BIG’s Blog: What Part of Free Don’t You Understand? – Part One

Over the course of the next month, I am going to try to drive home the point that there is a very big “leveling of the playing field” for fund raisers going on through new technology. By-the-way, this is good news for small fund raisers and not-so-good news for larger fund raisers.

In case you haven’t noticed, the prices of computers and services through the Internet have gone down over the past twenty years. Somebody said that if the price of a new car followed the price of computing power in your PC or laptop computer, that a new car would cost 50 cents. Remember long distance bills twenty years ago? Now we get unlimited calls for $20 and some calling services over the Internet are free.

Free...what’s with that? How do they stay in business?

Why is this bad news for large fund raisers; especially those that have large direct mail fund raising programs? Mail is about economies of scale. If you are a small organization and you mail 10,000 pieces of mail, you are going to pay a much higher cost per piece than someone who mails 100,000 or one million pieces. Scale works for the large direct mail fund raising organization.

But now let’s talk email. A small organization can send out 10,000 emails to their supporters for virtually the same price as the large organization sending out one million. The larger organization will still reap more donations, assuming both have similar response rates, but, the larger organization has lost its economies of scale advantage.

What are the implications? We’ll talk more about those in the next blog.

-Mike

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BIG’s Blog: It’s Not About You

For the last several years, thought leaders, thinkers and pundits in the nonprofit fund raising world have been talking about the move from organization-centric to donor-centric approaches for fund raisers trying to reach out to younger generations.

The basis of this thinking is rooted in the changing attitudes towards giving and being involved as well as the reality of how our consumer society influences expectations. For example, more and more successful retailers recognize that “success” comes from being customer-centered rather than being business-centered. It’s about the customer.

Real world examples of Customer Friendly versus Customer Un-friendly service:

Customer friendly – Zappos – an online retailer. Zappos have people to talk to you about anything dealing with their merchandise or orders 24/7/365. Zappos customer service will do whatever to make their customers happy.

Customer Un-friendly – Time Warner Cable – a provider of cable services. Time Warner mostly has monopoly municipal contracts to deliver cable television and other services. Have a problem; just try getting the right person on the phone for even the simplest fix. And if you are trying to terminate service – forget about it! One wonders if their customer service is by intent. But one thing is sure; it is certainly not about the customer.

In other words, is it about what your organization does for the target of your mission (it’s about you), or is it about what your constituent donors can do (it’s all about them)? Big difference.

The easy part is changing your message. Today’s younger generations want to be a part of something bigger than themselves; they want to “feel” they are a part of the mission or the movement of change. This comes through in how you talk and communicate with your constituent donors. But what shows the real commitment to be constituent donor-centered is how you handle the access – mostly through technology – you give to younger more tech savvy prospective constituents. This demonstrates that you “walk the walk” not just “talk the talk.”

Wait a minute. Did you think I was just talking about Gen X and Millennial generations? Actually, all the above applies to the Baby Boomers as well.

-Mike

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BIG's Blog: Something to think about...

"The central problem of our age is how to act decisively in the absence of certainty." - Bertrand Russell

"After all is said and done, more is said than done." - Anonymous

"It's always helpful to learn from your mistakes because then your mistakes seem worthwhile." - Garry Marshall, 'Wake Me When It's Funny'

"When written in Chinese, the word crisis is composed of two characters. One represents danger and the other represents opportunity." - John F. Kennedy

These quotes should spark some thought. Ask yourself the question, “How can nonprofits address the strategic challenges brought on by new technology, changing demographics and a world in financial uncertainty?”

-Gail

BIG’s Blog: The Silver Bullet Approach cont . . .

Last Tuesday, (March 8), I wrote about how easy it is to buy things...I called them Silver Bullets for fund raisers. Rather than first doing the heavy lifting of developing a well thought out plan leading to a strategic solution, instead, we tend to buy something that we hope will solve our immediate problem.

The other day I was talking to a Chief Operating Officer (COO) of a large missionary organization and he said, “We think we know what the problem is, but, how do we get the answer?”

Don’t we all do that? Don’t we all want to jump to the answer as if it is a cookie cutter tactic or thing that will solve our immediate pain?

I don’t think this is a Baby Boomer instant gratification reaction; rather, I believe it is an emotional reaction by really good people to the speed of change that is coming at us and the pressure to have immediate answers.

But, here is the deal...RESIST with all your might the pressure to jump to Silver Bullets.

What is coming at us today is WAY bigger than anything you have experienced in your fund raising career. Or, for that matter, way bigger than anything to hit fund raising since the inception of your community or organization.

Think I am kidding? How about the biggest change in over 550 years...since the Gutenberg printing press.

We are quickly moving out of what they call the “analog” world (printed ink on paper) and into the “digital” world of electronic forms of communication.

It isn’t that we don’t know this is happening; the problem is we really don’t know all of the IMPLICATIONS for our organization of this shift. And it is those “implications” that can lead to unintended consequences of the bad kind...unless...we thoughtfully draw back and develop a new strategic direction incorporating the best of what we do today with the new technological opportunities that are all around us.

Has your fund raising group updated its strategic plan in the last five years? Have you ever done a strategic plan in your fund raising group? Well, my take is that if a 550-year event doesn’t call for a new strategic vision of how you fund raise...I don’t know what does.

-Mike

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BIG's Blog: Beatles or Disco - Who are you?

It is interesting when you look at the Baby Boomer cohorts. Their births span 18 years. Fundraisers should take this statistic into consideration when developing their communication to these cohorts. Marketing and fundraising efforts may need to be different.

Let’s look at their life experiences. Baby Boomers born between 1946-1954 remember the assassination of Martin Luther King Jr., John F. Kennedy and Bobby Kennedy, “Cold War” bomb drills, the Vietnam War and Watergate. Many Boomers of this group were personally involved in some way with the Vietnam War. These events led Boomers to soul searching on moral and ethical topics.

And who could forget the Beatles coming to America and Woodstock? These events changed the world of music and the lives of many early Boomer cohorts.

Even with all the life changing events during this period, Boomers still held onto traditional values.

Baby Boomers born in 1955-1964 did not face the same challenges as their earlier cohorts. Many are too young to remember the assignations, the wars and political scandals.

On the other hand, those born in the later years of the Baby Boomer era were raised on disco and “rock & roll” music. The use of recreational drugs and having casual affairs became more prevalent. Birth control, along with the Women’s Rights Movement, changed the life for women of all ages. Women were now thinking about careers and putting off having children.

For Baby Boomers who identified themselves as Roman Catholics, the Vatican Council profoundly changed the way they practiced their faith. Many Roman Catholics of this cohort and those that follow don’t actually believe (or even know) what Catholic theology states. This same trend is seen in other religions as well.

What does this mean for fundraisers? Your nonprofit’s mission should find ways to address their unique generational values and shared life experiences and correlate them with your need for support. Ensure the messages you send resonate with their life experiences.

-Gail

BIG’s Blog: The Silver Bullet Approach

From the Wikipedia online encyclopedia, the definition for 'Silver Bullet' is as follows: "In folklore, the silver bullet is supposed to be the only kind of bullet for firearms that is effective against a Werewolf, witch or some other monster."

What’s your biggest monster in fund raising today?

In the world of nonprofit fund raising, we are familiar with the Silver Bullet concept too. It goes like this . . .

“My donations are down, but if we just had a better Web site.”
“My donations are down, but if we just had an up-to-date database.”
“My donations are down, but if we just used email blasts.”
“My donations are down . . . " Okay, you get the point.

The nonprofit fund raising world is so chronically overworked and understaffed that there is little time to:

S-T-O-P, take a breath and look at the big picture.

Rather than a silver bullet, a better approach is to find a trusted advisor that can help you work through some long-range and focused questions like . . .

1. With all the technology changes, how does that affect your fund raising?
2. How does the current generational shift affect your fund raising?
3. How will increasing competition affect your fund raising?

It is so easy to buy things . . . Web sites, databases, etc.

But if you don’t know where you are going, any road will take you there.

Don’t substitute silver bullets for a plan.

First, develop a plan.

Then buy what you need to make the plan work.

-Mike

Welcome to BIG’s Blog and yes, by all means forward our blog to your friends and co-workers.

BIG's Blog: Can religious nonprofits create a dialogue with cohorts on a limited budget?

The answer is “Yes!” And, research is one key to your success. We all know that testing is expensive. And, now there are many new options for reaching out to constituents. So where do you start?

Begin by looking at corporate marketing efforts. See the images they use in magazines. Watch TV and visit websites to see how others portray the generational differences. Make note of them. Then take what you have seen and complete a review of your organization’s communication and fundraising materials.

Do your ministry's brochures, website and fundraising materials need a facelift? Has your organizations' ministries changed its look and feel over the years? Will this next generation of constituents understand the value of your ministry to their lives through your current communication tools?

Use the visual concepts you see in your daily life and apply them to your ministry. As you create marketing strategies for your organization, test some of the imaging you have seen. Monitor your results. Remember imaging is just one part of the message. Test copy with the next generations of non-traditional religion cohorts.

Though our biggest challenge today is reaching out to Boomers for support, do not forget to communicate to the younger generations who may be willing to give to the nonprofit in other ways.

-Gail

BIG’s Blog: A Big Email Week!

Since our email message earlier this week that the National Catholic Development Conference had joined The Alliance of Nonprofit Mailers in opposing the Postal Service's plan to eliminate nonprofit preferred mailing rates, our email box has been flooded with questions. Many NCDC members and others were completely shocked that the fund raising work horse of direct mail--as we have known it--could be at risk. We found no fund raisers who said they could take a 100% + increase in postage.

In one of my seminars last year, I told the group about a situation I saw play out in the 1990s that I find very similar to what nonprofit direct mailers are facing today with their direct mail efforts.

In the 1990s, I owned a database marketing agency that only dealt with large banking companies. And more particularly, we only dealt with what they called the “retail” sides of bank business, meaning individual customers of the bank. So, if you as an individual opened a checking account, you would fall into the retail side of the bank.

Speaking of checking accounts, all through the 1990s, the banks were issuing bank debit and credit cards as their customers asked for them since A.) they were more convenient for their customers to use rather than writing checks, and B.) it was less expensive for the bank to process.

My company had 13 of the top 25 largest banks in the country as clients, so we could clearly see the huge number of customers that were signing up for debit and credit cards. By the late 1990s, almost 95% of all bank customers had bank-issued credit and debit cards.

Seeing this trend, every year from 1995 on, we would expect that the companies that printed checks would finally see their check printing volume begin to decline. Right? But every year through 2000, we were proved wrong as check volume went up; maybe only two or three percent, but up nonetheless.

But then in 2001, the volume slid 4½%. In 2002, the volume slipped another 7% from the previous year. And in 2003, it fell another 14%...and then it just plunged!

Today, check volume is a fraction of what it was in 1999. The ease and convenience of debit and credit cards PLUS the change in behavior finally caused the “worm to turn.” And when it turned – it was a huge fall-off.

The point of my story is that we can’t predict when the “tipping point” will come for direct mail...but it will come.

Start planning for it today!

-Mike

Welcome to BIG’s Blog and yes, by all means forward our blog to your friends and co-workers.

BIG's Blog: “I Just Know” – Boomer Response

Some individuals are born with a strong intuition. They will tell you that there are times when you “just know,” that your “sense” is right. And, as you age, life’s experiences come more from an emotional response (intuition) versus reasoning. Life experiences have taught you that your sense is right.

My intuition tells me that there is a market for religious nonprofits; but, how we reach out to the Boomer market will need some thought. The spectrum of how they believe is large. Finding your organization's “niche” with this market will take some effort.

In 1978, a Gallup poll stated that 39% of Boomers said religion was very important to them. That is good! At least over a third of this group thinks about religion.

In 2007, an AARP study found that 85% of Boomers rank themselves as either “somewhat spiritual” to “very spiritual.” But, what does that mean to religious nonprofits trying to find support? How can we build a relationship with the “Boomer” generation whose religious belief is so broad?

Having a consistent message for your mission across all marketing efforts is a start. Make certain that all efforts stimulate either an emotional and/or rational experience. This is the first step in building a relationship with a “Boomer” cohort.

Compared to WWII and Depression cohorts, researchers have shown “Boomer” cohorts to be the best educated which means they will want to understand why the mission is important to them. It could be for numerous reasons such as: family belief, the search for faith, love of Church or a need to take care of the world in need. Take the time to think through how your message resonates with this generation of cohorts. They will not respond like their parents.

They will also look for fiscal responsibility. They will question, “Is the nonprofit using their gift in a responsible way?"

Give cohorts of any age an opportunity to learn about your mission through visual, verbal and auditory experiences that stimulate an emotional response. If your marketing efforts are able to do this successfully you will benefit from their support. Trust me, “I know.”

-Gail

BIG’s Blog: What this Article Means for Nonprofit Fund Raisers – Part Five

Over my last few blogs, I have been examining the implications from the article in the Direct Marketing News – Direct Daily that two-thirds of all purchases and half of all transactions would be done over mobile devices by 2015.

As I close out this blog series on this important article, I can’t close out this series without addressing the last two paragraphs of the article. The breakfast forum at Google’s offices in New York was a DMA event for the Google executives to share this information about the coming growth in transactions through mobile, and in attendance was the CEO of the Direct Marketing Association (DMA), Mr. Lawrence Kimmel.

I am not going to paraphrase Mr. Kimmel’s remarks as they were reported in the article, rather I am going to lay them out verbatim and then comment on them.

Mr. Kimmel urged the attendees (attendees at the DMA event) not to abandon direct mail for digital. He said that direct mail spending increased 2.2% in 2010 and predicted it will grow anywhere from 3% to 5% this year. “Everyone moved away from direct mail because digital was the new kid on the block,” Kimmel said. “But direct mail is a $47 billion business. It’s incredibly important and it still works.”

Did you read anywhere in the article that anyone said 'stop' using direct mail?

We live in a world where speed of change is accelerating. If Google’s Mr. Shapiro is only 25% right in his prediction of transactions through mobile, that is a sea change in how the vast majority of people do transactions, not to mention how they get their information. How many paper checks do you write today versus ten years ago?

Poor Mr. Kimmel of the Direct Marketing Association; he is caught between the proverbial rock and a hard place. On one side are all of the marketing organization members of the DMA, including nonprofit fund raisers, who need to take this Google information very seriously and try to figure out how to alter their marketing strategies to deal with the fast changing landscape. But, on the other side are all of the DMA corporate direct mail partners that are underwriting the DMA. Did Mr. Kimmel not make the point that direct mail is a $47 billion business?

Of course, direct mail is not going away tomorrow or next year or the year after that, but nonprofit fund raisers that are dependent on direct mail for a majority of their donations today need to seriously consider the implications of the changing marketing communications environment and adjust their strategies accordingly.

-Mike

Welcome to BIG’s Blog and yes, by all means forward our blog to your friends and co-workers.