BIG’s Blog: Drip, Drip, Drip into 2014!

What if they threw a party and no one came? Does it strike anyone else as odd that the Postal Regulatory Commission’s award on Christmas Eve of a 4.3% “exigency” increase to the Postal Service, now being decried as the end of direct mail, is really the most expected non-event in the history of the Postal Service as well as many circles (though not all) within the nonprofit fundraising community?

I mean, come on! Up to now everyone and their dog could have an opinion on the future of direct mail; or more particularly for fundraisers, the viability of direct mail as a long-term, cost-effective fundraising tactic. Now the “big boys” have stepped up to the microphone and have weighed in . . . and, by the way, they are the only voices that count.

Their verdict (it is now official) is that mail volume will continue to decline and to manage that decline without going deeper into the red, rates must rise, and quickly!  The definition of the peculiar word “exigent” is in line with Merriam Webster's interpretation of “needing to be dealt with immediately.”

Make no mistake about what just happened, it is about managing the decline with as little red ink as possible. What part of “death spiral” don’t you understand?

Please see this as an extremely clear signal for what it is. I know some of you – up to now – still believe that direct mail is your present and your future (“we are up over last year. . .”) but please, please see this for what it is.

Drip, Drip, Drip.

And this is my final blog post mentioning anything related to postal rates, responses, costs, demise etc., etc. I personally am closing a chapter on direct mail. As many of you know, I have been a direct mail marketer for over 30 years! Actually, I closed my personal direct mail chapter five years ago, but up until now my “mentions” were to get you to the same point.

Now it’s over. The PRC’s ruling coming on the heels of the Canadian Postal Service announcement that it will stop home delivery and raise rates substantially ought to be all that you need to . . . as I said in a previous blog post . . . “change your mind.”

You don’t have to “read tea leaves;” this is in plain English. If you can’t see it now . . . there is nothing more I, or anyone else, can do for you.

So are you ready to move on and start building your plan to start growing your revenues significantly again in 2014?

Okay, so now we set about “getting serious” about VIABLE alternatives to direct mail.

But what do we really need to replace?

Direct mail is “relatively easy” to do, there was a time many years ago when it was new to us. Direct mail is also able to reach and build a “national constituency” from wherever your organization happens to be located.

Let’s start with those two criteria.

Relatively Easy: Have you ever learned something new? Skiing (snow or water)? Typing (now called keyboarding)? Driving a car? Would you say that you were an expert at the end of the first day? The second day? The first week? The first month? How about the first year? Even if it took you several years to become “expert” or “competent,” it didn’t mean you couldn’t . . . ski, type, or drive . . . when you started, you just became more competent over time.

National Constituency: Your message needs to cost-effectively reach thousands, even millions of people to find the individuals that share your passion for your ministry or mission. While the Postal Service provided a superb delivery mechanism, there was a cost to it. So you need a new mechanism through which you can share your message that is national (even international) in scope. Hmmmm, I wonder where we could find that?

So, where are we?

1. We need to “learn” a new way to communicate our message. It will help you that you understand direct mail. But, it will be new. But you CAN learn something new and though you won’t be an expert the first day, week, or month, you WILL have started the journey. Can you master something new? Yes!

2. We need a cost-effective mechanism that can allow us to share our message far and wide. And we don’t want to just depend on the written word. We want to share our message via the spoken word and even video. We think the Internet could be that mechanism. Are there limitations on media on the Internet? Not if they are digital. Can we learn and master the Internet? Yes?

Okay, we’ve started . . .

Have a wonderful New Year’s celebration . . . 2014 is the beginning of a “new” fundraising chapter for your organization.

Drip, Drip, Drip.

-Mike

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BIG’s Blog: Drip, Drip, Drip

You are all probably off today. The good thing about having Christmas fall on a Wednesday is that the Development office operates with only a skeleton staff Thursday and Friday of Christmas week with most of you off enjoying friends and family.

Most of us are relaxing in the glow of our Christmas 2013 memories and trying not to do too much as we kick back in anticipation of going full tilt into 2014.

So what is the story with the title of this blog post . . . Drip, Drip Drip? Glad you asked. Although I am very bad as a prognosticator, I am going out on a limb to say that I believe the vast majority of fundraisers who use direct mail to a significant degree in their fundraising WILL FINALLY ACT IN 2014 on what they have known in their gut for a long time, about direct mail’s future.

I have noticed a decided up-tick in senior fundraisers’ conversations with me in person, by phone, or by email actually telling me their direct mail appeals are declining in profitability. We don’t talk about if direct mail will cease to be effective, we talk about when direct mail will cease to be effective. THAT is a major sea change in mindset from even last year at this time. This doesn’t mean that they will stop using direct mail tomorrow, but that they admit direct mail will have a sunset.

Look, every organization is different. I get that. But at some point the facts just pile up and the clarity emerges as the consensus opinion.  Let’s face it, this is a huge issue to fundraisers as it drives how they acquire new donors and accounts for anywhere from 20% to 80% of some organizations’ net annual revenue.

Talk about something that will keep you up at night!

Hopefully your direct mail program is still throwing off revenue. That is a good thing. Once you have changed your mind about direct mail . . . it changes everything regarding how you think about your fundraising strategy. When you finally change your mind and say out loud to yourself or others, that direct mail is not the future, you have subtly shifted from dependence to viewing it as a tactical piece of your fundraising program. And a piece of a program is a very different perspective than viewing it as the linchpin of all your efforts in fundraising.

So now you have moved from DEPENDENCE to OPENNESS in trying things you might have heretofore not considered. All because you “changed your mind.”

THAT is a great mindset to be in going into a new year!

Oh, and Drip, Drip, Drip?

In 2014, “Drip, Drip, Drip” will become our mantra and metaphor for how you need to learn to communicate with a whole new market (new generations) of potential donors.

Join us.

-Mike

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BIG’s Blog: I Rejoice at Your Success

As we wind down to the end of the year, most of us have our office, friend, and family Christmas parties that are a great time to reconnect . . . but also remind us to reach out and connect with other friends and colleagues we have missed throughout the year. Sometimes we are intentional and other times we are reminded by a note, a Christmas card, or in my case, our blog. Yes, I get more emails from blog readers at this time of the year. Maybe they have been meaning to write and then they read one of my blogs and, bam, they act.

Apparently my recent post, "The Tyranny of the Now," was one of those blogs that reminded them to act. That blog encapsulates many of the of themes that fundraisers are struggling with and that I have tried to cover all year. In this recent blog I also mentioned the reality of the long-term decline of direct mail appeals and I even noted the recent announcement by the Canadian Postal Service. The number of emails from blog readers has hit new records, but then our subscriber list has grown as well. In fact, this news about the Canadian Postal Service was so big that some readers sent me notes even before I mentioned it in my blog, which, of course, means it was really big news.

Some of the notes were from regular readers of my blogs telling me that their mail responses were up from last year . . . as if I do not REJOICE in their success. But as JP Morgan, the old Wall Street baron, once said when asked about the market, "the market sir, will fluctuate." Over and over I emphasize again and again that many organizations still have time (due to their still-profitable direct mail) to begin building their future fundraising model, which will be 100% online. Fundraisers need to look at the long-term trend lines of their direct mail programs. Take the time now to begin your new model while you have positive cash flow. I'll bet the senior managers from Kodak would like a "do over" of their decision years ago to dismiss digital photography because they "owned" film. Whether they actually believed film would never go away, or just didn't want to rock the boat, we'll probably never really know for sure. But we can learn from their mistake.

Many fundraising groups across different nonprofit sectors are reporting strength in giving this year versus the last few years, but it is still uneven. Unfortunately, in the faith-based sector where I primarily work, results are heavily tilted to the flat to decline . . . yet again . . . and we all know the reasons.

So, as the radio talk show hosts of the 1950s used to say, "keep those cards and letters (and emails) coming.”

Join us.

-Mike

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BIG’s Blog: The Tyranny of the Now

We are all guilty of this. In fact virtually everyone at every level (with a few amazing exceptions) from the President of the United States to you and me are guilty of failing to prioritize . . . and failing to prioritize makes it appear that we are incapable of making decisions.

Is this really a problem? Well, ultimately, making decisions is what people in leadership do. You know . . . “the buck stops here” . . . “I’m the decider.”

Fundraising organizations are even more prone to this than many other industry sectors. Why? Generally the major culprits are being understaffed and overbooked. Sound familiar?

The other day I read, “The greatest danger is letting the URGENT crowd out the IMPORTANT.” Let’s face it; there is always a tension between the urgent and the important.

As this year draws to a close, many regular readers of this blog and even occasional readers are seeing in the fundraising industry extremely ominous signs that are getting all the more urgent. USPS postal rates are going up even as response rates to direct mail appeals are mostly flat to declining, even for faith-based organizations. Just last week the Canadian Postal Service announced that they will discontinue home delivery and raise rates substantially. Can the U.S. Postal Service be far behind?

We are quickly reaching a point of inflection, or, as the author Malcolm Gladwell calls it . . . the tipping point. The decline accelerates as the old modes pass.

Yet you’ve known for a long time that things need to change.  Whether that means plugging into a learning program like ours or hiring a consultant, it is important to create a new plan that will navigate you into the future. But the day-to-day urgent always squeezes out the time for the important next step. As things are quickly changing, however, it is not about “tweaking” your current fundraising business model, or “doing your job better,” or “working harder.” No, there is a major shift that is going on and its implications are becoming urgent.

You’re not alone.

There is still time, but you have to move this important issue to the urgent list.

Then act . . . now.

Join us.

-Mike

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BIG’s Blog: Now here is a doozy of a question!

Joe Marchese asks in a recent blog; “Does advertising, as we know it, have a role in a world where content is on-demand?”

Whoa!

See, here’s the thing . . . people like you and me don’t even think about what advertising is or the role it plays; we know what it is and we know its role. Pretty straightforward, right? And then this 30-something asks the question that only someone from his generation would ask. And POW . . . we’re stumbling, we’re stammering, we’re caught off-guard.

As nonprofit fundraisers, we know that we will be creating much more and varied content in the future . . . videos, blogs, podcasts, and articles and on and on. We get it that we will have to do a much better job at storytelling to be compelling. Although we’ve told stories through our direct mail for years, we realize we are going to have to “up our game” across other media as direct mail declines.

Meanwhile, in our real lives, we are already plugging into and paying for Netflix, Hulu, and cable-pay channels that offer on-demand entertainment content which means we are watching fewer and fewer venues where “advertising” is present. All this means that our tolerance for “advertising” is either going down or . . . going away. That is really the core question that Mr. Marchese is asking, “What is advertising’s role when all the content is ‘on-demand’?”  

So think about it, as fundraisers, will we be advertising or just delivering compelling stories? And if it is the latter, do we have a fundraising business model that can deliver dollars to our charities in the same way that Netflix and Hulu deliver revenue to their companies? You know, a subscription model. Will a subscription-like model work for fundraising?

Our take is . . . absolutely!

And it’s about time.

Join us.

-Mike

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BIG’s Blog: Why did this video go viral?

First of all, do you understand what the phrase “going viral” means when we use it in connection with a video? I’m sorry, I am certain most of my readers know this term, but some do not. And even those of you who understand the term as it applies to videos, still have yet to internalize the concept in what it could mean to your fundraising organization.

From About.com Web Trends: What Does “Viral” Really Mean? By definition, viral comes from the word “virus,” which is a medical term used to describe a small infectious agent that can infect all types of organisms. In terms of the Internet, a piece of content can spread just like a virus if people become “infected” when they see it. The infection usually comes from emotions that spur the viewer to share it, so they can relate with other people and discuss how they feel.

Watch this short video.

Have you watched it?

Now sit back and ask yourself, “What if instead of WestJet, our organization would have done that?”

Look, I get it that this is not typically or even remotely part of your mission or ministry, but think about it . . . it isn’t WestJet’s mission either.

The Net has the POWER to connect you . . . introduce your organization . . . to millions of people (19 million in WestJet’s case) who have NEVER heard of your organization. Honestly, have you ever heard of WestJet before?

Oh, and by the way, WestJet is a low-cost Canadian air carrier. Why do I bring up that Canadian fact? Well, big news out of the great white north this last week. Last week Canada’s Postal Service announced that they will cease home delivery over the next five years, and substantially increase postal rates. Why? Because just like the United States Postal Service, they are dying. Don’t miss that point.

How far behind is the USPS?

But what were we talking about before I digressed into Canada’s Postal Service? Oh yes, that potentially you could reach 19 million people if you create a video that goes viral.

At this juncture now that you are really thinking, I would be remiss if I didn’t mention that we have a few slots open for our online learning Course’s, “Acquiring the Next Generation of Supporters,” January term where you could learn how to do fundraising 100% online.

Join us.

-Mike

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BIG’s Blog: I’ve got a friend who . . .

I’ve got a friend named Cindy who is about my age (I’m 60). Cindy refuses to get a smartphone. Why? Because she says she doesn’t want to be bothered with work after she leaves work.

Cindy is convinced that as soon as she can pick up emails and texts on her phone that all hell will break loose and she’ll be expected to be connected 24/7/365.

I’m not saying that Cindy’s excuse isn’t real in her own mind, but I wonder . . . what is her real hang-up???

Besides, what message is she communicating to her boss? She could just say, “Look, don’t expect me to respond to an email or a text in two minutes at 10 o’clock at night.” But don’t you think that her boss knows her cell phone number?

Do you work with any Cindys?

In fact, are you a Cindy?

When the boss won’t get a smartphone, what does that say to the rest of your staff about their future? Or worse . . . what if the boss has a smartphone but your Website stinks and it isn’t optimized for mobile?

Join us.

-Mike

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BIG’s Blog: We Need Heroes

Right now in the nonprofit fundraising world, more than anything else . . . we need heroes.

Historical heroes like George Washington in the United States or Nelson Mandela for South Africa are in the pantheon of heroes because they personally sacrificed so much so that we could be the beneficiaries.

When you compare the sacrifices of George Washington or Nelson Mandela to what is being asked of leaders today in nonprofit fundraising, it seems on the surface that there is no comparison. . . yet that is not true. There is courage and sacrifice inherent in stepping forward and finally saying, “we need to seek a new way, we need to leap.” That does take courage and, on any level, courage is courage.

As Seth Godin stated in one of his recent blogs . . .

“Rapid change exposes the work of outsiders, neophytes and most of all, those attracted by the chance to grow. Rapid change sweeps aside the status quo and those that defend it (the stuck former geniuses and the stuck bureaucrats). It replaces them with those willing to leap.”

Will you leap?

Will you be the hero we look back 20 years from now?

We need heroes more than ever today!

Join us.

-Mike

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BIG’s Blog: Towards Sustainable Faith-based Fundraising

Isn’t the goal of our faith-based and charitable organizations to not only sustain year-to-year but also grow? Merely surviving cannot be the operational goal.

Yet again for the fifth straight year in a row, reports are coming to me that results of mail appeals . . . with a few exceptions . . . are down again for the fall appeals and, worse, trending down for the all important end-of-the-year and Christmas appeals. Some faith-based organizations reported an increase last year over the previous few years but, again, they are off this year. They’re off yet again!

At what point do some of these groups say, “Maybe we need a different strategy?”

I know it has been said in these blogs as well as many other places, and by many writers, but it bears repeating yet again . . . the bedrock generations [Depression and WWII] who have supported your organization for the last 40+ years are declining so drastically in number that as another writer has said, “this decline will turn into a firestorm of red ink for way too many fundraising organizations very soon.”

Recently, Laura Arrillaga-Andreessen, the Founder of the Laura Arrillaga-Andreessen Foundation, wrote an article wherein she, as a Generation X philanthropist, shared the way she thinks about choosing who she gives to. Her points are a peek into the mind of younger generations who are not just giving, but really checking out how their involvement makes an impact.

Her list:

1. Outline your strategic giving plan.

2. Research organizations online.

3. Select high-quality nonprofits in which to invest.

4. Apply your time, skills, money and/or networks to a cause you support.

Almost sounds like an approach to retirement saving rather than choosing an organization to donate to. Look at some of the key words and phrases: “strategic giving plan,” “research . . .online,” “in which to invest (not donate . . . invest),” “apply time, skills, money . . . networks.”

Can you even imagine my 86-year-old Mother (or the average prospective donor you are mailing to) thinking like this? How does my Mother choose? Whoever makes it into her mailbox, that’s how.  Forget the issue of direct mail; can’t you see that the “thinking process” of philanthropy has changed? Not “is changing” but “has changed.”

My fear is that too many faith-based organizations think that they “get a pass” and the new thinking doesn’t affect them.

Laura Arrillaga-Andreessen is giving you a true gift this holiday season . . . and that gift is a glimpse into the mind of the supporters you want to reach.

If you don’t have a plan, seek help and information that can help you quickly develop a fundraising plan that can connect and engage younger supporters. These new younger donors offer you sustainability and growth . . . if you can connect and engage them.

Join us.

-Mike

Welcome to BIG's Blog!  Please feel free to forward this post to your friends and coworkers...and email me a comment at: mike@big-db.com