Could 2020 Get Any Crazier? Navigating Fundraising Amid Uncertainty
Introduction: As 2020 unfolds with its endless twists and turns, we find ourselves asking yet again: Could this year get any crazier? With the U.S. presidential election seemingly pointing toward a Biden victory and the potential for a divided government, nonprofit organizations are left wondering what all this political turbulence means for fundraising efforts in the coming months. The Uncertainty of 2020: What Does It Mean for Fundraising? The year 2020 has been a whirlwind of challenges—from the global pandemic to social unrest, to economic instability. Now, with the election results hanging in the balance and potential Senate control determined by two runoff races in Georgia, the uncertainty is palpable. How does this affect nonprofit fundraising, and how should your organization prepare? The Investment Paradox: A Lesson in Prioritizing Effectiveness Over Cost One crucial concept to consider during these uncertain times is what Roger Craver refers to as the “investment paradox.” This idea highlights the tendency to scorn fundraising costs even when those investments yield superior results. As you strategize for year-end fundraising and beyond, it’s important to remember that effective fundraising often requires thoughtful investment, even if the costs seem high upfront. Applying Mises’ Model of Human Action to Fundraising Strategy As we navigate this unpredictable landscape, returning to fundamental principles can offer clarity. Ludwig von Mises’ Model of Human Action provides a simple yet powerful framework for evaluating your fundraising approach: Identify the Problem: What is the pressing issue or threat your organization is addressing? Is it something that resonates with your target audience? Offer a Credible Solution: Does your solution convincingly address the problem? Will it lead to tangible, positive outcomes? Establish Credibility: Is your organization seen as capable of delivering on its promises? Do your supporters believe that with the right resources, you can achieve success? Staying Focused Amid Distractions In a year where headlines are dominated by monumental issues—elections, the pandemic, and economic turmoil—how do you ensure your message cuts through the noise? By aligning your fundraising appeals with the concerns and aspirations of your supporters, you can create a compelling value proposition that resonates, even in a crowded marketplace. Preparing for the Future: Learning from the Experts As you plan for the future, consider leveraging insights from seasoned experts like Roger Craver and Richard Viguerie. Both have decades of experience navigating political and economic shifts while leading successful fundraising campaigns for their respective causes. Their wisdom can provide valuable guidance as you adapt to the current environment and seek out new opportunities. Conclusion: A Simple Framework for Complex Times In these chaotic times, it’s easy to feel overwhelmed. However, by returning to simple, time-tested frameworks like Mises’ Model of Human Action, you can maintain clarity and focus in your fundraising strategy. This approach will not only help you weather the current storm but also position your organization for long-term success.
Could This Be Your Purple Cow? Standing Out in Donor Communications
Introduction: How do you get your donor’s attention in an over-communicated world? Picture this: a generous donor from Cedar Rapids, Iowa, receives a letter all the way from Latvia. It wasn’t the expected solicitation but a heartfelt note from a Latvian student who had benefited from their contribution. This story, over 30 years old, still holds relevance today as an example of how standing out—like Seth Godin’s concept of the Purple Cow—can make all the difference in donor engagement. The Challenge: Grabbing Attention in a Crowded Field We live in a world where people are bombarded with requests for their attention. Whether it’s marketing emails, social media ads, or direct mail, everyone is competing for the same limited space. For fundraisers, this poses a major challenge. How do you create messages that don’t get lost in the crowd? The answer lies in creating unique, memorable experiences for donors—your Purple Cow. The Power of a Personal Touch Imagine a donor receiving a letter, not from your organization’s headquarters, but from someone they directly impacted. This personal touch can make a significant impression and create a lasting connection. As demonstrated by the letter from Latvia, donors appreciate hearing from those who directly benefit from their contributions. Why a Purple Cow Approach Works Godin’s Purple Cow theory advocates for creating something remarkable that naturally grabs attention. Here’s how you can apply this to your donor communications: Stand Out: Just like that letter from Latvia, find creative ways to make your communications unique. Personalization: Make sure your donors feel a direct connection to the beneficiaries of their contributions. Authenticity: Let the letters speak in the voice of the beneficiaries themselves, rather than coming from your organization’s branded materials. How to Create Your Own Purple Cow If this concept resonates with you, here’s a practical way to implement it in your donor communications strategy: Identify the Right Signers: Think of those who have powerful, relatable stories to tell, like the Latvian intern in our example. Craft a Unique Message: Help them write a message that balances gratitude with reinforcing your organization’s mission. Make It Personal: Use non-standard formats—artwork, handwritten notes, or even unique paper styles that reflect the personality of the signer. Avoid Overproduction: Do not use your organization’s stationery or mass-produce the letters. Let it feel personal, like the donor could be the only recipient. Case Study: Nobel Laureate Vernon Smith’s Personal Letters A powerful example comes from Nobel Prize winner Vernon Smith. After winning the Nobel in Economics in 2002, he personally wrote thank-you letters to donors who supported his work. These were mailed with stamps from Stockholm, adding a unique, personal touch. This was a Purple Cow moment that made a lasting impact. Takeaway: Make Every Donor Feel Special The key to successful donor communications is making each individual feel like they are an essential part of your success. Personalized, thoughtful communication not only shows gratitude but builds a long-lasting relationship between donors and your organization.
Why You Shouldn’t Try to Boil the Ocean: Focus on Special Projects in Fundraising
Introduction When you’re sitting down with a prospective donor, how much time do you spend explaining your organization’s entire mission? Versus honing in on a specific project or initiative that directly impacts them? Too often, fundraisers complicate their message, trying to sell the whole organization instead of a simple, compelling project. In today’s crowded marketplace, simplicity is not just a preference; it’s a necessity. The Challenge: An Overcommunicated World We live in an age of constant communication. Every day, it’s estimated that each of us receives over 10,000 requests for our attention. For prospective donors, this number might be even higher. So how do you make your message stand out? By zeroing in on a special project, you simplify your message, making it easier for potential donors to grasp the impact they can have. The Power of Special Projects Special projects have several advantages that make them particularly effective in fundraising: Easier to Understand: A specific project with a clear goal is far easier to communicate than a broad organizational mission. Simpler Visions: Projects can present a clear, focused vision, making it easier for donors to see their contribution’s impact. Defined Objectives: With clear objectives, donors can easily understand what success looks like and how they can contribute. Guided by Strategy: A specific project allows you to articulate a straightforward strategy, showing donors a clear path to success. Clearer Plans: Special projects come with detailed plans, making it easier for donors to follow and support your efforts. Driven by Urgency: The finite nature of special projects creates a sense of urgency that can motivate donors to act quickly. Tighter Budgets and Timelines: These constraints make it easier for donors to see how their contributions directly impact the project’s success. Why Election Campaigns Succeed One reason election campaigns often raise funds so effectively is because they embody all the characteristics of a special project. There’s a simple, clear objective: to win. The timeline is short, creating urgency. And the outcome is clear—there’s a win or a loss, making it easy for donors to understand the stakes. Your Homework: Focus on a Special Project We suggest think about a special project you could bring to your donor prospects. Whether it’s a media campaign, a legislative initiative, a membership drive, or a new internship program, special projects offer a unique opportunity to engage donors. Consider starting small with a select group of major donors or a segment of your existing supporter base. If the initial response is positive, you might expand your reach through a targeted acquisition effort.
Understanding “The Investment Paradox” in Fundraising
The Investment Paradox: A Closer Look The “investment paradox” refers to the contradictory attitude that many stakeholders have towards the cost of fundraising. On one hand, they demand high returns in terms of donor engagement and revenue generation. On the other, they often balk at the necessary investments required to achieve these results. This mindset can be detrimental to the long-term success of any fundraising campaign. Why Costs Matter Less Than Returns Critics of fundraising expenses often overlook a key fact: effective fundraising requires investment. Whether it’s in technology, personnel, or marketing, these costs are not just necessary—they are the bedrock upon which successful campaigns are built. The focus should not be on minimizing costs but on maximizing returns. A well-funded campaign that drives substantial donor engagement and contributions is far more valuable than a low-cost campaign that fails to meet its objectives. Key Takeaways from Roger Craver’s Insights Value Over Cost: It’s essential to shift the conversation from cost-cutting to value creation. High-performing fundraising campaigns often require significant upfront investment, but the long-term returns justify these expenses. Investment as a Growth Strategy: Think of your fundraising budget as an investment portfolio. The more strategic investments you make, the higher your potential returns in terms of donor retention, acquisition, and overall fundraising success. Educating Stakeholders: Part of overcoming the investment paradox is educating your board, donors, and stakeholders about the true cost of effective fundraising. Transparency about where and why you’re investing in certain areas can help shift their focus from cost to value. Moving Forward: Applying This Insight To apply these insights to your fundraising efforts, start by evaluating your current investment strategy. Are you underfunding key areas out of fear of increasing costs? Consider where additional resources could lead to significant returns. Whether it’s investing in donor management software, hiring skilled fundraisers, or launching a new marketing campaign, the right investments can dramatically improve your outcomes. Conclusion Understanding and addressing the investment paradox is crucial for any organization looking to scale its fundraising efforts. By focusing on the value generated rather than the costs incurred, you can create a more sustainable and successful fundraising strategy.
Starting a Revolution: Lessons from Patrick Henry for Effective Fundraising
Patrick Henry played an indispensable role in the fight for America’s independence. And that’s because he was a highly effective communicator. Knowing Your Audience First, Henry understood that knowing your audience is crucial. He used words, terms, and phrases that were familiar to them, ensuring his message resonated deeply. He concentrated his efforts on the specific audience segment that required persuasion and recognized that an emotional argument could often be more powerful than an appeal to reason. The Historic Oration On March 23, 1775—250 years ago next spring—Patrick Henry delivered the most powerful oration of his life. This speech ranks as one of the most important and influential in our history. The setting was the Second Virginia Convention, convened on March 20 at Henrico Parish Church, now known as St. John’s Church in Richmond, Virginia. Approximately 125 delegates arrived to consider what should be done about deteriorating relations with Great Britain. Patrick Henry proposed three resolutions, the third of which was considered quite radical. It called for the raising of a state militia, which seemed less about defense and more about the provocation of war. To support the passage of these resolutions, Henry rose to speak. Crafting a Persuasive Message Henry directed the bulk of his message at those critical of the overreach by British authorities. However, these same individuals were comfortable and prosperous in their lives in the Virginia Colony and didn’t necessarily want to disrupt the status quo. Understanding this, Henry knew he needed to convince this specific group. Drawing from Biblical references, classical scholars, and even a popular play of the time, Henry concluded his argument with: “Gentlemen may cry, Peace, Peace! But there is no Peace! The war is actually begun. The next Gale that sweeps from the North will bring to our ears the clash of resounding arms. Our brethren are already in the field. Why stand we here idle? What is it that Gentlemen wish? What would they have? Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God!” Then, thrusting an ivory-handled dagger toward his chest in reference to the Roman patriot Cato the Younger, he declared: “I know not what course others may take; but as for me, give me liberty or give me death!” The resolution passed on a close vote, 65-60. And as they say, the rest is history. Relevance to Fundraising Today Why share this story now? There’s the obvious reference to our celebration of America’s Independence this July 4, and the upcoming celebration of America’s semiquincentennial in 2026. More importantly, Patrick Henry’s famous address is perfectly relevant to our current Fundraising Tips series. A Declaration of Independence exemplifies the concept of Going Big! by: Casting a bold vision Establishing clear objectives Offering a compelling strategy for solving a relevant problem Laying out a credible path to achieve the desired success Targeting your audience and meeting them where they are Providing a clear role in which they can become engaged Designing Your Fundraising Appeal With a special project or initiative, you can design a fundraising appeal around it. Here’s how: Create a Thoughtful Letter: Develop a narrative that outlines your vision, objectives, strategy, and plans. Target Your Audience: Start by sending your appeal to 5,000 worthy prospects. If you receive a positive response, scale up to 25,000 names, and then to 125,000. Experiment with Low-Risk Bets: Begin small to test your approach before going big. This process isn’t easy, but it doesn’t have to be complicated or daunting either. Follow the step-by-step guide from our Fundraising Tips series launched back in January here. That’s your roadmap to success. Ready to Elevate Your Organization? Have you been trying to figure out how to take your organization to a higher level? Here’s my advice: Turn an Existing Effort into a Special Project: Focus your initiatives to create a compelling narrative. Frame Your Project’s Vision, Objectives, Strategy, and Plans: Clearly outline what you aim to achieve and how. Ensure a Credible Solution to a Relevant Problem: Your project should address a real issue that resonates with your audience. Craft a Persuasive Fundraising Letter: Include a strong offer, the right signer, and a clear, compelling narrative. Need Feedback? If you’d like, send me your letter for review. I’d be glad to offer feedback to help you make it even stronger and more persuasive. Even if you can only get as far as outlining your vision, objectives, strategy, and plan, I’d be happy to take a look at that too. You can do this. Think Big! Experiment with a relatively low-risk, small bet, and then be prepared to Go Big! If you’re serious about your work, you owe it to yourself, your organization, and the people you’re trying to help to give this a go.
The Power of Reciprocity: Giving Prompts Giving Back
We just can’t help ourselves. Across the globe, it’s the same story—when someone acts generously towards us, we feel compelled to return the favor. This is what the esteemed social psychologist Dr. Robert Cialdini calls the principle of reciprocity. When a thoughtful gesture is extended, we respond in kind. Cialdini lists reciprocity as the first principle of persuasion in his trailblazing book, Influence. But what does this have to do with our fundraising and marketing work? Plenty! In a recent tip, I shared Cialdini’s six principles of persuasion and promised to explore each one in detail, showing how they can be applied to achieve transformational fundraising results. So, let’s dive into reciprocity. Reciprocity in Action Politicians use reciprocity to amass support for their projects—something known as logrolling. “I’ll vote for your bill if you’ll vote for mine.” It’s a common strategy in legislative bodies around the world. In the marketplace, reciprocity might appear at a food court, where a restauranteur offers a free sample. By accepting the gift, you’re more inclined to purchase their full offering. In direct mail fundraising, we see this principle through “front-end premiums.” Free notecards, personalized return-address labels, or even a pocket copy of the U.S. Constitution—these small gifts tap into the power of reciprocity, boosting response rates. Morton Blackwell, president of the Leadership Institute, perfected this principle with an incredibly successful approach. You might remember the story about the jars of honey. A Sweet Gesture with Sweet Results Back in the late 1980s, Morton began sending jars of honey as holiday gifts to the Leadership Institute’s most generous donors. Morton, a backyard beekeeper, had been gifting his homemade honey to friends for years. But when he shared his surplus stock with the Institute’s top supporters, something remarkable happened. Those who received the honey often increased their donations—sometimes tenfold. Intrigued by this response, Morton decided to test the effect further. He split his donor list into two segments: one half received honey, and the other did not. The results? Those who received the honey gave significantly more over the next 12 months than those who didn’t. Last year alone, the Leadership Institute mailed nearly 80,000 jars of honey—over 45 tons—to contributors who gave $100 or more. And the impact didn’t stop there. Morton took things a step further by sending daylily seedlings to key supporters each Spring. These gifts continue to bloom year after year, serving as a constant reminder of Morton’s thoughtfulness. Could you do something comparable for your supporters? Consider the possibilities. Applying Reciprocity to Your Work The principle of reciprocity is not only powerful but essential to building lasting relationships with your donors. By offering thoughtful gestures, you can inspire your supporters to give more generously and more often. I encourage you to think about how you might incorporate reciprocity into your fundraising strategies. What small gifts or gestures could you offer to deepen your connection with your donors?
The Power of Liking: Building Trust Through Connection
What’s not to like? People prefer to say yes to those they like. This is how social psychologist Robert Cialdini defines one of his six principles of persuasion: Liking. According to Cialdini, we tend to like—and therefore agree with—people who share similarities with us, pay us compliments, or cooperate with us toward mutual goals. Can understanding and applying this principle strengthen our fundraising and marketing efforts? Absolutely! The Principle of Liking in Action Let me share a recent experience that perfectly illustrates the power of liking in action. Just last week, my daughter and I arrived in Inverness, Scotland, for a hiking trip in the Highlands. We met Eleanor, a friendly local who drove us from the airport to the rental car booth. Eleanor’s warm demeanor and helpful advice instantly made us feel at ease. She offered us a free upgrade to a more suitable car for our journey and shared valuable tips on where to hike and what to avoid. She even convinced me to add insurance coverage—something I usually decline—because I trusted her judgment. This experience reminded me of the principle of liking and its profound impact on our decisions. Eleanor wasn’t just doing her job; she was building a relationship, and that relationship made all the difference. The Role of Trust in Fundraising Trust is a key driver of fundraising success. When donors trust you, they have greater confidence in your ability to make a positive difference with their contributions. And trust often stems from liking. Liking plays a crucial role in major gift fundraising, direct response, and legacy giving. When donors feel a connection with you—when they like you—they are more likely to say “yes” to your requests. Applying the Principle of Liking in Fundraising As fundraisers, we can consciously apply the principle of liking to strengthen our relationships with donors. Whether working on major gifts, direct response, or legacy giving, understanding and applying this principle can help us connect more deeply with those who support our cause. Building Connections Through Similarities: Find common ground with your donors—shared values, interests, or experiences can create a strong foundation for trust and partnership. The Power of Genuine Compliments: Sincere compliments can go a long way in building rapport. Acknowledge your donors’ generosity, commitment, or wisdom in supporting your organization to strengthen their connection to your mission. Cooperating Toward Mutual Goals: Working alongside your donors to achieve shared objectives creates a sense of camaraderie and partnership, making them feel like an integral part of your organization’s success. Call to Action If your interest has been piqued through this discussion of Cialdini’s principles, I strongly recommend reading his classic work, Influence. The book was life-changing for me, and it can be for you too. Let’s continue to build these connections and apply the principle of liking to our fundraising efforts. By doing so, we can foster trust, enhance our impact, and ultimately make a greater difference in the world.
Consistency and Commitment: The Foundation of Trust in Fundraising
We’ve all heard it before. “You haven’t changed a bit!” Maybe it was at a school reunion. Or perhaps at a wedding with old family friends. With a former co-worker you haven’t seen in twenty years. But how did that compliment make you feel? For most of us, being seen as consistent is a deeply ingrained part of our nature. We value consistency because it aligns with our beliefs and values. Social psychologist Robert Cialdini calls this the principle of commitment and consistency. He explains that once we’ve publicly committed to something or someone, we’re much more likely to follow through and deliver on that commitment. This principle is powerful, and it’s one that both marketers and fundraisers have leveraged effectively. Consider the value of “getting a foot in the door.” An initial gift, however small, is incredibly important. That’s because donors are much more likely to make a second gift after they’ve made a first one. Why? Because psychologically, our self-perception changes. We’re now “a donor,” and we want to prove to ourselves that our original decision to give was the right one. It doesn’t stop there. Donors are even more likely to make a third gift than they were to make that second gift, and the likelihood increases for a fourth and fifth gift. A bond develops, a sense of loyalty, similar to how you might feel towards a sports team, your hometown, or even your favorite local coffee shop. Effective fundraisers understand this. Here’s how you can apply the principle of commitment and consistency to your fundraising efforts: Pledge of Support: Receiving a pledge of support, even an informal or tacit one, increases a donor’s desire to carry through that support. Encourage Thoughtful Giving: Simply asking someone to “think about a range of possible support and pick a number that you’d be willing to give” increases the likelihood they’ll give generously. Written Pledge: A written pledge, even if it’s just scribbled on a torn slip of paper, greatly strengthens a donor’s ultimate desire to give. Public Pledge: If there’s an opportunity to make a public pledge, especially in front of their peers, the likelihood of giving spikes even higher. Let me share a story that illustrates this principle in action. My friend Morton Blackwell is well known to many in the fundraising community. Through his Leadership Institute, he has trained hundreds of thousands of public policy activists and advocates. His commitment to the conservative movement has been unwavering throughout his life. In the summer of 2016, at a raucous Virginia GOP Convention, emotions were running high as attendees debated and voted on delegates for the RNC Convention in Cleveland. The atmosphere was tense, with people yelling and even physical altercations breaking out. During a recess, Morton was invited to speak. What happened next was remarkable. As he approached the podium, the entire assembly—activists from both sides—rose to their feet to give him a profound and extended standing ovation. How could that be? Commitment and consistency. Morton’s dedication to his principles and his political party had been so consistent over the decades that people instinctively rose to honor him for it. It’s the best illustration I’ve ever seen of this important principle in action. When your brand is built on trust—on a solid reputation—then you’ve really got the wind at your back. Applying these principles can transform your fundraising efforts. Focus on building trust, maintaining consistency, and reinforcing the commitment of your donors. This is the foundation of long-term success.
Understanding the Power of Authority in Fundraising
Question Authority. You’ve probably seen that slogan on bumper stickers or T-shirts, often with a rebellious undertone. It was a rallying cry during the Vietnam War protest movement in the 1960s. But while questioning authority is sometimes necessary, the truth is that we’re hardwired to respect it. Social psychologist Robert Cialdini explains that our upbringing is steeped in messages about the importance of authority. From parental guidance and school lessons to religious teachings and societal structures, we’re taught to submit to and respect legitimate authority. This is why Cialdini includes the principle of authority among his six principles of persuasion. Why Authority Matters in Fundraising Over the years, many fundraisers have successfully applied Cialdini’s principles to achieve transformational results. So, how can the principle of authority be applied to your fundraising and marketing efforts? Cialdini suggests three simple ways to establish authority: Titles Clothing Other Trappings Titles are a powerful symbol of authority. They’re easy to acquire but require careful use to ensure they lend credibility to your arguments. A well-used title can make your subject matter experts’ positions more convincing. Clothing also plays a significant role in how authority is perceived. Consider the uniforms of law enforcement officers, military personnel, or even commercial airline pilots. What they wear conveys their authority and builds confidence. The same goes for your donor meetings. Dressing appropriately can give your arguments more weight, while poorly chosen attire can undermine your credibility. Trappings are the third element. Cialdini notes that finely styled and expensive clothes, jewelry, and even cars can carry an aura of status. The same principle applies to the appearance of your workspace, the quality of the meeting room, or the reading materials you distribute. These elements all contribute to how others perceive your authority. Applying Authority to Your Fundraising Work Think about how you can use titles, clothing, and trappings to project authority in your fundraising efforts. Whether it’s through the way you present your team or the environment in which you meet your donors, leveraging authority can significantly enhance your ability to persuade. Remember, you’re an authority, too. You may be an expert in a specific aspect of your organization’s mission or have specialized knowledge in fundraising. How persuasive you are with your expertise depends on how well you apply the principle of authority.
The Power of Retention: How a Small Increase Can Lead to Big Gains
Ready for Some More Math? Let’s use the example of a shoe salesman who finds more value in a second-time buyer than a first-time buyer. The logic is simple: a second-time buyer is much more likely to return for a third and fourth purchase than a first-time buyer is to make that crucial second purchase. The same principle applies to your financial contributors. While just under half of first-time donors might give a second time, 80-90% of those who do will go on to give a third time, and 80-90% of those will give a fourth time. These retention percentages are not unique to your organization—they tend to hold true across the board. But what if you could take special actions to improve the likelihood of that second gift? The Impact of Improving Retention Imagine this scenario: This year, 10,000 donors make their first $100 contribution to your organization. For comparison’s sake, let’s split these donors into two lists: List A and List B. List A follows the usual pattern: 45% of these donors give $100 again, 85% of those give a third time, and 85% of those give a fourth time. Now, let’s say you take some smart actions to boost retention, and 55% of List B gives $100 a second time, with the same 85% giving a third and fourth time. Here’s where the math comes in: With List A, you would generate $578,400 in subsequent revenue. With List B, you would generate $707,500. Did you catch that? By simply improving the retention rate from 45% to 55% for first-time contributors, you generate at least $125,000 more. That’s a significant increase, and it only becomes more impactful over the long run. Why Retention Should Be Your Focus By reallocating your resources to focus more on retention, you’re not just maintaining your donor base—you’re driving greater profitability. It’s a smart strategy that pays off in both the short and long term.
