How to fail at fundraising innovation — and how to succeed

It was one of the most amazing mixtures of stupidity and brilliance I’ve ever seen.

The Director of Communications at a nonprofit I was helping had made a discovery:

Most of our donors don’t really understand what we do.

That was a provable fact. We had repeatedly tested fundraising messages that were clear “explanations” of their programs. And every time — every single time — those “how we work” messages didn’t perform compared to emotional and action-oriented “here’s what you can do” messages.

I’m not talking about a few percentage points of difference in fundraising performance. It was orders of magnitude worse every time we tried to explain how we did the work.

If you have any experience in fundraising, you’re probably saying, “Well duh, Jeff. Tell me something I didn’t already know.”

Our challenge was the Comms Director didn’t know this. But now he finally got it: Our donors don’t respond to our programs and methods. They are unlikely to become more educated about or work. They respond to simple, emotional, action-oriented messages.

But …

(Everything I’m telling you could have ended up great … without that “but.”)

But instead of concluding that maybe we should stop trying to tell donors things they clearly didn’t connect with and instead practice fundraising that worked, the Director of Comms came up with a different conclusion:

Find better donors!

The problem wasn’t us. It was them!

“Our” donors were just not sophisticated and educated enough.

We’d go out and find a better class of donors!

If this were a movie, here’s where the scary music would start playing.

He hired a lifestyle/branding research company to find those better donors.

After several months and a few tens of thousands of dollars, they found our dream demo: Donors who hated traditional fundraising and were just waiting for something more to their heightened and sophisticated needs.

This new dream demo was decades younger than our donors were. Also wealthier and more educated. In focus groups, they almost universally poo-poo’d standard fundraising, saying it was simplistic and annoying. They told us they would respond to straightforward facts that respected their intelligence. They told us they’d lavish their resources on us and promote us on their large social media followings.

These people were a dream come true! They were the kind of donors the organization (its comms department, anyway) really wanted.

The predications from the lifestyle/branding people were breathtaking: When we started focusing on these new donors, we’d see higher giving, more upgrading, more engagement than we’d ever experienced before. There was no way this could take us anywhere but up!

Just one complication: these new donors didn’t show up in the places we usually found donors. They weren’t on donor lists at all, because they so rarely responded to fundraising. So we had to go to subscription and catalog lists. Which are a lot more expensive than donor lists. But no worries — it was going to be well worth it!

To cut to the chase: We created some “new donor” fundraising pieces. They were more fact-based, upbeat, less emotional, full of numbers and explanations that made the case for our amazingly effective programs.

Then we tested.

The good news is, we tested smart. We sent the New Fundraising to both New and Old Donor groups. And we sent the Old Fundraising to both groups also.

How did it turn out?

The New Fundraising, sent to the exciting New Donors, failed spectacularly. It did worse than anything we’d ever yet tried. The response rate was about one-tenth what we were used to. The average gift was high — about 25% higher than normal, but that wasn’t even close to making up for the poor response. The high cost of the names compounded the loss.

The winner? Old Fundraising sent to Old Donors. By a landslide. It got the kind of response we were used to. Not record-breaking, but sustainable.

Now here’s where it gets weird: Our crusty Old Fundraising sent to the exciting New Donors did twice as well as New Fundraising did with them. Double the response. Still a failure, but it was twice as strong as the noble experiment we were doing.

Stranger yet: New Fundraising to Old Donors also did about twice as well as New Fundraising sent to New Donors.

We learned four things:

  1. Our Dream Demographic was not a good source of donors. They barely responded, either to messaging tailored for them or to our standard messaging.
  2. Our standard demographic was much more responsive, both to the standard messaging that was created specifically for them, and to the new approach that was not at all aimed at them.
  3. Our amazing new messaging failed to get good response from anyone, either from those it was created for or from our standard audience.
  4. Our old messaging got better response from everyone, including the Dream Demographic who specifically told us they hated it.

Please don’t think I’m saying you shouldn’t keep trying to do better, either with your messaging or your audience. Things are changing, and if we don’t keep learning we will be caught in a very bad place, where we don’t know how to raise funds or from whom!

But you can avoid expensive, dead-on-arrival experiments like the one I’m telling you about by keeping a few things in mind:

  • Your expanded audience groups are not radically different from your current audience. They are adjacent. A few years younger. Slightly different attitudes.
  • The messaging that works will always be simple, emotional, and action oriented. No matter what your surveys and focus groups tell you, just-the-facts fundraising doesn’t work for any group of would-be donors.
  • If you seek breakthroughs, new channels are where you should be experimenting. Apply what you know to be effective in new channels and you just might find something powerful. The good news is, new channels keep popping up in this time of fast digital innovation. Some of them just might be very important for fundraising.

Want to know what happened to the Director of Communications in this story?

He changed jobs just before the magnitude of the failure of his experiment became clear to his bosses. He’s done similar things for other nonprofits since, though I lost track of him. He may have moved out of the nonprofit space as news of his serial failures started to get around.

Everyone else? We continued to do our jobs, testing messages and lists, sometimes failing, sometimes succeeding, but generally making progress.


Comments

2 responses to “How to fail at fundraising innovation — and how to succeed”

  1. Thank you for sharing your experience and ideas with us all!

  2. Thank you for sharing your experience and ideas with us all!

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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff BrooksJeff Brooks has been serving the nonprofit community for more than 35 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com. More.


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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About the blogger

Jeff Brooks has been serving the nonprofit community for more than 30 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com.

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