These days, fundraising is a great challenge.  Stumbling blocks appear virtually everywhere.  Our donors have less to give, our mail campaigns cost more (and earn less) and there are more channels than ever to keep track of.

Only about half of US donors feel that nonprofits are doing “a good job” or better.  If we start out barely mediocre in the eyes of our supporters, there’s a long way to fall, then, when something goes wrong.

Just recently, several nonprofit and governmental organizations made national headlines for various scandals:  Komen, Penn State and the Secret Service, to name a few.

Not all scandals get an enormous amount of viral publicity, but since you are merely a participant in social media – and no longer control what information is disbursed – it is essential to have a plan in place.  And not just a plan that a few key people in leadership are aware of, but something specific known to everyone on staff.

The Trust Report demonstrates some unflattering figures about how the US public feels toward the ethical conduct of charities, such as “26% of Americans admit . . . they don’t trust charities.”  The report goes on to say that “the majority (57%) explained that this was because they did not know how donation money is spent.”

Unfortunately, stories that make the news contribute to this lack of trust:

•   California State parks hid $54 million surplus, while trying to close 70 parks & asked for budget increase

•   Fake nonprofit is a shell corporation for “Chinese Luxury Market”

•   Healthcare company preys upon the uninsured, injured with undercover debt collectors in ERs

The Trust Report points out that communication with constituents is essential, however.  The more that people feel knowledgeable about what your organization does, the less likely they are to feel taken advantage of after having made a gift.  Transparency is key.

Certainly, even when there is no wrongdoing, such as theft, embezzlement, etc., a scandal – and backlash – can occur, simply because of a communication breakdown.

This is what happened with the Red Cross shortly after September 11, in 2001.  Scores of people offered an unprecedented outpouring of generosity, intending to help the victims of 9-11 and their families.

What happened after those donations were made was that the Red Cross diverted some of the funds toward other disaster relief, as they have often done in the past.  (High profile disasters often get more contributions than those in lesser known or less populated areas, but they still need funds, too.)

The response to this was extremely negative, however, and the Red Cross had a great deal of back pedaling, explaining, and, eventually, bookkeeping to do.  They moved the funds back, due to the public response.

In fact, the Red Cross hadn’t intended to be dishonest, misleading – or even change their policy – but they weren’t transparent enough ahead of time so that everyone understood what was going to happen.  Therefore, people felt betrayed, or somehow cheated.

Filling out your organization’s profile as completely as possible on Guidestar and/or Charity Navigator is advisable, because independent ratings and assessments are looked upon favorably.  Many donors will search these types of sites when deciding whether – and how much – to give.

It’s not enough to be listed, but make certain that what you post on your site and others can be easily understood.  Nobody wants to pore over an hour of documentation, or click incessantly, just to find a few things.  (What does my gift of $X help accomplish?)

If you have put these things in place ahead of time, then when (if) a scandal does strike, it might sting less and last a shorter while because you were prepared with a battle plan.  The worst thing to do is nothing.  Pretending it doesn’t exist and hoping it will go away only confirms the suspicion that your organization is terribly unprofessional.

And, once in a while, there is the rare occasion that a great fundraiser can be borne out of a scandal.  This is definitely an example of making lemonade out of lemons!

Do you have any stories of how you handled a crisis at your organization?  Feel free to share in the comments below.

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Keep the base of the pyramid strong

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For many fundraisers closing out their fiscal years, the news isn’t great.  Foundations and corporations are returning, but not quite as quickly as they departed – and not back to their previous levels.  And some not at all.

When a long-time supporter – especially a major one – suddenly stops giving, it can be quite a blow.  This has happened (and is continuing) to many nonprofits as the economy shrinks the accounts of not only companies and foundations, but individual large donors as well.

“Not putting your eggs in one basket” takes on multiple meanings in development in times like these.  In addition to having a diversified campaign that seeks donations from a plethora of contributors – foundations, corporations, individuals, etc. – it’s also important within each campaign to conduct multiple campaigns.

For example, when pursuing foundations, expand your grant proposals to various types, including smaller family foundations, corporate foundations, etc.  Don’t limit yourself to the same kinds that have always funded you in the past.

Corporate sponsorships can be viewed in a similar fashion.  Have you always pursued national companies’ support?  There are many locally owned businesses that might welcome an opportunity to publicize their philanthropy.

With Annual Giving, think of the multiple channels that are now at your disposal to reach a vast audience of individuals.  Not only can you pursue more people with online giving, social media, mobile, etc., but studies show that integrated approaches raise the most money of all.

Consider the United Way campaign(s) and how they are affecting dozens (if not more) nonprofits across the entire country.  Because United Way decided at a national level to reprioritize its mission and refocus on several core funding strategies, agencies that received enormous amounts of funding are now finding it vastly reduced, if not eliminated outright.

This is happening all across the United States, including California, Illinois, Kansas, Louisiana, Missouri, North Carolina, Nebraska, Nevada, New York, Ohio, Oklahoma, Pennsylvania, South Carolina, Texas, Virginia, Washington, Wyoming, and in Ontario as well.

While some articles are spun to promote it as a positive opportunity to “let new organizations apply” for funding, many others who have been supported by United Way for years don’t see it that way . . . particularly when their messaging appears to be inconsistent.

For example, their new mission’s focus loudly proclaims to be generally zoned in on three main areas:

•     education
•     self-sufficiency
•     health

Although these are the newly declared areas of funding targets, various inconsistencies in this newly mandated attempt at being consistent continue to appear.

In multiple states (CA, LA, OH, NC, VA), the local Red Cross chapters had their funding significantly cut, if not eliminated, although many tried to argue that their providing food, shelter, clothing, etc., during disasters offers “self-sufficiency,” in keeping with the mission.  In the Buffalo, NY area, that United Way chapter maintained their Red Cross funding, but eliminated funds for the Girl Scouts . . . even though educating youth is supposedly a priority.

Other organizations affected by the new policy, resulting in drastic cuts in funding include the Salvation Army, the YMCA, as well as the Boy Scouts and Big Brothers Big Sisters, which lost their funding entirely from United Way of Dallas.  Given that the new UW priorities are listed as being about educating children, it’s perplexing that these long-funded institutions were dropped altogether, particularly when one sees that another United Way chapter in Illinois gave Big Brothers Big Sisters their highest award.

Although “youth development” is specifically listed among United Way of Topeka’s goals, Boy and Girl Scouts were eliminated from agencies receiving funding!  They got only designated funds from donors . . . and these designated funds are “a practice that is under review and could be eliminated in the future because of changes to United Way’s funding process.”

Columbia, MO and Charleston, SC took issue with the new priorities not addressing issues of real concern to their local communities.  Namely, they felt that their senior population was being severely neglected and ignored by the newly declared priorities.  These citizens argued that a great deal of what the local United Way needed to address and solve were the problems of the local citizens . . . and that the issues sent from national weren’t keenly aware of what was happening in their neighborhoods.

One can see that the Reno, NV and Norman, OK chapters dealt with this more directly, anticipating these needs, and altered the mission to include more local concerns.

While in York, PA, the United Way Executive Director was “flabbergasted” that an agency would make public their disappointment over not getting funded, it seems to be catching on all over the country.  In fact, in Nebraska and Ohio, they’re appealing the funding decisions, and in Ontario, they’re convening a meeting to review the entire allocation procedure!

It’s clear that you can’t control many factors about your funding sources:  the economy, funders’ changing priorities, how slow the post office delivers, cost of postage, etc.  Rather than spending a great deal of time altering an ever-changing strategy (and filing multiple appeals), a better overall campaign strategy is one that includes multiple funding sources, so that if one of them is drastically reduced, it doesn’t sting too badly during the period it takes to replace it with another channel of income.

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