Why I Hate the Donor Pyramid
All pyramids are lies:
- They have a dishonest scheme named after them.
- They will not keep your razor blades sharp or apples fresh.
- They messed up the four food groups.
- Maslow’s Hierarchy of Needs isn’t really true (there are fundamental needs, but there isn’t a hierarchy and people pursue different “level” needs simultaneously).
Even the Egyptian pyramids were really built by aliens. I know that last one is true because I saw it on the History Channel and you can’t have lies in history.
It’s time to call the donor pyramid what it is: yet another three-dimensional-triangle lie for desperate presenters to shove into PowerPoint slides to give the illusion of intelligence. (See also: clipart of stick figures doing things, photos of people shaking hands, any time arrows make a circle.)
So let’s see and know the enemy:
It looks innocent enough. But do not be drawn in by its tetrahedral lies. These include, but are not limited to:
Steady steps up the pyramid. Some illustrations even have a person climbing up the side of the donor pyramid like Yodeling Guy from The Price Is Right (I’m sure Yodeling Guy has a canonical name, but hopefully this description suffices).
In reality, steps are so frequently skipped as to render the metaphor useless. Think of the little old lady who gave your organization $10 each year at Christmas, then left you a bequest of $400,000. She skipped all the steps. You didn’t even try to get her to be a monthly donor, because your modeling indicated she probably refers to going online as “The Google.” And major donor? Fuhgeddaboutit. $10 per year. She was probably the last person you were going to ask. Literally, the last person.
I will bet the contents of my wallet (seven dollars cash and some receipts I need to file for reimbursement) that this experience happens more often than someone stopping at every step of the so-called donor pyramid. When the worst-case scenario for your metaphor is more common than your best-case, you have a metaphor problem.
More mundanely, it’s probably counterproductive to think that you are moving someone up one step at a time. Look at monthly givers versus major givers. Yes, you are probably going to invite your monthly donors to make major gifts. But if someone is giving you a thousand dollars through the mail and has high commitment scores, you are going to start personal cultivation with that person (while not removing them from direct marketing, because you are not an idiot). That will come at the expense of, and rightly so, an invitation to monthly donor land.
The pinnacle of donor experience is death. If this is true for your organization, take a good long look at your donor relations processes. Yes, bequest giving is probably the capstone of your pyramid, but it shouldn’t be.
Progress. The donor pyramid has never heard of a lapsed donor. When the donor pyramid thinks someone is about to say “lapsed donor,” it sticks its fingers in its ears and says “lalalalalalalalalala” like a recalcitrant child.
Yes, in this analogy, pyramids have both fingers and ears. Work with me here.
The idea that you would have to get a donor back doesn’t occur to this pyramid – its donors are too busy ascending.
Meanwhile, back here in reality, lapsed donors are valuable. They are less valuable than multi-donors, but more valuable than person-off-the-street. But they don’t fit into the pyramid power’s progress. So they are left aside.
This last point also shines the way to the better analogy: donor journeys. A journey is messy. The fact that it’s the donor’s journey has the possession right, as their destination may not be yours.
A journey from point A to point C may not go through point B. Despite your best efforts, a donor journey can get lost.
You can provide all the directions you want, but there’s no guarantee they will be followed. That lyin’ pyramid is a poor roadmap.
Nick
15 responses to “Why I Hate the Donor Pyramid”
Behavioral Science Q & A
Integrating an individual giving appeal with other communications from a charity can have both positive and negative effects, and the outcome largely depends on how it’s executed. Advantages of Integration Brand Consistency: Maintaining a consistent appearance and messaging across all communications can reinforce the org’s brand identity and strengthen brand recognition and trust among your […]
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I’m not aware of any in-market tests specifically comparing recurring vs. gift frequency language. I suspect the answer might not be the same with all gift frequencies, nor with all people. It sounds like a great opportunity for you to test and find out what works for your audience. Based on the literature, here’s a couple […]
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Based on what we know from existing data, those renewal notices can actually be pretty effective in getting people to donate. They tap into our psychology – creating a sense of urgency, reminding us of past support, and using personalization to make the message hit home. They’re playing on our natural tendencies to feel obligated […]
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Interesting question. I had a quick look at the testing done on this topic. On the positive side, in all cases, over half of donors decide to cover the fee. In some cases, it goes as high as 65%. Not a negligible percentage at all. Here’s another test from iRaiser showing consistent results (see point […]
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There’s just one thing to consider when designing a supporter journey: the supporter. More specifically, you need to take into account: Who the supporter is i.e. their identity, which is the reason they support this cause, and their personality, which describes the way they “see” and process the world. These will determine the kind of […]
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I’m not an expert in this but a quick search surfaced this article on the effect of tax reforms on 2019’s charitable giving. The researchers didn’t find a reduction. Actually, they observed an “increase in charitable contributions in 2019, even with the lower tax rates and the dramatically smaller number of taxpayers who itemize their […]
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This made me chuckle! I agree the donor pyramid has outlived it’s usefulness (plus… the pyramids were built by slaves — who likes that?!). Plus it makes too many donors “bottom feeders.” Here’s an article I wrote on the topic for Nonprofit Pro four years ago. https://www.nonprofitpro.com/article/rip-donor-pyramid/all/
thanks! The pyramid aside, there’s lots of great stuff ‘buried’ in your post here, fabulous.
1. YES, small monthly donors are very likely to leave you in their will. So the minute you get monthly donors, you should start planting the ‘will’ seeds, rather than asking for major gifts.
2. In my 25+ years of experience with monthly donors, they come from donors giving less than $250, so that’s your target. The minute someone writes a big check like that, indeed try to get bigger checks.
To confirm, monthly donors are typically NOT big check writers so asking them for major gifts they often simply can’t do. You’re better off asking for a small upgrade every year and send them some targeted extra appeals during the year to get additional (small) gifts.
3. I see so many organizations moving monthly donors to the ‘personal cultivation stream’ but because they are so focused on the $1,000+ donors, these monthly donors never receive anything so that’s a mistake too. They like what you do now and they want to support what you do in a way that best fits their budget, that’s why they give monthly.
4. Nowhere in the pyramid does it talk about stewardship and acknowledgements or online versus offline communications. I see so many organizations who don’t even send a thank you letter in the mail any longer or they don’t pick up the phone, those are images that should overarch the complete pyramid… it’s all about the donor, people! And people are humans who want to hear from real people, not computers…
I agree with the notion of a pyramid being too constrained to truly represent the journey, but we are visual creatures and need some cue for reference.
There are many others that have attempted other representations: https://www.google.com/search?q=donor+pyramid&source=lnms&tbm=isch
What else is an organization to use? Is there a way to represent the entire life cycle in a single visualization or should we just scratch the whole idea? Do we end up with just one large circle or Venn diagram?
I’m of the opinion that donors will do what they want and they define their own journey. Each sector has their own definition of what that looks like and how donors are grouped, but in the end it’s more about knowing how to respond “when” a donor does something rather than “if”.
Tons of insight as always. Thanks! As for the yodeling guy, his name is Hans. (I take no pride in the factoids that stick in my brain. I merely share them when appropriate.)
So imagine that we give paper and pen to individuals and small groups and ask them to create a “map” or series of metaphors and or also… And see the results. And do this from various perspectives and for different “market segments” and different individuals or businesses and and and …
Thinking and drawing and noting and…
I’ve done it. And, of course, mapping and diagramming is an old and current strategy/art.
While I appreciate your use of tetrahedral, this post made me feel defensive for geometry. It reminds me of a quote attributed to Einstein, “Make things as simple as possible, but not simpler.”
In the tetrahedron’s defense there is a lot of money coming from a little number of donors and a lot of donors generating little money. You know if you were to map it, it would look something like a pyramid right side up representing people and upside down representing money.
To be sure that I don’t get mixed up in your ire:) I totally agree that this shape you detest, does not come close to mapping a journey or process such as you are describing above.
Claire, that’s a great post and I recommend it to all readers. I apologize if I stole the Egyptian pyramid intro from you. I’m a NPP fan, so I probably read this when it came out and it soaked in. Such theft was unintentional and my apologies.
Erica, excellent points, especially #3 – people who are on the cusp of mid/major donors can enter a netherworld where they receive neither communications from direct marketing and from mid/major teams or where they receive both or where they receive the one they don’t want to receive. Much better to let the donor determine.
Barry, thank you – this is exactly the type of datum in which I delight.
Tim and Simone, at the risk of self-promotion, we use a touchpoint mapping tool online that has been a godsend for me, having done it with multicolored sticky notes of indeterminate branding in the past. You can learn more at http://www.thedonorvoice.com/products/touchpoint-mapping/.
Ben, I agree there’s a need to communicate the Pareto-on-steroids that is our fundraising world, with four percent of donors giving 76% of donations. I don’t know that the current donor pyramid communicates that, though. When shown as a triangle like the above, the entire bottom half (plus or minus) of the pyramid would have to be one-time donors (with our current low retention rates of first-time donors) to correspond to actual volume. Bequest donors of consequence would be a tiny speck at the top. So I worry that it also distorts our view of how many donors are in each part of the lifecycle.
For that purpose, I recommend this image from the Fundraising Effectiveness Project: http://afpfep.org/wp-content/uploads/2017/10/new-fundraising-rules.png.
While your comments are true, I think the real value in the pyramid comes from giving a nonprofit a visual of what their donor base should look like. Prospects better be huge, monthly or small donors should create a base the organization can depend on. It is also true that the further up you go on the pyramid the more dollars are given and the fewer donors there are at that level. Too many n/ps make the mistake of depending on the big donations to sustain them, thus inverting the pyramid and making it unstable.
Donor pyramid, marketing funnel… as others have said, these are flawed metaphors. But visuals of some sort can be helpful.
For a number of years I’ve been much more intrigued by David Edelman’s “Loyalty Loop” that I first saw in HBR: https://hbr.org/2010/12/branding-in-the-digital-age-youre-spending-your-money-in-all-the-wrong-places
See the visual here: https://sites.google.com/site/m432spring13/week-1/loyalty-loop
While this is focused on consumer marketing, it translates better to fundraising. And it emphasizes retention, retention, retention.
We live and function in a three dimensional world. Claire’s vortex in some ways closer to an accurate illustration, though I would argue that it’s smaller at the top than the bottom with regard to numbers of donors (not gift totals, which might far outstrip the base of the pyramid).
However, I may be off base, but we still lose and will lose some number of first-time donors and from my reading of the works of Adrian Sargeant and others that it OK. So there is some funneling or winnowing and we need some way to consider where to focus limited time and energy. Am I off base here?
FYI this is not a purely academic discussion or question for me, I teach fundraisers and aspiring fundraisers and am wondering what rubric I might use if not the donor pyramid.
Yes it has its flaws but I will say this, it has helped me make my case for acquisition investment and a robust annual program. You can’t expect to have a robust pipeline for growing a major or planned giving program without that “base”. A donor may not move up the pyramid in that fashion but you are likely to have a more robust fundraising program if you have invested in building the base.
I must confess I had not thought of an alternate model/metaphor. Part of the challenge – and I think it’s reflected in the comments – is that the pyramid is sometimes used to represent the make-up of a donor file and sometimes used to represent the journey of a donor. Those are two functions that need not be in the same metaphor.
So here are two ideas for visualizations that are probably worse than the donor pyramid, but can start the discussion.
For the make-up of the donor file, I’m thinking of the tail that wags the dog. Not only does this appeal to the statistically minded of us, thinking of long-tail distributions, but it also connote this power of something small on something larger.
For the beautiful randomness that is a donor’s individual journey, perhaps a very hard pinball game? Most of the time, you launch the ball and it falls straight through. Occasionally you are able to get a flipper on it and sometimes even direct the ball near where you want it to go. Sometimes it will stay up of its own volition, but often you have to interact with it intentionally to try to guide.
Unfortunately, in that latter one, the pinball has no agency, so there’s probably a better idea there.
Other thoughts? To the extent we need a metaphor (or two), what’s the best way of framing?
(And to Lisa’s point, if the pyramid helps you justify investments, go for it and don’t look back. I don’t much care if the cat is white or black as long as it catches mice.)
Nick – hilarious and interesting as always. However, I do have a bit of a bone to pick with your anti-pyramidness. Your entire argument against the donor pyramid is based on one assumption: that an integral part of the pyramid is that donors move, one step at a time, up towards the top. Not a fair or accurate assumption. People can move up and down the pyramid (except for the top level…), and indeed, as you say, often skip levels. Don’t throw the baby out with the bathwater (to add yet another colorful expression to this discussion)!
I’ll agree – I’d be a lot less anti-pyramid if the assumption was not one step at a time. However, I’ve often seen it presented as such. We hear people talking about climbing the donor pyramid and it’s sometimes even presented that way (e.g., https://www.communityfunded.com/blog/evolution-philanthropy-fundraising-pyramid)
This metaphor then leaks into barriers we put up between people working on different giving types. You are running the major donor program, so the pool of people you can draw from is the multi-givers. You are running the planned giving program – you should market to the major donors. That’s even when someone could be in multiple groups (major giver, pledged bequest, monthly donor, and DM donor) and being hit from all sides.
Hey Nick, thanks for the provocative post, which spurned such interesting debate. That said, I’m with Mikaela.
While I agree the pyramid is no journey map, IMHO, too many fundraisers just get lost in the annual fund and forget that the real opportunity is value, not volume.