I’ll be the first to admit that I lean old school in many ways. Many of these classic principles have withstood the test of time: systematic donor cultivation that creates long-lasting relationships; discovering donor values and priorities rather than simply declaring them; placing a high priority on donor retention; soliciting donations from appreciated assets rather than cash from discretionary income; listening carefully during our four-segment interview process; and most of all, developing donor-centric versus organizational-centric donor relationships (focusing only on what works best with donor values and inheritance priorities).

With all the distractions and competing priorities, it’s not easy to consistently follow such a long-term, forward-thinking approach. However, I’ve been on this path for most of my career for a single reason: it works better than anything else I’ve seen. In over forty years as a fundraiser, a planned giving professional, and now as a gift planning consultant, I’ve seen just about everything.

BLENDING NEW AND OLD SCHOOL IDEAS

The old school principles can only thrive in the changing climate by adapting through new school elements. Some of those are the results of evolving taxation and inheritance laws. For the most part, however, it has been the emergence of modern technologies. A few examples:

• We’ve upgraded our tracking database as a way of measuring and monitoring our progress. Over the last 10 years, Thompson & Associates has completed 4,051 charitable estate plans on behalf of our clients. Through this new tracking, we’ve been able to measure that at the beginning of our estate planning process, only 8% of those we meet with include any charitable gifts in their estate plan. After our planning process, 81% include charitable gifts to clients and/or other organizations. What you measure and monitor tends to improve.
• In 2012, I began publishing a blog entitled The Fundraising Executive. To date, I’ve written over 140 blog posts with over 273,855 views.
• Our first podcast was launched in 2010, Conversations with Industry Icons, interviewing philanthropic leaders. The show has now produced 30 episodes.

These are just a few of the ways we’ve incorporated new school capabilities into our overall marketing communications plan. Nonetheless, our core development strategies are still based on Sy Seymour’s foundational principles—visiting donors, building long-term relationships, and simplifying complex giving strategies. If we lose that emphasis, we also lose our way. Seymour was the godfather of what could be called “old school philanthropy.”

Fundraising, though, does not require pitting old school against new school but rather balancing the benefits of both philosophies.

There are many benefits to an old school approach, but that doesn’t mean we should all go back to using IBM Selectric typewriters and mimeograph copiers. There will always be a remnant for whom “old fashion” fundraising is the only right approach to nonprofit fund development—who stick to the old ways because they see them as acts of virtue. Fundraising, though, does not require pitting old school against new school but rather balancing the benefits of both philosophies.

EVOLUTION OF FUNDING STRATEGIES

In the last twenty years, technological innovations have enabled a general shift away from fundraising strategies based on developing personal relationships and towards contacting donors through mass media communications. The latter fund development model has become so commonplace that new generations of planned giving professionals don’t even remember how things were done before the year 2000.

The current trend is to recruit as many potential donors as possible with non-personal communications—mass emails, text messages, social media postings, website updates, and even televised solicitations. Taking advantage of available technology would be considered a new school application that elevates the awareness of the organization’s mission. That is a great benefit to any fundraising campaign. If organizations are out of sight, they quickly become out of mind. However, in terms of realized fundraising, the input-to-output ratio is extraordinarily low—lots of effort and expense put into outgoing communications but with a very low return on investment (ROI). A few stats:

Blackbaud Charitable Giving Report showed that only 8.5% of overall fundraising in 2018 came from online giving (i.e. 91.5% came from other sources) and that for every 1,000 broadcast emails delivered, nonprofits raised $45 (i.e. less than 5 cents per delivered email).

2018 M+R Benchmarks Report revealed that the fundraising response rate declined by 13% in 2018 to 0.06% (i.e. one donation per 1,666 email solicitations).

NextAfter.com benchmark statistics found that only 14% of nonprofits prompt one-time online donors to upgrade to a recurring giver during the donation process (i.e. 86% don’t ask), only 13% called to say thank you in response to an online donation, and that 91.2% of organizations stop acknowledging online reoccurring gifts by the third month.

Organizations are in a sense playing a numbers game. Every organization needs to find a balance between new school technologies and old school donor relations. An overreliance on either approach will likely result in organizational decline.

VISIONARY LEADERSHIP

Most importantly, institutional leaders need a clear understanding of things that really matter and things that really don’t. Being a visionary is quite simple and an essential quality in all nonprofit leaders. Most found their way to nonprofits because they were visionaries. Being a visionary leader, however, is something else altogether. Below are four character qualities of visionary leaders:

1) Visionary leaders are “experienced idealists.” They have the experience to understand the subtle differences between things that matter and things that do not. Senior executive experience can come from many places and sometimes not from years of experience at a nonprofit. Occasionally, gifted but relatively inexperienced nonprofit leaders are promoted and lead the organization to new levels of funding and performance. They usually make up for their lack of experience with an intuitive sense of relationships. They naturally gravitate toward the most important aspects of long-term fund development.

I’ve also seen examples of career executives being promoted based on their tenure. Having been elevated to an executive leadership position, these individuals often set about installing their own array of ineffective fundraising strategies. Business consultant Laurence J. Peter identifies this form of leadership with “The Peter Principle.” In short, the term describes successful executives who are promoted to the point of their incompetence.

2) Visionary leaders tend to think generationally—ten to twenty years ahead. I liken it to stopping or turning a 200-ton cargo ship. You have to stay focused on the future and plan for what is ahead of you.

3) Visionary leaders make on-time decisions. Great visionary leaders are in the trenches making tough and timely decisions. Mere visionaries are often paralyzed by difficult decisions—often because they lack the experience to understand the difference between things that really matter and things that really don’t.

4) Don’t react to the tyranny of the urgent. Some leaders are so accustomed to focusing on immediate needs that they have difficulty distinguishing between things that are truly important and those that are merely urgent. They are able to adapt to a rapidly changing world without losing the essence of what has made the organization great.

Old school philanthropy practices focus on personal donor relationships, whereas modern technological advancements embrace efficiency. While the essence of successful fundraising has long been genuine, long-term relationships, visionary leadership is crucial to navigating the balance between old school and new school. This holistic approach combines the strengths of both philosophies to prioritize forward-thinking in fund development.

Eddie Thompson, Ed.D., FCEP
Founder and CEO
Thompson & Associates

“If we merely aim for the industry standard, then our goal is mediocrity. Emulating the average nonprofit, we are destined to live with all the problems the average nonprofit faces. So, we suggest you aim to be exceptional in your approach to fund development.”  —Eddie Thompson