Selling Your Board On Direct Response

June 12, 2014      Roger Craver

Roger has written on several occasions about the obstacles that nonprofit boards can present to effective fundraising and growth — see, for example, here and here — especially when it comes to direct response fundraising.

Similarly, Tom Harrison, chairman of Russ Reid, writing a recent column in Fundraising Success, recited some of the ‘wisdom’ he’s heard from board members:

  • slash the acquisition budget in digital, mail, DRTV in order to improve the current year’s net income and fundraising ratios;
  • people don’t want to receive letters anymore … the organization should simply email its donors;
  • the organization should cut back on frequency (and on expenses) because the board member knows someone who complains about receiving too much email and snail mail;
  • the organization should emphasize the positive results of its programs rather than showing need, because people want to invest in success; and,
  • champion “the next big thing” in marketing as a way to attract hipper, younger people to the cause.

Doubtless you’ve heard one or more of these pearls. As Tom points out: “Direct-response fundraising is often counter-intuitive, so in this rare case, otherwise successful board members can easily make costly missteps when trusting their non-direct-response marketing instincts.”

Tom — clearly more optimistic than Roger on the subject — also offered some excellent advice for educating such board members. Here are just a few of his points, as presented in Talking to Your Board About Direct Response:

  • Map out the long-term value of your donors, and explain how you calculated what you can afford to spend to acquire and cultivate them. Get your board used to evaluating everything over the long term — not simply campaign by campaign.
  • Show them the money. You’ll be amazed at what happens once businesspeople understand that for every dollar you invest in direct-response fundraising, you net $3 to $4 for your cause.
  • Do the analytics … to show your board how direct-response donors (the bottom of the pyramid) can be migrated to produce monthly contributions, major gifts, capital-campaign support and planned-giving revenues.

Excellent selling points. But Tom makes two key assumptions. First, you can get your CFO and/or CEO to understand and embrace these points (Roger is dubious). And second, as Tom puts it: “The facts are friendly.” If you’re running a solid direct response fundraising program, they should be.

Is Tom being too optimistic … or Roger too pessimistic?

Tom

 

 

 

7 responses to “Selling Your Board On Direct Response”

  1. erica waasdorp says:
    June 12, 2014 at 7:09 am

    Terrific post!! I think the truth is probably somewhere in the middle.

    I’m one of those optimistic people so i’d like to say that Tom Harrison has it right but…

    I work with a lot of small to mid size organizations and while they have very smart board members (on paper anyway), it’s almost as if they come into the board room and leave their business sense at the door. And then when they leave, they go pick it back up…

    Where else can you invest $1 and get $5 back? I don’t see that happening in the stock market… but that’s not how they look at it. Many organizations think like this: ” Ah, last year, we only spent $10,000 on direct mail, so that’s all we can spend this year… they’re not even looking at results necessarily.

    Sadly, many board members rather look for that next new shiny thing because that’s where it’s at (NOT!)..

    And long term thinking? They are certainly not looking at that either… It’s just amazing how much money organizations leave on the table by not looking at their direct response results, not to mention the possibility of upgrading them to monthly donors…

    I’ve been fortunate to work with some wonderful organizations and I’ve seen a number of campaigns where we’ve even been able to make money on acquisition!!!

    And those organizations are now seeing the benefits in their growth in donor results.

    But, all we can do is keep educating our organizations about the results of direct response and hope that we can get in front of those board members to help them understand the bigger picture and the continued potential. Keep’m coming… ! Sincerely, Erica Waasdorp, A Direct Solution

  2. Mike Browne says:
    June 12, 2014 at 8:28 am

    Great stuff … if we could all Time Travel back to the 1980s.

    I’ve dealt with the ignorance (let’s call it what it is) of board members as well as CEOs of commercial enterprises when it comes to direct marketing all my professional life. Yes, the newspaper campaign to paint direct mail as “junk mail” was incredibly effective at creating the mindset in the public that still persists in NPO board members minds today. Helped along of course by “bad” direct mail.

    But be careful today, the carping you are hearing from board members about direct mail may be their frustration that fundraising management keeps defending direct mail even as the world moves online.

    After almost 40 years in direct marketing (president of mail order company in 1980s and Founder & CEO of direct marketing agency in 1990s) why are we wasting time and energy (and the precious limited attention of harried fundraising professionals) talking about a dying media? Of course it’s not dead … yet, but come on, they still print and deliver dead tree yellow page books that not person you know still reads.

    Instead of spending time and energy today trying to counter board ignorance about the value of direct marketing, which we all know is in terminal decline, rather, let’s spend our time educating and challenging NPO fundraising leadership about the need for new “online” models of fundraising that can work.

    I mean seriously, this post could have been written back in the 1980s when it actually would have had value and meant something when direct mail was our state-of-the-art valuable media. But today!?!?!?

  3. Nick says:
    June 12, 2014 at 9:02 am

    “…direct-response donors (the bottom of the pyramid)…”

    Poor direct-response donors 🙁

  4. Dennis Meyer says:
    June 12, 2014 at 5:55 pm

    I agree with Erica…the truth is somewhere in the middle, and yes, board members are often attracted to “shiny new things.” Ideally, board members should not be involved in decisions re strategy and tactics. The learning curve is just too long.

    I’ve also heard board members and other critics argue that direct marketing “is in terminal decline.” This speculation seems to come from those with digital stars in their eyes!

    It’s rare that one channel generates the gift. One has to use multiple channels today, and direct mail, even though it’s expensive, still has it’s place. You just have to be better at it, and smarter in how you use it to communicate with donors and prospective donors.

    Keep agitating!

    Denny

  5. Simone Joyaux says:
    June 13, 2014 at 8:10 am

    Nice conversation. But I think the larger problem is the fact-denying nature of the world today. God did it in 7 days and only 10,000 years ago (or whatever the story tells). She could have still done and one can still believe in evolution. I’m the CEO of a big company and I know more than any little (or big) nonprofit staff. I’ve raised lots of money as a volunteer (and I give lots of money, too) so I know what works.

    Opinion versus body of knowledge. I posted a rant about that in my blog a while ago. And it’s also in my Free Download Library. Fundraising is a profession with a growing body of knowledge. Professionals can explore professional insights and experience. Non-professionals (most board members) can ask questions but they must be stopped from promoting their non-professional opinions based on personal experience and power.

    Science. Facts. The Enlightment. Or… fact deniers, power pushers. Take a look at Chris Mooney’s article in Mother Jones a few years ago… about the science of why people don’t believe science. Then lead your board members to understanding. Or remove them.

    It’s Friday the 13th. I’m crabby. Today is the day that deMalay (yes, French) head of the Knights Templar was burned at the stake. That’s why Friday the 13th has such a bad rep.

  6. Mike Browne says:
    June 13, 2014 at 8:14 am

    I’m probably the source of the phrase, “in terminal decline” as it pops up in my blogs frequently. But it’s not “direct marketing” that is in terminal decline … It’s direct MAIL that’s in TERMINAL DECLINE.

    And let’s not be too hard on board members, especially those in their 20s, 30s and 40s who keep raising this “shiny new thing” called the Internet. And the reason they keep raising it is that they see their organization database of donors stagnating or shrinking and growing older and their fundraising professionals keep “doubling down” on direct mail instead of DOING THE WORK to move THEIR learning curve when it comes to online fundraising.

    If professional fundraisers don’t figure out a new business model that is essentially 100% online … THEY will be in terminal decline!

    -Mike

  7. Mike Cowart says:
    June 26, 2014 at 10:29 am

    Agitators,
    I love this one and needed it so badly for several nonprofit healthcare foundation prospects who are desperately trying to convince their C-Suite and board of focusing on lifetime value of donors and not a line item expense on the income statement.

    I was invited to do a board presentation by the CDO of a large hospital foundation. The Board Chairman owned several car dealerships. He introduced me by saying, “Direct mail doesn’t work, but we promised Mike he could have ten minutes.”

    Thank you
    Mike

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