Barriers to Donor-Centricity: the Challenges you Face

Barriers to Donor-Centricity: the Challenges you Face

After defining donor-centricity and explaining why we believe it should be a strategic priority for NFPs, it’s worth us exploring some of the challenges you may face on your journey towards donor-centricity.

Commercial entities recognise that sustained competitive advantage comes from having a customer-centric approach across all levels and teams within their organisation. Only when the customer permeates the hearts and minds of the entire organisation – regardless of seniority, department or title – will the company start to reap the rewards of trust and loyalty from their customers.

The same is true for NFPs. Donor-centricity needs to permeate the DNA of your charity in order to be truly effective.

And therein lies perhaps the biggest barrier to donor-centricity: your organisation itself.

Its ethos, culture and leadership.

Its vision, strategy and core values.

Its programs, targets and KPIs.

Its operating model, revenue streams and decision-making processes.

Its hiring policies, onboarding and development opportunities.

These elements all need to be conducive to first understanding your donors at each stage of their life; and then infusing these insights into all areas of your business to help inform decisions, shape strategies, determine priorities, set goals, build your brand, establish a connection and ultimately create a unique and ongoing value exchange for your donors that leads to trust and loyalty.

All of which, of course, rely heavily on the technology your organisation uses; the quality of your donor data and even the very language you use to communicate with your donors. These too present additional potential barriers to donor-centricity.

Then there are the external factors to consider. The ratio of NFPs to active donors, resulting in everyone ‘fishing from the same pond’. The subsequent over-targeting and communication overload that leads to paralysis of choice, desensitisation or message fatigue. All this even before a global pandemic is thrown in the mix, threatening our way of life as well as life itself.

Yes, the path to donor-centricity is undoubtedly full of obstacles and challenges: internal and external, known and unknown.

But they are not insurmountable.

Because your organisation has a secret weapon.

You.

A champion, not only for the cause your organisation represents but for the donors who so generously give their money in support of its beneficiaries.

A voice, always asking “what will this mean for our donors?”

A rally cry, encouraging everyone in the organisation to put the donor first, always.

No matter what hurdles NFPs face on their journey to donor-centricity, their success will be that much greater – the outcomes that much more meaningful – if they have someone like you in their corner.

So don’t be afraid to be that constant presence, that constant reminder that sustainable giving stems from sustainable relationships built over time and based on trust and loyalty. And that begins with a donor-centric approach throughout your entire organisation.

If that sounds daunting, don’t worry – we’re here to support you. In fact, there’s a whole community of people here to support you…and we’d love for you to join us at LemonTree’s free Donor-Centricity Collective (DCC). As a member of the DCC, you can learn from your peers, share your experiences, ask questions and keep up-to-date with the latest strategies to become more donor-centric…AND be part of a movement to help grow sustainable giving in Australia! Simply click here to sign up for free.

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Next up in this series:

  • How to become more donor-centric
  • The different stages of the donor relationship and how they impact donor-centricity

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Why donor-centricity should be a strategic priority for NFPs

Why donor-centricity should be a strategic priority for NFPs

In my previous blog post, I explored what it means to be donor-centric. This post, I’ll explain why we at LemonTree believe donor-centricity should be a strategic priority for NFPs.

Donor-centricity is the ongoing dedication to increasing the depth and breadth of your donor understanding. In doing so, you generate insights that can be used to tailor your communication and engagement efforts and demonstrate to your donors that they are at the heart of your entire organisation. This builds trust and loyalty – the critical foundations of any lasting, sustainable relationship.

How do we know this? Because we’ve seen it before in the commercial world.

Customer-Centric Commercial World

Long ago the commercial world realised that the ‘customer is king’ and so adopted a customer-centric approach to their business. Marketing teams work tirelessly to get inside the hearts and minds of their customers so they can position and promote their products and services in the right way, at the right time and with the right message to engage and nurture the customer and eventually make the sale.

Faced with increasing pressures, change and disruption from technological innovation, and a general decline in trust amongst businesses, commercial entities recognise that sustained competitive advantage doesn’t belong to those who provide the best product or service. Sustained competitive advantage belongs to those who provide a sustained focus on delivering the best customer experience.

A positive customer experience makes us feel something and – as humans – we are motivated to act based on how we feel. We tend to make decisions based on emotion, then find a way to justify that decision based on logic. Which is why we choose to walk that little bit further to get our morning coffee, even though it costs 50c more…but the barista greets us by name, remembers our order and takes the time to ask how our kids are getting on with that school project.

We walk further and pay more because of the way the experience makes us feel; that’s what keeps us coming back. It makes us trust the barista; makes us loyal to the cafe and gives them a competitive advantage. In today’s challenging times with COVID-19, this entrenched loyalty – built up from years of providing a positive customer experience – is keeping many businesses alive, and for that, we applaud them and wish them every success.

To deliver the best customer experience and earn a sustained competitive advantage, businesses need to earn trust and build loyalty by adopting a customer-centric approach:

  1. Understanding what their customers want, need, like, dislike, hope, fear and value at each stage of their life (see Fig. 1)
  2. Infusing these customer insights across all their business functions to help shape decisions
  3. Creating a unique and ongoing value exchange for their customers
  4. Engaging in open, honest and transparent two-way conversations with their customers, across many different channels
  5. Empowering customers to interact with their brand on their own terms

This same approach applies to not-for-profits looking to secure sustainable giving. You need to earn trust and build loyalty by adopting a donor-centric approach, and that starts by increasing the depth and breadth of your donor understanding.

Fig. 1

Understanding your Donors

In the same way as a customer’s ability or desire to purchase a product or service will vary over their lifetime (see Fig. 1), so too will a donor’s ability and willingness to donate to your cause vary in both time and dollars as their circumstances change and evolve.

Adopting a donor-centric approach enables you to recognise the changes in their life stage (whether it’s a significant milestone or subtle adjustment) and adjust your communication and engagement activities accordingly so you sustain the relationship over a longer period of time.

Smart organisations – both commercial and NFP – would rather have a customer or donor contributing $25 annually for 10 years, versus a one-off transaction of $500. That is not sustainable.

Historically, donors have reported they often feel treated like ATM machines, where the focus is on the financial transaction itself, rather than taking the time to nurture and engage with the donor. But if NFPs treat the donor relationship as a purely transactional one, then it will only ever yield one-off transactional results.

The building blocks of sustainable relationships

Remember, trust and loyalty, are the building blocks of any long-lasting relationship. But they are not built on a series of one-sided transactions. Trust is built over a series of two-way conversations during which the donor feels recognised, valued and instrumental to your organisation and its beneficiaries.

If you can make your donors feel this, they are far more likely to stay loyal to your cause…and even adopt it as their own.

So if you want to grow sustainable giving for your cause, and for the Australian fundraising industry, you need to adopt donor-centricity as a strategic priority to earning trust and building loyalty.

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If you’re on a mission to become more donor-centric, we invite you to join LemonTree’s free Donor-Centricity Collective (DCC). As a member of the DCC you can share best practice, learn from your peers, keep up-to-date with the latest strategies to become more donor-centric…and be part of a movement to help grow sustainable giving in Australia!

Next up in this series:

  • Barriers to donor-centricity: the challenges you face
  • How to become more donor-centric
  • The different stages of the donor relationship and how they impact donor-centricity

Previous:

‘Donor-centric’: defined and dissected

‘Donor-centric’: defined and dissected

Donor-Centric. It’s a term used so frequently in our world, we run the risk of glossing over it without pause for thought about:

  1. What it really means to be donor-centric;
  2. Why not-for-profit organisations should make donor-centricity a strategic priority;
  3. Barriers to donor-centricity: the challenges you face;
  4. How to become more donor-centric; and
  5. The different stages of the donor relationship and how they impact donor-centricity

So, I’m going to address those questions in this next series of blog posts, starting with what does it mean to be donor-centric?

Let’s break it down. The word donor comes from the Latin word ‘donare’ meaning to “give as a gift”. The word centric evolved from the Greek words ‘kentrikos’ and ‘kentron’, meaning “sharp point” and the English word ‘centre’ – centric refers to being “located in or at the centre”.

At a basic level, donor-centric or donor-centricity simply refers to putting your donors at the centre of everything you do.

But, practically speaking, what does that mean exactly?

Simone Joyaux, a leading consultant for nonprofits and NGOs, describes the term donor-centric as “another way of saying building trust”.

Joyaux believes a donor’s relationship with your organisation deepens – or frays – depending on how much trust you can create in three key areas:

  • Trust that donors play an essential, vital, central role in your mission’s success;
  • Trust that your organisation does worthwhile things with donor gifts;
  • Trust that your organisation conducts its operations efficiently.

So putting the donor at the centre of everything you do means do everything you can to build trust, especially in those three areas.

Ian MacQuillin, Director at Rogare, The Fundraising Think Tank provides us with a working definition of what it means to be donor-centric: “An approach to fundraising whereby for-purpose organisations genuinely strive to understand their donors and meet their needs – usually, but not exclusively, through relational marketing approaches and the use of two-way communications – in order to maximise sustainable voluntary income.”

MacQuillin suggests putting the donor at the centre of everything you do means working to understand the needs of your donors, and using this knowledge to promote your cause and communicate with your donors to help maximise donations.

At LemonTree, we believe putting the donor at the centre of everything you do is a combination of both. We define donor-centric as:

“The continual dedication to increasing the depth and breadth of your donor understanding, so you can connect more meaningfully, collaborate more effectively, and – most importantly – genuinely care for your donors in order to create ongoing value exchange, build trust and increase loyalty.”

 I’d love to hear how you and your organisation define the term donor-centric – please comment below or email me.

If you’re on a mission to become more donor-centric, we invite you to join LemonTree’s free Donor-Centricity Collective (DCC) . As a member of the DCC you can share best practice, learn from your peers, keep up-to-date with the latest strategies to become more donor-centric…and be part of a movement to help grow sustainable giving in Australia!

Next up in this series:

  • Why not-for-profit organisations should make donor-centricity a strategic priority;
  • Barriers to donor-centricity – the challenges you face;
  • How to become more donor-centric; and
  • The different stages of the donor relationship and how they impact donor-centricity
‘Win Me Back’ – Synergy Fundraising

‘Win Me Back’ – Synergy Fundraising

Guest blog by Adam Drinan, Director – Synergy Fundraising

The best way to win back donors is easy.   Don’t lose them in the first place.  

While it seems obvious, I’m a believer in tackling re-activation proactively but also focussing on the issues that increase donor attrition in the first place.

For that reason – here is my top five tips for winning donors back and my top 5 tips on how to avoid losing them at all!

Tips to win donors back! 

  1. Take real action

Are you watching and waiting or taking action?

We know the most important factor in whether someone will support you again is recency – so let’s say a donor who used to give every few months stops.   What will you do? Wait until they move from a 0-12 segment to a 13-24.

Then what? Wait for them to go 25+

The longer you wait the harder it will be to get a donor back in the fold.   Don’t move donors around in pots that effectively mean nothing!  

  1. Talk to me!

Surveys are magical things. Ever asked donors this question on a scale of 1-10?

“How likely will you support organisation x in the next 12 months?

Anyone that says 7 or less is flat out telling you they aren’t committed – you’ve got an opportunity to take action right there.  

Drop me a line via our website and I’ll tell you exactly what to do when donors answer 7 or less and what to do with donors that say 8, 9, 10. (Yes – even the 10 donors require some love!) 

  1. Taken the wrong road? Turn back!

Did you acquire a donor with a particular type of story, ask or case study?   I’ve seen charities acquire donors on one topic and instantly switch to other things.   It can be dangerous, try going back to what appealed to donors in the first place and see if anything changes.

The perfect storm occurs here when charities change the messaging on donors that haven’t been onboarded well (eg if your welcome/onboarding processes suck changing the messaging too quickly can really hurt). 

  1. Use Data to make better decisions!

If you’re big or small – over time, you’ll see similarities between the donors that attrite and supporters that keep supporting you.  

You’ll see patterns emerge that can start to predict with some accuracy who’s likely to stop supporting you.

If your own data isn’t painting a picture you can get some external assistance. Much like data hygiene this can cost less than the opportunities lost by doing nothing.

Once you can spot the patterns.   You can even take action on HALF of the donors so you can have a control group to see if your actions made any noticeable difference. It’s a game of patience and small tweaks but well worth doing. 

  1. Time to say goodbye?

It may be hard to say, but there are some donors that will be resistant to even your most charming efforts to win them back.  

Peer to peer fundraising is a great example. These events can bring in A LOT of new donors, but the 2nd gift rates are low. For many it’s the thrill of the event rather than the cause that’s the driving factor.

If you can’t offer the next new, exciting thing then they’ll be off. It’s either time to innovate or cut them lose and concentrate your efforts elsewhere.

Fighting a losing battle can cost you more even donors because you’re distracted by a fight you can’t win.    

Tips to reduce attrition. 

  1. Keep your data up to date  

 While data quality might not be sexy it’s essential to minimise what I would call “voluntary attrition”.

Examples of this would be washing your data against the Postal Address File (PAF) from Australia Post.

Some of you might have something like QAS or Hopewiser as part of your CRM – if you do, well done, because you’re verifying addresses in real time when you enter new prospects or supporters to your database.   (Have you ever ordered a pizza or uber eats and entered just a few characters here and there to bring up a perfectly formatted address – it’s technology that’s available to all of us now)

If you’re smaller organisation or don’t have a CRM that’s capable of adding a real time option – don’t worry.   You CAN get someone else to do it for you.   You’ll be able to find out who’s no longer at a certain address, sometimes you’ll even be able to access the new address.   If you’re part of a collaborative like Lemontree you’ll also be able to get insights on donor addresses that are incorrect BEFORE you mail them to find out.   What you can save on printing and postage can easily cover any costs involved.

The sin here is that a lot of charities don’t take either approach, and I’ll never understand why.   Even charities that pay hundreds of to acquire a donor won’t pay a few cents to verify their details – it’s crazy!

Crazier still? Databases without a high percentage of records with an email address and contact phone numbers.  

We know that around 1 in 7 people move every year, but you’ll know yourself that while you might get a new address chances are, you’ll always keep that Gmail you set up 10 years ago and you wouldn’t change your mobile number you’ve had since a Nokia 8350 was the shit! 

  1. Stay Relevant

I’ll cover this one by giving an example of what NOT to do.  

I recently spotted a post on Facebook about an issue that shocked me! It was an animal welfare issue I wasn’t aware of – so I clicked the FB post, ended up on a nice landing page and donated within a few minutes.

That’s when the experience went from hero to zero.   I got a really generic receipt by email – it didn’t even mention the project that caught my attention in the first place.

Even as someone that’s totally aware that small gifts aren’t tagged, I’d still like my communications to talk about my first gift and that I was helping the project that inspired me to click through and donate.

Worse still, since that donation they’ve gone out of their way to talk about everything BUT the issue that encouraged me to act.

Now someone at the organisation in question is probably wondering why so many donors only given once but who’s really to blame?

  1. Get to know me and FAST!

 It’s WAY harder to say no to a friend than it is a complete stranger, right?  

If donors feel they have a genuine two-way relationship it’s much harder for them to ignore your last ask, that newsletter or let your next phone call go to voice mail.

Ask donors questions, find out about their lives, their dreams and their motivations. Most people give to express their values, find out what those values are!

Do you get donors calling you pro-actively to update details? Guess what, they are your most engaged donors because they have a golden opportunity to walk away from you, but they don’t want to.

That call is an invaluable part of donor bequest scoring too – so make sure you flag anyone that contacts you to change their details! 

  1. Don’t let your processes and assumptions dictate your messaging – it’s really dangerous!

 You see a lot of this

“We haven’t heard from you in a while”

Let’s say a donor traditionally donates at Christmas time but they miss a year – we’ll probably say that donor hasn’t given for 2 years and it lapsing or lapsed, when in reality they didn’t respond once and who knows why – they could have had an expensive car repair, a medical procedure, they may have not even been in the country (which is just one reason why respond by dates can be a problem at certain times of the year!)

But the bottom line is that we’re treating them as a lapsed donor, but they don’t see that at all – in fact, the speed in which life passes by – that donation two years ago and often feel like it was recent.

If you treat a donor like they’ve abandoned you – it can become a self-fulfilling prophecy

Be careful what you say and like life in general, thanking people for what they HAVE done will always be received better than telling people where they came up short.  

  1. Premiums

Love them or hate them, if you used them for acquisition and then you stop, expect your attrition rates to increase.  

A premium-incentivised supporter has a different relationship with your organisation than one that’s giving to express their personal values or with a strong personal connection.

If your recruit with premiums, you’ll likely always need to incentivise the relationship in some way. The idea that you can wean a donor off premiums with an amazing case study sounds great in principal, but rarely works in practice.

If you’re in this situation, the question you need to ask yourself is ‘Is this worth the cost/resource to keep going?’.

A simple look at the longer-term ROI will give you the numbers you need to decide what to do.