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Nonprofit Fundraising: Success vs. Productivity for Nonprofits

Written by: Ellen Bristol

Article Overview: Is "success" the same thing as "productivity"? Not when it comes to fundraising organizations. "Success" usually means high levels of income or gifts. "Productivity" means producing desired levels of income at controllable costs, ensuring that income is consistent and predictable, and managing the effort with efficiency. Here are a few tips to help you assess and improve the productivity of your nonprofit's fundraising efforts.

Nonprofit Fundraising: Success vs. Productivity for Nonprofits

Is "success" the same thing as "productivity"? Not when it comes to fundraising organizations. "Success" usually means high levels of income or gifts. "Productivity" means producing desired levels of income at controllable costs, ensuring that income is consistent and predictable, and managing the effort with efficiency. Here are a few tips to help you assess and improve the productivity of your nonprofit's fundraising efforts.

Every nonprofit executive is painfully aware of the challenge of fundraising. You’ve got to raise the money, but the more you raise, the more you need to raise. What worked last time might not work this time. And donor fatigue is growing. Although the specific challenges faced by major charities may seem different from those faced by struggling grass-roots organizations, the same rules apply: nothing happens that doesn’t require the spending of money, somewhere. So the time has come for nonprofit professionals to pay attention to productivity, as well as to volume of income. Here are seven simple tips to get you focused on productivity. Start raising more money today – while spending less to do so.

Tip #1: Fundraising time is expensive. REALLY expensive. One hour of fundraising time likely costs more than $1,000 in opportunity value. That's an expensive asset. If your fundraising team invests its hours in unqualified prospects or unproductive activities, the cost of those hours goes up and up. Use them wisely.

Tip #2: Know who's "right" for you. Invest those expensive hours in high-potential donors and prospects. An 'ideal donor profile,' or Donor Scorecard, will provide a benchmark to your team, so they know which opportunities justify their time. Base your ideal donor profile on past and current successful relationships. If the prospect is a poor match, don't put too much time into the effort.

Tip #3: Lose early. If you can't win at a reasonable cost, then it's best to lose early. Encourage your team to walk away from underqualified opportunities. Their time is too valuable to waste. Congratulate team members who "de-select" underqualified donor prospects.

Tip #4: New prospects cost more than current donors. Before you run around looking for new donors, cultivate the ones you've got. It takes less time, it costs less, and it enhances those valuable relationships. As the relationships deepen, those important donors become a source of leverage, making your job easier and more productive.

Tip #5: Current donors are not enough. No matter how well you maintain current donor relationships, new-donor acquisition is a must for growth. Make sure your team balances its time between new-donor acquisition and current-donor relationships.

Tip #6: Bring some science to the art of fundraising. Great fundraisers are artists. But it's tough to establish predictability and consistency without some science in the mix. Create a process framework that promotes analysis of performance metrics. Track and analyze performance relentlessly with an eye toward productivity.

Tip #7: Choose metrics carefully - not too few and not too many. If you only measure 'dollars in the door,' you can't improve performance or efficiency very well. But if you measure too many things, you and your team will drown in data. Choose a few metrics that give strong insight into growth trends and efficiency.

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Article Tags: benchmark, challenges, charities, donor profile, donors, efficiency, fatigue, fundraising efforts, fundraising organizations, grass roots organizations, last time, match, money, nonprofit executive, nonprofit professionals, productivity, scorecard, successful relationships, time base, unqualified prospects



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