Weathering the Storm: How Nonprofits Can Navigate the Recession

Read the Transcript! (Posted 10/27/11)

Is there a double dip ahead?This week’s #fundchat topic is “Weathering the Storm: How Nonprofits Can Navigate the Recession.” Join the #fundchat community on Wednesday, Oct. 26 at 12 p.m. EDT (that’s high noon for you folks on the East coast!) for a conversation that will be of interest to you no matter what your role in your organization.

Most nonprofits survive on a shoestring budget and all are cost-per-dollar-raised conscious, looking to spend their donor’s money wisely. Call it a recession, a downturn, a dip or a trough, the economic environment is putting even greater pressure on organizations like ours.

What would you like to know from other nonprofit professionals about how their organization has navigated the economy? What tips could you offer your colleagues? Please offer your ideas for questions for this week’s #fundchat in the comments section below. Here are a few that we might consider for this week’s #fundchat:

  1. How has the recession affected your bottom line or the services you are able to deliver?
  2. What creative lengths has your organization gone to to stretch budget dollars even farther?
  3. Has your organization had to layoff staff? How were these decisions handled?
  4. Has your nonprofit found a way to use the economic climate in your case for support?
  5. If support has diminished in one area, has your organization found other areas of revenue to help offset the loss on the other side?
  6. As you looked to trim budgets, what expenses were the first to go?

Please help spread the word by introducing your colleagues and networks to #fundchat. If you are new to tweetchats, it’s easy. At the appointed time, you follow the hashtag (#fundchat) in your favorite Twitter client and participate in the conversation by adding the hashtag at the end of your tweets. You can also use services like Tweetchat or Twebevent to make participation easy. Check out the #fundchat Twebevent here. Before you begin, you might want to look at our “#fundchat 101” post to familiarize yourself with the format and overall guidelines.


Next #fundchat: Donor Acquisition, 8/3, 9 pm EST

Mission Control for the Next Two WeeksThe next #fundchat will be moderated from the Northeast Kingdom of Vermont, where I’m spending two weeks on vacation with my family.

Please join us on Wednesday, August 3 at 9 pm EST for a lively discussion about Donor Acquisition. If you are new to #fundchat, check out our guidelines.  Please share your ideas for questions or ideas in the comments below, but here is the initial slate of questions for this week:

  1. What donor acquisition tactics have been the most successful for your organization and why?
  2. Does your approach to donor acquisition include a combination of tactics? Which is best: Direct mail, phonathon, events, etc.
  3. Events are great for meeting new potential donors. Do you have any words of wisdom about how to turn these new friends into supporters?
  4. Can you share a success story (or idea) about converting social media fans/friends into donors?
  5. Have you ever employed a “friends” campaign to promote word of mouth to gain new donors (peer-to-peer fundraising).
  6. Once you have gained a new donor, what are some strategies to retain them?
  7. The best ROI is to bring lapsed donors back into the fold. What are some ideas for encouraging them to give again?

I hope you are looking forward to this week’s chat as much as I am. Please remember to invite a friend or colleague! This community is only as successful as those who participate; the more the merrier.


Is Direct Mail Dead? Reassessing the Fundraiser’s Workhorse

Are you a #fundchat newbie? Learn more about how to participate in #fundchat here.

I’m happy to announce that the next #fundchat will take place on Wednesday, July 20 at 9 pm EST on a topic near and dear to many a fundraiser’s heart: direct mail.

Special Delivery!With so many shiny new tools at our disposal (hello, social media), one tried and true workhorse is not feeling the love as of late. As any fundraiser worth his or her salt knows, at the center of any successful fundraising program is direct mail.

But is the landscape changing? Has direct mail worn out it’s welcome?

Here is a brief run-down of the pros and cons of direct mail:

Pros

  • It’s an opportunity for a personal connection with a current or potential supporter.
  • It’s a relatively affordable way to reach a large number of people.
  • The ability to target messages based on segmentation of your lists.
  • “Respectable” response rate compared to other methods.
  • Delivers that all important device: the gift reply envelope.
  • Provides a visual reminder about your organization (stay on their radar).
  • There is a lot of research and information about “best practices” from which an organization can borrow.
  • A dearth of creative options for mailer design to increase open and response rates.

Cons

  • It ain’t cheap! Postage, paper, design and more adds up and is out of reach for many small organizations.
  • Many pieces go unopened, especially around critical times of the year (year-end, holidays, etc.)
  • Isn’t mail “old fashioned?”
  • The typical response rate for direct mail is in the single digits.
  • Other forms of direct communication provide better ROI (e-mail campaigns, social media?).
  • Maintaining a database and lists is time consuming and can be expensive.
  • The environmental impact: many pieces go right into the circular file.

I’m sure you can provide additional bullets to both pros and cons regarding direct mail. It’s a topic that generates a lot of advice and opinions from fundraisers and that’s exactly what I’m hoping for!

Here is the line-up of questions for the next #fundchat:

  1. Does your organization use direct mail? Why or why not?
  2. How many appeals do you send in a year and at what frequency?
  3. Has your organization seen a decline in response rates to direct mail? What is a “good” response rate for your org?
  4. Of your various outreach tactics, what percentage of revenue do you rely on for direct mail?
  5. Is your program highly segmented, sending very specific messages to certain donors, or do you take a more global approach?
  6. What do you think about using QR codes in direct mail?
  7. Has your organization experimented with email campaigns as a replacement to direct mail? How does it compare?
  8. What tactics or strategies have you used as part of your direct mail program that have flopped?
  9. Apart from your “normal” program, have you experimented with a different strategy, design, message or other and what was the outcome?
  10. Call it “integrated” or “multichannel” marketing, direct mail has simply evolved beyond a one-trick pony: Discuss.

As a special bonus, here are links to some articles that might get you thinking about our next topic:

I encourage you to share links to other blogs or articles that shed light on the topic of direct mail. Just remember to include the #fundchat hashtag so tweeps can do their homework!


The Cost of “Free”

A guest blog post by Ephraim Gopin.

freeThe word “free” will light up the eyes of a nonprofit professional, especially the CEO of a small nonprofit. If something can be had for free, why pay for it?!

But is “free” really free?

Take social media: Yes, the outlets themselves are free. BUT, if we adhere to the time = money principal, then social media is unbelievably expensive! Your staff must spend a lot of time on multiple platforms engaging people with the hope they eventually become volunteers, donors or, at the very least, share your posts with others.

And we ALL know what happens when you pass off the task of managing your social media to a volunteer: if you’re lucky they have an hour per week to share, post or like and then no one is around to engage and respond quickly. Eventually, people stop paying attention to your posts. But hey, at least you didn’t waste precious budgetary resources!

Or websites/graphic design, a pet peeve of mine: Websites and brochures are not cheap, especially if you want it done professionally and within a time limit. Here’s an example of how this “free” approach can backfire:

In order to save money, the CEO where I once worked decided we should search for students learning to become graphic designers and have them design our brochures and annual report. Right now, some of you are shaking your heads side to side because you know what happened next: we found plenty of eager students thrilled to add to their portfolios. What we did NOT get was a single, usable design.

And in the end, we wasted time (there’s that money thing again!) hoping against hope that the project would bring positive results. Guess what? The product wasn’t ready for a fundraising trip, so we hired a professional company, paid for and received beautiful brochures.

This is NOT a blanket indictment of volunteers. They are the best cheerleaders your organization has. Volunteers can build beautiful websites and design stunning reports, raise money and operate programs. But it’s the RELIANCE on getting things for free that hurts many nonprofits.

Free means no deadlines because you can’t demand from a volunteer that they complete a project on time. You can ask nicely, cajole, plead or beg but they have lives to live as well. The same thing can happen when you pay but at least in these cases you can terminate a contract and try to recoup any losses.

As a fundraiser, I have always believed you spend a buck to make a few bucks. That includes overhead, distribution of materials and more. We may think donors will have pity on our nonprofit if they see a brochure that is not professionally designed;  the donor knows the organization has no money, giving them more incentive to donate.

My experience has shown the complete opposite! Donors want to see that your organization has invested in their experience, for example, a well structured website which is easily navigated and can boost donations! Donors are only too happy to show their friends to whom they are donating if they feel the love.

Many of us in the nonprofit sector are always busy putting out fires and have no time for strategic, long-term thinking and planning. As staff is downsized and budgets slashed, the temptation to cut corners when possible is very real.

But stop and ask yourself, what is the real cost of “free?”

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