Food bank donations truck unloads

5 Ways Effective Annual Reporting Drives Donations

Food bank donations truck unloadsFor many nonprofits, the yearly annual report is often just another task on a very long to-do list. Most charities are juggling a lot—development, program maintenance, fundraising, and more—and the annual report can feel like yet another mandatory routine project. One that often gets handled at the last minute without much intentional care and effort.

Even though annual reports are an industry standard, most nonprofits don’t realize how fruitful an effective annual report can be. An annual report that prioritizes storytelling, transparency, interactivity, and more can actually bolster donation solicitation efforts and become a lucrative fundraising tool.

Before we jump into the nitty gritty of strategic annual reporting, let’s cover the basics.

What is an annual report?

Think of an annual report as a “year in review”—like a yearbook of sorts, but for donors, supporters, and partners to look at the highlights of any given year at your organization. Of course, a lot can happen in a year (nonprofits know that best), but with an annual report, you can summarize all the year’s milestones including your impact, accomplishments, new developments, and more.

Annual reports can be created and presented in a variety of ways—both digitally and in print. Depending on the needs, audience, or even constraints of the individual nonprofit, you might choose to create a printed booklet or pamphlet (which could then be mailed to supporters and donors or handed out at events). Or, in line with more frequent developments in the space, you could turn to digital software tools to create an annual report that intrigues readers with more vibrant visual elements like photos, videos, and clickable links.

What does an annual report include?

Every nonprofit’s annual report is different, depending on its mission, values, impact, audience, and more. However, most organizations include a few standard elements:

  • Stated mission and values
  • Accurate financial data
  • Examples of impact
  • Major accomplishments
  • Program and initiative assessments
  • Event highlights and recaps
  • Donor and board member lists
  • Contact information

Though every nonprofit is required to submit a Form 990, most organizations take their reporting a step further and create a yearly review that includes more audience-centric material (like the topics listed above).

Now that we’ve covered the basics, let’s dig into the best part of annual reporting—the ability to create the ultimate fundraising tool.

5 Ways Effective Annual Reporting Drives Donations

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How Jargon Destroys Nonprofit Fundraising & Marketing

I hate jargon. With a passion.

Hate it. Hate it. Hate it.

Just. Can’t. Stand. It!

Yes, I guess you could call it a pet peeve.

But, really, why would you ever use jargon if you wanted to truly communicate with someone?

Just check out the definition:

“language used by a particular group of people, especially in their work, and which most other people do not understand”

— Cambridge dictionary.

Jargon = Failure to Communicate

When you talk to people in words they don’t understand, really, what’s the point?

Are you just trying to make yourself look smart?

Because, trust me, that’s not how it comes across.

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What Monkeys Can Teach Your Nonprofit

Monkey looking at youBabies can teach you the same thing.

If one baby does something, the others will want to ape them.

“Monkey see, monkey do.”

This is actually a psychological principle of influence and persuasion known as “social proof.”

It’s best explored in the 1984 groundbreaking book, Influence: The Psychology of Persuasion, by Robert Cialdini. He outlines six principles of influence affecting human behaviors. They’re all well documented, and can be incredibly useful to fundraisers.

One of the most useful principles is the one we also know today as the “Yelp effect.” It’s a type of positive (or negative) word of mouth that can make or break your business. I know how often I’ve abandoned my cart after reading a negative review. You?

Word of mouth is perhaps the most powerful form of social media you can find, so it pays to leverage it to your advantage.

Even someone inclined to support your cause may not give unless you push the right buttons. Of all the ways to do that, social proof is among the easiest and most successful.

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Just as there's a first kiss, there's a first time for everything for your nonprofit.

How to Persuade New Donors to Join Your Nonprofit Mission

Children holding hands

There’s a first time for everything, if you will it

 

What makes us think a perfect stranger, who’s never given to our organization before, will choose to do so?  It’s highly counter intuitive.

People are most likely to continue doing what they’ve done before.
Commitment and consistency is one of Robert Cialdini’s six principles of influence, and it’s useful in nonprofit marketing and fundraising. But only if you’ve got existing donors.
We talk a lot in fundraising professional circles about the folly of concentrating too many resources on donor acquisition and too little on donor retention. And for good reason. It’s significantly easier and more cost-effective to keep a current donor than to recruit a new one. Why?
It’s appreciably more difficult to get people to reach a new decision than to repeat an old one.
In fact, whenever I coach volunteers to do fundraising, I always suggest they remind current donors how many years they’ve already been giving to the organization.  This acts as a decision-making shortcut for these folks. Aha! They already decided this was a good idea.  No need to sweat it out again.  Done!
But… what if you’re a start-up organization that doesn’t have many donors?
What if your only choice is to go after first-time donors? How do you make a ‘sale’ if people are making a decision from scratch, with no previous history with you or knowledge about your vision, mission and values?
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Love letters

What’s Going On? What Can We Do?

Love lettersI had a fundraising post all ready to launch today, but I just couldn’t do it.

The world seems wildly out of whack right now.  I can’t pretend it’s business as usual.

I try to stay away from “politics,” because I know that’s not why you read my blog. However, we live in a political world. And so do our nonprofits, our staff, our volunteers, our donors and our clients. Simply put, politics is about making agreements between people so that they can live together in groups.

Nonprofits cannot seal themselves off in little bubbles, pretending what’s happening in the rest of the world doesn’t exist.

That’s why, during the pandemic, I encouraged you to talk about how events touch those who rely on you. It’s why, all the time, I encourage you to relate your work to what’s in the news and top of mind to donors. Be it hurricanes, fires, famine, drought, social unrest, war, civil liberties, mass shootings, homophobia, racism, sexism, bigotry, or anything else horrifying to body, mind, heart and soul.

If it’s something you’re thinking about, you can bet it’s something your constituents are thinking about.

If you don’t address it, you risk coming across as unimportant, blind, shallow or out of touch. Being relevant, and meaningful, means getting inside your supporters’ heads and knowing what’s important to them. What are they thinking? How are they feeling? In what way do the emotions they’re currently experiencing interact with your mission? How can they help you, and you help them?

I don’t know how you’ve been feeling, but many folks I’ve been talking to have mentioned anger, outrage and fear. Even those who are happy about one or two things are deeply concerned about other developments. And this holds true for both sides. Listen to Fox News, then listen to MSNBC.  You’ll hear equal doses of horror. The pendulum has been swinging wildly, back and forth, and the world seems madly out of whack.

What can the social benefit sector do to bring things back into balance?

I keep coming back to the Golden Rule. What if none of us ever did anything to anyone else we didn’t want them to do unto us? What if we only treated others as we would want to be treated? It seems so simple. So logical. So in everyone’s best interest.

What is it about the human animal that leads the same people who don’t want government to impose mask or vaccine mandates on them wanting to impose no abortion mandates on others? Or, from the other perspective, those who don’t want government telling them they can’t smoke pot wanting to tell others they can’t carry guns? All of this “I can impose, but you can’t” is nonsense from the perspective of “do unto others.” Yet, we persist.

The only way to make sense of these things is through an understanding of balance. We must strive toward philanthropy (translated as “love of humanity”).

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Proven 1-2-3 to Nonprofit Fundraising Success

L O V E Sign behind a fenceUnderlying this 1-2-3 formula is a need for balance.

It’s obvious. I know you know it. But… do you do it?

I’m here today, just in case you need a little reminder.

  1. The first step is essential for success in anything.
  2. The second step is essential for success in any consumer-facing business.
  3. The third step is essential for success in reaching a fundraising goal.

When the world seems wildly out of balance, it is incumbent on us to begin with centering actions: for ourselves, others, and our mission.

Balancing Trick: You. Donor. Nonprofit.

I’m talking about balancing self-love with donor-love with mission-love.

You can’t help others unless you first take care of yourself.

This is a truism you should carry with you throughout your life, and not just when the oxygen masks come down on an airplane. It’s never been truer than in the times in which we’re currently living, when there are new things about which to worry seemingly daily.

How do you lead the way forward, helping yourself and others navigate through the tough times?

I’d like to suggest you heed this 3-Step Formula to nonprofit fundraising success.

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3 people with marching orders

3 Ridiculously Easy Strategies to Boost Fundraising by 27%

3 people with marching orders I’m excited to share three easy tips with you, and the results are measurable.  Do these things and you’ll be able to tell if they impact your bottom line!

I was inspired to share these ideas with you based on a 2019 study by NextAfter and Kindful looking at how organizations are cultivating donors via email. They found plenty of data-driven ideas that can improve donor retention and boost online fundraising revenue — by as much as 27%!

Think about how much an increase like that could mean for your organization!

That’s right!

“Make way…” for these ridiculously easy, revenue-boosting strategies!

If you raised $100,000 last year, you could raise $127,000 – or more – this year.

And that’s without having to apply for a new grant, hold a new fundraising event or even ask for a new major gift or two to reap these rewards.

All you must do is simply pay a little more attention to your follow-through communication with donors.

Did you know most of the top reasons donors give for not renewing their giving have to do with how you do/don’t communicate with them after they make a donation?– or fail to personally, meaningfully and promptly communicate.

Meaningful, regular donor communication can hugely impact your bottom line.

To make a demonstrable difference in donor behavior, however, your communication strategy must tick more than one box. It must be prompt, personal and relevant to what your donor cares about and how they want to hear from you. Don’t just guess what your donors might like from you. Ask them!  In fact, surveys, social media queries, online quizzes, solicitations for comments and feedback are all wonderful ways to communicate digitally in a manner that personally engages your supporters.

Never forget: The best fundraising is personal.

So… what are you waiting for?

Here are three strategies revealed by the research: 

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Awesome/Less Awesome Sandwich Board

Key Strategies to Praise, Recognize and Give Meaningful Work Feedback

Awesome/Less Awesome Sandwich BoardI confess this is something I struggled with in my 30 years as a manager.

I had a boss who excelled at pinpointing weaknesses, and I learned a lot from her. [Plus, my mother was pretty good at this too – but we don’t have all day here.]

Ironically, this same boss told me ad infinitum (whenever I wanted to give someone a raise), that money didn’t really motivate people. All sorts of other things mattered more, including work environment.

At the time, I didn’t really believe this. I was constantly advocating for well-deserved raises because I thought it was the best gift I had to offer. And, by golly, it seemed like the right and fair thing to do! She told me resources were limited, and the satisfaction from a raise is fleeting, compared with things like greater authority, autonomy, praise and recognition.

You know what? She was right about what is most meaningful to employees in a workplace.

Because as much as the people who worked for me enjoyed a good raise, they complained a lot more about lack of advancement opportunity, responsibility without authority, a top-down infrastructure, lack of job fit, unrealistically high expectations, shortage of support and an overall stressful work environment.

If money is really bad, of course, it will get in the way.  However, it’s worth noting money is only fourth among the top five reasons people cite for leaving a job. In fact, the preponderance of research into the value of money as a motivator notes it is a motivator up to a certain point; once folks reach that level, more money has a negligible impact on their satisfaction.

[Background: I was fortunate during my career not to work at places where folks were expected to buy into the “starvation cycle” mentality and live below minimum wage. Where I worked, people generally were fairly and well-compensated. Sure, they’d likely tell you they wanted more money.  But this was not the reason they left.]

“In a nutshell: money does not buy engagement.”

— Tomas Chamorro-Premuzic, author, Why Do So Many Incompetent Men Become Leaders? (and How to Fix It)

Employee engagement is a product of overall work environment (culture) and specific management support (feedback, praise and recognition).

Begin with an Engaging Work Environment

A huge part of what employees will describe as “work environment” has to do with meaningful engagement, or lack thereof. And there are two ways to promote this engagement:

  1. Develop a broad, organizational culture of philanthropy [See here, here, here and here.]
  2. Develop a feedback system incorporating authentic praise, recognition and focus on strengths, not weaknesses.

I talk a lot about the former. Today I’d like to hone in on the latter.

Because… for engagement to stick, the two types must go hand-in-hand.

In fact, research reveals

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Interview exchange

How to Apply Job Interview Skills to Fundraising

When my daughter-in-law was interviewing for a job, she asked me for some advice. Here is what I found myself telling her:

Don’t focus on your needs. Focus on the employer’s needs.

Why are they hiring?

What problems do they need you to solve?

Which of your skills are they particularly looking for?

Can you describe to them how you might use these skills to help them?

Can you give a specific example, perhaps by telling a story, showing exactly how you’ll help them?

Are you clear what their values are?

CAN YOU DESCRIBE HOW YOU AND YOUR WOULD-BE EMPLOYER (DONOR) SHARE THESE VALUES?

I realized this is the exact same advice I give to fundraisers!

“Ask not what your donor can do for you, but what you can do for your donor.”

Meet your donors’ needs.

This is the heart of all effective fundraising, and the following should be your daily mantra.

“Today I will meet my donor’s need by…”

In fact, if you really want to become effective at your job, you will adopt this mantra for your interactions with co-workers as well.

“Today I will meet my colleague’s need by…”

This shift in your stance and approach may not seem like a lot, but it’s actually a game changer. By beginning with putting yourself in the shoes of another, you automatically open yourself to giving and receiving gifts.  And I often say if you want gifts you must give them.

Before you engage in any fundraising strategy, ask yourself:

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Nonprofit donor conversation

Top Strategies for Open Nonprofit Donor Conversations

Over the pandemic I took some time to enroll in an intensive coaching course. Over Zoom, of course. It was designed for people who don’t necessarily intend to become certified life coaches as a career path, but who want to incorporate a coaching approach into their daily life.

The heart of this approach, I believe, can be distilled into two words. And they’re extremely useful for donor conversations:

1. CURIOSITY

When you’re genuinely curious about another person you ask questions to draw them out. And questions to help them get to the place they want to go; not where you think they should go. Because what’s right for you is not always right for someone else. They’ll tell you what’s right – with you acting as their guide – but only if you’re interested enough to ask.

It happens some questions are better than others if you want to get to the core of the matter at hand. We’ll get to those in a moment.

2. LISTENING

There’s a better way to have dynamic, effective conversations than jumping in prematurely with your own opinion. I’ve always known this, but it turns out there’s more to it than adopting the old adage: “You have two ears and one mouth; use them in that proportion.” Because it’s how you approach the listening that matters.

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