Donor Recognition or Stewardship?

In her seminal book Donor Centered Fundraising Penelope Burk laid out the case for the vital importance of good donor stewardship, using extensive research data showing the close connection between simple, personal stewardship (she is a particular advocate of calling donors – all donors – directly to say “thank you.”) and donor retention. She found that the simple act of calling and thanking donors, particularly first-time donors, dramatically improved retention rates.

Burk also argued that stewardship should not be confused with recognition – names on walls, etc. – and that what donors want is quality stewardship demonstrating that their giving has made a difference. If stewardship is done well, according to Burk, there’s little need for recognition. I’ve worked with a few nonprofits who have really embraced this philosophy; some have ditched the annual report of donors altogether. What a relief not to have to worry about getting angry phone calls from donors who didn’t like the way their name appeared in a publication!

In this article from a slightly different perspective emerges. According to the author, billionaires are quite taken with the idea of being very public about their giving. I wonder if things are starting to shift in that direction overall, or is this just an ego-oriented behavior of the mega-rich?


Yes, but what do you actually DO?

I came across this article in the Nonprofit Times. It’s not a terribly new theme. Experts have been beating this drum for quite a long time, but I liked the way the point was made with the many examples of nonprofit mission statements that all contain the phrase “alleviate suffering.” Of course, all these nonprofits seek to do that, but the point is that “alleviate suffering” is much too generic a phrase to describe the mission of your nonprofit, especially as the number of nonprofits to which donors can give has grown tremendously. With this growth, nonprofits have become increasingly specific in their missions, even if their mission statements don’t seem to say so!

In my own previous life as fundraiser in the independent school sector, we had our own versions of “alleviate suffering.” Phrases like these littered (and probably still litter) admissions viewbooks everywhere.

  • Educating global citizens.
  • Creating lifelong learners.
  • Building the next generation of leaders
  • Fostering a sense of community

…and so on. No matter what type of nonprofit organization you serve, spend some time on exactly how you articulate what you do. Make it clear. Make it concrete. Make it specific. Isn’t that supposed to be at the heart of the conversations you have with your major donor prospects as you try to present them with opportunities that align with their passions so they’ll stretch and make transformative gifts?

Brandon Ferris
Senior Director of Strategic Services and Fundraising Counsel

Letting Go of Sacred Cows: The Danger of Being Data-Driven

So you want to become more data driven, right? Everyone does. Everyone is sold on the power of analytics to enable smart, data-driven decision making to improve organizational results. I don’t think it’s entirely unfair to say that terms like “big data,” “analytics,” and “data-driven” are so deeply ingrained by now as to approach buzzword status (not a good, thing, of course!).

But are you really ready to be data-driven, to go wherever the data leads you? It’s often not as easy as you might think it should be for people and organizations to allow data to guide their decisions, tactics, and strategy, especially when the data contradict something they just “know” to be true. Aren’t some things simply given? Simply and obviously true a priori? We all hold these kinds of “convictions” about something, and when we encounter data that contradict what we “innately” know we naturally resist and find ways to rationalize the data away.

There was a perception at an independent school for which I worked (in advancement) that the school’s culture and programs were not adequately “girl-friendly,” which was driving increasing attrition among female students, particularly at the key transition point between grades 8 and 9 (it was a K-12 institution). There was considerable speculation, particularly at the Board level, about what needed to be done to fix the problem. Not atypically, there were some loud voices on the board seeking to push various pet programs, which their advocates intuitively “knew” would improve results.

It happened that we were working on an institutional research project for admissions, and we had enough data to take a look at gender and attrition. We needed to quantify the problem of accelerating female attrition before we could look for correlations. What we found was that there was no particular female attrition problem. In fact, the retention rate for female students was slightly higher than that for our male counterparts. What was really happening was that way back at the start of the pipeline, in grades K, 1, and 2, the balance of students was 60% male, and that balance largely held all the way through. Not exactly something that should have been hard to notice or uncover, but the perceptions were established and this was overlooked.

Did this “revelation” put an end to the calls to add a cheerleading program to the upper school (one board member’s solution for making the school a better place for girls)? The title of this piece provides a hint. The certainty about the female attrition problem survived unscathed. We would like to think we are fundamentally rational beings, but it is hard to let go of closely-held beliefs, no matter how information points in another direction.

What does this kind of resistance to what the data are telling us look like in advancement? It takes many forms. Here are a few I’ve seen recently:

  1. Continuing to mail the same number of solicitations annually to a large pool of never-givers, despite models that suggest de-emphasizing a population and re-directing resources to more likely constituents.
  2. Spending significant gift officer time on statistically low likelihood prospects who have extremely high wealth ratings (yes, it’s fine to make a discovery call if the prospect will take an appointment; but at some point it’s time to move on).
  3. Allocating significant personnel time to maintaining some sort of “extremely important” constituent list, despite not knowing whether there is any correlation with giving (and sometimes, even knowing that no such correlation has been found).

Some people have very little difficulty accepting data-driven conclusions that run counter to accepted wisdom; in fact, some people enjoy the power of data to undermine unexamined assumptions. I know I find it quite exciting. But I’m sure if some Sabermetrician showed me advanced statistics indicating that up to this point in his career Novak Djokovic has been a better player than Roger Federer during a similar interval, my first reaction would be something along the lines of “that’s not what I’ve been watching.” But, as a data-driven fundraising practitioner and consultant, I would have to shrug that off quickly and listen to what the data have to say. In the end, our biases can be overcome, but it does take a degree of conscious effort and repetition. If you’ve made a commitment to becoming a more data-driven fundraising organization, you’ve taken the first step. Remind yourself to hold opinions lightly and to be open to the messages in your data.

Brandon Ferris
Senior Director of Strategic Services and Fundraising Counsel
Zuri Group

Driven Mad by Over-Segmentation, Part 2: Basic Principles of Sound Segmentation

In my first post on this topic I discussed common approaches to direct mail fundraising segmentation, and posited that we ought to step back and consider these two fundamental questions:

  1. Do we really know whether we’re getting meaningful ROI on our segmentation?
  2. Are we even set up to determine the answer to #1?

My argument, having worked with dozens of clients, is that the honest answer to both questions is no. I would further argue that the way we “do segmentation” can actually hinder our ability to answer these questions in the affirmative.

In my next post I will discuss an analytics-based approach to segmentation, but since a certain amount of audience-based segmentation is likely to continue as well, I will first suggest a few basic segmentation principles to inform that. There is no single correct answer, and it is not the main point here. However you decide to slice your constituent universe up, one of the most fundamental tenets of direct marketing is to do it in a way that actually permits you to test the effectiveness of some aspect of your effort – channel, content, timing, who signs the letter, etc. Too much segmentation and too many variables make it very difficult to do so. Perhaps we could take our lead from the world of academic research, in which experiments are carefully designed to test one variable at a time.

One consequence is that segments should be stable over some period of time. If constituents are constantly being grouped into different segments, the ability to gauge the effectiveness of different messages, channels, etc., can be lost. If the content is changed from one appeal to the next, a the composition of segments changes as well, differences in results cannot be accurately ascribed to the change in content. This may sound fairly obvious, but I do think this fact gets overlooked in practice due to the (sometimes vast) complexity of segmentation.

A closely related principle, therefore, is the use of test groups. If we want to test different content within a certain population, let’s say parents of current students, the most scientific approach would be to pull a random selection out of the overall group to use as the test group. There are different ways to accomplish this, and the more sophisticated fundraising CRM systems have functionality for this.

In my next post, I’ll present a data-driven alternative approach to direct marketing segmentation.

Brandon Ferris, Senior Director of Strategic Services and Fundraising Counsel

And in This Corner…..The Never-Ending Battle Between Fundraisers and Advancement Services

Yes I said “battle.” Too strong a word? Perhaps. But not always. I’ve been in the room several times when disagreement turned to yelling and one party had to leave the room before things escalated further (were fisticuffs next?). Keep in mind that I was in the room as a third-party consultant, so the fact that tensions boiled over so strongly in the presence of an “outsider,” when people usually behave better, says something about the severity of the tension.

Fundraisers and advancement services practitioners commonly hold a number of negative perceptions about each other. What follows may come across as a bit raw and blunt, and by no means are these observations universal, but I’ve encountered these attitudes in dozens of nonprofit organizations.

Fundraisers sometimes perceive advancement services as:

  • Rigid
  • Fussy
  • Unhelpful
  • Hostile
  • Overly controlling
  • Too hung up on data minutiae
  • Too concerned with data for its own sake
  • Unable to see the forest for the trees

Advancement services practitioners, similarly, sometimes view fundraisers as:

  • Lazy
  • Unintelligent
  • Unwilling to learn
  • Unable to learn
  • Clueless with computers
  • Not caring at all about the data and data integrity
  • Unappreciative of advancement services’ efforts
  • Ignorant of the time and effort required to fulfill data requests
  • Having wildly unrealistic expectations of data, reports, systems, tools, etc.

I’m sure this sounds familiar. The results of this are familiar too – conflict, lack of trust in colleagues, lack of trust in the quality and accuracy of data and reports, silos, lack of easy access to needed information, reduced productivity, shadow databases and spreadsheets to get around the system, and more.

The good news in all of this is that there is a simple approach that can go a long way toward improving cross-functional collaboration and collegiality between advancement services professionals and front-line fundraisers (or between any work groups with different functions). Simple may not be a strong enough word. I’d go so far as to call it the essence of common sense. But there are plenty of familiar quotes about the uncommonness of common sense!

If there’s a simple, common sense strategy to address this situation, why is this problem so pervasive? Because even though the solution is simple and elegant in concept, to runs counter to some fundamental “philosophical” aspects of the way American management is done. These fundamental elements are so deeply conditioned that we’re almost complete unaware of them. What’s more, even when they’re pointed out, they are usually so thoroughly accepted as inherently true they may as well be accorded the status of mathematical axioms!

For example, asking someone if it’s necessary and helpful to have common metrics and to conduct “objective” annual employee evaluations causes most people to react as if I had asked them to explain how they know that grass is green. Why this example? Because it’s just one commonly accepted management strategy that turns out to be counterproductive and that fails on a number of fronts:

  1. It destroys morale and harms people.
  2. It does not improve performance, which is its stated purpose.
  3. It prevents honest two-way communication between managers and subordinates.
  4. It pits employee vs. employee.

Item #4 is the connection to the issue of advancement services vs. fundraisers. As I explore this issue further in subsequent posts, I will argue that this “eternal conflict” is, in fact, a natural and completely expected consequence of an underlying (and, I think, obvious) systemic problem, which has an equally obvious systemic solution.

Brandon Ferris
Senior Director of Strategic Services and Fundraising Counsel

Driven Mad by Over-Segmentation, Part 1: Key Questions

Segmentation is a given in any annual giving direct mail solicitation effort. Everyone knows you need to tailor the message to the audience? Right?

Maybe. Of course no one would dispute the value of tailored communications, but in my experience in the fundraising world I’ve seen a lot of untested assumptions and a lot of incredibly complicated (I would argue excessively complicated) segmentation, sometimes seemingly only for segmentation’s sake!

At the heart of the matter of annual giving/direct marketing in the fundraising business are three common (and fairly obvious) objectives:

  1. Raise as much money as possible.
  2. Minimize solicitation costs.
  3. Analyze results and refine tactics accordingly.

Splitting constituents into segments based on one or more shared characteristics (e.g. alumni vs. parents vs. staff, LYBUNT vs. SYBUNT vs. non-donor, school of law vs. college of arts and sciences, grateful patients, and myriad combinations of all of these) is the primary strategy for achieving these objectives. A tremendous amount of time, effort, and, often, frustration goes into producing these segments (not to mention money. The more variable the content, the greater the cost typically is to produce and deliver a mailing). You’re likely very familiar with how long it takes and how hard it is to produce segmented mailing lists such that each constituent lands in the correct segment within your defined hierarchy and lands in only one segment. Then there are issues with two constituents in the same household in different segments….. And so on. It can get a bit crazy.

I think we need to pause and ask two basic questions:

  1. Do we really know whether we’re getting meaningful ROI on our segmentation?
  2. Are we even set up to determine the answer to #1?

These are fundamental questions for any advancement operation that strives to become more data-driven, and I will explore them further in my next post on this subject.

Brandon Ferris, Senior Director of Strategic Services and Fundraising Counsel

“Small Data:” The ONE Piece of Analytics Every Fundraiser Should Know

The phrase “big data” is everywhere now. Most of us are so well aware of the amazing things companies like Google and Amazon are doing with the oceans of data they collect about us that we’ve come to expect this level of sophistication to be the norm. Most nonprofit organizations aren’t able to collect the amount or kind of data the giants can, but they can still use analytics very effectively to achieve better fundraising results.

Because big data and everything associated with it has become such a part of popular consciousness, I believe that our industry has come to:

  • Expect too much from our data. We simply do not have the ability the collect the amount or type of data that Google does.
  • And yet, in opposition to the bullet above, overlook some very fundamental and useful data we have at our fingertips.

The latter bullet is the one to which I refer in my title. To find out whether you know the ONE thing I’m talking about, try to answer this simple question right now:

What percentage of the constituents in your database have NEVER made a gift to your organization?

That’s it! Simple enough.

You’re forgiven if you have to run a query to get the answer this time, but I would suggest this should be top-of-mind knowledge from this moment forward. Why? Because knowing this critical piece of information and using it to inform fundraising business decisions is the first step in becoming a data-driven fundraising operation.

Here are four things you can do with that simple piece of information that will save money, improve fundraising results, or simplify your operations:

  1. Reduce the number of times your long-term never givers are solicited each year.
  2. Rank long-time high capacity never givers lower than other high capacity prospects when making assignments. This is especially important when you wealth screen thousands or tens of thousands of records.
  3. Purge the oldest records of never givers from your database if you can (not alumni, for example).
  4. When you do send an occasional mass appeal to the oldest never givers, craft a message that emphasizes participation over high ask ladders.

You’ve probably already come up with more ideas. These may sound like obvious decisions to make, and yet I still commonly see a proclivity for “shotgun” tactics aimed at everyone in the database. If you cannot start with simple tactics such as these, it will be that much harder to achieve higher levels of sophistication and take full advantage of all the power your data has to offer.

Analytics-based fundraising, data-driven fundraising, call it whatever you like, is fundamentally about prioritizing your resources and efforts – targeting your dollars, time, and people toward the prospects most likely to make the biggest impact. Start with small data and build your way toward becoming a data-driven fundraising team.

In Defense of Crystal Reports

I encounter quite a bit of bashing of Crystal Reports within the advancement industry. The criticism seems to be growing of late as more people within the industry gain some level of awareness of competing reporting tools such as SSRS, Tableau, and Logi Analytics, to name a few. These are powerful tools, to be sure, and they may each offer some unique capabilities. But Crystal Reports is also extremely powerful if you are willing to invest the necessary time and effort into learning how to leverage its capabilities.

Which brings uCrystal_Screenshotp an important point: All reporting tools require a significant degree of training and understanding. Let’s be blunt for a moment: Many of the reports we want or that management requires are highly complex, and they are reflective of highly complex fundraising operations and organizational structures. You can only go so far in terms of simplifying the process of generating the needed analytical reports. It will never be “easy button” level easy. So before we dismiss Crystal Reports as being “too complicated,” let’s step back for a moment and admit that this whole endeavor is highly complex! And no matter what tool you use to create reports, you have to have a solid understanding of the underlying data. Selecting the data you need to answer your reporting question is more than half the battle.

One of the great advantages of Crystal Reports is there is a high likelihood you already own it, either because it’s so ubiquitous in the industry or because it was bundled along with your fundraising database system. Tens of thousands of organizations using The Raiser’s Edge already have Crystal Reports, even if they’re not using it or are not using it extensively. And RE even has a built-in export format designed for Crystal Reports. When you combine that with a user-friendly query tool, the process of pulling the data and joining the tables you need for a report is made relatively easy. If you use a different CRM system, Crystal still makes it fairly easy to connect to the database to select datasets directly, or to use datasets in various formats.

It ultimately comes down to training. I’m not sure I have ever encountered an organization that has provided enough training for its employees. In all my years as a fundraiser I received exactly ZERO training to use my CRM and reporting tools. Like many of you out there I had to figure it out on my own. That’s great once you get there, since you’re quite likely to retain that hard-won knowledge, but it’s a terribly inefficient way to go.

Well-designed training can get users up and running and generating great Crystal Reports in a matter of days. Of all of the various training topics I deliver I enjoy teaching Crystal Reports the most – by far. It will sound like a cliché, but the most rewarding thing for a teacher is to watch the light bulbs go on for their students. When my students discover that they can understand Crystal Reports, the enthusiasm they exude is infectious. I hear exclamations like “I can’t wait to use this” or “I’m going to be able to do so many things with this!” all the time.

Brandon Ferris, Senior Director of Strategic Services and Fundraising Counsel
Zuri Group

Teach a Man to Fish…

… and you feed him for a lifetime, so the well-known proverb goes. This familiar platitude has its parallel in the world of fundraising. In many advancement shops, fundraisers and other end users have no choice but to request lists from advancement services specialists, sometimes having to wait a week or more for the request to be fulfilled. Then the list isn’t exactly what the user wanted, and so a revised request goes back to advancement services, etc., and several rounds of back-and-forth ensue. After much time is lost and a great deal of frustration is created, the list is finally completed.

But many modern fundraising CRM systems include user-friendly query building tools that enable end users to create their own lists without having to know how to write SQL, which begs the question: Why do so many advancement shops restrict users’ ability to create their own queries, thus perpetuating the situation described above?

A few typically heard reasons:

  • “The fundraisers don’t want to learn to do it themselves.”
  • “The MGOs don’t have the time to learn how to do it.”
  • “There’s a lot to remember (e.g. special exclusions, organizational rules, etc.) so it’s really easy to make mistakes, and we’re the ones who hear about it when that happens.”

Are these claims true? Let’s address these objections and suggest some benefits to a more inclusive approach.

  • Some end users won’t want to learn to create their own queries, and others may not have the aptitudes necessary to become accurate query builders. This population can continue to rely on the specialists. But many end users, given the permissions and the training, would be very happy to become increasingly self-sufficient in their jobs.
  • Given the choice between investing some time in learning how to query and waiting for days every time they need to submit a list request, many end users will gladly choose the former.
  • A distinction can be made between when a user needs a simple list for the performance of a task vs. when a user needs a formal list for something more consequential such as a mass mailing or major event invitation. In the latter case it makes sense to continue to rely on the specialists. Properly trained users can be trusted to know the difference and act accordingly. Trusting staff to do the right thing and empowering them to be more self-sufficient increases engagement as well.
  • Investing the time and effort in carefully-planned training not only can help make employees better at their jobs but can also help give fundraisers and other end users greater insight into the depth of expertise of their advancement services colleagues and increase their sensitivity toward data management issues.
  • With a reduced need to fulfill list requests, advancement services specialists can focus more on the high-level analytical efforts they are capable of.

Having worked with dozens of advancement teams I have also found that the attitudes reflected above often point to deeper underlying tensions between fundraisers and advancement services practitioners in our advancement departments. Executed correctly within a more collaborative and collectively-intended organizational structure, the process of teaching more end users to pull their own lists can be a first step toward greater teamwork and productivity. I’ll have more to say about this theme in later posts.

Brandon Ferris, Senior Director of Strategic Services and Fundraising Counsel
Zuri Group