What to Say When Your Donor Asks: How Much do you Spend on Overhead?
Why do we always think of donors with pyramids?
Philanthropy, Not Fundraising
The pyramids were built in Egypt. On the backs of slaves. It took a very, very long time. The cost, in human terms, was untenable and unsustainable.
That’s why you don’t see many pyramids being built these days.
Except in nonprofits.
Where building the donor pyramid is still the holy grail. Get ‘em in. Move ‘em up. Acquire through direct mail. Convert to monthly donor or sustainer. Acquire through events. Convert to mail. Up, up, up…. to the pinnacle of major and planned gifts!
Except for one tiny thing.
It doesn’t work. Pyramid building is so 2630 BCE. Nobody’s got 100,000 workers (aka direct mail donors) building a solid pyramid anymore. Many so-called pyramids really look like hour glasses. Or upside down pyramids. Or plateaus. Even the pyramid-shaped ones are resting on shaky foundations of donors who move in and out, in and out… 7 out of 10 leave… making the ‘foundation’ more like a river than a solid, secure slab of mortar.
So… what’s going on? I’ve been thinking a lot about this.
Pyramids are forced.
They’re where people go to die (yes, remember the pyramids were built as tombs). Why are we forcing people up to the top… just to get them there and hope they’ll expire so we can get their planned gift? That sounds like the antithesis of a donor-centric strategy. It sounds totally self-centered – kind of like a Pharaoh!
Instead, what about a model that’s free, active and filled with room to breathe? One that focuses not just on the strength of the dollars given, but on the love and engagement freely offered. One driven not by fundraising, but by philanthropy (i.e., “love of human kind).
I’m thinking of a vortex – an energized circle. Everyone is equal in a circle; just at times some folks have more energy than others. People move in and out of the circle, giving and getting, as the time and spirit moves them.
A natural, circular flow works in two ways.
In the energized circle/vortex model ‘donors’ are not categorized solely by their money.
They’re people, first and foremost. Sometimes, when things are going well for them, they become donor-investors helping other people. Sometimes, when other things in life take precedence, they may become recipients of philanthropy.
I’ve known an awful lot of people who at one time were charity beneficiaries, and who then went on to become philanthropists. Sadly, the reverse is true as well. But that’s what the circle – the circle of life – is all about.
The vortex enables folks to come in and out from various points on the circle.
They can then zoom back in as the vortex continues to swirl around them. The vortex never stops. People may swoop in with a shared tweet, acting as your ambassador. They may jump in with a peer-to-peer crowd funding initiative, acting as your fundraiser. They may dance around on Facebook or G+ trying to get a petition signed, acting as your advocate. They may make a small online special appeal gift … attend an event… purchase an auction item…take a tour… or sit down with your E.D. and end up making a significant donor investment.
All these folks are similar points of energy on your circling vortex.
As the energy builds up, some are swooped towards the center of the vortex and stay there. They’re the ones whose energy (and values) match yours most closely. They’re the ones where the chemical reaction (or, as Yoda might say, “the force”) is so strong… and the energizing experience of the circle (your community; your family) is so potent, that they simply can’t resist you. These become your hard core of supporters – the ones you continue to supply with lots of energy.
But everyone else gets energy too. The folks engaging with you online are just as important as offline. They must be responded to so the energy keeps flowing. Some of these folks have so much energy themselves that they’ll spread your message like wildfire — if you let them. So… let them. Play with them. Invigorate them. Catalyze them. Give them breathing room – rather than trying to force them into rungs on a ladder, points in a funnel, or levels on a pyramid.
Stop treating your supporters – any of them – like bottom feeders.
Don’t get ticked off at them for giving “the wrong way.” No one is at the bottom of anything if they support your cause. They’re the ‘tops’ in my book!
Stop treating your supporters – any of them – like corn to be force fed into a goose. Seriously, stop forcing folks to go where you think they should be. Folks who make repeated small gifts are just as likely to leave bequests as those you force up to the top of your pyramid, ladder or whatever you call it.
Get yourself an embracing circle.
Make yourself a strong, compelling magnet. Concentrate on clarifying your mission and simplifying your case for support. Tell your best emotional stories. This will energize your circle.
Keep the compelling content flowing. Build yourself a content calendar and put someone in charge of donor-centered communications. Watch the circle begin to spin and build momentum. The energy will do the work for you. You just have to concentrate on being the magnet – and rotating.
I’ll have more on the vortex model next week. Meanwhile, I’d love to hear your thoughts!
Meanwhile…
- Don’t miss this month’s Halloween Nonprofit Blog Carnival – Major Gifts Tricks and Treats. Tons of tips from nonprofit experts across the web. Plus you can score some free fundraising E-Books from the likes of Joe Garecht, Mazarine Treyz and Vanessa Chase over at the Halloween Goodie Giveaway. You’ve got a sweet tooth, right?
- Also, I’ll be participating in a free live video discussion with Chronicle of Philanthropy about Clever Ways to Thank Donors on Halloween Thursday, 10 am PST. Joining me will be nonprofit legal expert Gene Takagi (clever doesn’t mean forgetting all the legal requirements), technology and social media expert Cody Switzer of The Chronicle and Tony Martignetti of Nonprofit Radio. Lots of Q & A… so come hang out with us!
Note: This post was inspired by the brilliant work of Julie Dixon & Denise Keyes who wrote an article in Stanford Social Media Innovation Review that nicely sums up the benefits of the vortex model. I encourage you to read it.
Photo: Flickr, Khalid Almasoud
34 Comments
Love this Claire! What I love about your embracing circle is that is helps me visualize the nonprofit information flow into the circle – the vortex has always made it hard for me to see where exactly the nonprofit fits into the info flow. The embracing circle is a beautiful vision for the kinds of relationships we can build – without imposing an artificial hierarchy based on gift amounts. We can still prioritize resource (time) allocation – we have to – but it doesn’t have to ALL be a hierarchy. Thank you for sharing your vision on this!
Thanks for your comments Julia. And all your support! Reminds me of a poem by Edwin Markham (I went to Edwin Markham Jr. High).
He drew a circle that shut him out,
Heretic, rebel, a thing to flout.
But love and I had the wit to win.
We drew a circle that shut him in.
Another great article. Thanks for getting it and sharing it and being a blessing to many.
Thanks so much Gray. 🙂
Couldn’t agree with you more! We actually just posted an article a couple days ago about declaring the fundraising pyramid dead – http://imarketsmart.com/smartideas/2013/10/the-fundraising-pyramid-is-dead/
Brilliant minds think alike! Still, I’m not in love with the upside-down funnel pyramid either. It still places the emphasis too much on the money; not the love. Not that we don’t need money; it’s just that focusing there can blind us to opportunities to build relationships with folks who we might otherwise miss or ignore.
Since I’m the one who developed the upside down pyramid and blogged “The fundraising pyramid is dead, recently, I guess I’ll chime in.
I think nonprofits need to recognize that they are, after all, a business. And businesses need money to run.
I dig the concept of focusing on love. But in the end, “show me the money.”
Here’s my upside down pyramid in case anyone wants to check it out.
http://imarketsmart.com/smartideas/2013/10/the-fundraising-pyramid-is-dead/
Sure Greg. I like that you’re turning things around, for sure. And, yeah, yeah… I know you need the money. But… money is still just about the largest taboo subject in our culture. When we focus on it, funny things can happen. People get stuck. They lose sight of their inner drives and passions. Forgive me for getting psychological-minded, but I just see it happen so many times. If you focus on philanthropy, not fundraising, you do better.
I’m not suggesting that we ask donors for unicorns and rainbows. No. We ask for specific gifts to meet the needs. We just somewhat shift the culture and come from a place of love rather than guilt, greed, need or other triggers that leave folks feeling just a little bit less than overjoyed with their giving.
Sure caught my eye! I’ve been hearing and reading about donor pyramids since I started in fundraising 30 years ago. I love someone who suggests that the “emperor has no clothes”. An embracing circle is a much more compelling concept than moving donors to a peak to die. Good thoughts!
Appreciate your comment Sally. You made me laugh!
Very interesting article, thank you! I’m curious what the “donor-centered communications” would entail? We do direct appeals, donor postcards, thank you’s, etc. but how does one really build off these and make it more personalized and truly donor-centered?
Donor-centered means exactly what it sounds like. You think about what’s in it for the donor; not about you or your organization. It’s not features, but benefits. The more information you can put into your database in a manner that you can segment donors with different interests and characteristics, the easier it is to be personal. If you want some tips, I suggest my Attitude of Gratitude Guide which is available from this website.
Or feel free to give me a call. I always do a complimentary 15-minute chat!
Claire – this is brilliant! This post actually got me excited about the possibilities! I love that, in your vortex model, people can come and go as their circumstances dictate. It is true that at times, one is able to be a donor, and at other times that person needs to be a recipient of services. I don’t hear many people talk about that in the nonprofit world. Thank you for acknowledging that (I think they’re a special population, myself).
You said, “Concentrate on clarifying your mission and simplifying your case for support. Tell your best emotional stories. This will energize your circle.” Hallelujah! Keep it simple and show them how it works. The rest will just happen. Thanks for a great article!
You’re so kind Laura. And you’re correct: Keep it simple, human and personal. Somehow that’s all too easy to lose sight of as we chase after shiny new objects.
I’ve always that development, like the life cycle of an organization, is a spiral. People come in, move forward, become involved, connect with others, and overlap again at a new entry point that keeps moving forward. Some things are revisited, which is comforting; sometimes people take on a different role, such as mentoring others newer to the organization; and there is space for light and growth along the progression. I have used this model in many ways and have found it to be helpful and to inspire “what if?” thinking. Thanks, Claire.
Thanks Terri. Yes, a spiral is much like a vortex… maybe a little less embracing. I like us to focus on creating energized communities. That requires that we put energy into the circle as well. Sometimes nonprofits are a little too passive. Donors come, donors go. Circle of life. Well… let’s try to improve the life expectancy a bit!
Yes, yes, and more yes! Thank you! I’ve read a number of “entry-level” development books these past few months and they ALL have the pyramid. Not one of them could explain it to me in a way that reflected what I am seeing in my real world of very small (less than $100,000 budget) nonprofit development. This, though, makes ever-so-much more sense to me! It is exactly what we’re dealing with. The trick, I guess, is energizing more people into the vortex when they are ready – which I suppose requires some serious listening skills. 🙂
Question for you: do you have a donor database that you recommend? Ours is very limited in its reporting features. Given your advice about keeping detailed information about donors in the database, what software do you advise?
Hi Barbie! Thanks so much for your comments. Yes, listening is a huge requirement. If you don’t absorb the energy being given, it simply dissipates. What a shame! Let’s talk offline about databases, okay? Feel free to email me.
Claire, I like the idea of circles, but the numbers I see suggests that the donor
pyramid is still alive and well. Donors fall into patterns and when you have 5% of the donors giving 50% or more of the money, there’s a top donor peak and a very wide small donor base. I favor a lifetime giving model that has no less than seven circles, each representing a type of giving and a mindset that reflects the donor’s relationship with the charity at any point in time. It’s a lifetime model because it classifies how donors may move from one circle to another over the course of a lifetime, and defines how to manage that relationship in each stage.
You can always stuff donors into whatever model you’ve a mind to. If you want to stack folks up according to how big their gifts are TODAY, you can do that. But… where does that get you? For most nonprofits, it leads to a culture of building relationships only with the folks at the top. A lot of potential is missed. It’s always been thus, but the digital revolution has shined a beacon on this because it’s so much more evident who our influencers are. We didn’t know when our $25 donor was telling 100 of her friends to give to us. So we didn’t lavish any attention on her. Today, we can see via Twitter, Linkedin, Facebook, G+, YouTube shares, Yelp reviews and comments on our blogs who our real fans are. The pyramid model doesn’t do them justice.
Only problem is where do we find the time and money to pay so much attention to so many people?
Technology can help do that. But I like Mal Warwick’s quote: “Fish where the big fish are.”
Of course I focus on major gifts so my opinion is very tainted.
Penelope Burk said “Treat every donor like a major donor — when you can.” Sure, you’re going to put more resources into higher-yielding donors. The problem is that you don’t always know who those folks are. Some of them are hiding in plain sight. The multiple time a year givers in your database. The long-standing direct service volunteers. The folks who consistently retweet your posts or run campaigns for you on Facebook. We need to simply be more thoughtful about who our biggest fans are; not just our biggest monetary donors. There’s more low-hanging fruit than most of us realize.
Yes! This past year I presented a workshop at a national school foundation conference and our topic was totally in line with what you have written. We have found that by engaging a broad community strategy that invites participation at all levels, we have been the recipients of wonderful and generous gifts – if people love and feel part of your non-profit, when they find themselves able to give in more substantial ways they will turn to you. So glad to see this philosophy gaining traction!
Thanks Gail. Good to hear! And… Happy Halloween!
Glad you found this helpful. The more useful we are to our constituents, the more likely it is they’ll want to be useful to us. Just human nature. Win/win.
I love the vortex imagary, as well as the ever-(r)evolving spiral. That kind of energy is what I see in my experience with donors. We’ve used the ‘lava lamp’ model for so long I don’t recall where it originated. The idea is, like a lava lamp, donors are fluid, flowing up and down at their own pace and according to their own agenda. I see value in the pyramid imagery for the purpose of fundamental planning, but you are so right that it rarely applies to people. These more fluid images give us an opportunity to engage donors in much more apprioriate way.
Love the lava lamp imagery. The only flaw I see with it is that it conjures up a notion of observing the fluidity, rather than being an active, energetic participant. Because it’s not just about the donors and where they naturally flow; it’s also about the energy the nonprofit brings into the circle to engage/influence their natures.
Absoutey insghtful and great discussion because nonprofits must plug the leaky donor bucket with every means possible.
Thanks for your comment Jim. Appreciate it!