Crisis? There is no crisis!

By Erik van Dorp
On July 5, 2012 At 2:00 pm

Category : events, high value donors, legacies, loyalty, strategy

Responses : One Comment

Earlier this year we interviewed 10 senior fundraisers in the Dutch Market to ask them if the economic turmoil changed their opinion about the fundraising potential in their market. And, if any, where they saw fundraising opportunities.

In the majority of interviews, the current economic situation was debunked as an excuse for non-performance. Even if the market is getting a bit rough, there is plenty of opportunity for growth, was their main message.

The question is: Where is the money? And how to get it?

First the how: Relevance!

The easy answer is “You just should work harder for your money”.  In any case that would be my advice. The more complete answer is: a charity needs to be and stay relevant in the eyes of the donor.

To my humble opinion, a charity acts only as a catalyst between the causes that matter and those willing to help. The added value of a charity is its ability to do what a donor/sponsor/person can not do by himself (do research to cure cancer or provide medical relief in emergency situations). Combine this with the way you, as a charity, want to reach your goals (do you prefer the way Greenpeace wants to reach it’s goal over WWF’s approach?).

If you can not explain your added value and approach in less then 2 sentences, it’s going to be very hard to compete in the current market place. In fact, you’re doomed. In other words, what’s your elevator pitch that strikes your audience like lightening?

So, let’s assume your charity has it’s key message in order, where is the money?

First priority: legacy 

According to one of the leading experts in legacy fundraising, the legacy market in the Netherlands will grow by 30% in 2017 and 60% by 2022. Even if it would be a bit less than that in your market, legacy has a huge potential in the long run. So start working now and grab the rewards in the years to come. Legacy is extremely slow money though, can we find ways to get money sooner?

Second priority: Membership 

Over the last years, many charities have focused on getting new donors in, not bothering so much with keeping them in. With declining retention rates some charities now choose to stop their recruitment programs altogether. This is a big mistake, because you need fresh oxygen in order to survive. The good news is, there is still huge potential in improving the retention rates within your membership program. For some of our clients we have seen double digit improvement in retention rates, just by following up the newly recruited donors with quicker and more relevant communication in a structured donor journey.

Second part of membership is the ability to upgrade existing donors, hence making them more loyal and getting more income in at the same time. Not many charities are working on a middle donor program. This is such a waste, a lot of money is to be found here. Will you be one of the first to succeed? Go for it!

Third priority: Major donors

Not too many charities get as much out of the major donor segment as they could. If you want to develop your major donor program, get the right person(s) on the team, get your projects and key message straight, and take the time to develop your donors. Just do your job on a daily basis and ask for the right amount for the right project at the right time. The top 10% of Dutch households have a cumulated wealth of 400 Billion euro, so plenty for your charity to tap into.

Tip: Invite your top donors to a small scale, informal event where you give them the opportunity to ask you questions and to interact with each other. It’s important not to overfeed them with details, but to share your passion for your projects with the donors. Not sending, but receiving. Even better, get them to see your projects and let them experience it themselves.

Fourth priority: Events

The world is changing (slowly but steadily) and you have to change with it. Donors want to get involved, and do more and more themselves. But they also want to be part of something bigger. Especially with sports events, it is crucial that people know what you stand for so they can emotionally connect with you. If the participants of your event do not feel confident about their story, they will not do fundraising on your behalf. (See how much money your event could make if you do it right). Only with a dedicated group of participants, you will be able to make your event a structural success.

We do all of this, but still we are not growing!

As said, the crisis will force you to work harder for your money. Better put, you need to work smarter for your money. Focus on your key message so that your target audience knows why they should support you and not a similar charity or do it yourself, focus on the areas of growth and do not settle for not growing!

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Erik van Dorp (6 blogs on 101fundraising)

Over ten years experience in marketing management, marketing strategy and direct marketing, with a special interest in fundraising in the Netherlands and abroad. First as a fundraiser for WWF Netherlands and international, now as a Strategy Consultant building business plans and campaigns for numerous clients. Check out www.cervinomarketing.nl or www.cervinosocial.com


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Comments

  1. Great post team – I’m part of the Canadian legacy movement through @CAGP_ACPDP who have been shouting into the wind about the coming storm that is our aging donor base for now 20 years.

    What I got a good reminder of is how I’m often a snobby fundraiser who is stuck in my mindset about fundraising events. How they’ve evolved to be so much more than walks, runs, rides to represent a more powerful part of the fundraising ecosystem.

     — Reply