Stop focusing all your efforts on finding "younger" donors

If I had a dollar for every time a fundraiser said to me “We are trying to recruit younger donors”, I wouldn’t be blogging here right now.

My response to this is the same always: why?

Charities are always looking to recruit "younger" donors because they think that’s what they should be doing. Wrong.

Mostly because they hear, are told, or are in fact seeing that traditional recruitment methods (I.e. direct mail) don’t work as they once did.

So the obvious response is, we need to find channels that “younger” people responsd to.

In fact charities should also be spending time looking for better ways to recruit “older donors”.

Before I move on, I’m taking a pretty broad brush here. My definition of “younger” is pretty loose, let’s say under 35 years old. By “older” I’m talking 60 and upwards. Not a science but works for the point of this blog.

Why?

Because “older” donors give much, much more and are statistically more likely to stay with you. Fact.

Let me prove it to you.

I undertook some data analysis with a client recently, and looked at the key drivers of attrition across their file.

For every channel we looked at we were able to determine that “younger’ constituents were more likely, in some cases two to three times more likely to cancel their giving than “older” donors. And when you translate that into income, both long and short term that meant “older” donors were giving far, far more.

This is consistent with all of the work we have done with our clients at Pareto Fundraising, in each country we have looked at this in, across varying types of organizations.

The message is always the same.

“Younger” donors stay on for shorter periods of time and hence give less. The reasons are pretty simple, “younger” donors are at a different life stage. Less disposable income, more transient, more likely to have a mortgage, possibly with young children. Bottom line, less income to give away to charity.

So what?

Well, reaching out to find “younger” supporters isn’t necessarily the silver bullet. Finding better ways to attract and engage older constituents is. I’m not suggesting don’t recruit “younger” donors at all, far from it.

What I am saying is get the balance right. And when you do reach out to younger constituents, please, please, please talk to them differently. I’ll save that for another blog though.

Jonathon

Being inspired: Terry Fox

Most Canadian’s will know Terry Fox’s story.

I only became aware of Terry’s amazing life when I moved to Canada last year.

For those of you who don’t know, Terry was diagnosed with bone cancer when he was just 18, and forced to have his right leg amputated above the knee in 1977.

So moved by the suffering of other cancer patients whilst in hospital, Terry decided to run across Canada to raise money for cancer research.

Here is the mind blowing part.

Terry ran 42 kilometres (26 miles) a day through Canada's Atlantic provinces, Quebec and Ontario! A marathon a day. With a prosthetic leg. Simply incredible.

Unfortunately on September 1st, after 143 days and 5,373 kilometres (3,339 miles), Terry was forced to stop running outside of Thunder Bay, Ontario because cancer had appeared in his lungs. An entire nation was stunned and saddened. Terry passed away on June 28, 1981 at the age 22.

Terry’s legacy lives on through the work of his foundation and the cancer research that their support has funded, having raised close to half a billion dollars in the last 30 years.

I had the privilege today to go and present to the folks at the Terry Fox Foundation. Which was an incredibly humbling and inspiring experience.

Over lunch one of the guys was talking about how he’d been for a 30 minute run that morning. One of his colleagues remarked at how impressive that was getting up so early in the morning. His response: “Terry ran 143 marathons. 30 minutes is nothing”. He went on to say (remarkably) that the 89km he once ran in a day in South Africa was also “nothing” in comparison to Terry’s feats. It was all about “perspective” as he put it. How true. I sometimes need to get a bit of that perspective, we probably all do.

It’s hard not to love your job when you hear stuff like this and get to meet some wonderful people.

Thanks to the gang at the Terry Fox Foundation for having me in. You’re an amazing bunch of people continuing on Terry’s great work. Oh, and I look forward to the run in a few weeks! Stay posted for that one readers….

Jonathon

Tell me, tell me and for god's sake tell me again...

Occasionally I get fixated on certain products and services. For a while it was, and to be fair, still is Porter Airlines. They are brilliant. Torontonians, if you haven’t used them before you must.

Recently I stumbled across Priceline – a cool website that allows you to book cheap flights and accommodation.

A dime a dozen though, right?

Sort of. The great part about Priceline is that you can bid for stuff. So I can bid (as I did a couple of weeks ago) for a hotel, in the city I want to visit, in the area within the city and then nominate or bid what I want to pay.

Then within around 60 seconds I find out whether I have been successful.

Where it gets really smart is when I place my bid, or before I press the bid button it tells me if I have a low probability of getting the place I want. So that if the chances are low I can bump up my bid.

Basically it works. I’m currently staying in the Sheraton on 7th Avenue in Manhattan for $110USD a night. And for anyone whose stayed in NY recently, that’s unheard of.

So what the hell has this got to do with my fundraising program, Jonathon? Get on with it!

Well apart from the obvious analogies like being easy to use, what I love about Priceline is they are bloody persistent!

Last week I bid for a hotel in Vancouver and missed out on the price I suggested.

Every day since then I have received an email like you the one you will see attached, reminding me that I can bid again at the same price if I like. What I love about this is:

- They have remembered me. My name, my details, my bid.
- Just because I missed out the first time doesn’t mean I am not interested. I can either re-enter the same bid or make some revisions. They key is reminding me.
- They make it easy for me to go and bid again. I simply click the link and presto, I have re-bid.

Absolutely brilliant.

Remember these things in your direct response fundraising.

Tell me, tell me again and for gods’ sake tell me again! In a direct mail letter, we usually ask a donor around 5-6 times (within a 4 page letter). We know, as we have tested, that the repetition increases the response rate. Some simple rules to remember here, are:

- Always include an ask in the first 3 paragraphs
- Always include an ask on each page
- Always include an ask at the end of the letter
- Always include an ask in the P.S. and tell them everything you have just told me one more time

Great work Priceline. I reckon you’d make a good fundraiser.

Jonathon

Accept that donors are not cheap

Point number three of ten in my session yesterday, entitled the 10 point plan to recession proofing your fundraising.

In reality I could have scrubbed out the "recession proofing" your fundraising, and substituted it with "leading" because in reality the presentation and the messages within are timeless.

Anyway, back to point three.

If you think that you can make money straight away on acquisition (this comment excludes those in the US where you can make money upfront mainly as a result of the enormous volumes you can talk to) then frankly you are kidding yourself.

There are as always exceptions to the rule. But across the board acquiring new donors is bloody tough.

Depending on the channel you are recruiting by, it typically takes on average anywhere from 18 months to 4 years (and up) to make money.

The point is donors aren't cheap and we need to manage peoples, errrr... your bosses and boards, expectations about this.

Here are some key takeaways:

- The most effective charities on acquisition take a long term view. They don't throw the towel in after one campaign. They test, tweak and refine until they get it right. Messaging, lists, elements within a DM pack. They all need to be tested.

- It's rare to make your money back quickly. 18 months is the lower end (regardless of channel) to breakeven. But it's not uncommon for some channels to take 3 years and above. That doesn't mean its not worth doing if these recruits are bringing in substantial long term value, but you need to realistic.

- You must aim to recruit regular, monthly givers. Looking at some analysis today for a client showed that the long term net value of monthly donors (it differed by channel) is around ten times that of one-time cash donors. It isn't easy but you need to find a way, whether that is signing people up to monthly straight away or getting them in on cash and then converting them really quickly after they come on board.

All in all you need to stop just looking at response rates, average gift levels and the cost per acquisition.

You need to accept that donors are not cheap. But you also need to understand, what is a donor really worth over a period of time when you factor in how much they give over their lifetime, taking into account all costs to recruit and cultivate. That's what smart acquisition is about.

Jonathon