November 17, 2017
Jeremy Haselwood is a member of
In the nonprofit world, direct mail is still king when it comes to generating revenue. This is one of the few industries in which this is the case, and I can confidently say it isn’t changing drastically in the near future. As a digital marketer, it’s fascinating to me because this sector seems ripe for opportunity to shake up the industry with digital strategies and tactics.
After observing numerous nonprofit clients I’ve worked with, the reasons are clear. A majority of individual donations come from older generations that have more disposable income and are more accustomed to responding to direct mail, as opposed to donating online. The more silent issue I see involves the culture of many nonprofits that hinders the advancement of digital fundraising.
The following is a roundup of five major challenges within the culture of many nonprofits that, if rectified, could open up a windfall of online revenue:
1. The Old Guard
In many nonprofit organizations, the most senior-level employees and decision makers have little to no knowledge of digital marketing and fundraising. Many of them were raised in the direct-mail world and don’t understand the technologies and intricacies involved in pulling off a digital program. They have a wealth of knowledge in direct mail, which generally has proven response rates. They know that if they spend X on direct mail, they will get Y in return — and it has worked for years.
2. The New Guard
Many younger nonprofit professionals understand digital marketing and technologies, but lack fundraising and direct-mail experience. Though they don’t need to understand direct mail inside and out, there are still principles and strategies that have worked with fundraising in direct mail that can and should be applied to digital fundraising. The younger guard often has a difficult time selling the idea of investing more in digital because there isn’t always as clear of a correlation between X and Y. Sometimes you will spend X without knowing what Y will be.
3. Culture of Conservatism
Nonprofits are constantly under scrutiny in terms of how much money raised actually goes toward the cause as opposed to lining the pockets of the C-suite. As a result, many nonprofits are ultraconservative when it comes to investing in new forms of fundraising like digital. Nonprofits are in a tight spot because every single dollar matters. Every dollar spent on an unproven strategy is a dollar that could potentially have gone to help a cause. The stakes are high, and nonprofits have to be conservative, but sometimes this hinders them from testing new ideas and strategies that could actually generate more revenue to make an even bigger impact.
4. Digital Talent Retention
Nonprofits can attract solid digital talent, but they often don’t have the budget to pay market value for the skill set they are acquiring. Luckily, candidates are attracted to the satisfaction that comes with having a job that makes a difference, even if it means they don’t earn their market value in salary. The challenge lies not in acquiring talent, but retaining this talent. Life changes, and it becomes tempting for talented digital employees to jump ship to other companies in order to better provide for their families or personal lifestyles. I’ve seen many talented digital fundraisers leave nonprofits for this very reason.
5. Diluted Staff Roles
In an effort to keep expenses minimal, nonprofits can be understaffed. This means employees are required to wear various hats. This can result in fundraising decision makers that don’t have a background in business or digital marketing. It’s easier to go with what’s always worked (direct mail) because there’s no time to research and understand digital fundraising. Through no fault of their own, these decision makers have to decide quickly because there are 50 other things on the agenda that have to get done today, and fundraising budgets are just one of them.
Though these five problems are prevalent at many nonprofits, they are not without solutions. However, keep in mind we’re talking about the issue of culture here. Shifting company culture is not easy, nor is it quick. But even the smallest steps toward shifting culture can make a difference. Here are a few tips to begin this shift:
- Establish a consistent dialogue between the old and new guards to share knowledge.
Each group can benefit from exchanging ideas and best practices. Even a quarterly or semi-annual meeting to cross-educate each other can foster common ground, understanding, and credibility between both groups. - Set aside part of the budget for innovation.
Test new marketing and fundraising strategies and tactics. The nonprofits that don’t do this will begin to get left behind, while the ones that do will advance their overall fundraising. - Strive to pay closer attention to market value for good talent.
It’s just a cost of doing business and likely will have a stronger impact on the organization over time as turnover rates are reduced and top talent puts together effective strategies that grow revenue.