The Risk Not Taken

January 28, 2015      Admin

At the start of the year Steve MacLaughlin, Blackbaud’s Director of Analytics, in his post 5 Things That Won’t Happen in 2015 hit on what I consider the biggest risk facing nonprofits these days — doing nothing.

Sure, not so long ago maintaining the status quo — repeating the same activities year after year — was considered less risky than innovation. After all, the reasoning goes, “let others take the risk on ‘new’ things.”

diceJust one problem. These days maintaining the status quo will ultimately kill your fundraising. Why? Because more and more of today’s donors are expecting ‘new things’ now! Fail to deliver on their expectations and you’ll lose ‘em.

And the ‘new things’ aren’t whiz-bang apps or drop-dead awesome videos, or any of the other stuff that glows in the dark. Instead, what today’s (and certainly tomorrow’s ) constituency craves — and responds to — is something our sector is absolutely lousy at delivering … great donor service.

For the life of me I don’t understand why the concept of great donor care so eludes most fundraisers. Maybe it’s because so many believe it’s the appeals, the frequency of the appeals, the personalization on the appeals, or the ask strings that make or break a fundraising program. WRONG!

In my post Better Than Fundraising, I noted this painful and destructive paradox: On one hand many organizations claim to be ‘donor-centric’. But in reality most merely concentrate their ‘donor centricity’ on the transactional and mechanical dimensions of the appeals or collection process itself.

By ignoring or neglecting the human interaction that results from great customer or donor service, most organizations forfeit enormous sums of money and increased levels of donor commitment and loyalty.

Sad but true. Most organizations do not appreciate the damage or value that poor service or great service produces. In short, there’s far too little understanding of its overall impact on fundraising’s bottom-line. As a result the idea of ‘servicing’ donors is generally treated as a cost center and not as the enormous profit center that great donor service represents.

I’m not advising you to go nuts with risk-taking. I am advising that if you want to reap BIG rewards with NO RISK (other than to your organization’s ego) you might want to start with the simplest — and one of the most important — elements of donor service … seeking the donor’s feedback.

The value of seeking donors’ feedback is reflected in the chart below which was presented in a recent Agitator/DonorVoice webinar.

Why Bother?

In a test involving only a single instance of collecting donor feedback, here’s the performance 6 months after the test:

  • Contributions/purchase of additional offers increased 3 times over the control group.
  • There was a 50% decrease in attrition; and,
  • A 35% increase in net income from the test group over the control group.

As the chart notes, “If ever there was ever a ‘silver bullet’ this is it.”

Last year in September The Agitator offered — free and forever — a simple Feedback Widget to encourage our readers to get started on the essential task of seeking donor feedback.

50+ forward-looking organizations jumped at our offer and put the widget to work. In checking back with them, I’ve learned that some have discovered their donors find their ‘Donate’ pages horrible. Donor feedback has helped others discover that their honor or memorial gift offerings are confusing. Still others find their donors requesting an option for monthly giving or other ways to give.

Even better, in the course of using the free and simple Feedback Widget others have taken addition steps to offer even more feedback opportunities.

My favorite year-end feedback story came from a group that installed an online chat function. With that they discovered their donation/credit card procedure was confusing to older donors. Thanks to this feedback they were able to save a number of year-end gifts and, more importantly, probably saved those donors from retention-wrecking frustration. (If you’re curious why the stats on your ‘Donate’ page are high in the ‘abandoned shopping cart’ department, ‘donor feedback’ will tell you why and what steps you should take to fix it.)

For those afraid to ‘take risks’ and spend some time getting a donor feedback process in place, I say, “Shame on you”.  You’re needlessly risking the increased lifetime value and commitment of donors … risking losing hundreds, thousands or tens of thousands of dollars because you won’t spend a couple of hours properly caring for those donors.

What ‘risks’ are you taking this year? Please share.

Roger

 

 

3 responses to “The Risk Not Taken”

  1. Jay Love says:

    Roger, it is still hard to believe in a relationship centric world such as fundraising you must keep insisting on nonprofits focusing on donor care and donor feedback.

    Keep bringing it up because it does work and each time a few more will try it.

    As I sip a new brew of morning coffee, here is to a Donor Centric 2015!

  2. Tom Ahern says:

    I’m with Jay. Beat this drum over and over, Roger and Tom. Rule of 12. Keep reporting on results from your widget, too. There’s a tipping point out there somewhere. But it will take an unbearable amount of harping.

  3. Jackson says:

    Let me run get this widget. Getting the whole organization team on this wagon is the challenge my org faces.