“Smug” Is A Four-Letter Word
We talk about falling retention rates when the reports from the Blackbaud Institute Index or the Fundraising Effectiveness Project (FEP) is released each quarter. We don’t talk about how many poor fundraising practices contributed to that decline. We talk about the declining overall number of donors, not how fundraising malpractice contributed to the failure to hold on to their donors.
You can see how the use of general trends and sector statistics has the effect of shifting the focus off the skills and practices of fundraisers onto donors. Even the terms “lapsed donors” or, more accurately, “malpractice against donors” are problematic. They’re passive constructions—no proactive agents in those terms. It’s just a negative thing that happens to donors. Nobody is doing it to them. Fundraisers aren’t even part of it.
The use of passive terms and generalized benchmark statistics when it comes to getting an accurate picture of a fundraiser’s –and the overall organization’s –commitment and care of donors is dangerously misleading.
Why? Because it’s too easy to become smug or complacent where benchmarks are concerned. “Oh look, our retention figures are ‘average’ so we’re doing fine” ….” Wow! We beat the benchmark. Can’t wait to tell the board and CEO.”
No need to dig in and determine why we’re losing donors and how to stop the hemorrhaging.
I have yet to see a fundraising report that starts with “In the year just ending we lost 1245 donors. Had we held on to them they would be worth $327,000 over the next five years. And this is what we’re doing to correct the situation.”
Equally important, I have yet to learn of any staff or consultant compensation plans that take donor retention and increased lifetime value into account.
Until fundraisers, CEOs and boards demand a regular report of donors lost and a listing of the remedial steps that will be taken to improve donor experience, retention and lifetime value we’ll drown in a sea of complacency and lapsed donors.
Roger
11 responses to ““Smug” Is A Four-Letter Word”
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Completely agree. Focusing on retention means having a written plan complete with measurable objectives. And it requires holding our feet to the fire to assure we execute on those objectives. Reporting on the data is but the first step. Next comes figuring out what that data really means for YOUR organization, and not so much how it compares against the benchmarks. Even if you’re above average, you may be below average when it comes to your own organization. And that means you’re leaving money on the table. Money that could have gone to your mission. I actually just wrote about this on the Clairification Blog.
I think the high level of complacency stems from the high rate of turnover in most organizations. It’s easier to just pass the buck than to stick around. What’s looks better on your resume than “maintained industry standard growth and retention rates”?
I wouldn’t dream of speaking for Roger. I’ll speak for myself. To my way of thinking, “maintained industry standard growth and retention rates” on a resume puts the candidate in the Only Last Resort pile.
Agreed. By definition transparency isn’t one sided. Too much at stake. Too many causes. Too many lives. Reframe fundraising and nonprofit work into something sacred. Your personal why is a great motivator – for you. It ends there. Yes, you matter, but you are a vehicle for transformation. This is bigger than you. It is bigger than your organization. Self-interest is necessary and warranted but ego should never be a barrier that impedes accountability.
It is always helpful to remember the Mark Phillips quote when planning your communication strategy: “She is not your donor. You are one of her charities”.
Yes Roger, being average is certainly not a recipe for long term success in just about any endeavor.
Perhaps those of us who are part of FEP need to edit the wording as you suggest in our next quarterly report…
I am personally going to suggest that at our next meeting!
Jay, I’ll give that an enthusiastic second when you raise it!
“Good enough” isn’t. Period. It is a disservice to the missions we claim to support if meeting industry benchmarks is seen as success. The data that is out there isn’t intended to provide a cushy, comforting hug. It’s there to give all of us a swift, hard kick in the behind to figure out how we can do better.
LOVE Jay’s idea.
So grateful to you, Roger, for the appropriate “calling us to task.” Thank you thank you.
From my current article (so synergistic we wrote about this on almost the same day):
Sometimes clients tell me their retention rates are good, so they don’t need any advice about how to raise more money. They’re doing swell!
Really?
I’d say a lot depends on your definition of ‘swell.’
If you’re content patting yourself on the back for results that match the previous year, then… swell.
If you don’t really need to raise more money because fundraising represents a miniscule percentage of your budget, then… swell.
If you don’t have waiting lists, or new programs you wish to roll out, or services that could be much higher quality given a larger budget, then… swell.
Otherwise… I don’t really care that your acquisition and retention rates are above the average.
It’s better than the alternative, of course. But they could still be poor results for you. Because you may have lots of unmined potential and be leaving money on the table.
If raising more money could enable you to do more and help more, don’t you owe it to your constituents to endeavor to do so?
Sometimes it doesn’t take much to increase retention and upgrade giving.
Amen Roger! Thank you for the callout.I am sharing this article among my board and professional fundraising colleagues far and wide.
Absolutely this! It’s a massive bug bear of mine and it’s worse in charities with large donor bases, where even sub-standard fundraising brings in income with several zeros at the end, so everyone feels secure in the knowledge that they’re doing well.
The degree that this is probed by organisations is often woeful and it goes undetected in the business as usual operations for years – whilst they lose donors, miss out on millions in donations, and instead spend more to attract more new donors.
I worked with one very large charity that was not doing what I’d consider the basic fundamentals of donor cultivation, and introducing those doubled the net income of their individual donor programme. I was saying today that someone should really have been fired for poor performance for letting that be possible.