Blueprint Fundraising

Tip of the Week: Provide social information to increase gifts

The Wharton School at the University of Pennsylvania recently published a paper called “Field Experiments in Charitable Contributions: The Impact of Social Influence on the Voluntary Provision of Public Goods.” It is great to have this kind of research in the public domain — so much direct mail and fundraising research is proprietary.

The question: will people give more if they are given a suggested donation amount and if they are told how much others have donated? The answer: yes. And there is an especially clear application for this in soliciting renewing donors.

The researchers looked at giving scenarios where the ask is ambiguous (they studied a public radio on-air drive). I’m simplifying the experiment but when donors called to make a pledge, the volunteer either asked if they were a new member or renewing. Then they either 1. Told them that another member had pledged $300 and then asked how much the caller would like to pledge or 2. Simply asked them how much they would like to pledge (without indicating any other gift amounts). They found a 12% larger gift size for those who had the social information (about the $300 gift).

The research included other experiments (email me if you would like more information). The researchers conclude that:

• Providing social information significantly increases contributions.
• It works best when you provide information that is seen as “relevant” to the donor and encourages “social conformity.” Callers who were told that another donor was the same sex (as they) gave significantly more than callers who were told that another donor was the opposite sex (i.e. women give more if they know that other women are giving more).
• There is a “boundary effect.” Use social information drawn from the 90th to 95th percentile of your organization’s contributions. Lower social information has little or no influence, while that over the 99th percentile actually has a negative effect. For example, donors were motivated to give more when they were told about a $600 gift (a number around the 90th percentile of that donor base) than a $1,000 gift (representing the 99th percentile).

You can try this experiment yourself — identify the size of gifts at your 90-95th percentile and use those as anchors in your gift arrays and in your fundraising requests. Tell donors about gifts made by people like them (same sex, family situation, donor level) to inspire larger gifts.

Tip of the Week: Handy tax credit calculator

My last Tip of the Week pointed you to the United Way of the Lower Mainland’s website and we’re going there again… You can use their tax credit calculator to quickly determine the real cost of a charitable donation. It works for donations made by BC residents to registered charities (tax credits vary slightly in each province). Research always shows that tax credits/tax receipts are not top motivators for giving, but nonetheless it is important for fundraisers to understand the tax implications of gifts.

Tip of the Week: United Way does it right

At this time of year, you can’t help but notice and admire the fundraising techniques of the United Way. While the campaign is on I encourage you to check out the United Way of the Lower Mainland’s Campaign 2005 Toolkit. Wander around at the planning tools, forms, talking points and watch the campaign video to see some really great fundraising.

Tip of the Week: TechSoup’s yummy deals

TechSoup offers amazing deals on software, hardware and everything technology-related, just for Canadian registered charities and US 501(c)3 groups. Need a router? Need new anti-virus software? Need a fundraising database? They have it all. Quantities are sometimes limited and deals come a go, so visit often or sign up for their new product notification email. TechSoup also hosts very informative discussions of technology issues and provides other educational resources and tools for nonprofits.

Tip of the Week: Car sharing works

Today is Car Free Day and if think you can’t possibly live without your own personal vehicle, think again. With gas prices on warp speed (not to mention climate change, traffic, smog, obesity, and many stinky results of too many cars on the road), this is a good time to consider whether car sharing could work for you.

I’ve been a member of Vancouver’s Co-operative Auto Network (CAN) since 2001. When Andrew and I moved here we discovered that car insurance was outrageous, the parking expensive, and the alternatives (such as public transit, walking, and CAN) pretty good. Andrew takes the bus and a skateboard to work at the University of British Columbia. I walk, take the bus, and use a CAN car whenever I need to (several times a week for work and errands).

How does it work? It’s a co-op, so members jointly own all the cars. There are vehicles parked all over the Lower Mainland — more than 100 cars in the fleet with new ones being added all the time. Scroll down this page to find cars near you and read the FAQs for details on how it works. Once you join, you pay a monthly fee to cover some of the fixed costs of the car and when you use a car, you pay low fees by the hour and by the kilometre. The fees include gas, insurance, maintenance, and BCAA. You have access to a car (or truck, van, stationwagon, Mini, VW Bug, Prius… yes there are some cool cars available!) when you want it. You don’t pay for more car than you need.

Email CAN if you want to know more. It’s not 100% car free — but it’s a step in the right direction!

Tip of the Week: Avoid 7 deadly sins of donor newsletters

How many times have I said this to a client: “Your donor newsletter is so long, boring, and poorly written that I can’t stand to read it! Even though I love your work! And you’re paying me!”

You probably put great effort into donor communications and your newsletter might be a cornerstone of that program. Creating something that truly adds value to your fundraising and builds a meaningful connection with your donors requires more than just dryly reporting on your work. No one wants to feel that pang of guilt as they toss your unread newsletter into the bin.

Communications expert Tom Ahern has a new book coming out at the end of this month called The Mercifully Brief, Real World Guide To Raising More Money With Newsletters Than You Ever Thought Possible. I’m sure it will be excellent. Here’s one of the chapters (they really are brief!):

These Seven Flaws Are Killing You

• Flaw #1: Your newsletter fails the “you test.” I’ll explain that simple (but critical) test later. For now just keep in mind that a good donor newsletter is friendly, even intimate, in tone. If you insist instead on an institutional voice, you distance yourself from your readers.
• Flaw #2: Your newsletter skimps on emotional triggers. You already know that charity starts when you move a heart. In a donor newsletter, tugging the heartstrings is a full-time job.
• Flaw #3: You claim it’s a newsletter (i.e., a bearer of news), but it’s really just an excuse to say hi. Here’s a clue: You devote your front page to a ponderous letter “from the desk ofâ€? an ED or board chair. Beware: a newsletter with no news value is a waste of time and money. And donors are quite demanding: they want very specific kinds of news. Their interest in your organization can quickly wane if you fail to deliver.
• Flaw #4: Your newsletter is not “donor-centered.” It does not make the donor feel needed or wanted. Remember: donors don’t give to your organization. They give through your organization, in an effort to change the world. You have to give the donor credit as well as thanks.
• Flaw #5: The newsletter is not set up for rapid skimming and browsing. On the contrary, you assume people will read long articles. Here’s the harsh truth: most of your audience won’t have time to give your newsletter more than a glance. If you bury important information in long articles, most people will miss it.
• Flaw #6: Your newsletter has weak or dysfunctional headlines. If any of the fatal flaws deserves the title of “Most Deadly,” this is it. Headlines have a function: to summarize the key points of the story. Most donor newsletters I’ve seen fail at that simple task.
• Flaw #7: It depends far too much on statistics (and far too little on anecdotes) to make your case.

Tip of the Week: Visit AFP’s Seven, No, Eight Blogs

The Association of Fundraising Professionals has entered the world of blogging by starting no less than seven new blogs! It’s a little cumbersome to visit them all (don’t ask me why they didn’t just make one blog with multiple categories) but go check them out anyhow. Even as I write this, they’ve announced one more: a blog dedicated to Hurricane Katrina-related fundraising issues.

Tip of the Week: Get your money’s worth from fundraising staff or consultants

Direct mail guru Mal Warwick asks a question on many an executive director’s and board member’s mind: Are we getting our money’s worth from our development director or fundraising consultant? Salaries and fees are high, so are expectations for results. Mal shares his evaluation criteria and suggests how to measure performance in a meaningful way.

Tip of the Week: Consider all the revenue options

If you are new to nonprofits, you might not know the wide range of ways that organizations fund themselves. It’s not all about fundraising. In fact, only 13% of it is about fundraising! Statistics Canada identifies these sources of revenue for the average Canadian nonprofit (in 2003, the most recent year available):

Government payments for goods and services – 18%
Federal – 1%
Provincial – 15%
Municipal – 1%

Government grants and contributions – 31%
Federal – 5%
Provincial – 24%
Municipal – 1%

All government sources combined – 49% of revenue

Earned income from non-governmental sources – 35% of revenue
Charitable gaming – 1%
Membership fees – 11%
Fees for goods or services – 20%
Investment income (including interest) – 4%

Gifts and donations – 13% of revenue
Individual donations – 8%
Fundraising organizations and family community foundations – 1%
Disbursements from other nonprofit organizations – 2%
Corporate sponsorships, donations or grants – 3%

Other – 3% of revenue

For each sector (i.e. arts, social services, environment, health, education, etc.) this breakdown of sources is different. For example, arts organizations receive more from corporations — 8%. International causes receive more from individuals — 30%. Email me or post a comment if you would like to know the details for your sector.

Tip of the Week: Visit the Grassroots Fundraising Journal

Kim Klein and Stephanie Roth are wonderful people and fundraising gurus to boot! Their magazine, the Grassroots Fundraising Journal, and their website are full of excellent resources to help small organizations creatively, ambitiously and successfully raise more money. The “Dear Kim” Q & A section is especially helpful. Whatever question you have, someone has probably asked Kim and received a wise answer that can help you too.