Monday, April 29, 2013

BIG’s Blog: We Need a New Word for “Audience”

I looked up the dictionary definition of the word “audience.” There were five definitions for this noun, but the closest one that fit how fundraisers think about the word was: “the persons reached by a book, radio or television broadcast.” Now, of course, missing from that definition was direct mail media, since most fundraisers don’t find it effective to: A) write a book, B) use radio, or C) use television.

For our entire adult lives we have been in the era of broadcast media, and, of course, direct mail is a variant of that. We decided how big an audience we could afford to reach and then mailed accordingly. For some organizations that was 5,000 pieces of mail, others 50,000 and still others 5 million.
But here is the key: our audience was always a finite number.
How do we make sense of the Internet? Theoretically, at any one moment there are a finite number of people on the Internet. When you begin to expand that moment to, for instance, how long your Web site is “on,” the number becomes all the people with access to the Internet … or, for all practical purposes, infinite.
So what is the practical aspect of this insight for fundraisers?
Let me use an example of two retailers you have probably heard of. The first is Land’s End, a Wisconsin-based catalogue mail-order company founded in 1968. Since they were a private company, we didn’t know what their gross sales were until, in the year 2000, they sold to Sears. In that year, they reported $1.2 billion in sales. So it took them 32 years to attain slightly over a billion dollars in sales. Very impressive.
I am certain that when Land’s End started, they mailed as many catalogues as they could afford and over the years as business grew, they mailed more and more. So each year, the number of catalogues … their audience … grew.  
Then there was another retailer by the name of that, ironically, was founded in the year 2000. Instead of printing a catalogue, however, they put up a Web site and opened business on the Internet. In less than 8 years, their sales were one billion dollars. Can you say “impressive on steroids?”
So here is my question: How big is Zappos’ audience?
Suddenly, the definition of “audience” that we thought we understood doesn’t work anymore.
The Internet changes everything, including the very definition of the concepts we thought we understood.
If you’re age 50+ and are running the fundraising operation of a nonprofit, and throughout your entire career have defined audience as finite, it is eye opening to find others that are hugely successful, just because they have changed from chasing “finite” to “infinite.”
Join us.
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Friday, April 26, 2013

BIG’s Blog: The Agitator Chimes In

Tom Belford and Roger Carver are responsible for the blog, The Agitator, and it is undeniably one of the the most popular and influential blogs in nonprofit fundraising. After you read their blog for a while, you clearly understand why they call it The Agitator. They are constantly pushing, prodding, tweaking, admonishing and encouraging nonprofit fundraisers to “up their game” and raise their practice of fundraising.

Last Monday I wrote a post entitled When a Page Turns, it Turns Fast.” In it I referred to the momentous decision of the 100 year-old American Cancer Society to abandon direct mail acquisition; a decision that is sending shock waves through the fundraising industry. By the way, that post of mine generated more comments than any other blog to date.
And lest you think that it is just me … yet again … giving my opinion that direct mail fundraising is in decline, now comes The Agitator post with the title “The Courage To Change,” handing out huge kudos to the American Cancer Society for their courageous leadership.
Look, I know you are busy and can’t read every email or blog … BUT READ THIS ONE (Click Here) … AND THEN FINISH MY BLOG TODAY.
Because your nonprofit organization’s financial existence may depend on it.
Hyperbole? Not really.
Over the last five years, we have audited twenty-some fundraising organizations that receive the majority of their donations through direct mail appeals. Upwards of 85% of their donor base are age 68 and older...most in their late 70s and 80s. Their donor files have aged and shrunk over the last 20 years.
Project that out ten years. What does it look like? Pretty scary, huh?
I really appreciate Tom and Roger’s hubris in The Agitator. Though they point out the problems with the current status-quo-thinking of most fundraising organizations, Tom and Roger still believe that somehow … somehow … fundraisers are going to iterate change to some new promised land of fundraising. They believe in transition.
But it’s not transition … it’s Transformation.
Join us.
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Wednesday, April 24, 2013

BIG’s Blog: Scarred for Life

Years ago, I was giving a presentation when my laptop started to smoke. I closed it up and handed it to one of my colleagues who removed it from the room. I went right on presenting.

It was a big presentation that meant a lot to my company. I could have been scarred by that experience with technology and been scared of using technology in a presentation again. That, of course, would have limited my abilities to make really effective presentations.
Today, virtually all technology works. In fact, you either get the new thing or hand it off to someone else before today’s technology breaks. Remember when cars used to break down with unfortunate regularity? Yes, many of us … shall I say “more seasoned” citizens … remember when stuff broke, or, in the case of technology, crashed. Today it’s stable, it’s beautiful, and more and more we are all on the same Internet.
So what is keeping some nonprofits from moving their technology to the cloud? Certainly not the stability, the speed, or capacity.  After all, most of the largest companies you know are already renting computing power from even bigger online companies.
Did you have a bad experience like me … only it scared you and left a scar? Or, does the change from software on your computers to software in the cloud not make sense to you?
Either way, the sooner you start moving to the cloud, the sooner your nonprofit saves significant dollars.
Join us.
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Monday, April 22, 2013

BIG’s Blog: When a Page Turns, it Turns Fast

“When a page turns, it turns fast.”

Jerry Weintraub on Paul Anka in the May issue of “Vanity Fair.”
Jerry’s writing about his friend, Paul Anka. Let me give you the complete paragraph for context:
“For Paul, the biggest test, the thing that could have killed his career before it really got started, came in the early 60s, when the Beatles made their first tour of the United States. My God, nothing was the same after that. It was as if the old cavalcade of stars was folded up and shoved in the back of the closet. The biggest stars of the 50s, the heartthrobs, they couldn’t get on radio or sell 10 tickets to a show. WHEN A PAGE TURNS, IT TURNS FAST. You might run across some old rock idol and suddenly he is not 19, he’s 27 and pushing a broom around Grand Central, or working as an agent.”
Props to Bob Lefsetz from his blog for the above.
Jerry Weintraub’s story about Paul Anka is a perfect metaphor and object lesson for today’s mature fundraising organizations that are overly dependent on direct mail appeals.
Many in the direct mail fundraising community had heard about the decision of the American Cancer Society at the end of last year, but they were either keeping it quiet or were in denial it would really happen. But then, when Angie Moore, a respected consultant, wrote an article in Successful Fundraising about the American Cancer Society dropping acquisition mailing… all hell broke loose.
Here’s the deal.  Direct mail as a “technique” will be with us for some time to come, but “direct mail programs” are fast becoming history. And what most mature nonprofit fundraising organizations have are direct mail PROGRAMS.
Will this happen overnight? Probably not, although it could. The question is this: What is your Plan B?
Some of the smartest and most successful direct mail fundraisers are evolving duel strategies. What is a duel strategy? A duel strategy is managing two completely different strategic fundraising approaches for separate audiences. For example, they are continuing to manage their direct mail “program” approach as they always have (because that is effective with older donors) while decreasing acquisition mailing and managing the profitability decline they see already happening in their direct mail programs. Their other strategy is to ramp up a separate “pure online” strategy targeting the Baby Boomers, Gen-X and the Millennial generations.
“When a page turns, it turns fast”… are you ready?
Join us.
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Friday, April 19, 2013

BIG’s Blog: This Changes A Lot ! !

In March of 1977, my father-in-law, who ran a mail-order company selling sewing machines, opened the Wall Street Journal and read an article that said the Singer Sewing Machine Company would cease all advertising.

To put that announcement in perspective, it would be as if Hoover said they were going to quit advertising vacuum cleaners.
The Singer Corporation was already a conglomerate of many companies selling all kinds of products including aerospace, if you can imagine. But the brand Singer meant sewing machines to generations . . .and to stop advertising was an admission that home sewing was in severe decline.
So what to make of the American Cancer Society’s admission that in 2013 they are stopping all acquisition direct mail… reportedly 41 million pieces mailed in 2012?
Frankly, it is the shoe that a lot of us were waiting to drop. It is the admission by a large and sophisticated fundraising organization of what we all already knew: that direct mail is in a long-term decline. To quote a good friend of mine who has been a very successful direct mail fundraiser, “Direct mail’s best days are in the past.”
It’s not just your organization.
Notice as you read the article that the American Cancer Society uses the word “transform” over and over. That is where fundraising is at today…you must transform.
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Wednesday, April 17, 2013

BIG’s Blog: To Accomplish the Mission

An old protestant pastor relates the story of his wife never feeling like she could wear a new dress because the expectation of a pastor’s wife was that they lived simply and hand-to-mouth. Where did that perception come from?

The expectation for people who work in nonprofit charitable organizations is that they are paid below market wages because a charitable organization can’t be funding the staff’s lifestyle. And, oh, they are expected to wear many hats because, after all ….
After all… what??
Where did this thinking come from?
If I walk into Best Buy to shop for a big screen TV or a computer, do I sneer at the store manager or the geek on the floor because I think their price is too high and I don’t want to subsidize their lifestyle? No, if they want more than I think it is worth, I don’t buy from them.
If I support a charitable institution and their outcomes don’t match my expectation, do I say they are paying their staff too much? My main concern is that they are actually accomplishing the goal for which my money is given. I really do want to see that they are accomplishing the mission. That pretty much sums up the philanthropic attitude of the Boomer generation.
I’m a Baby Boomer. Do you think attitudes of Boomers differ from their parents and grandparents? Judging from the way racial attitudes – as one prominent example - have changed over the last 30 years as the Boomers have aged, I would say, “Yes.”
So then do you think – maybe – attitudes about philanthropy might have changed as well? Do you think that shift has been along generational lines? Answer… yes.
Is that a bad thing?
I think not, and here is why. It allows a fresh start. We can throw out some really stupid and ignorant attitudes about how a person must dress or what they get paid merely on their choice of occupation in the charitable world. Or, in the case of the pastor’s wife, merely being married to someone in the charitable world. Really stupid!
What matters are outcomes.
When you build processes – for example fundraising – around erroneous and stupid  expectations and perceptions from generations past, it skews the whole of the organization and reinforces mediocrity of outcomes in fundraising… but also in mission. This is really stupid.
If you are talking to Boomers, explain the mission and the value of the work, then ask for their support. Then, if you are transparent and accountable AND you are producing good outcomes… Boomer money keeps flowing.
Does your charitable organization do this? If so, then by now the preponderance of your supporters are Boomers… right?
They’re not?
My friend Michael Wick says, “It is time to move from wearing hats to hiring heads.” He gets it… but he also gets the generational change and its implications and expectations on charitable organizations.
Seriously, is your organization still operating with perceptions and expectations that were built for my parents or grandparents? Do they harken back to “White Only” drinking fountains?
You may be repulsed by that … as well you should be … but that only proves you are aligned with the Baby Boomer mindset. It also means you are probably a Boomer yourself and you understand what I am saying. But if that’s the case… where are your Boomer supporters? Boomers today are 25% of the U.S. population, or about 80 million out of 300 million. This year Boomers are age 49 to 67. By now, they should be the majority of your donor file.
So if your donor file isn’t majority Baby Boomers… something is definitely wrong. And if you don’t realign your organization, including your Development organization to connect with Boomers, you won’t be accomplishing the mission for long.
Join us.
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Monday, April 15, 2013

BIG’s Blog: Social Media and Generational Perspectives

My friend Dave Targonski recently had the opportunity to observe – up close and personal – how the Millennial generation engages social media. Dave is a fundraiser, the father of five, and a Baby Boomer. Here are his ruminations.

The last time you heard live music what did you do?

  1. Attend with a group of friends and we enjoyed dinner, maybe some dancing but a lot of laughs.  Spent no time on social media
  2. Had dinner beforehand with a couple of friends, enjoyed the music with little interaction during the music – talked about it after listening to the band’s CD’s on the way home, and updated your Facebook account in the car or at home if you drove.  Spent maybe 10% of your time on social media
  3. Went to the concert with one or two friends.  Your actions of the night:
    1. Arrive at concert
    2. Upload pictures on a Social Media site
    3. Listen to music
    4. Comment on social media websites
    5. Listen to more music
    6. Upload video from concert
    7. Comment on others peoples’ comments to your pictures/comments (missing song you really like)
    8. Listen to more music
    9. Meet up with random concert attendees you meet online that night
    10. Go home and create a video/picture montage of the evening
Spent 50% of time on social media

Depending on how you answer, you could be in the Greatest Generation, a Baby Boomer, or a Millennial. Think about what these actions say about each group.

While I would not even think to act like a Millennial, think about it from their perspective.  The concert is not just a concert; it is a shared event among a large group of people who I may or may not know.  I will sacrifice my pleasure (listening to the song) to give pleasure to unknown people via my use of social media.  Instead of detracting from the experience it actually makes it a better experience.

In terms of fundraising, it illustrates the HUGE gap between how the generations engage with social media. One-size-fits-all direct mail is fine for the Greatest generation, but for the Boomers, now that they have engaged social media, one-size-fits-all direct mail is looking a bit dated. To the Millennials, well, they aren’t even opening the snail mail.
Courtesy of Dave Targonski, Belmont Abbey College.

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Friday, April 12, 2013

BIG’s Blog: The Rich Woman Walking Down the Street

She is in a strange city. She’s a good woman. She is a caring woman. She sees an obvious need from people holding signs in the street and asking for spare change. She gives them money. Does she have a relationship with these people? Will she ever give them money again?

She’s a good woman. She is a caring woman. She receives a direct mail solicitation from your organization asking for money for your mission. She is moved and sends you money. Does she have a relationship with your organization? Will she ever give you money again?
I would guess that there is more of a chance she will give again to a person on the street than to your organization a second time. Ooops, I don’t have to guess! 60% of first-time donors DON’T give a second gift.
Why do I think there is more of a chance for her to give again to a person on the street than your organization… besides the statistics telling me 6 out of 10 people DON’T give a second time? Because she has more of a connection to the person on the street than she does to your organization.

If today your Development organization doesn’t exist to create connections, maybe it’s time to rethink how you’re connecting.

Join us.


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Wednesday, April 10, 2013

BIG’s Blog: The Connection Economy

What does the “Connection Economy” mean?

Seth Godin, the prolific blogger and author, explains it this way:
“In the connection economy, there is a dividing line between two kinds of projects: those that exist to create connections, and those that don’t. The Internet is a connection machine. Virtually every single popular Web project (eBay, Facebook, chat, email, forums, etc.) exists to create connections between humans that were difficult or impossible to do before the Web. When you tell us about your business or nonprofit, or public work project, tell us first how it’s going to help us connect. The rest will take care of itself.”
Something has changed in how people (you and me) EXPECT to communicate, whether it is a business we buy from or a nonprofit we support.
Another word for “connection” through the Internet is “interaction.” Are you interactive with your supporters? Or, better yet, can your supporters be interactive with you?

If today your campaigns don’t exist to create connections, maybe it’s time to re-think how you’re connecting.

Join us.


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Monday, April 8, 2013

BIG’s Blog: Cyclical versus Structural Downturn in Donations

We are all seeing that donations are down. On that we all can agree. Now The Nonprofit Finance Fund just released its annual State of the Sector survey results detailing the decline in funding sources and actually stating that “Nonprofits need new funding sources and models.”

That last word, “models,” is key.
In the coming days I will address the above report in a whole blog, but today I want to address the separate beliefs as to what is behind the drop in donations.
Development professionals fall into two camps. The first camp believes that the downturn in donations is cyclical, while the second camp believes something structural has changed and donations will not come back unless we address this structural change that is keeping donations declining.

The argument mirrors what is going on with economists as they attempt to figure out why unemployment remains intractably high.

One camp of economists believes that the prolonged stagnant economy is keeping unemployment numbers close to 8%. Their argument is simple: When the economy begins to grow again, unemployment will decline. This is the cyclical camp.

The other camp of economists believes that something else is at play. When they look across all sectors of the economy, they see half of the businesses in the sector growing while the other half are badly lagging. This camp believes that something structural is holding back the performance of one group, while at the same time allowing the other group to grow. So what is this structural “thing” that divides the performance of the two groups? On this point there is an almost universal consensus. It is the Internet and the digital revolution it has wrought.

As fundraisers, if you fall into the cyclical camp, you believe that you can bolt on digital tools, yet still overwhelmingly continue to base your strategy on direct mail appeals. When the economy comes back, so, too, will our direct mail responses.

But if you are a fundraiser who is starting to believe that “the internet changes everything” … and everything includes how you practice fundraising … actually changing your fundraising model. You fall into the structural camp, and I am right there with you along with the folks at The Nonprofit Finance Fund.

Join us.


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Friday, April 5, 2013

BIG’s Blog: The Clock Is Ticking

In his book, Outliers: The Story of Success, Malcolm Gladwell coins the phrase “The 10,000-Hour Rule.” Essentially, Gladwell argues that the key to success in any field of endeavor is, to a large extent, a matter of practicing a specific task at least 10,000 hours.

Put into a forty-hour workweek, that is about five years . . . and, anecdotally, we would pretty much agree that it tends to make sense.

You are already a competent and accomplished professional in the work of fundraising, as it has been practiced for the last forty-some years. You have long-since passed your 10,000 hours. Now, however, the very foundations of how fundraising is practiced are shifting. It’s that darned online thing! And it takes a whole new fundraising model.

You’re the Development Director or leader and you know… or guess … that your organization has another five years of income generation (albeit declining) through your direct mail program.

Don’t you think it is time to start building up a new online model that appeals to younger generations? Accepting that it will take five years to get it really rocking and rolling…why are you waiting?

Join us.


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Wednesday, April 3, 2013

BIG’s Blog: Yesterday’s Vision

Some sixty years ago direct mail appeals for charities were in their infancy. The vision of the early pioneers of this medium paved the way for countless charities to cost-effectively reach tens of thousands, hundreds of thousands, and millions of prospective donors to generate billions of dollars in donations and build files of supporters to go back to again and again.

Sadly, direct mail’s best days are in the past, and its future is decline and eventual obsolescence.

Today, charitable institutions sit at the dawn of a new mode of fundraising: the online digital world . . . and the online world holds an even bigger promise of reaching more people in a more cost-effective way for charities than did direct mail. The biggest plus of this new online world is the real possibility to build actual, connected relationships.

What’s needed is the vision to see the possibility, the fortitude to change the organizations (for the better), and the will to do it.

Yesterday’s vision is in the rearview mirror. Tomorrow’s is right in front of you.

Join us.


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Monday, April 1, 2013

BIG’s Blog: We Are All Geeks Now

It used to be in your social circles there were one or two people who were always talking about the cool new technology gadget. They liked the new and always had to have the latest right after it came out.

The rest of us fell into one of two camps; either we were the ones who waited until the “new thing” was bug-free and cheaper before we bought it, or we fell into the camp that actually seemed to pride themselves on being the last to change or, frankly, never change.

But things are changing. Even my full-on Luddite friends, the real laggards who, as recently as a year ago, still enjoyed pulling out their six or seven year old flip phone and telling those assembled, “it only makes phone calls,” are now sporting smart phones and talking about getting an iPad or Kindle Fire like their wife.

Their whole demeanor has changed, and the conversation turns to the latest app. They talk about getting their scores, weather, stock quotes, and restaurant menus right on their phone. Honestly, most of these people are guys, and the older ones at that. I have come to believe that they actually were scared they couldn’t learn how to use the new smart phones and tablets. They remember having to learn software programs at work that were not intuitive and sometimes took months to learn. Someone showed them how easy these new intuitive devices are, and bam… they crossed the line to users.

So what does this mean for fundraisers?

It means my Baby Boomer friends are more and more online. This is changing their behavior in how they get used to consuming news and information and, more to the point, how they are reading fewer and fewer printed publications.

It doesn’t mean that these folks won’t still open your direct mail appeal letters, but it solidifies the reality that those in their 20s, 30s, 40s and 50s have shifted.

Join us.


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