By Chuck Thomas / in Blog, NPOutlook / March 13, 2018
Building the trust that fuels program growth
In recent years, about two thirds of Americans respond to appeals from charities for support of projects to meet human needs, create new initiatives, advance faith, and reverse wrongs. Nonprofit organizations received $390 billion in donations and were supported by 7.9 billion hours of volunteer service.
Unfortunately, the support is fleeting. For every 100 new donors, American nonprofits lost more than 100. A new report concluded that for every $100 charities raised last year, $100 was lost as donors stopped giving or donated less. Even as the economy flickered to life and giving increased, donor attrition has stagnated charitable progress.
The reasons are clear: Although people are moved to give to specific needs, impulse giving is thin commitment. The long-term loyalty of donors, volunteers and other partners is based on the trust of organizations and their people, the evidence of real change and impact, and the relationships that are developed as part of or after the donor transaction.
The building of trust and loyalty is grounded not in a schedule of follow-up letters or emails, but in the DNA of organizational structure, values, and promises. When organizations build trust and loyalty, it is an accelerant for growth and stronger program impact.
We’ve observed seven disciplines in the organizations that are successful in retaining their friends and partners:
Successful charities establish and over-communicate a buoyant yet clear and reasonable vision, as well as core values that guide decisions and actions. While most organizations at least ‘tip their hat’ at vision and values, and the missions that emit from these (all have become management buzz words in recent years), the successful organizations devote time to developing these directional and differentiating foundations and do not allow their leaders or communicators to marginalize the process or ignore the result.
We love the simplicity and clarity of the Charity Water vision/mission:
“bringing clean and safe drinking water to people in developing nations.” Of course, many organizations deal with far more complexity than Charity Water, but if they get too far away from this simplicity, they may be doing too many different things.
Successful nonprofit leaders and soft hearted and hard headed. Promises they make to themselves and to potential donors, partners and recipients are only those that are rationally defendable. This may seem obvious, but it is a clear delineation between the successful charities and those that flame out quickly.
A leading reason for failure, particularly for small organizations and startups, is that entrepreneurial and earnest founders and leaders are lying to themselves. Not purposely, of course. Their passion and drive simply overwhelm their common sense. They have little or no idea whether assets will be available to them beyond an initial gift or a successful fundraising event. Sometimes there is an enduring base of support; often there is not. Because passion does not necessarily translate into support, it cannot be the basis of promises.
There are many strong organizations that have counted the cost for many years. One example: we’ve worked extensively with Awana Clubs International, which has grown steadily and very carefully over 60 years, negotiating the challenges of national and international growth, dealing with many church denominational groups and theological traditions, and building revenue by franchising programs, selling products, and asking for donations.
When it comes to accountability and reporting on results, there is plenty of room for improvement across the board. We have found that nonprofits don’t have a lot of information available on the impact of their work, and do relatively little reporting on its extent, expansion, and in-program effectiveness. Much more money and energy is put into developing the contents and plan for future fund appeals than on presenting results in thorough and compelling ways.
Some of the most successful charities, such as World Vision, are able to be more complete in reporting to donors because their primary funding mechanism, child sponsorship, requires personal reporting. Other groups are making an extra effort for thorough reporting to be a central practice. One example: a charity called DonorsChoose that lets donors pay for education supplies and other needs listed by schoolteachers on a Website. In exchange for contributions to a teacher of their choice, donors are promised a statement from the teacher describing the difference made by the gift, thank-you letters from students, and photographs of students putting a donor’s money to work.
Regardless of the parameters of the program or the funding methodology, the best charities spend more to report extravagantly on the differences donors and volunteers are making through their contributions, time, and talent. What better way is there to earn trust and loyalty?
The best known, thriving charities search relentlessly for the values, programs, and characteristics that give them unique value–what in the corporate sector is called a value proposition. It is this statement of unique value that explains how these organizations make a difference; it satisfies their constituencies of supporters and partners. In addition, the organization’s value has to be declared at times and in ways that will enhance and broadly communicate the unique characteristics of the organization. Compassion International works hard at this, taking every opportunity to establish the differentiating characteristics that set it apart from its relief and development competitors.
Great communications plans are evident at every point of public contact. But they do not start there. They start in the conference rooms and retreat centers, where teams of leaders gather and hammer out the bedrock of organizational value, and where the central messages of the charity are determined. They continue in the research and planning that produces sound direction, and in the creative hot houses that germinate compelling creative. What follows is truthful, compelling, flexible, and current communications that tell stories and capture the drama of human progress and struggle.
And today, ascendant nonprofits are those that recognize every vehicle—old, new and next—must be utilized to reach major groups, but all communications strategies must have the online component as the hub of the wheel. One example is Invisible Children which, since 2004, has made a habit of using media in new ways—dramatic documentary films in colleges, the Web phenomenon Kony 2012—to focus the world’s attention on the atrocities of the Lord’s Resistance Army in northern Uganda.
The huge charitable dependence on mass, direct-response fundraising has limited personal touch. The organizations that survive and grow through national crises and economic recession complement their direct response efforts with programs that include small events and meetings, local celebrations, and other efforts to increase personal communication.
Charities can raise a lot of money for their work as a result of strong professional fundraising campaigns, but they won’t be great, deeply rooted organizations without the personal touch and relationships that require leaders and representatives to climb out of the ivory towers of charity and into the halls and living rooms and coffee shops, churches, and banquet halls of American cities and towns.
One example of this: Although it is one of the largest charitable organizations in the world, The Salvation Army puts itself in a position to make personal contacts and raise its visibility as it raises funds, notably through its Christmas kettles and its thrift stores.
The final step for great trust-builders is actually a continuous process: the constant research, evaluation and measurement that precedes, interweaves, and follows every major move. Metrics are essential to track the perceived value of programs and communications, donor retention, public opinion, and relevant societal and industry trends.
Certainly many organizations are now routinely testing channels, audiences, vehicles, methods, and return on every investment. We are particularly impressed with Charity Water (again) because of their decision and effort to measure and report on their adherence to one of their core values or operating principles: that they will raise private and foundation monies for all overhead so that 100 percent of public donations go to programs to provide clean water.
Successful charities have proven that it is attention to these 7 disciplines that will most reliably build the trust and loyalty that fuel program growth and organizational effectiveness.