Fundraising’s biggest smokescreen
On April 12, 2016 At 2:40 pm
Responses : 5 Comments
Warning: this post may offend some readers.
When was the last time you read a blog that waxed lyrical about retention and how if you really look after your donors it’ll be the equivalent of fundraising and donor nirvana?
Probably earlier today.
How often in the last 12 months has your board and perhaps your boss banged on about how your organisation has a “big strategic focus” on providing the very best donor care in the sector?
I suspect quite a lot.
Throw in a plethora of articles, conference rants (sorry, presentations), and the odd debate in the pub and it’s fair to say your fundraising brain is awash with retention overload. <Insert here any other retention or donor care synonym that’s trending today>
So what’s the problem here?
Nothing, if you plan to make small improvements to your program.
Focusing primarily on retaining supporters is a smokescreen for what really drives long-term growth: the quality of supporters you’re recruiting in the first place.
A case in point
See the table below.
This organisation had been undertaking face-to-face recruitment, but like most other charities hadn’t been looking after their supporters particularly well.
They were treating their F2F (younger) donors like direct mail (older) donors. Mail packs, newsletters, etc.
So a test was set up to look at the improvement generated by treating them as younger, transient, mobile confident supporters. The test contained lots of really good, rich content (mostly video) shared via SMS and email early on to reinforce why they supported. We were in touch at least weekly.
The control was far less frequent, just 2 touch-points in the first three months, both delivered via the post.
The result is clear cut (statistically significant). The test group out performed the control: donors were much more likely to stay on board by the 3-month point post sign up if they were provided updates and love via email and SMS (and done much more frequently).
Doesn’t this fly in the face of a retention smokescreen?
This organisation stopped recruiting on the street within a year.
Not because their approach to retention wasn’t proven, it was.
Because it wasn’t enough to offset the poor quality of recruits coming in the door in the first place. Too many donors under 30 years of age giving at levels they can’t afford, not enough in the latter stages of life who can afford to give.
Yes, the focus on retention improved the overall result, but not enough. It simply wasn’t making them money.
Hindsight provides a much clearer view of what would have been better to invest more time in. Specifically:
- better understanding their data as to who was being recruited (and influence this with their agency and fundraising teams on the street)
- managing fundraiser performance on a more granular level (not rewarding success based on sign ups but long term retention)
- implementing a scale of payment for donors that remunerated the agency based on quality, not volume in isolation
- focusing on the retention that really matters: keeping their street fundraisers for as long as possible
In addition to the above we’ve run several other tests around the value of looking after supporters. Both in a controlled (head-to-head) and a less controlled environment (before-after scenario).
In most instances there is no doubt that a focus on great donor experiences wins. Sometimes clearly, often by very little. One recent example pitted two very different approaches head to head.
Lots of love, beautiful and inspiring content, full of surprise and delight. Versus nothing. That’s right, nothing. Other than an annual tax receipt.
The difference? Very little, around a 1% reduction in attrition in the first year (not a brilliant outcome for 18 months worth of work on this project).
The takeaway here is that the organisation was absolutely brilliant at the items listed above. They understood how their recruitment was working, what the keys driver of attrition were (age, gift level, recruitment agency, etc), had their backend systems working a treat. They really knew the sweet spots.
All far more likely to positively impact their net return than a profoundly different supporter experience.
Because they recruited the right people and spent more time on the things that mattered most. Pleasingly their retention of street recruited supporters is one of the very best in the country.
The lovely retention program helped, but the balance of effort was out of whack.
So what does all of this mean?
It’s fashionable to talk about retention.
It also feels like a quick fix. As I hope I’ve highlighted above that’s usually not the case.
But conscious of not simply focusing on what not to do, here are some suggestions on how to improve both the recruitment (most important) and retention aspects of your program.
- Don’t believe all of the hype. Channel and technique bashing is easy. “Premium mail” doesn’t work. “Face to face” is done.
Most of this is BS.
The premium one is easy to kill off. In fact earlier today we analysed some data from a clients acquisition program that proved that a test 3 years ago of premium versus non premium mailings not only the worth of premiums in the initial test (2.5 times the response), but over 3 years had delivered a 47% greater net contribution.
- Live and breathe your data. As explained earlier, understand what drives retention and long-term value – and most importantly, know how to use those insights. You can’t simply stop recruiting younger people on the street, but you can influence the value you sign them up for.
- Manage expectations (including your own). Do you know what you’re in for? Yes, street recruits re harder to keep. Signing up regular givers via an acquisition mailing generates small numbers but can be worth it. Monthly donors signed up via SMS prospecting give at low values.
Know this in advance and it helps your forecasting, your sanity, and your relationship with your boss and your board.
- Please revisit the previous 1,000 words above on recruitment. Fix that and your fix the retention problems.
- Understand really quickly what a supporter’s initial experience was like and whether they intend to stick around. Respond quickly (and appropriately) if it was poor in an effort to keep them.
- Bust myths. We’ve recently tried and proved that asking in a thank you letter (post first gift) does work. It generates more multi donors much quicker, and generates more net than not asking, including the affect on subsequent appeals.
And of course, be really, really nice to those wonderful supporters who have shared their love. And their generosity.
Surprise the hell out of them. Take them on a roller-coaster ride, flooded with tears and contentment in equal measure. Invite them to stuff. Send them personalised videos from your CEO. Never forget how much donors value handwriting. Close the loop regularly so they are assured their $50 changed someone’s life.
But always remember how important it is to find the right people to support you.