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Posts Tagged ‘Suze Orman’

The Short End of the Stick

Wednesday, April 13th, 2011

I’ve never been an advocate of “selling widgets on the side,” to bolster a nonprofit’s income.  On the one hand, it detracts from the mission in a glaring way.  On the other, it steals valuable staff time from what we should be focusing on.

This is all too common, such as the Snowflake Animal Rescue website, which encourages not only online giving, but that you shop for Amazon and Food Lion via their site.  What do books, music and groceries have to do with animal rescue, though?

Even more conspicuous is the Ectodermal Dysplasia Society, where the ads for Amazon and buy.at are nearly more significant than the [Donate] button. Clicking the buy.at button then opens up into another entire world of retailers, waiting to take the constituents’ money and throw a small slice back at the charity.

A new study has come out, soon to be released in the Journal of Consumer Psychology, which shows that cause marketing actually leads to lower charitable donations.  This shouldn’t be surprising, actually.  First of all, when said actions or purchases are made, the consumer is led to believe that they have completed their philanthropic duty, which lessens further acts that they might have otherwise taken (of greater amounts).

In addition, many people donate to nonprofits out of a sense of giving to others, rather than receiving tangible goods in return.  The messaging changes from one of selflessness to more “selfish” giving, when there are always goods associated with donating.

I witnessed this phenomenon while tracking fundraising statistics at PBS years ago.  The average gift during phonathon hovered just below $100 – and then Suze Orman, financial whiz, came on the scene.  Stations everywhere were pitching her programs very successfully:  “And if you donate $___, you can get the Suze Orman DVD, or for $___, the CD, or for $___, the VHS …”

It was an undeniable correlation!  Almost in synch, as Suze Orman shows broadcast on PBS, the average gift skyrocketed above $100, systemwide.  Suze renewed with PBS for a few years . . . then she signed with QVC, to make real money.  When PBS stopped airing her specials, the average gift dropped below $100 once again.

It became all too clear that the mission of public broadcasting hadn’t been pitched nearly as much as Orman DVDs, CDs and tapes, and now that they were gone, it was a tougher sell, falling back on what hadn’t been spotlighted for some time.

Perhaps selling t-shirts, posters, mugs, hats, etc. with your mission, logo and so forth works well with your branding and interests your constituents, but if it doesn’t, why are you hawking and peddling someone else’s wares for a mere slice of the proceeds?

Even if it is part of your mission, however, take care that you continue incorporating that mission with every pitch.

I recall one state public broadcaster who presented a session at the PBS Development Conference, during the Suze Orman frenzy.  He explained that, although they could start their pitch at the higher (DVD) end, they always made a point to open pledge drives by asking people to join at the basic membership level, followed by, “. . . and if you can afford to support us at the $___ level, we’d like to send you this thank you gift of ____,” and so on, up the ask ladder.

He explained that, as a state licensee, it was important that, when they went to ask for state funding, they could demonstrate as wide a market penetration (support base) as possible throughout the state.  Therefore, it was more important that the station bring on more people as members first, regardless of their giving level.  Once people made the decision to donate, the station would work on cultivating them to contribute at increased levels over time.

The reverse is also possible, even if transactional sales are a significant part of your mission.  I achieved this years ago when managing my daughter’s troop’s Girl Scout cookie booth sales.

I taught the girls to assess the customer.  If s/he said, “No,” why did they think the customer didn’t want to purchase cookies?  Perhaps they scowled as they hurried past with their groceries.  In that case, move on to the next customer.

However, many people expressed “No” with regret, such as, “I’m diabetic,” or “My (grand)daughter is selling them, too,” or “I’ve already bought ___ boxes.”

In this case, we clearly had a supporter – of the mission – who simply didn’t want more boxes of cookies, and I instructed the girls to immediately follow these remarks with, “Would you like to make a donation to our troop?”  This frequently yielded a substantial amount of funds, which always more than offset the cost of the free samples we gave out to passersby.  In turn, of course, the girls giving out free samples generated more cookie sales.

Regardless of your mission and its various aspects, it always helps to assess when you take on a new project:  Who is this helping?  Is it mission related?  If it’s not obvious to the donor why you’re doing it and someone else is benefitting more than your organization, odds are, you’re getting the short end of the stick.

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Keep the base of the pyramid strong

The Right Corporate Sponsor Can Be Beneficial

Monday, June 28th, 2010

Bringing on corporate sponsors in new and creative ways is being suggested more frequently these days, as non profits are experiencing budget shortfalls that they haven’t seen before.  While we all want to have fiscal support, it is important to keep in mind several factors before deciding to enter into a partnership with a company:

Is the company a good fit with your organization?  Does the corporation represent a product/mission related to what your organization stands for, or is trying to accomplish?

Is the campaign itself mission-related?  You have X points of contact per year with your constituents.  If/when you ask them to act on your behalf, it’s important that you make it count – related to your organization, meaningful to your mission.

Too often, companies attempt to portray themselves as philanthropic simply by throwing (usually relatively little) funds in the direction of charities, yet the non profits are required to do the lion’s share of the work, retain very little of the profit . . . and often, hand over their constituents’ contact list that they have worked for years to cultivate as well.

This only seems like a good deal to cash-strapped organizations who feel they have little alternative but to agree to nearly any terms for the extra income, but it is penny-wise and pound-foolish.

It is better to cultivate your donors with consistent messaging about why they should support your mission of ending illiteracy, feeding the homeless, combating domestic violence, etc., instead of asking them to switch long distance carriers or click on your website’s Amazon button, and so forth, so that you can earn Y% of that purchase.

Some examples of corporate partnerships gone sour:

Chase Community Giving Contest – One of the largest social media contests, which awarded over $1,000,000 in prizes to non profits; however, it was riddled with scandal.  In order to vote on Facebook, you had to offer all of your contacts’ data.  Many questionable/counterfeit users were created and voted, tainting results.  In addition, several finalist organizations were eliminated during the last days, due to Chase’s not wanting to be associated with their missions.

Public schools have been experiencing this desperation far longer than typical non profits.  Although the Campaign for Commercial Free Childhood successfully won a several year battle against BusRadio, they are now tackling a pitch to air television on school buses.  CCFC also reports on public schools that allow churches to preach, and gun shop owners and fast food companies to market to school families in exchange for various sponsorships.  This phenomenon was even highlighted – and mocked – years ago by a then popular tv show.  Most parties agree that children shouldn’t be bombarded, but others feel that what is happening in schools is an indicator of a trend of things to come in other areas of society.

When the donation becomes transactional and the transaction is gone, so is the donation.  While working at PBS, I witnessed a transformation in the average gift during pledge drive:  It climbed from the high double digits to triple digits while Suze Orman specials were on the air, due to her premiums being pitched.  Donors gave higher gift amounts not out of loyalty to public broadcasting, but because they wanted the Suze Orman DVD or CD that was being emphasized.  A few years later, Suze signed with QVC and left PBS.  When she did, the average pledge once again dropped below $100.  The correlation was undeniable.  People were selling Suze merchandise on the air, rather than the mission of public broadcasting and loyalty to PBS, and it cost us dearly.

Of course there are ways to strike a balance and enter into corporate partnerships that benefit both parties, but it is always important to keep your long term goals and big picture in mind:  What does your organization stand for, and how do you want it represented?

There are also new definitions of Social Business being created.  Muhammad Yunus, Nobel Prize winner and author of Building Social Business: The New Kind of Capitalism That Serves Humanity’s Most Pressing Needs, looks at ways businesses can better serve society and operate neither at a loss nor a profit, but reinvest profits back into the company.  Monday, June 28th is Social Business Day.

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Keep the base of the pyramid strong

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