A variety of recent news items crossed our desk that bear on what we’ll explore this week –”segmentation”.

ITEM:  Civil Society in the UK reports in Top Charities See Largest Fall for Voluntary Income in 20 Years that the top 100 charities have recorded their most sustained drop in voluntary contributions in two decades.

ITEM: In Canada,  according to the Fraser Institute fewer and fewer Canadian tax-filers are giving less and less by way of charitable donations.

ITEM:  In Australia the government reports that while charities are raising more money, the revenue is coming from fewer and fewer donors.

ITEM: In the U.S. the “Trump Bump”  benefitting some organizations (these organizations are the exceptions) is camouflaging a dangerous downward fundraising trend as reported in Blackbaud’s Vital Signs. Over the past decade the number of American households contributing to charity has declined by 7%.

ON TOP OF ALL THIS the 2018 Edelman Trust Barometer alerts us to a global decline in the public’s trust in nonprofits.

All this troubling news makes two things clear: 1) almost every nonprofit, no matter where located, is affected; and 2) it’s time to challenge and improve conventional fundraising practices.

Unless you’re content with blaming flat or poor results on external factors (that apply to most organizations) like “the economy”…”global warming”…”regulations”…”competition” …”you name it”, the time has come to take a fresh look at conventional practices.

And that’s why we’ve chosen to focus much of this week’s content on the fundamental, importance of “segmentation.”

Why?  Because few fundraising practices more affects the bottom line than the proper and sophisticated grouping of donors and the message and methods of how we relate to them.

In short, selecting or segmenting donors using instinct or the conventional approach of simple RFM is no longer enough for organizations looking to grow.

[And just think how even more effective great copywriters like Ahern & Brooks, Sargent & Swayze, (and the many more I should mention but for space),  will be when you identify and properly segment the donors they’re writing to.]

FRIENDLY WARNING: This series on segmentation will go into a lot of detail on different segmentation approaches and different segmentation layers that can be put on top of one another.  Be patient.  Read carefully.  The effort’s worth it.

I  realize that identification and processes we outline are ones that most fundraisers will dismiss out of hand as “too difficult”, “too expensive”, “too time consuming”.

But as Tom noted in Donorus Specificus , “… did somebody tell you fundraising would be easy? It’s hard, and getting harder. In no small part because donors (like consumers in general) are getting harder to please and lifting their expectations. They’re evolving.”

Donor Identity—The Key part of every effective segmentation.

Over the last few years we’ve had a lot to say about “donor identity”. (See here, here, here, and here for starters.)

No wonder.  Donor identity is the key part of the most effective donor segmentation efforts. But, it’s not the only part because, and there are a variety of additional approaches you can use with it.

This week rather than just preach about its importance we’ve asked Nick to go through some detailed, practical, step-by-step, approaches to segmentation and donor identity.  He’ll also share illustrations and findings with you.

Tomorrow, in What Do You Mean When You Say “Segmentation”? Nick will define and outline the basic types of segmentation.  On Wednesday, in Brainstorming Donor Identities he’ll offer practical guidance on how to find and use your own Identities.  He’ll wrap it up on Thursday with Testing Your Donor Identities by providing methods you employ yourself and will also introduce you to some powerful tools available through DonorVoice.

I’ll be back on Friday to deal with the issue of “Trust”–why the 2018 Edelman Trust Barometer signals trouble, and what to do about.

Meanwhile, have a good week.

Roger

P.S.  Even though you personally may not be responsible for segmentation this week’s series is valuable for those in your organization who deal with this.  So, please pass these posts along.  Or, better yet, have your colleagues sign up free to receive The Agitator each morning.

P.P.S.  The need to break out of the conventional ways of doing things is not only essential for nonprofits, it’s absolutely essential for the consulting firms that serve them.  As Alison Huntingdon writes in Source Global Research ,in the commercial world the “brand name” firms like McKinsey, Bain and Boston Consulting are already facing stiffer competition and losing business to a tectonic shift that is occurring as clients demand change.