By Jim Hussey, President

Nonprofit organizations are rising to the challenge by educating the public, organizing support and raising revenue to address these major problems. And while these organizations need to focus on the “big picture” in most of their public-education efforts, often they should do the opposite in their fundraising campaigns. In other words, and in a reversal of an often used phrase they need to “see the trees, rather than the forest!”

Huh?
“What is he blabbering about?” you might be asking right about now. Here’s what I'm trying to say:

Often, nonprofit organizations focus their fundraising communications on such massively big problems that the potential donor believes that no amount of his support could possibly help. This is what I refer to as a “drop in a bucket” scenario.

Here’s a fictional example of how an environmental group addressing global warming might, in fact, create this kind of situation:

Dear Friend,
Global warming is rapidly heating our planet. A huge hole has opened in our ozone layer. Polar ice caps are melting away. Chunks of ice the size of Texas have split away from Antarctica. Current coastlines will begin to disappear as water from the melting ice drowns our coastal cities. Millions of people will be displaced or die from the resulting change in weather patterns.

Please send us $15 to stop this catastrophe.

See what I mean? A recipient who reads this literally could envision a drop of water plopping into a huge bucket… because that's how he’ll view his relatively small contribution in comparison to the problem it’s supposed to address. It will discourage many potential supporters from even addressing the subject.

OK, that example may be somewhat of an exaggeration, but it's not so far off of the mark.

Some fundraisers attempt to fix this problem by changing the ask to something like, “Please send us $15 to stop this catastrophe, and we'll send you this really cute teddy bear.”

In other words, they overcome the donor’s hesitance by offering a bribe for a contribution. I’m not condemning those who use premiums to overcome the reluctance of potential donors. A few of my clients will testify that, in some cases, I’ve urged them to do just that.

Bring it home
But before succumbing to the easy solution of premiums, you should try another method when addressing “big picture” issues such as global warming, war, world hunger or deadly diseases. First, you should attempt to bring the issue down to a level that the potential donor can more easily understand, and can more easily visualize how his $15 contribution will make a difference.

Child-sponsorship organizations understand this strategy better than anyone. Can one person stop world hunger? No way. But can one person, feed one child in a Third World country? Yes... that is a manageable goal. And can a single person stop global warming? No- But one person can support lobbying efforts in Congress to pass higher automobile mileage standards or other regulations that stem emissions that cause global warming.

The next time you attempt to communicate with potential donors about the “forest” of challenges that your organization wants to address, remember to take the time to point out a few of the trees.

How are you successfully showing the "trees" in your appeals? 

Properly leveraged, good press can power through a sea of
skepticism.
By Jim Hussey

I’m confident that few of my colleagues who’ve been in the business over the past two decades will disagree when I say that potential donors are far more skeptical about fundraising solicitations than they were 20 years ago.

The evidence can be found in numerous places:

• Comments noted on response forms or to telemarketers making calls; 
• Inquiries made to the Better Business Bureau or to state attorneys; 
• More and more additions to the National Do-Not-Call Registry and the Direct Marketing Association’s Mail Preference Service.

What are the causes? There probably are many.

• The increasing volume of solicitations in the mailbox and the increasing use of telemarketing over the past two decades certainly have taken a toll. 
• Internet users are inundated by spam. As a result, donors face an onslaught of fundraising solicitations every day via their mailboxes, telephones and e-mail inboxes.

Major scandals within the nonprofit community, which have drawn attention to irregularities concerning the use of funds, haven’t helped the situation. The United Way scandals, the American Red Cross’ post-Sept. 11 controversy and other hullabaloos have affected many nonprofit donors’ confidence. Unfortunately, the mistakes of a few have tainted all of us to some degree.

So what can you do about it? How can you combat increasing donor skepticism and protect your fundraising program? It's not practical to trim your own use of direct mail, telefundraising or e-philanthropy. If you pull back on your solicitations, some other nonprofit will fill the void with its own fundraising campaigns. Out of sight, out of mind… your donors and potential donors simply will direct their contributions elsewhere.

The best way to combat donor skepticism is by addressing the issue head-on. You need to illustrate your organization’s effectiveness and efficiency within your fundraising campaigns.

The importance of this concept was illustrated in a test conducted by my firm for one of our clients. The organization was favorably noted in an article in a well-known national magazine, which named the organization one of the most effective charities in the country. We developed a small insert that referenced the endorsement, and then tested it as a new component within that organization’s donor-acquisition control package.

The inclusion of this simple insert dramatically boosted results. This positive outcome led to other tests:

• A quote from the magazine was included in the letter, 
• A teaser that announced the favorable rating was placed on the envelope.

And this isn’t an isolated case. Many examples of similar tests with other organizations also have proved to be successful. Organizations that have received favorable comments by publications or efficiency ratings from nonprofit watchdog groups have used these flattering reviews to their benefit. Simple charts that illustrate the fiscal efficiency of an organization have proven successful, as well.

Ironically, the success of these tests also proves my original point that there’s a level of major skepticism on the part of at least some donors. Otherwise, why else would there be such a favorable response to efforts to tout efficiency? This must mean that they suspect many nonprofit organizations are not efficient.

To figure out how to reassure your donors and potential supporters about your organization’s efficiency, ask yourself the following questions:

1. Does my organization spend a majority of its funds on its mission versus administration and fundraising? 
2. Have watchdog groups given my organization good ratings? 
3. Have any magazines, newspapers or other publications given us good reviews?

If you have a positive response to any of these three questions, then you need to convey this information to your donor audience. You’ll be rewarded for the effort.

Do believe donors are getting more or less skeptical? Is your organization making use of these three tools? If so, in what ways?  

The most powerful word in fundraising?
By Jim Hussey, President AH&A

As we embark on a new year, so too have begun the membership/donor renewal efforts for many organizations.

Renewal programs are a series of contacts with the member/donor, asking that individual to renew her support for the organization’s work for another year. Renewal formats should include direct-mail packages, telemarketing calls and e-mail.

For those who are new to the industry, there are two types of membership/donor renewal programs: 

• calendar-based - seeks to renew the annual support of current members/donors at the same time, typically at the end of one calendar year or at the beginning of the next.
• expire-based - seeks to renew based on the anniversary of that individual’s first contribution.

There are pros and cons for each type of system. Expire systems take the donors’ giving habits into better consideration and allow the organization to spread income throughout the year. But expire renewal systems also are much more expensive, for mailings are scattered across the year; as a result the quantities of each mailing often are small - driving up production costs.

Since a calendar-based renewal system typically starts at the beginning of the year, it takes advantage of the most productive time to renew a donor’s support. And since all donors are mailed at once, mail quantities are much higher and production costs are much lower. Calendar-based systems generally are best for small and fledging organizations.

In many ways, renewal solicitations are the easiest to produce. Asking a donor to simply renew her support is one of the most basic forms of fundraising, and it doesn’t take a creative genius to prepare such a package.

Despite the relative simplicity of such efforts, I’m still amazed by how many renewal programs lack some of the basic elements that can achieve the best results.

Stating the obvious
The best example - using the word “renewal.” I often have heard colleagues say that “free” is the most powerful term you can use in marketing. In regards to fundraising, I respectfully disagree. I believe the term “renewal” is the strongest.

Often, the only thing necessary to generate a contribution is some variation of the word “renewal.” Amazingly, I am often surprised to see some renewal packages that do not even use the word on the outside envelope. Check your current renewal series. If any of the packages don’t use this term on the carrier, test it and see if it doesn’t perform better with it than without.

In addition, this word should be used throughout the package. Once I’ve written a renewal letter, I count the number of times I’ve used the word “renewal” or some variation of it within the copy. If it’s less than a dozen, I add more. In addition, make certain that the reply form uses the word liberally. And it doesn’t hurt to even add it to the return envelope, such as a teaser that says, “Expedite ... Membership Renewal Enclosed.”

Testing into frequency
Many organizations also do not include enough solicitations within their renewal series. But how many constitutes “enough” varies among organizations. I have one client that has more than 13 notices within its renewal series, and another with only four. The number of renewal notices in a series should be determined through testing. With a young program, my general rule is that renewal notices should be mailed until the point that diminishing returns fall below the average response rate of appeal packages.

All healthy renewal programs also should include at least one telemarketing effort. If you lack a telemarketing effort in your renewal program, test the inclusion of a call. If you have tested telemarketing and it failed, try another vendor or different placement within your series. Some element of your member/donor file should be responsive to calling.

And increasingly, e-mail is a major part of renewal efforts. Whether you use e-mail to directly solicit renewed support (as you should for any Internet generated supporters) or merely to inform recipients about an upcoming renewal mailing, the use of e-mail should not be ignored.

A direct-mail twist on a holiday classic.
By Jim Hussey

’Twas the week before Christmas, and out front of the house

Not a creature was stirring, not even a mouse.

The mailbox hung by the front door with care,

Anticipating that a deluge soon would be there.

My wife was watching “Oprah,” our dog in her lap,

And I had just settled down for my afternoon nap.

When out on the lawn there arose such a clatter,

I sprang from my La-Z-Boy to see what was the matter.

Away to the window I flew like a flash,

Tore back the curtains and threw open the sash.

When, what to my wondering eyes should appear,

But a parked, white minivan; maybe a repairman from Sears?

With a tired-looking driver, red-faced and obviously ticked,

From his disposition, I knew it wasn’t St. Nick.

Dragging a heavy gray bag, he slowly came,

And he cursed and he shouted, and he called them by name:

“Oh, American Cancer! Oh, World Vision! Oh, St. Jude!

Oh, the soup kitchens! And all of the other charities, too!

My bag is so full, it’s as high as I am tall.

Oh darn them! Darn them! Darn them all!”

So up to the porch he slowly stewed,

With a mailbag full of fundraising letters, and a few bills, too.

His back was aching, bent down to a bow,

But he was keeping his promise to deliver even in snow.

He spoke not a word, but went straight to his work,

And filled up my mailbox, then turned with a jerk.

Trudged back to his van, and slumped into his seat,

Away he drove, another load of mail to meet.

But I heard him exclaim, as he made a hard right,

“Will the new year ever come? There's no end in sight!”

Happy Holidays All! 

Things to know if you haven’t yet delved into this tricky
fundraising medium.
By Jim Hussey

The concept of planned giving is nothing new — churches began the process many years ago — but too many nonprofit organizations don’t have sufficiently organized planned-giving programs. If you're one of them, here’s something of a primer.

Planned giving is a generic name for fundraising programs that seek to generate giving from supporters in their later years who will continue to give once they’ve passed away - in the form of estate gifts and other charitable vehicles. It’s the best long-term resource in which a nonprofit organization can invest.

A relatively small amount of money invested now to conduct some basic marketing and education concerning planned giving will result in a windfall for your organization in five to 10 years, All you need is a little bit of skill and a lot of patience.

Different vehicles
The most common forms of planned gifts are bequests, in which a supporter sets aside money for the nonprofit organization in her will or insurance policy. Other bequests can include the donation of land or stocks. You can promote the concept of bequests through mediums as simple as ads in your newsletters and other publications, or as complex as multifaceted marketing campaigns that use direct mail and personal contact. You don’t have to wait for a donor to die before gaming her support through planned giving. As a matter of fact, the cultivation process has to begin well in advance.

Other options include annuities. Annuities involve the donation of a set sum of money by a living donor to an organization, which then pays the donor a specific amount of interest every month during the remainder of her lifetime. When the donor dies, the organization keeps the balance of the money.

Annuities are great because they can help both the organization and the donor.

While the organization benefits from the donation, the donor also benefits by receiving revenue for the remainder of her life. The older the donor, the higher her return rate. So a 90-year-old donor will receive a much higher return rate than a 70-year-old donor.

How to do it
Many organizations work through consultants who specialize in planned giving to develop their campaigns and related materials. The consultants provide readily available knowledge and marketing materials that require little effort on the part of the nonprofit organization.

Other organizations, chiefly larger groups, rely on focus groups to develop their own materials. Focus groups usually aren’t very effective in gauging direct-marketing response. It’s normally cheaper and more effective to test direct-mail packages by simply mailing them to small test cores.

But you don’t have that advantage with planned-giving materials - it could be years, or even decades, before a “test” donor passes away and leaves your organization a gift. Only then would you be able to judge the effectiveness of your marketing materials. That’s why focus groups have proven to be a valuable tool in helping to develop effective planned-giving campaigns.

Correctly targeting potential planned-gift supporters is a tricky business, and you need to work closely with your consultant to develop the right mix of materials targeted to the right mix of recipients. Demographic factors such as age, gender, length of home ownership and the value of the primary residence often are important elements to examine.

Amazingly, the amount of a donor’s previous donations often is not a reliable indication of her ability and inclination to donate through planned giving. I've seen many instances in which donors who have given only $20 or $25 to a nonprofit organization during their lifetime leave hundreds of thousands and even millions of dollars to that organization at their death.

Does your organization have planned giving? 

There’s little we can do about it, so why talk so much about age?
By Jim Hussey

No other donor demographic is more over-discussed and overrated than age.

As fundraisers, we’re obsessed with our donors’ average ages, even though there's little we can do to push this figure up or down.

I wish I had a dime for every time inexperienced or would-be clients blanched when they learned their donors’ average ages, which usually is in the 60s or sometimes even higher. They fear their current donors soon will die off.

Before they panic and begin posting their resumes, I explain to them that charitable giving is dominated by older donors. And as one generation passes on, it's replaced by the next.

Here’s an example I use to demonstrate this trend. I've been affiliated with one organization for almost 18 years, so it provides a good example of how a donor base is affected over time. When I first began work with this group, the average donor’s age was around 66. Today, it’s still in the same ballpark.

In the past 20 years, many of those original donors, maybe even the majority, certainly have died. But they've been replaced by others who've aged and moved into this donor age bracket.

Why are most donors older? Are younger people less committed to charitable causes? Absolutely not. Younger people are just as committed; they just express it in different ways. Older donors typically have more expendable income, while younger philanthropists are more likely to volunteer their services than their cash.

An example of this is Habitat for Humanity, which partners with needy families to build their own homes. The average age of volunteers who work at a building site is less than the average age of typical direct-mail donors who financially support the organization.

But there’s more
Fear of a dying donor base isn’t the only issue of concern to nonprofit organizations. In this age-phobic time when commercial marketers often favor younger consumers, some fundraisers try to exclude older supporters by aiming for younger donor bases.

I hear them say recruitment efforts should be targeted toward younger donors, to help bridge the age gap. In the end, most of these efforts quickly fail for financial reasons. That’s because most such strategies are akin to Apple Computer Inc. spending more of its iPod advertising budget on 80-year-old prospects, since they account for such a small segment of the MP3 player market.

Even if an organization wishes to dramatically reduce its donor base’s average age through aggressive recruitment efforts, it’s difficult to achieve.

In the 1990s, I worked with one organization that had an average donor age in the low 70s. My firm instituted a successful donor-recruitment campaign that brought in more than 1 million new supporters. Our targeting wasn't based on age; we simply targeted every mailing list that could generate an acceptable response.

After such an aggressive effort, in which we pulled in every donor we could find, we lowered the donor base’s average age by only five or six years.

There are exceptions to any rule. Not all donor bases have such high average ages. AIDS organizations usually have a younger donor base. Women’s rights groups often have younger donors. Organizations that have major, short-term successes on the Internet — such as those that raked in a lot of money after Hurricane Katrina — also might demonstrate at least brief downward trends in their donor bases’ average ages.

None of these cases are due to targeted efforts based on age. So why waste breath on the issue?

What do you think?

Donors want to do more than simply donate.
By Jim Hussey

Donors are tired of receiving solicitation after solicitation merely asking for their financial support. If you want to succeed in the fundraising market today, then it is increasingly important to offer donors and potential donors an opportunity within your direct-marketing efforts to do more than just write a check.

You must make your donor a partner in your mission. The donor must understand that she is an integral part of your organization, not just a dollar sign. If you can find legitimate ways for your donors to participate in your mission, you will be rewarded with greater donor loyalty, better retention and higher levels of financial support.

That’s why you need to ask yourself, “How else can our donor base support our mission, in ways other than donating money?”

Whatever your answer, your solution more than likely wilt be an “involvement device.” Involvement devices are vehicles employed by your direct-marketing program that require an action other than a contribution.

One of the most obvious examples of an involvement device is the petition. Many 501(c)4 organizations use petitions to demonstrate support or opposition to a particular action. Petitions can be addressed to members of the legislative or executive branches of our government regarding a particular issue or stance, or be targeted to other entities, such as regional or local elected positions or even corporations.

Another popular form of involvement device is the survey. Often called a poll or a questionnaire, these allow the donor to express her views about a particular subject. Surveys aren’t as prevalent as they once were in the direct-marketing community, but they can be employed successfully for just the right occasion.

Other involvement devices include donor recruiting-donor campaigns, in which donors are provided materials and/or incentives to recruit neighbors, family and friends to also become donors. And the “campaign kit,” which often features a poster, bumper sticker and other materials for a donor to display or distribute.

Involvement devices are an important component you should consider using for your fundraising program. But here is a word of caution: Don’t use any of these ideas if you don’t plan to legitimately use the end product. You should only use petitions if your organization truly plans on using them to influence the target of the petition. Don’t use polls or surveys if you don't plan on compiling some form of results.

My clients have used petitions in their fundraising programs to generate grand spectacles that have resulted in press coverage. Several have photographed their petition deliveries in front of Congress and sent the photograph to their donors afterwards. They also have compiled returned surveys and polls and mailed the results to those who participated. Both situations resulted in much greater support from donors.

People want to give to good causes because they personally want to reach out and affect the world around them. By utilizing involvement devices properly, you'll improve the quality and scope of their experience with your organization, and they will reward you as a result.

It’s trending up, not down.
By Jim Hussey

I recently attended a parent's meeting at my church to discuss future activities for my teenage son’s youth group. Now stick with me — this actually addresses an important issue for all fundraisers.

The youth minister in charge of the group was outlining what would be happening and casually said, “The kids want the annual calendar and notices about events sent to them by (snail) mail. So please look out for any church envelopes addressed to your son or daughter, and please pass them on.”

I, the bored parent who was struggling to keep my eyes open, was instantly awakened by the direct marketer within that usually tries not to think about such matters on the weekend.

“Whoa!” I said to the group. “You mean these text message-crazy Internet addicts want to use old-fashioned mail? Why?”

“Because they fear the messages will be lost in the mass of information they receive,” he said. “And they want a hard copy of the schedule.”

“Wow!” I thought. I didn't think that kids today knew what “hard copy” means.

This tidbit of information had a profound effect on me. I had been hearing all of the predictions that the new technology of the Internet will replace the older technology of snail mail. But then I witnessed an example of the newest generation — which is incredibly Web-savvy and greatly dependent upon it for communication and information — actually backsliding into the use of the centuries-old medium of mail.

With so many cynics preaching about the end of direct mail, while advocating Internet-exclusive strategies, we need to take notice of what is actually happening out in the world around us.

If you look around, not just at my son’s youth group but also at what the major commercial marketers are doing, you quickly will learn that the two mediums of direct mail and the Internet actually complement one another. Instead of clashing in a life-or-death struggle, the Internet and direct mail are actually proving to be quite chummy bedfellows.

As a case in point, in recent years, one of the top mailers in the nation also is our nation’s largest Internet provider, America Online, which mails hundreds of millions of its disks annually.

USA TODAY recently quoted respected advertising forecaster Robert Coen’s estimate that marketers’ spending on direct mail will increase by 7.5 percent in 2007, after growing by 8.5 percent in 2006. This compares to a growth of only 4.8 percent for all forms of ad spending.

The United States Postal Service, while reporting decreases in First Class mail in fiscal year 2006, also estimated that the quantity of Standard mail (which is chiefly used for commercial and marketing purposes) increased by almost 3 percent. They also are predicting further growth for the 2007 and 2008 fiscal years … despite higher postage rates.

So what does this information tell fundraisers that use direct marketing? It tells us that the commercial world has rejected a “one or the other” attitude about the Internet and direct mail. It has learned through the past decade of experience that the best marketing strategies mix the two mediums.

And the same rule applies to fundraisers. Just as any fundraiser today is crazy to think about fundraising efforts without the use of the Internet, you'd be just as crazy to consider fundraising efforts without the use of direct mail.