Flat Earth Fundraising: Preventing Bottom-line Shipwrecks

July 17, 2012      Admin

Before the 1700s ocean navigators could not find an accurate way of determining longitude. This failure caused ships to miss their destination, many times crashing into rocks and killing their crews.

Although the concept of latitude was used by navigators for centuries, use of that concept alone was incomplete and dangerous without an accurate way to calculate longitude.

A practical solution came from a simple carpenter, John Harrison, who solved one of the most difficult problems of his time by creating an accurate chronometer. The best scientists of the time, including Isaac Newton, thought it impossible. Harrison spent four decades perfecting a watch that would ultimately earn him the prize established by the Longitude Act of 1714, thanks to the recognition and influence of King George III of England.

There are parallels between our small 21st century world of fundraising and the massive problems inherent in 18th century navigation that deserve some comment.

  • For decades fundraisers have relied on donor behavior like RFM and other transactional data (our ‘latitude’) to attempt to steer their fundraising course.  Reliance on behavior alone often runs us onto the rocks. Rising acquisition costs and falling retention rates are evidence of our own ‘shipwreck’.
  • Now, as then, efforts to solve the problem have largely gone unheeded at best and have been met with withering skepticism at worst. For example, many of the so-called ‘best’ fundraisers of our day stick blindly to RFM and refuse to believe there are any significant navigational tools that can be added to our ship.
  • If it took John Harrison, the inventor of the chronometer, 40 years of battling Isaac Newton and other skeptics (his arch-rival, Rev. Maskelyne, an astronomer claimed the solution lay in the heavens instead of a man-made object) to get his chronometer adopted, how long will it take us to understand that along with fundraising ‘latitude’ (donor behavior) we also need to steer using ‘longitude”’(donor attitude)?

I sure hope it doesn’t take us 40 years because too many organizations will pile up on the financial rocks before then.

So, how’s our sector doing against the chronometer’s 40-year benchmark?

Twenty years ago, in 1992, British fundraiser Ken Burnett published his landmark Relationship Fundraising: A Donor Based Approach to the Business of Raising Money. Landing in the height of the ‘burn and churn’ era of direct mail fundraising it set off a firestorm. Greed and skepticism combined to form a powerful band of critics.

This breakthrough book, or at least its main title – “Relationship Fundraising” – was soon adopted as part of the jargon of our trade. Sadly, few bothered to look beyond the title to truly understand and put its insights to work.

Few understood, especially the skeptics, that the game changing essence of the book lay in its subtitle: “A donor-based approach to the business of raising money.” As Ken later noted, “Those ten words, I believe, are ultimately much more important than the two words that precede them.”

Fortunately, “Relationship Fundraising” survived those intent on targeting the book and its thoughts for infanticide and went on to inspire others, including this Agitator. To this day it remains a basic text that belongs on everyone’s bookshelf.

Twelve years later, in 2004 academics Adrian Sergeant and Elaine Jay published the next major treatise in fundraising navigation – Building Donor Loyalty – using a research-based approach to providing new insights into the ‘longitude’ of donor behavior.

Three years after that Tom Ahern and Simone Joyaux came forth with a jam-packed book of attitudinal insights in their 2007 work, Keep Your Donors: The Guide to Better Communications.

Building on all that’s gone before – including monumental advances in understanding customer attitudes and loyalty in the commercial sector – we decided to put all these decades of thought and insights into practice and build a usuable ‘chonometer’. Our version is called DonorVoice.

So now that ‘latitude’ and ‘longitude’ can be used together, the question is how long will it take fundraisers to move to a safer and far more productive form of ‘navigation’?

Clearly, it has already taken our sector much longer than the commercial sector that invented its own ‘chronometers’ years ago.

Source: DonorVoice post by Kevin Schulman

As our sector faces the ‘shipwreck’ of rising acquisition rates and falling retention rates, there’s now only one barrier that stands in the way of rescue: inertia.

Roger

P.S.  The drama, back-biting, and stakes involved in John Harrison’s invention of the Chronometer and his race to win the multi-million £ Longitude Prize in the 18th Century is brilliantly and briefly chronicled in former New York Times science writer Dava Sobel’s Longitude. Perfect for the beach … or the Development Committee.

3 responses to “Flat Earth Fundraising: Preventing Bottom-line Shipwrecks”

  1. Kim Silva says:

    Amen! Now, if I could just get my board members to want to take that approach. 😉

  2. Tom Ahern says:

    Simone and I are flat-out flabbergasted to be included in this short list of books. Thank you deeply.

  3. How proud to be cited by you all on your blogs. How proud to be included in a mention with Ken and Adrian. Thank you. Simone