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How to Handle the Slow Death of Strategic Philanthropy

As the hip giving method of the early 2000s goes down in flames, what changes should nonprofits be ready for as they try to impress donors?

The Stanford Social Innovation Review recently published a thought-provoking symposium on strategic philanthropy. If you’re not familiar, “strategic philanthropy” is the movement that got obsessive about metrics, and tried to get children’s ballet studios to demonstrate their success with a bunch of complicated numbers. For a few nonprofits that hadn’t put any effort into finding out if they were actually doing any good, this was helpful. For most, it was immensely distracting and even damaging.

Now, top foundation leaders and consultants are ready to admit widespread failure on this project. Most of the writers in the SSIR symposium suggest that strategic philanthropy doesn’t adequately account for human nature, let alone the nature of humans in groups. The problems of human social networks, and their solutions, tend to be messy and organic, as conditions constantly change and even “root causes” are rarely possible to identify completely.

On top of this, as William Schambra pointed out a few weeks ago in an incisive treatment, the vast majority of nonprofit funding (73%) comes from individuals, not foundations…and after years and years of being told to be strategic philanthropists, 84% of Americans still aren’t. Most don’t pick which nonprofits to support based on objective performance metrics. That doesn’t mean they are irrational. It means they’re motivated to give by factors other than the ones that go into the metrics—personal experience, a relational connection with someone involved in the organization, geographical proximity, an emotional tug, etc.

Yet many of the nonprofits I see are putting a lot of work into keeping foundations happy, rather than tailoring their measurements and communications strategies to the majority of their donors. As some foundations are considering new ways to measure success (like the scary utilitarian “effective altruism” approach), many nonprofits will no doubt scramble to change their ways to match.

But what if they didn’t? The vast majority of nonprofit donors won’t turn into utilitarians any more than they turned into strategic philanthropists; they’ll continue to give based on influences from their personal and social experience. What if nonprofits built their primary communications (and reporting) strategies to impress and retain their primary donor base? What would it look like for them to demonstrate their value in a way that corresponds to how their donors actually think?

The real nonprofit donor base

First, some context for thinking about this: the next generation of nonprofits will be hubs of American civic activism, not specialized initiatives of experts who demand that the rabble fund “their” work.

I’ll say that again. The next generation of nonprofits will be hubs of American civic activism, not specialized initiatives of experts who demand that the rabble fund “their” work.

This is true partly because of social problems. Feelings of isolation and disenfranchisement are increasingly the norm rather than the exception. Social breakdown isn’t just a crucially central cause of the problems nonprofits exist to fund—it’s also a central reason for nonprofit donors’ involvement. For most nonprofit donors today, who often don’t even vote for president in person, nonprofit involvement is their primary civic activity—it gives a sense of meaning and connectedness in a way that almost nothing else these days can.

It’s true partly because of changes in the donor base. Baby Boomer donors (and even more so their children and grandchildren) want to feel a part of what’s going on. Unlike their parents, they don’t want to just write a check once a year. But retirement norms have changed; they also need to be involved in a way that can be juggled with a full-time job, kids, and other commitments—so current volunteer systems, which are built around retirees with World War II-era involvement habits, will need to be rethought.

But these changes only exacerbate a more fundamental reality: the “hub” claim above is true because of the way the human mind works, and has always worked. People get emotionally invested in things that have a personal impact on them (even if it’s a degree of separation or two away). Causes catch fire because people perceive them to be things “everybody is doing,” or everybody believes. And people stay invested in things when they can see practical value for them, and the social currency that comes with it. Total altruism is a myth. The complex organism that is human charity has benefits for everybody when it’s allowed to work naturally (when was the last time you felt bad for being nice to somebody?).

Far from being irrational or outdated, the human connectedness that makes effective, sustainable charity possible is top of the line moral and social psychology; taught in graduate and business schools, written about in bestselling books, and employed by the best-performing organizations out there. The social changes and the human nature behind them are real, and will only be more dominant as the Boomers move into their role as the primary donor base.

The next generation of nonprofits will be hubs of American civic activism for one reason: they have to. The expectations and desires of the people behind 73% of their budget dollars will dictate it.

How to capitalize on it

So, how to capitalize on the looming change? The vast majority of my consulting work involves helping nonprofits answer this question. Unlike Strategic Philanthropy, Effective Altruism, and other trendy solutions from Big Philanthropy, the answer is very different depending on the individual organization; the nature of its work, its location, its geographical rootedness, the nature of its connections with its existing donor base, and other questions. But here are some general questions to consider:

  1. How can you demonstrate value to a donor in a way that allows him/her to feel and see, rather than simply measure, it? Numbers can play a role here, but the closer you can get a donor to seeing what you see on the ground every day, the better. People aren’t computers; their brains are hard-wired for story and emotion. At a basic level, this is a question of content creation—telling your story effectively with stories, videos, etc. At a more advanced level, this can be done through events, in-person volunteer opportunities and other interactive ways to engage your work and its core issues, development of regional support for national nonprofits, and digital vehicles (like a Google Hangout) that can provide a partial approximation of in-person activity online.
  2. Why would a donor feel a part of your work? Simply accomplishing #1 above doesn’t cut it—even the best nonprofit communications are just faking #2 if they’re not supported by real opportunities to get involved; ways that work for young people and professionals, ways that capitalize on and build on relational reasons for involvement.
  3. How can you build infrastructure so that your development people are spending their time building relationships, not keeping up with paperwork? There are creative ways to streamline, outsource, or even crowdsource (with volunteers) administrative development work, especially if re-prioritizing around individual donors is the goal. Find those ways and use them. Then use all that extra spare time to connect with people, and to brainstorm ingenious ways to connect with more people! I’ve seen clients reduce their development director’s workload by 70-80%. Imagine what yours could do with that kind of time, if it were properly directed. Speaking of which…
  4. How can you make involvement social? It’s pretty easy to think about volunteer opportunities socially. But what about giving? What about first contact with your organization? Are you generating content that’s worth John Doe Donor’s time to share with his friends, even if they know nothing about your organization? (If so, then congratulations; John Doe just netted you a couple dozen introductions by sharing your link.) Are you thinking about ways to capitalize on website visitors and introduce them to your organization’s work through email marketing, personal contacts, etc.? Are you creating clever campaigns that give your existing donors incentives (and easy mechanisms) for tag-teaming their donations with friends, so that you’re capitalizing on social networks to grow your donor base, rather than feebly trying to find new people yourself?

Where to from here?

These questions are just a starting point. If you want more things to consider, or want to see more of the history and social science behind these changes, read “Enlisting the Amateurs.” You can also check out my website for a look at how my company can help improve your communications and free up your development director’s time—or contact me to talk about a strategic planning or training session to work through the big picture with your staff or board.


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6 ways to improve your email numbers...

...that none of those other posts about how to improve your email numbers have told you.

Talk to anybody who trades in a certain kind of communication (social media marketing, email marketing, direct mail, etc.) and they can quote you numbers that “prove” why their kind is of value. The email marketers tell you that email open rates are much higher than social view rates, plus you have direct access to the subscriber.

But here’s a reality: people are rapidly losing their patience for bad emails.

Most of us just get way too many emails; it’s easy to spend almost as much time deleting emails you don’t want as responding to ones you do. This is especially true of the “important” people who are probably your best donors—they’re busy, and they get literally hundreds of emails a day, just like you do.

As a result, many, many people I know have either unsubscribed from everything (there are even tools that allow them to do that en masse), or send a lot of their email newsletters straight to an archive folder (where they may or may not get back to them later), or sign up for e-newsletters with spam-catcher email addresses they never actually check. And then there are things like Gmail’s new-ish inbox tabs, which by default put mass emails in secondary tabs where they again may go unseen.

If you’re smart, you’ve been doing things like A/B testing your subject lines to maximize opens. But how much thought have you given to things from your subscribers’ perspective? To what they want? A happy subscriber is much more likely to take steps to ensure your emails make it to his inbox.

And while direct mail strategies tell you to scare the hell out of people so they’ll donate in order to save the world, email subscribers are much more likely to end up donating if you consistently give them content they actually care about reading.

Hubspot posted an interview last week with Dan Oshinsky, Buzzfeed’s email newsletter guy, that gives some good insights into what this mindset can look like. It’s harder for an organization than for an aggregator, because you only have so much content.

But here are some practical questions to ask yourself:

  • How well do you know your audience? Do your subscribers care about the same things you do?  These two are wrapped up in each other. The things that get you excited about your organization might not be the same things that get your subscribers excited—you see things every day that they don’t see; so it’s important to take concrete steps to get to know them. Have you sent out email surveys specifically designed to get a good feel for what content they care about? Have you checked the subject lines and link clicks of your past campaigns over time to look for trends? Take some steps to make sure you’re aware of your readers’ priorities before you develop (let alone sent out) content for them.
  • Are you reporting information or empowering and inspiring a community? Your readers probably aren’t foundation grant officers—they’re normal people. Oshinsky says, “When content makes them angry or happy or sad, they tend to share it.” Does your content do any of those things? (Also note: be careful about making people too angry or upset too often; not many people enjoy that, so every donation you get from an angry person might mean 10 or 20 people who stop opening your emails because they’re tired of the apocalyptic tone.)
  • What about your organization provides your subscribers with a positive identity? That sounds a little cheesy. But one study after another; in nonprofits, in politics, even in business; has demonstrated that a huge reason people get and stay involved in causes is that the cause is part of their identity. They have an idea that “people like me do this.” This is also true of their motivation to do smaller things like forward emails. So a major priority in your email communications needs to be reinforcing that identity—for example, giving them information that makes them feel important and “on the inside” when they share it with others, or creating a narrative over time that makes them feel connected to great things and valued for the part they play. Telling one story after another of a life that got changed might not quite cut it.
  • Is your imagery memorable? You have a mission statement, and probably some language you use frequently. Have you actually tested that language to see how people react to it? You want to have images and phrases (they’re called “memes”) that you use consistently; they reinforce your identity in the reader’s mind, as well as making it easy for the reader to identify with you—if your memes are well chosen.
  • How can you link your content with outside-world triggers? When something they see or talk about later that day triggers a memory of something they read in your email, you’ve probably won two battles—first, they remember your email; second, they might just mention it to somebody else. So it pays to think outside the echo chamber of your own work and remember that there is a world outside it—news, images, etc. And then incorporate it when you can!

I tend to think of nonprofit and campaign communications in terms of four stages. Maybe I’ll go into them in more detail some other time, but for now, think of them this way: the first stage is about infrastructure (yay, we have a Facebook page). The second is about developing content to sent out via that infrastructure (posting regularly, sending emails). The third and fourth are about refining your content, refining your audience (so different people might get different content depending on their interests), getting more interactive, and building a two-way relationship that reinforces and empowers your supporters' identity relative to YOU.

Hardly any nonprofits get beyond stage 2. If you do even two or three of these things, your emails will be flirting with stage 3 and be far more effective than the vast majority of the pack.

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