Nonprofits need to convert episodic donors

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Nonprofit organizations continuously will have to change their marketing strategy. Whether it is in preparation for large-scale disasters such as Hurricane Katrina and the Indian Ocean tsunami, or a major election year, organizations are finding new ways to appeal to donors.

Three major nonprofit organizations, UNICEF, American Red Cross and Habitat for Humanity, predict a positive outlook for nonprofit fundraising in 2007.

"I think and hope that 2007 will bring somewhat of a return to normalcy in the nonprofit sector," said Tim Daugherty, senior director of marketing at Habitat for Humanity, New York. "The last few years we have seen wild fluctuations in response to natural disasters and political campaigns."

Indeed, the worry is about the relative status quo in the donor base.

"We're coming out of 2006 in a soft market, so database file sizes may not be growing as aggressively," said Carol Cassidy, director of direct response fundraising for the American Red Cross, Washington. "Nonprofits should expect to create very realistic and perhaps conservative budget projections for 2007."

With constant budget restrictions, organizations need to be savvy, according to a top executive at UNICEF.

"Fundraising is not always about the new; sometimes we overlook the very mundane, but essential building blocks to make the organizations ready to take on new challenges or respond to opportunities that arise," said Jeff Towers, senior vice president of development, marketing and communications for the U.S. Fund for UNICEF.

"Fundraising is about art and science - the combination of strong brand visibility, relevance of cause and how cause resonates with the targeted donors," he said.

Has the donor changed over the years?

"Donors are savvy and continue to raise the bar of expectations for timely and accurate acknowledgements," the Red Cross' Ms. Cassidy said. "The investment in strong and healthy stewardship programs remains critical."

The Habitat for Humanity's Mr. Daugherty thinks donors have changed in another way.

"I think donors are ready to get back to the causes they are so deeply passionate about rather than reacting to the headlines," Mr. Daugherty said.

That said, opportunities and threats are an entwined dance for nonprofits.

"Increasingly, nonprofits are being scrutinized by media, watchdog groups and donors who expect more results, greater efficiency ratings and less overhead," Mr. Towers said.

"In a market that is flooded with causes, scrutiny and competition, we must continue to stay relevant and competitive using the same, if not fewer, dollars for fundraising costs," he said.

There is an increasing amount of ways that nonprofits can stay in contact with their donors.

"From electronic screening to analytics to research, a variety of cost-effective services and products are available for all sizes of nonprofits to utilize," Ms. Cassidy said.

"A concern among my colleagues is the inconsistency of mail delivery," she said. "Whether real or not, the perception among many leaders in the industry is that mail either may not be getting delivered on time or that an unacceptable percentage is not getting delivered at all."

Which key developments have nonprofits uncovered in 2006?

"We learned that we need to improve on how we convert these episodic donors and are realizing the importance of leveraging online giving into a much more integrated fashion," Mr. Daugherty said.

"It is no longer acceptable to treat all of your donors in the same manner, no matter the source of acquisition," he said. "A fully integrated approach is becoming an expectation of the donating public."

So what tips and advice can nonprofit organizations give to potential donors and other members of the industry?

"The greatest tip we can give is transparency and accountability," Ms. Cassidy said. "We intend to be centered on how donors want to give, to what they want to give and to continue to spend their money as they intend."

Some outside help doesn't hurt, either.

"Some of our best and most creative ideas are coming from our external volunteers," Mr. Towers said. "Sometimes it is just as important to implement with excellence on the tried and true."

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