to map an action plan with deliverables as a result.  Establish clear metrics for each phase and implementation.  Building trust with customers takes time by delivering engaging experiences, paying attention to customer needs and expectations and responding effectively to criticism.

Challenge #5 - Keeping it Going

Customer optimization is not a result but a continuous process.  The only way to monitor customer-centric effectively is to monitor and respond to customers’ ever-changing needs and expectations.  The Solution - Listen always, and act immediately.  To succeed, organizations must make listening to the customer the core of their corporate culture. 

Organizations adopting a customer centricity approach, and addressing anticipated challenges will be better positioned to satisfy business demands, employee needs and customer expectations.

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Finally, never forget “The Donor is more important to you … than you are to the donor!”

Regards,

Sue

I remember driving to Baltimore in the fall of 2006 to attend GetActive’s nonprofit conference.  Needless to say driving on the beltway is one of my least favorite things to do … but the sessions looked interesting and I especially wanted to hear their plenary speaker, Seth Godin.

I had heard a lot about Seth Godin from those in the nonprofit technology sector … but must admit at that time he was not on my fundraising buddies radar.

GetActive (now Convio) was also promoting his latest book “small is the new big” and 183 other riffs, rants, and remarkable business ideas.  I was excited to hear what the bestselling author of Purple Cow and Permission Marketing had to say to a group of nonprofit online fundraisers.  

Small is the new big has some essential themes (as described in the book jacket)

1-  Big has gone from a huge advantage to a liability.

2-  Authentic stories spread and last, but lies get exposed faster.

3-  The ability to change fast is the single best asset for any person or organization.

4-  Respect is the secret to success.

5-  It’s easier then ever to become remarkable. There’s no excuse for sticking with mediocrity.

Seth was sharing truths and examples that nonprofits could take to heart … adapt and actually use.  I became an instant fan and immediately went home and signed up for his blog!

In case you have never heard Seth Godin … now’s your chance … here’s a talk Seth did with Network for Good last week.  It is worth taking 30 minutes … perhaps you will get some ideas and inspriation … I know I did!

Regards,

Sue  

Where have all the eAppeals gone? 

This was the question I was asking myself during and immediately after the onslaught of hurricane Ike.

Not one email from the variety of organizations I support that provide relief services - until 5 and 6 days after the disaster!

Okay I realize that free media drives traffic … and maybe this natural disaster didn’t receive the extensive media coverage like others have in the past … but when I went to the 24 hour news stations, from the day before the hurricane hit, through to when it went inland and tapered off, reporters were covering the length of the Texas coast … along with press briefings from officials stating how devastating this hurricane was going to be.  And guess what … they were right!

Whole areas washed away … unsanitary conditions … lack of basic services … and the tremendous need for support from the government and the public.

I even saw some television PSA’s asking for support.  But not ONE emergency email appeal!

So what happened?  That is a great question, that only the organizations can answer. 

Was it something to do with determining the level of response … running through message approval processes … the weekend?  Perhaps … but none of these excuses justifies “missing the moment” to ask donors and supporters for help!

Just some thoughts as we all struggle to try and reach those fast approaching year-end goals!

Regards,

Sue

Recent natural disasters, the home mortgage crisis and Wall Street’s meltdown are all obvious indicators that the economy is facing its most difficult time in years. 

We continue to see and hear stories about the impact … including recent articles in the Chronicle of Philanthropy such as “Donations Fall as Stock Market Plummets“, or the recently published survey by Grizzard showing that donors plan on giving less this year. 

It reminds me of the old adage … no news is good news. 

So what to do? Best advice … harden your resolve and get busy! 

For the past few months, I have been writing about the challenges to raising dollars that we currently face in the nonprofit community, and offering tips and suggestions on how to meet those challenges.  After Monday’s news regarding another investment bank biting the dust and wondering about how many more government bailouts are going to occur … I thought perhaps offering a couple more “To Dos” might not go amiss right now.

Then I opened my email this morning, and there it was … sage wisdom and more important “7 Fundraising Tips for Surviving 2008″ from Roger Craver in today’s Agitator … I couldn’t have said it better.

I encourage you to take a moment to read and heed Uncle Roger’s advice!

Regards,

Sue

Okay, hands up everyone who has signed up for an enewsletter, online store promotions, updates or - yes - even a blog!

Ever noticed that, every time you get one of these in your email … in order to view the entire piece and get rid of those big white spaces with a large red “X”, that you have to click to accept pictures? 

Of course you have … and that, according to the email service providers, is for security (that is why the display is turned off). Goodness knows, the last thing you want are little bugs or viruses running around reeking havoc with your beloved computer!

So how do you ensure that the emails you create … spending days drafting copy and finding just the right image to evoke emotions for either a donation or call to action … will actually be viewed, and that you will be able to successfully track the results?

In a recent article in eMarketing and Commerce.com, Scott Madlener, VP of Interactive Strategies at Performance Communications Group shares his “7 Best Practices for Delivering the Best eMail Experience.”

Scott’s main goal is to provide “High engagement experience for subscribers (constituents) with minimal Big Red Xs - for maximum results.”

I am all for maximizing results … goodness knows it is hard enough in the best of times. 

Regards,

Sue

Okay - so it might be more than an ‘Oops!’ to investors … think of this more as a cautionary tale about how quickly stories good, bad or indifferent can spread around the Internet.

First take an article that is not time and date stamped in a newspaper’s archive … second, add a reporter who has total faith in what pops up on a google search without further investigation … third, run the story and watch a company’s stock plummet. 

This is what happened earlier this week to United Airlines.  Up pops an online story declaring the airline had filed Chapter 11, when in fact the story was writen in 2002 and the airline came out of Chapter 11 in 2006. (Of course, with all the present-day negative media surrounding air travel and airlines, the story would not be hard to believe.)

According to Washington Post staff writer Frank Ahrens, after the initial posting … United’s stock fell significantly and even after the report was shown to be a mistake, did not bounce back to it’s pre-story level.

As you can imagine, fingers are pointing all round … the paper should have time dated the article … the reporter should have doubled checked his facts … Bloomberg should have doubled checked the reporter … haven’t people been fired for this kind of sloppy reporting in the print media? 

Why the concern Sue?  Okay, so the media is not always viewed in a positive light … but you certainly want your nonprofit viewed as a trustworthy, creditable and reliable source of information on your issues and programs. 

Now imagine what a “Friday Oops” could do to your fundraising capabilities!

Happy Weekend!

Sue

For the past couple of years, I usually try and put some reference in my nonprofit presentations that older Americans are staying in touch with family, banking, becoming more engaged during election cycles … and they are doing it all online!

This blog has shared numerous examples of surveys, reports and studies that show a growing number of 55+ online constituents.

I could tell you why I think this is becoming more the norm over the past several years. (I speak from an in-depth discussion conducted with my “marketing survey of one” demographic who shares my office)! 

1-  Ease of use - online has been demystified - no longer do you have to have a technology degree to understand how to use basic interactive communications.

2-  Staying up on the latest trends and gadgets- just look at recent TV commercials (particularly during the evening news) “Remember the generation that promised never to get old!?”  Social networks, IPods, IPhones, Web-cams, Texting, VOIP (Voice Over Internet Protocol) etc. are all being used by the over 50s.

3-  Using technology to make life easier - anything that makes my life easier is tops on the list of ‘must haves’ - particularly online banking, registrations, dinner reservations, catching up on the daily news, etc. 

Need more convincing?  I suggest you read one of my favorite fundraising blogs “The Agitator”  where Tom Belford shares his views regarding a recent DMNews article … Nonprofits Adopt Social Media … which looks at two organizations AARP and The Arthritis Foundation … and how they are offering more tools that can be custom­ized by members.  AARP Members can also invite friends to view their profile, send and receive messages and join or create special interest groups.

Yep, I would definitely say “The generation that promised never to get old!” is adapting, utilizing, and making the “wide wide world of technology” their own!

Regards,

Sue

I can still remember having a conversation with my husband almost ten years ago … fed up with trying to find information on the Internet … he told me about a small search engine called ‘Google’.  First thing I thought was ‘what a ridiculous name’!  After getting him to spell it for me three times, I went to Google and have never looked back!

Goggle immediately went into my favorites list and now is the search engine of choice when I open my web browser!

Okay, Sue, you ask what does this have to do with nonprofits?  Well quite a lot …

1- Goggle Grants - 5 years ago, Google created their philanthropic arm ‘Google Grants’.  Google Grants has allowed nonprofits to begin testing the waters of Search Engine Marketing - and despite the limitations, without these grants - many nonprofits would never have looked at SEM as a viable online acquisition tool.

2- Google Earth - provides site maps and images that go beyond “gee, there’s my house”. This feature made it possible for a number of nonprofits that provide direct service delivery, whether nationally or internationally, to bring their part of the world a little bit closer to their constituents - making it that bit more real.

3- Google Video - Viewers can search and watch millions of videos indexed from all over the web. Users can also upload and share videos.

There is also Google Talk, Google Images, Google Translate, Google Street View, Google Mail, Google Analytics (Ad Planner - Sues Muse 7/02/08), Friend Connect (Social Networking - Sue’s Muse 5/13/08) and ‘Chrome’ - Google ’s new web browser - coming soon to a computer near you!  I have no doubt the list will continue to grow with this innovative and exciting company.

So thank you Google, for making my life easier in the wonderful world of search, for those nonprofits who you have given an opportunity to play with the big boys in the world of SEM, and for all those creative innovations you have and continue to create.   

Happy 10th Birthday Google!

If for some unknown reason your nonprofit has not applied for a Google Grant- I would get started filling out the paper work immediately!

Regards,

Sue

Who benefits from the billions of dollars in charity tax breaks that the federal government provides?

Should donors get a bigger tax incentive if they support charities that serve the needy?

Do poor and middle-class donors deserve new tax breaks for gifts?

Are nonprofit endowments hoarding money that could meet immediate needs?

Have federal laws kept up-to-date with changes in how nonprofit groups operate?

Generic questions?  Hardly - these were the glaring headlines and front page story in The Chronicle of Philanthropy’s September 4th edition. 

What has brought about this latest review on Capitol Hill - the economy - finding funds to pay for social programs for the poor, such as children’s health care.

Leading the charge - Rep. Xavier Becerra from California.  Rep. Becerra states that charitable tax breaks cost the federal treasury billions of dollars - estimated currently at $44 billion - and the government needs to be sure it is getting their money’s worth.  He questions whether these donated dollars are truly assisting those in need. 

I would remind Rep. Becerra that if it weren’t for some of the very nonprofits he questions … these issues might never have seen the light of day … nonprofits depend on the the generosity of the American public and are accountable to donors who support their causes … can government say the same? 

Or is this a question of … are all nonprofit deductions created equal? 

The debate is just beginning - some nonprofits welcome the debate - others see it as a threat to their ability to raise program dollars.  Either way, nonprofit leaders need to be ready with answers - as the Chronicle Article rightly points out - no matter who wins in November - this issue is NOT going away!

Regards,

Sue

P.S. To read the full article you must either already subscribe to The Chronicle of Philanthrophy or have an online pass.