Saturday, October 12, 2013

How Do You Draw Retention Conclusions From The Fundraising Effectiveness Survey?

There have been all sorts of blog posts recently about how terrible the Fundraising Effectiveness Survey Report is with regard to donor retention. For the life of me I just don't get what all the fuss is about. Peter Drucker set us all straight decades ago when he said that every business is designed perfectly for the results it gets.

Back in the early 90s when I had my first boarding school position in the Northeast part of my responsibility at that time was to also be a student advisor. I had one particular student that really was struggling, and had been really getting a lot of negative feedback from teachers. His parents were not all that happy with him either. I recall sitting with him on one of those grade New Hampshire mornings, he walked into my office head down clearly dejected because he had just done poorly on the exam. He handed me the exam with the big red letter at across the top and showing a result of 58. I asked him how much time he had spent studying and preparing for the exam, his response was that he hadn't studied or done any preparation. I stared at the paper for about a minute; he squirmed in his seat waiting for the criticism he had come to expect. I lifted my head, smiled and said you are amazing. You were able to get a 58 with out doing anything, you should feel very proud of your accomplishment. His mouth dropped as he looked at me completely bewildered, while also starting to fit a little straighter. You can figure out the rest of the story.

What is remotely surprising about the fundraising effectiveness report? The report itself measures short-
term performance. If you scroll into the methodology behind the report itself you will discover that there aren’t any metrics for donor longevity. Many bloggers suggest the results of this report demonstrate how poor our retention rates are. You could argue that the report itself doesn’t even measure retention. There is information on year over year money and donors, along with stats on recapturing past donors. But that is not retention. Retention and keeping the customers requires other stats not measured in this report. If the report doesn't measure longevity of relationships, it is in fact not measuring donor retention.

Retention is a byproduct of designing donor connections with a longview. All the conversations that are related to thank you, building relationships, leaving out the ask, how much you ask doesn't matter, be donor centered, these will very little impact without metrics that span 5 and 10 years.

Donor retention will not be resolved by tweaking, it route will require a complete rethink of what we measure, our internal culture and crafting our communications in a way that recognizes how our donors see themselves in their world.

It took 50 years to get to the place we are, and every report suggests that the nonprofit industry has significant opportunity in what is labeled as untapped resources. Some of the questions we need to ask ourselves:

1.Do we want to continue taking advice from the same people that got us here?

2. Will we realize our capacity by keeping all our systems, strategies and tactics the same?

I spent the last half-decade in rethinking fundraising metrics, if you are interested in viewing new models click here.

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