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Blinded By the 'Sophisticated Donor'?

April 03, 2013

(Derrick Feldmann is CEO of Achieve, an Indianapolis-based creative fundraising agency. In his last post, he wrote about the importance of "usability" to the online fundraising experience.)

Feldmann-headshotWhen I started in fundraising, I had almost no experience asking for money. To compensate, I read lots of articles and books about the different approaches and techniques used by successful fundraisers. As I immersed myself in their ways, I started to pay particular attention to an approach that emphasized the importance of communicating to donors the impact their gifts were helping to create.

Many years later, as the head of national fundraising for a K-12 education program, I spent a good deal of my time seeking support from some of the biggest foundations and corporations in the country. My "ask" in these situations invariably included what I thought was a powerful and persuasive presentation that demonstrated to grantmakers how a grant would transform the lives of a certain number of students and ultimately improve a community. Every time I gave my presentation, I would see heads nodding and would sigh with relief, knowing that those present "got it." Of course, not every presentation resulted in financial support, but even when they didn't, I usually made new friends who understood and liked what we were doing and were willing to help us build our network of supporters.

I used this method, with its focus on impact, in every fundraising solicitation I made. And I taught my staff to do the same.

One day, a member of the board who planned to ask a friend to donate to our organization before the end of the year called me to review our solicitation script. But as I walked him through it, I could tell something was wrong. He didn't say anything after I finished, but he clearly was uncomfortable. A week or so later, he called me to report on the meeting and let slip that he hadn't said any of the things to his friend I'd told him to say. When I asked why, he said, "I've known my friend a long time. And I know the only thing that really matters to him is my trust in this organization and the people who run it. I could've talked about all that impact stuff, but it wouldn't have made a difference. So I just told him why I support you and asked him to consider making a gift."

I told him I appreciated his honesty and filed it away as one person -- albeit an important one! -- who made a spur-of-the-moment decision.

A couple of months later, I attended a gala event for an organization that a friend served as a board member. Now, I have to admit that attending a fundraising event for another organization is not high on my list of things to do. But I wanted to help my friend.

So I watched as individuals schmoozed, bid on auction items, and generally enjoyed themselves. Then it was time for the "fund the need" portion of the evening, during which everyone in attendance was asked to support the cause by donating whatever they could. As I sat there, my wife (a fundraiser in a former life) turned to me and told me to get out our credit card. I hesitated, then asked, "Why?" Because, she said, it was important to our friend. "How do you know our gift will make a difference?" I replied. "Stop being cheap," she said.

Then it hit me. Not everyone is a "sophisticated" donor. Not everyone is a professional fundraiser or works for a foundation or corporate giving program. In fact, very few people do. And people who don't seldom give to a charitable cause or organization because they're looking to achieve impact or based on a chart of performance metrics; they give because it makes them feel good, or because it's a worthy cause, or because, like me, they want to help a friend.

As professional fundraisers, we tend to align our methods and appeals with the needs of sophisticated donors. Why? Because they have money to give and it's what they expect. But in doing so, we sometimes forget about the people who give because it makes them feel good or because they like our mission, our leadership, or the story we have to tell.

What's a fundraiser to do? Start by thinking about your sophisticated donors and how they may be influencing, subtly or otherwise, your overall fundraising approach:

Board Members
Board members, especially good ones, are by definition sophisticated. They tend to be accomplished individuals who are interested in your work and are more than happy to sit through presentations and engage in serious discussions about all aspects of that work. Since most are expected to dig into their own pockets to support your organization, they also tend to have a keen and very personal interest in your fundraising results. As such, they can exert a disproportionate and even damaging influence on those results. As I like to say to the board members with whom I work, you are not the target audience of an organization's fundraising appeals; the general public is.

Given the number of organizations seeking their support, foundations really do have limited resources. Which is why many of them, especially larger ones, evaluate their grant investments on a regular basis to identify high-performing nonprofits with a proven ability to execute. They also are staffed (again, the larger ones) with program officers who have particular agendas of their own. Many nonprofits seeking foundation support get into trouble when, against their better judgment, they agree to alter, expand, or create programs to serve a foundation's goals rather than their own.

Major Donors
Some fundraisers will try to replicate the conversations they have with major donors when "pitching" a member of the general public. That almost never works, for obvious reasons: Jane Doe doesn't have the resources, philanthropic experience, or big-picture mindset that a major donor typically has. Even more problematic is trying to approach a potential $1,000 donor in the same way you might approach a $100,000 donor. Don't assume the former (or even the latter) cares about organizational effectiveness or is familiar with any of the well-known charity rating systems out there. Indeed, studies show that fewer than 22 percent of all donors will check a charity's ratings before making a gift.

Don't get me wrong: Sophisticated donors and the fundraising approaches that resonate with them are important and should be reviewed and revised on a regular basis. But development professionals also need to realize that not every donor is willing to invest as much time and thought in their giving as are wealthy individuals and big grantmaking organizations. If you remain mindful of that fact and allocate your resources accordingly, I'm pretty confident you'll soon realize improved returns on your investment in fundraising.

-- Derrick Feldmann

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Posted by Dan  |   April 04, 2013 at 03:46 PM

Good post and points. Fundraisers should also try to convince "unsophisticated" donors that caring about impacts and outcomes is actually incredibly important, and could even be considered part of their donation. Fundraisers should, carefully and conscientiously, convey the impression that giving because it "makes you feel good" is fine and honorable, but not enough. Giving because you want to make an impact, and giving that is informed by research and knowing that the organization has excellent performance metrics, is better giving and will do more good in the world. Motivation matters.

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