Short-term thinking is by far the greatest enemy of effective fundraising.

Signs of this noxious enemy abound. Boards and CFOs afraid to make an acquisition spend that can’t be recovered in a year  — or less. CEOs who won’t invest in skill-building and continuing education for fundraising staffs. Fundraisers who persist in using metrics like % of response, cost-of-money-raised and RFM, unaware or uncaring that these lagging indicators provide no path to the future.

Sometimes it feels like the vast majority of fundraisers simply want to ‘make this year’s numbers’. A few do take the time, make the plans and actually operate on a three year plan which, of course, beats operating on a one-year plan — likely copied over from last year’s spreadsheet.

How many groups do you know that, rather than focus on 1, 3 or even 5-year plans, devote their skills, energy and investments to a Ten Year Plan of Action … and then execute on it?

Very few.

The short-term virus is especially epidemic in direct-response driven organizations. Almost seems as though thinking in terms of a decade or more is simply out of the question.

Ironically, it is the direct response-heavy organization that is best positioned to take advantage of a long-term view and commitment.

Successful direct response programs, as a general rule, produce the greatest number of donors. Donors who not only can be moved up the direct response ladder — multiple cash gifts, regular or monthly gifts, upgraded gifts –but also on into the mid-level, major and bequest tracks.

But sadly, most of the highly successful organizations built on direct response fail to take advantage of the true — and immense — potential of their large base of donors.

Why? Failure to integrate.

I’m not talking about integrating direct mail with online, with telemarketing, with social media, although that’s important. I’m speaking of the structural or organizational integration required to actually realize this potential.

Nowhere have I seen this missed opportunity more effectively summarized and visualized than by Sean Triner in his plenary session at the Fundraising Institute of Australia conference last week.

In a cleverly titled and comprehensive benchmarking presentation, titled State of the Donation, Sean not only shared a remarkable overview of charitable giving that he and the team at Pareto Fundraising had prepared, he offered up one slide that should be copied and distributed to every nonprofit Board, CEO, CFO and Fundraiser around the globe.

Here at The Agitator we’ll start the copies flowing by encouraging you to share this with others in your organization and with friends and associates in the sector.

Pareto’s graphic below is powerful, factual evidence of the enormous possibilities that exist for every organization — small, medium or gigantic — that will take the task of structural/functional integration seriously … and, of course, do something about it. [Click chart to enlarge.]

By adding and integrating a major gift program and a bequest program with a standard direct response program, an organization can TRIPLE its net income from $7 to $21 million over a 10 year period.

In arriving at these figures, Sean and Pareto have assumed the organization continues to spend $1 million a year on acquisition in the first five years, invests in the telemarketing conversion of new donors to regular/monthly giving status, and puts in a ‘good major donor program’ and a ‘good bequest program’.

Study the chart above and you’ll see what ‘Standard’ direct response alone produces ($7 million) … then what the addition of a ‘good major donor program’ will yield ($13 million) … and finally what combining a bequest effort with the major donor and direct response effort yields ($21 million).

Over the years Tom and I have seen this ‘phenomenon’ at work in organizations we’ve worked with. But sadly, not many organizations have the discipline and foresight to set their sights and structure their functional organization on this combination. Too many simply stick with the ‘standard’ direct response and stop.

BUT … when a direct response donor base is treated as the source — the well spring — yielding far greater returns than direct response alone, ‘miracles’ happen.

Sean’s chart clearly demonstrates that there is ample reason to believe in miracles. All you have to do is organize for them.

Roger

P.S. It’s so important for the future that organizations of any size recognize and plan for the power of adding major donor and bequest programs to their direct response efforts. So important that I’m going to join Sean in a series of free webinars he’s hosting in April to detail and explain simple, effective ways to put all this into effect in your organization. Details on dates and times will follow shortly.