In last week’s post, I shared some of the various reasons why your fundraising bucket might be leaking. This week I’m delighted to be joined by Sarah McKinnon to provide you with some answers on how you can go about fixing your bucket!
Understand your donor data
Your data tells a story, so this has to be number one on your list. It can help you to understand why donors come on board in the first place, why they stay and specifically with regard to helping you to fix your bucket, why they leave!
Paying attention to trends
Starting with your trends, what does your data look like year over year? Are you seeing any patterns in relation to donor behaviour that can give you any clues as to what is both motivating them, and demotivating them? Can you see any sharp spikes or dips, or even slower increases or decreases that could indicate whether there are any activities or changes in strategy that could be impacting your donors’ behavior? How can you build upon what’s working, and fix what is not?
Donor retention is like your super metric, since it can be so indicative of what is going on with your program. It can tell you how well your stewardship efforts are going, how influential your welcome process is, and which donors need a little more love.
Statistically, fewer than half of your donors will give a second time. Given that it is so much more costly to bring on board new donors than to keep existing ones, we all need to do as much as we can to get more donors to stay on board. While an overall retention rate can tell you if you are in trouble, by breaking down donor retention into segments, you can get a clearer idea of where your program might be faltering and put in place strategies to address it.
Return on investment
It can be helpful to look at all your funding streams and figuring out what your cost per dollar raised is, but this should not be the only metric that you pay attention to. For example, what if some of your more expensive funding streams are also your best channels for donor recruitment, or your events, while not having the highest ROI, are the only ways which you are stewarding donors? Are you making a mistake by dropping them?
Dependence upon too few funding sources
Fundraising metrics are not just about figuring out whether you are cost efficient with fundraising. They can also tell you whether you are putting yourself at financial risk.
The most financially “efficient” fundraising programs are those that raise the majority of funds from very few sources, but if these sources were to be with withdrawn or reduced, you could find yourself in big trouble. To address this, consider how you can diversify your funding base so that you are spreading your risk.
Talk to your donors
Knowing what your donors want isn’t just about understanding your donor data. Your donors are talking to you, so you need to make sure that you are listening. By paying attention to what your donors are telling you, you can gather wonderfully rich information that can help you to direct your fundraising and donor stewardship programs, build a much better connection with your donors and give them a wonderful experience.
There are many ways to collect your donors’ feedback, from sending an annual survey, asking a few additional questions when they call you up to making sure you are connecting properly with them at events. You could also think about running specific focus groups or consultation exercises to gain their thoughts on specific aspects of your work, such as your Case for Support or online fundraising strategy.
In the last post, we talked about how we often think that we can do it all, and as a result, we stretch ourselves too thin, or over-commit. By being more realistic about what we are capable of, we avoid setting ourselves up for failure from the start, and ensure that we have the resources in place to do things properly.
One way to manage your workload is to create a road map that tracks your progress along the way. Particularly in cases where you might not realize revenue immediately, for example, with major gifts and planned giving, by having such a guide you can point to steps you’ve taken to see if you are indeed moving forward and identify if you are going off track.
Another way to ensure that you are being realistic is being cognizant of where your organization is in terms of its evolution. Not every organization is in the same place. Some have very mature fundraising programs, while others are in their infancy. The expectations for one cannot be the same for another, so bear this in mind when developing your plan.
Have a solid fundraising strategy
The vagaries of fundraising can mean that it is all too easy to get caught up in the day-to-day, focusing on fighting fires and dealing with specific demands (and apparent opportunities!) that might come your way, rather than thinking strategically about what you are doing. The reality is though, without a strategic fundraising plan, there is a much greater risk that all your busyness results in you spinning your wheels rather than actually raising more money.
So while this may seem like an obvious step, make sure that you take some time to take a step back from your day-to-day work to ensure that you are working strategically. That way, you’re not sacrificing what’s important for what’s urgent.
Steward your donors
As highlighted in part 1, donor stewardship is an essential part of donor retention and crucial to avoiding a leaky bucket. The key to success is ensuring that you are intentional with regard to your stewardship strategy and that you have the resources in place to ensure that:
- donors do not fall through the cracks when it comes to building fruitful relationships;
- donors receive the acknowledgement and recognition they deserve in return for their support;
- donors truly feel that they are having an impact in a cause that they care about;
- that they can trust you with their donor dollars;
- they are able to engage with your organization at a level that suits their interests.
Whose help do you need?
More than likely, you’re not going to be able to fix your bucket on your own. You will need the support of other people. Particularly if you need to build a culture of philanthropy to address the cause of your leak, you will need the engagement of your board, through to the support of your other teams, from program staff to administration.
So how to start? Begin by identifying what your strategy needs and who you need to connect with to get their support. From there you can identify some champions amongst your team members who can support you in your goals and help ensure that you are all on the same page.