FYI Blog

Do you have the guts to invest in fundraising?

No denying it: donor acquisition is down across the industry. Nonprofits are acquiring fewer donors, and many are experiencing volatile results and declining response rates, according to the Fundraising Effectiveness Project’s Quarterly Fundraising Report (June 2019). The number of donors is down; the number of donors who are giving is down; revenue is down. So what […]

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September 26, 2019

Checking All of The Boxes

This summer, I’ve been taking my oldest son to look at colleges. Like me, he’s analytical, so we started by making a list of the critical things he requires: does College X have the business program he wants? Study abroad? The right club sports offerings? I want him to check all those boxes, but my […]

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August 23, 2019

Choose Your Friends Wisely

My preteen son is 12—staring down (and trying on) his teenage years. Since he’s my oldest and this is a bit of uncharted territory, I’ve been reading up on how to best support him through this tumultuous time. If you Google teens and peers, you’ll get findings and advice from thousands of sources, from WebMD to […]

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February 19, 2019

Are Premiums Right for Your Organization?

Are premiums right for your organization? Avalon President Allison Porter gets to the crux of this debate in her article in the June issue of DMAW Advents.

She reports on her conversations with three industry professionals, as well as her own experience, in finding ways to include mission-specific premiums in a marketing program.

From testing to analytics to donor value to premium selection, this article covers the benefits and pitfalls of premium use in the real world.

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June 30, 2016

Are Premiums Right for Your Organization?

Are premiums right for your organization? Avalon President Allison Porter gets to the crux of this debate in her article in the June issue of DMAW Advents.

She reports on her conversations with three industry professionals, as well as her own experience, in finding ways to include mission-specific premiums in a marketing program.

From testing to analytics to donor value to premium selection, this article covers the benefits and pitfalls of premium use in the real world.

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June 24, 2016

Revisiting a Top Post: Removing the Barriers to Growth

AllisonPorter-21- CroppedOne year ago, I wrote a post entitled Removing the Barriers to Growth: How to Influence Your Organization’s Leadership Through Data. If all of the positive feedback I’ve received since then is any indication—this post definitely struck a nerve.

Over the past year, this is a subject that keeps coming up in my work with colleagues, clients, and boards, as people strive to make informed decisions about the future of their nonprofits. So we’re re-running the original post in hopes that it can help start or further a (perhaps difficult) conversation about investment and strategy, underpinned by cold, hard facts.

Data shows that there is a lot to be optimistic about as the fundraising industry shows clear signs of rebounding and getting back on the path to growth. Growth is not a passive activity however. It requires a clear strategic plan and, more often than not, strategic investment.

Last summer, I attended a leadership conference where some of the leading nonprofit fundraising professionals defined the most common barriers to growth. At the top of the list was the need to educate, inform, and persuade the leadership of our organizations—the CEOs and CFOs, the Boards and Board committees—about the value of our programs in order to clear the way for strategic growth.

As fundraisers, it’s not only our job to raise critically needed funds, but also to educate, explain, and inspire our leadership about why this channel is so effective, and to build confidence in our direct marketing programs by showing the evidence of success.

So how do we do this? Here are a few simple tips for strengthening your communications to your leadership.

Be sure that the goals and objectives are clear. Nonprofits need to proactively hold themselves accountable to the defined goals and objectives, and report transparently to the leadership in their organizations about the successes and failures. Frequently, when we ask leadership if their priority is donors (who represent the reach of the organization), or net dollars, the answer is “all of the above.” The reality is that if you’re trying to make a change, sometimes you can’t have both, and it’s critical to communicate what it will take to meet those goals.

Know your metrics. What are the key performance metrics that will provide evidence of success? Beyond the critical income, expense, and net numbers, report on the key variables that provide a barometer of the health of the program, specifically the variable data around: retention, income per member, donor value, return on investment, and rates of upgrading and overall growth (or decline).

Consider your audience. Like a good direct marketer, knowing your audience is critical to a successful presentation. Think carefully about who’s in the room. Does your executive director have a thorough understanding of direct marketing, or will you need to be sure to use lay terms as you describe your work? Is the board member sitting in the room one who has frequently asked you about retention? If so, be proactive about addressing those common concerns.

Be clear about the story you’re telling. First and foremost, make sure everyone is on the same page about goals and objectives. Defining and articulating these needs to be a group process. It doesn’t help if the executive director of your organization thinks that membership growth and building a broad grassroots movement is your number one strategic priority, and you have been laser focused on net revenue for the last five years. Clearly articulating the strategic goals and objectives at the start of every meeting, and recapping how you got there, will help remind everyone about the process that you’re going through.

Visualize your data. Your audience will involve people who have a deep understanding of the data and the financials, as well as people who don’t. Visualizing your data even as simply as using the charts available in Excel, will make it easier for everyone in the audience to understand even the most complicated reports.

Benchmark your data. It’s extraordinarily valuable for leadership to understand the context of your performance metrics. How do you compare to the rest of the industry? How do you compare to others in your sector? Target Analytics has a ton of publicly available benchmarking data that you can use to provide broad comparisons. You can also participate in their formal benchmarking groups. And you should network thoroughly and reach out to your colleagues and peers and ask them to help you benchmark your numbers. Nothing helps defuse a critical discussion of your performance like being able to say you’re doing better than your number one competitor.

Refresh and repeat. If your organization is making a significant investment in change, this will not be a one-and-done communication. Accountability needs to be ongoing, and reporting back frequently and consistently is critical. Oftentimes the people we are reporting to at the leadership level don’t have their heads in our direct marketing programs on a daily basis, so we need to remind them about where we fit in, what our goals were, and bring them along in the process. Repetition is our friend in this case, being consistent and showing the same views will help to deliberately and methodically bring them along in the process.

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June 15, 2016

Taking the Deep Data Dive

tjhillinger webYour data holds the key to taking your direct marketing fundraising program to the next level of success—but you’ve got to go below surface level to see what’s really going on.

Aggregate campaign-level metrics and benchmarks are great ways to measure performance. But for the most robust analysis of membership dynamics, file trends, and return on investment (ROI), Avalon recommends a really deep dive into your data—an Avalon Inquire™ master file analysis.

This thorough data file assessment can help you meet your fundraising goals by providing the most accurate picture of your file today and identifying significant trends that impact program performance.

Each Avalon Inquire™ analysis is customized to the individual needs of the client, but typically includes an overall health-of-the-file assessment, acquisition analysis, house file analysis, channel analysis, multi-channel giving behaviors (mail, phone, online), segmentation analysis, and upgrade analysis.

Beyond these foundational analyses, we’ve added the following views to help our clients learn as much as possible about their donors, members, and prospects:

  • Age overlay view: Compares the organization’s age trend to the national average and illustrates that fact that donors on most files skew older;
 NMAI MFA Slide 2 - Age Append
  • Break-even analysis: Reveals the projected point at which an acquisition join group will break even—when revenue covers the initial cost and subsequent cost to resolicit;

NMAI MFA Slide 3 - Break even analysis

  • Heatmap/geographic overview: Gives organizations a view of donors’ geographic distribution by zip code, illustrating pockets of donor concentration;

NMAI MFA Slide 4 - Heatmap

  • File stabilization view and trajectory: Projects the current trajectory of the file (growth, decline, or stability) and the number of new/reinstated joins needed to keep the file stable—key data to consider when making decisions about acquisition investment;

2016-06-02 Slide 1

  • Membership vs. giving level/discounts: For membership-based nonprofits, this view provides insight into the member value based on giving levels (compared to discounted giving levels); and
  • Enhanced major gift pipeline: These added views quantify the revenue low-dollar/membership donors provide to the major donor program, underscoring the importance of direct marketing as a pipeline to major giving and the impact of direct marketing beyond the program itself.

If you’re not sure where to go from here with your direct marketing program, an Avalon Inquire™ analysis can help you set a course for the future while giving you the statistical back-up to make your case to stakeholders and leadership. We’ve got your back.

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June 2, 2016

Dispelling Myths: “We shouldn’t spend money to acquire new donors.”

“We shouldn’t spend money to acquire new donors.”

tjhillinger webThis marketing myth can be especially difficult to dispel, particularly when nonprofits are going through hard times. Investing in direct mail donor acquisition always seems to be first on the chopping block when budgets are tight.

The good news is that it’s also one of the easiest myths to dispel, when you take the analytical approach — and that analytical approach is all about the long view.

Here’s a real-world example of a surprisingly reasonable investment in acquisition: Starbucks spends $1,400 to acquire a new coffee drinker, which might seem crazy…until you learn that a Starbucks coffee drinker’s 20-year value is $14,000!

Similar calculations are essential if your nonprofit is considering shutting down donor acquisition investments — because, when weighed against lifetime value, the investment to acquire a new donor through direct mail is relatively modest.

dispelling myths part 3 graph ver 2

There’s no getting around the fact that acquiring new donors/members requires an investment! The key is to make strategic investments backed up by cold, hard facts. Some points to keep in mind:

  • Investment should be driven by organizational goals and real data, not gut reactions or random figures.
  • Losing revenue in a direct mail campaign can be hard to swallow — and yet, you won’t realize revenue gains without sustaining initial net revenue losses.
  • If your direct mail acquisition program does not require an initial investment, the program is probably not fully optimized.
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May 13, 2016

Best Practices: Benefits, Mission, or Both?

Does your organization have a bricks-and-mortar venue, like a museum? If so, is your case for support driven by benefits, mission, or a little bit of both?

Benefits Model for PP and Publisher  -Avalon puts a high priority on helping our clients find the right balance between making a benefits-based and a mission-based case for support to convince and compel donors to give.

You may find that the benefits-based “What’s in it for me?” approach, one that rewards visitors with free tickets, parking, or gift shop discounts, works best. But many organizations find that educating donors and prospects about their vital work further encourages loyalty and long-term support.

In all communications with prospects, website guests, venue visitors, members, and lapsed donors, Avalon recommends testing the case for support permutations. This will help determine the correct balance for your organization.

Educating donors can help them think beyond the “What’s in it for me?” transactional nature of benefits. It helps donors view your organization as a living, growing institution that needs ongoing support, instead of simply a destination for a fun outing or field trip.

Your website should be your entry into donor education, while also encouraging people to join and visit your facility. It should tease new exhibits to explore, while also highlighting your ongoing work—such as the permanent collection—and future plans that will require consistent funding.

Avalon recommends testing a mix of benefits vs. mission messaging in all direct marketing programs to analyze, hone, and create the most effective case for support for distinct audiences. For example, would prospects from outside your state or community—those with few opportunities to visit—be more interested in additional details about your mission? What secondary cases for support (e.g., educational outreach, scientific leadership, community involvement, consumer information, etc.) work best for the locals who visit your facility frequently? Are there further tangible benefits that can move the dial? And what case for support works best for upgrading donors or recruiting sustaining members?

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November 20, 2015

Best Practices: Help Mid-Level Donors Reach Their Potential

Climbing up ladder together

Are you paying enough attention to your mid-level donors—supporters whose giving falls between your low-dollar and major donor thresholds?

The beauty of mid-level giving is that if you allocate the same level of outreach to this discrete group as you do to other groups, the benefits can be tremendous. Because although they’re likely a much smaller subset of your database, midlevel donors have a much higher average gift, making them well worth the extra effort.

And that extra effort doesn’t have to cost a lot of time or money—solid best practices and steady stewardship will do the trick. Some of our strategies for identifying, cultivating, and engaging mid-level donors include:

  • Identify those donors most likely to move up the giving ladder. Our stats show that 40-60 percent of $1,000+ donors made a first gift of less than $100. Many new mid-level donors are already on your file—you just have to recognize their potential, cultivate them, and ask them to step up their giving.
  • Expand your target audience within your database by testing data-mining techniques like modeling and wealth overlays to uncover untapped giving potential.
  • Once you’ve identified good prospects, build relationships with your mid-level donors to increase their support at successively higher giving levels. Brand this group—give these donors a unique name and create a more personalized, high-touch direct marketing experience to make them feel like they belong to an exclusive group of core supporters.
  • For one client, Avalon used an integrated mail and phone strategy (enhanced by modeling) to target best upgrade prospects. For another client, we integrated upgrade asks into the first renewal and two appeals, leading to a record number of upgrades.
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October 26, 2015