Last night I attended a lengthy meeting for one of the several nonprofit organizations for which I serve as a board member. This particular organization is intent upon initiating a capital campaign to address an array of short- and long-term needs. Unfortunately, the board is in the midst of making several of the same mistakes that I’ve observed in other organizations that approached fundraising by using an outdated model. None of these other efforts came close to achieving their goals, so I find myself in the unenviable position of needing to challenge the presumptions of the group without appearing to be pessimistic.
The old fundraising model
Many books and articles have been published that address tried-and-true formulae for fundraising. In most cases, they share a similar theme, namely that over 50% of the stated goal should be committed by major donors during a silent phase, then another 25-30% from significant donors during a networking phase, and the final 20-25% covered during a public phase of the campaign. This latter phase is when many donors contribute comparatively small amounts, but it is essential to the success of any campaign.
Of course, many campaigns are preceded by a feasibility study. My experiences with such studies are less than encouraging. In far too many cases, the studies are based on a small volume of interviews or focus groups that gather input from the people who are already convinced of the need for a campaign. The donor perspective isn’t truly represented under this scenario, thus the feasibility of the campaign isn’t accurately predicted.
The new realities
Our company has been conducting research for several nonprofit organizations that are intent upon understanding the current mindset of current and prospective donors. Several common threads have emerged from these various studies. The following are especially notable:
Donors are only interested in supporting specific needs
The majority of donors today are unwilling to support anything that they might consider frivolous. In years past, capital campaigns could include some less exciting components if the featured elements of the campaign were attractive enough to donors (an example might be including the renovation of a distant concession stand in a campaign to rebuild a football stadium). The donor mindset of today is unlikely to tolerate this type of combined activity. They want to know exactly how their money will be used and if they can’t get a clear answer, there simply won’t be a donation.
Even major donors are contributing less
Under the old model, a handful of major donors could account for half of the campaign goal. In light of the current economy, the definition of a major donor has changed significantly, and not in a positive direction. Instead of several donors accounting for the silent phase of a campaign, the number is creeping towards several dozen.
Capital campaigns are a low priority
Our research has indicated that donors are far more likely to support annual campaigns than a capital campaign. The average anticipated donation to an annual campaign is slightly lower than in previous years, but the anticipated giving levels for any type of capital campaign are substantially down.
What is the new nonprofit fundraising model?
With the emergence of social media, new nonprofit fundraising strategies are available for exploration. Political affinities aside, the success of our current President’s election campaign was inherently connected to its online strategies. Web-based organizational and instructional tools, online communities, and the obvious ability to contribute seamlessly through the campaign website were all significant contributors to a successful campaign. While none of the nonprofits with which I’m affiliated have the internal resources to conduct such an extensive online effort, all of the tools are available to them and, best of all, they’re free. What we need are different ideas on how to use these tools and volunteers who are knowledgeable enough about them to put them to their most effective use. By adding a more social aspect to fundraising marketing, more donors will be engaged and the over-reliance on the declining number of major donors can be offset.
Educating the board
All of the members of the board that I mentioned above are ages 40 and up with little or no familiarity with social media. Naturally, their instinct is to follow the old fundraising model. In my opinion, this would ensure an unsuccessful campaign. What the board needs is a handful of new members who are social media advocates, people who not only believe in its power but who also consider it to be part of the fabric of their lives. This type of enthusiasm is difficult to resist. Unfortunately in the meantime, I’ll be the person trying to explain this “new phenomenon” and convince them that a new strategy is both exciting and more likely to be successful.
I can’t wait to see all of those blank stares.
Mike
