To Incentivise or Not?

Fundraising isn’t an easy job, ask anyone who has been doing it for some time; they’ll say they enjoy the work, the challenge and like the fact that what they are doing is helping someone else.

But, are fundraisers missing out. People in sales and marketing roles in the private sector receive not only their salary but also performance bonuses; often in the non-profit sector this doesn’t happen.

The reason why there’s no performance incentive is often because of perception that money given for charitable purposes is being redirected to pay over inflated wages; as anyone in the non-profit sector knows, wages, pay are not over inflated; actually often the pay scale in the non-profit sector is below what someone would earn in the private sector.

Staff turnover in the fundraising area of charities can be high, and it could be that those who are performing well are feeling frustrated and feel that their efforts aren’t being recognised (or rewarded).

It’s recognised that organsations have some hesitation in giving rewards, or paying any form of commission due to either public perception of charity money being “misused” or due to other restrictions (such as sector organisations not permitting such payments); that’s understandable. However, there are ways that fundraisers can be recognised, as said early, an extra day off or similar.

What we need to ask is, is it wrong for people to be rewarded for doing well in ensuring funds are available for the beneficiaries of an organisation?

If fundraisers can’t be recognised or rewarded for doing well, organisations could run the risk of having empty desks and empty bank accounts; that would be more harmful to the organisation and its beneficiaries than some small acknowledgement of a job well done.

I have seen some fundraisers being rewarded through special gifts from major supporters; supporters who acknowledge the hard (and stressful) job of fundraising; such as a hotel that would make a room available once a year for an extended weekend to be used by the fundraiser who brought in the most new donor support.

There are ways fundraisers can be rewarded, often it only needs some lateral thinking to come up with a method.

Do you incentivise your fundraisers?

Should fundraisers be rewarded?

Donor Loyalty

How do you keep loyal donors, they’re the ones who support you no matter what – they’re the people you can count on.

But, like any other donor, there’s always the risk they’ll move on.

What can you do to retain their loyalty and commitment to your cause?

Many non-profits expect a high attrition rate after a donors first support; in some cases this can be as high as 65%. That’s 65% of new donors walking away after their first donation; that’s a high percentage, so maintaining loyalty is important.

You need a compelling message, a clear reason why donors should stay with you and, remember it’s about the donor not you. Tell donors why they are important.

How you communicate with your donors can make or break loyalty, what does your message say about you? What does the way you speak, communicate with donors say about the way your organisations operates?

Show your donors why their help is needed, and how this can make a difference, right now.

Trust is what donors are looking for, trust in your organisation and trust in what you are saying. They need reassurance that what you are doing is making a difference, helps others and that the money they are giving is being used wisely.

Are you making it easy for donors to support and communicate with you? One of the biggest turn offs for donors is the way they are treated. If donors feel that they are being treated with indifference or your organisation doesn’t show that it cares about them they will likely walk away.

Another way to turn off donors, is to make it hard for them to support you.

We all like things in life to be easier than it perhaps is, and this is true also when it comes to charity support.

Make it easy for donors to make their donation, does your website make it easy for them? Can they make a regular donations direct from their wages, or by other direct methods?

Another key to keeping donor loyalty, is in building a relationship with them. A receipt for donations received is not building on a relationship, so you need to have other ways to communicate and engage with donors. Keep in mind too that it’s not one size fits all when it comes to communicating with donors.

Some donors will be happy to receive a letter in the mail, others would prefer an e-mail, and others would appreciate a phone call. What do your donors like?

If you’re only thinking about ROI when it comes to donor communication, stop, and instead think about the lifetime value of your donors.

Not sure where to start with your donor loyalty “programme”, look at all possibilities and set up some tests to see what works best, again one size won’t fit all situations and donors.

What are you doing to build donor loyalty? If you support charities, what makes you stick with the ones you support? Share your experiences below.

See also

Donor Retention

Regular Giving

Recognise Regular Donors

Donor Retention: Time for a Change

Another great piece from Michael Rosen that’s definitely worth making a coffee and sitting down to read.

Donor Retention: Time for a Change

[Publisher’s Note: From time-to-time, I will invite an outstanding, published book author to write a guest post. If you’d like to learn about how to be a guest blogger, click on the “Authors” tab above.]

This week, I have invited international fundraising superstar Roger M. Craver, a direct-response fundraising pioneer, Editor at The Agitator, and author of Retention Fundraising: The New Art and Science of Keeping Your Donors for Life to share his wisdom with us.

However, do we really need a book about something as fundamental as donor retention? I believe we do. And so does Ken Burnett, Managing Trustee at SOFII and author of Relationship Fundraising. Here’s what Burnett says in the Foreword to Craver’s book:

Our nonprofit sector is bleeding to death. We’re hemorrhaging donors, losing support as fast as we find it, seemingly condemned forever to pay a fortune just to stand still.

It’s time we stemmed the flow.”

While the latest Fundraising Effectiveness Project report, developed by the Association of Fundraising Professionals and the Urban Institute, shows that the nonprofit sector’s donor retention rate has improved for the first time in years, the number is still wretched. The nonprofit sector’s donor retention rate now sits at a shameful 43 percent! For every 100 new and renewed donors, 102 donors are lost through attrition.

As a sector, we must stop this donor churn. It’s expensive. It prevents organizations from building long-term relationships that lead to large current donations and significant planned gifts.

Read full article here

Background Checks

Background checks are a necessity for many organisations but, when the cost of checks starts to eat away at finances needed for the core functions of an organisation things need to change. Either charities could be given an exemption from having to pay a proposed fee or the fee could be reduced to a token amount.

It would appear from article in the NZHerald that many organisations (and the people they assist) will suffer …

Charities and volunteer groups are warning the Government they will have to cut back on their services if a proposed charge on criminal checks goes ahead.

Non-profit organisations such as the Cancer Society, Age Concern, the Blind Foundation and others have asked to be exempted from a proposed $5 to $7 charge for police vetting, which is currently provided at no cost.

They say organisations which provide a public good, depend solely on donations and have a large proportion of volunteer staff should not have to cough up for the service.

A parliamentary select committee began hearing submissions last week on the law change which would allow the Government to charge for police services. Ministers have promised that vetting will be the only service to incur a charge.

Some cash-strapped groups estimated new costs of $5000 to $10,000 a year if they needed to pay for criminal checks.

The Blind Foundation said it looked after a large number of children, and under a law change last year it was required to vet all its staff. It estimated a new bill of at least $2500 a year.

The Police Association agreed with the groups. Its members supported moves to reduce the strain on the frozen police budget but believed cost recovery should be limited to private commercial interests.

The bill would give powers to the minister to make exemptions but it’s not yet clear how these will be used.

Police Minister Michael Woodhouse could not be reached yesterday, but his predecessor, Anne Tolley, emphasised that the proposed charge was much lower than the $50 to $60 paid for criminal checks in parts of Australia.

The Teachers Council, which is legally required to vet teachers and makes 40,000 checks a year, also opposed the bill.

Acting director Rob McIntosh said vetting was one of the police’s core functions and it should not be considered an additional service such as dealing with lost and found property or running the Police Museum.

He said police vetting of teachers was one of the key tools for protecting children and young people.

Criminal checks

• Between 450,000 and 500,000 criminal checks a year

• Estimated cost to police of $2.2 million

• Some organisations, such as those that work with children, legally required to vet staff

• Government wants to charge $5 to $7 for checks.

From NZHerald Monday 16 Feb 2015

Does your organisation do police background checks, what impact will a proposed fee have on your organisation?

Increase Your Revenue From Your Donors

Came across this great article by Wayne Elsey and thought I’d share it. Wayne raises some important points about donors and, donor retention.

Increase Your Revenue From Your Donors

According to an article in Network for Good, here is the reality for donor giving to nonprofits:

  • Commercial business customer retention is 94 percent. It is 41 percent for nonprofits.
  • New donor retention is 27 percent.
  • Repeat donor retention in the sector is 70 percent.

If you are a development director or executive director, you need to know what your donor retention rate is and then you want to know how to increase it. There are several strategic and immediate steps you can take to improve retention, which will ultimately increase your donation revenue.

Say Thank You

A basic fundraising practice is to thank your donors. This is fundamental. However, organizations sometimes focus on thanking their major donors, cut costs by not thanking donors under a certain donation amount or are not creative enough in their appreciation of donors.

If you have a newsletter that goes out regularly or an annual report that gets disseminated, take the opportunity to acknowledge your donors. Of course, always ask them if you have permission to publish their names in any of your collateral material.

Take the time to make a call. If a donor has given you a significant gift, it deserves a phone call. Make it a point to have your organization, including board members and staff outside of the development office, spend a few days during the holidays each year calling a broader list of donors simply to say “thank you”. Thanking people will increase retention and their subsequent gifts.

Make It Easy

Donors today have more choices and opportunity to support their favorite organizations. Smart nonprofits are not only providing multiple ways for donors to donate by being on social media and using social media donation tools, for example, but they are also providing donors with easy and plentiful ways for donors to support the cause.

Read full article here

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