Watch Out!  Your Non-Profit Could be Missing a Pot of Gold

by Joe Garecht

Under the fundraising rainbow.

Lots of times, people (and non-profits) don’t see the true value of what they have.  They take things for granted, and underestimate the capacity of the people they are closest to.

Here’s an example: for decades, the United States Postal Service was pretty disparaging about junk mail.   They had to tolerate it, but most of what they offered was geared towards individual mailers and small businesses.  That meant ads and programs geared towards children writing their grandparents letters, families sending out Christmas cards, and the accountant on Main Street mailing out her monthly invoices.

Over the past twenty years, though, that’s all changed.  The rise of e-mail meant the decline of person-to-person mail, and with it, the decline of the postal service.  The USPS quickly realized it had been undervaluing its best customer all along: the large bulk mailer.  Large businesses that sent out millions of pieces of mail each year were always a backbone of the postal revenue stream, but it wasn’t until grandma started sending e-mail that the post office started to show junk mail the love it deserved.   Now, the vast majority of new postal programs and advertising buys are geared towards businesses.

The USPS realized it was focused on a declining customer base while missing out on a real pot of gold.  Likewise, I’ll bet that your non-profit is missing out on key revenue streams because you’re undervaluing some of your biggest potential funding options.

3 Pots of Gold You’re Probably Missing

In my experience, non-profits usually focus on finding new donors, cultivating major donors, and keeping their tactical fundraising (things like direct mail, events, online appeals, etc.) running smoothly.  Those are all important things, and as I have said previously, focusing the majority of your time on individual donors, and particularly major donors, is a wise decision.

Unfortunately, the flip side of this equation is that organizations often undervalue and under-appreciate the capacity of other donor and prospect pools available to their non-profit.  Here are three pots of gold you’re probably missing at your organization:

#1: Your Event Donors

Most non-profits that I have worked with have a list of people and businesses that they treat as “event donors.”  They expect that these donors will only give through their large annual event (or a series of other smaller events) and thus only ask for event donations.

Sure, these organizations have annual and major donors who also give to their events, and those dual donors get lots of cultivation, stewardship, and non-event asks.  But the “event donor” group only gets a minimum of cultivation (e-mail newsletters and an annual report) and asks around event time.

This is a huge mistake!  Many times, your event donors don’t give at other times because they haven’t been personally asked.  Lots of non-profits send out an annual appeal letter to an event donor, and when the person doesn’t respond, the organization figures the person only likes to give through events.

Instead, pick up the phone and call your mid-level event donors.  Thank them for their support.  Ask them why they like your organization.  Invite them in for a tour of your office.  Personally ask them to upgrade for the next event.  Steward them.  Ask them to refer some friends to the organization.  Put them on your advisory board.  Event donors can be a huge source of revenue and referrals for your non-profit, if you work hard to build strong relationships with them outside of the event.

#2: Your Small Dollar Donors

How many of your small direct mail donors have you invited in for a group tour of your facility (a non-ask event)?  How many of your online donors have you called for a 15 minute conversation about your mission and your work?  For most non-profits, the answer to both questions is, “none… unless they sent in $100 or more…”

Your small dollar donors can be a big source of funds for your organization.  Many of them could upgrade to mid-level donors, if you gave them a reason to.  Many of them could leave you a planned gift.  A few of them could become major donors to your non-profit, if you built a relationship with them.  All of them could refer at least one friend to become a donor to your organization.

You can’t spend as much time per donor on small dollar donors as you do on major donors… but how about spending the same amount of time on them as a group?  For example, if you spend one hour per month personally cultivating a donor who gives $50,000 per year to your organization, and you have a direct mail program that brings in $100,000 per year, couldn’t you afford to spend two hours per month personally cultivating your mail donors as a group?

This could mean calling a few of them every month to thank them, or sending out some personal, handwritten thank you notes, or making upgrade calls, or inviting them all to a thank you coffee event at your office.  Put a system in place that will allow you to personally cultivate a portion of your small dollar donors every week, month and year… and watch your small dollar donation revenue grow.

#3: Small Business Owners in Your Community

Most smaller and regional non-profits take small business owners for granted.  They see them as ATMs who provide event sponsorships and silent auction items on demand.  Inevitably, a board member will tell these organizations that they should be asking those businesses for annual donations as well, and a staff member will dutifully call, write or visit the business owner to make an ask.

More often than not, the business owner will say no. They know the difference between making a donation in return for marketing benefits and simply being used.  If you make your interactions with local business owners transactional (always asking for money in return for something, and never cultivating them like actual supporters of your organization), they will be transactional, and see your organization as a vendor, not a mission-driven charity.

You need to cultivate your small business contacts.  You need to build relationships with them.  You need to be grateful for their gifts.  How many of your silent auction item donors have you called to thank?  How many of them have you gone out to visit, taking along a note from the clients you serve?  How many of your corporate event sponsors have you cultivated on a personal level?  How about that company that donated its old conference table to your office… did you go out and ask them for a large cash donation 3 months later, or did you spend an entire year cultivating them and treating them like part of your team?

Don’t take your small business supporters for granted.  They could be major assets to your non-profit, if you steward them properly.

Photo Credit: Robert Couse-Baker

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