Thursday, April 03, 2014

The Rational Aspect of Irrational Philanthropy

A few weeks back I was at a social gathering and, in conversation with another attendee, wound up talking about the use of crowdfunding to help low-income people over hurdles on their way to self-sufficiency.

She found it very interesting, and asked, "What country are they aiding?"

My reply, "Well, um, here. The U.S., including groups down the street, right here in Berkeley!"

She was a bit surprised, but pleased. Because we were talking about small dollar amounts, she had assumed that the donations were going elsewhere, where there would be more "bang for the buck."

Put your money where there will be the greatest impact, right? Isn't that what the big philanthropists do, and the example that they encourage us "everyday donors" ($25-50) to follow?

I remembered this conversation this morning reading Hewlett Ends Effort to Get Donors to Make Dispassionate Choices on Giving on the Chronicle of Philanthropy. Hewlett had been a major funder behind encouraging better and more effective philanthropy through the use of results- and impact-driven data.

Not that this focus on charitable ROI (return on investment) didn't have its critics. William Dietel, a philanthropy adviser and former president of the Rockefeller Brothers Fund, decried it as an "instant-gratification strategy driven by young, tech-savvy philanthropists."

But the woman I was speaking with at the party was not a young, tech-savvy philanthropist. She was a 50-something sculptor with empty pockets. Such is the extent to which the message of "effective philanthropy" has permeated the culture.

Of course, even with this mindset being promoted, there were still many donors (particularly smaller donors) who didn't bother with the research and just gave "from the heart." And that's how the debate was framed: giving from the heart versus giving from the head.
When Hewlett started the effort in 2006, then-president Paul Brest wrote, "Personal philanthropy may sometimes be so profoundly emotional as to be invulnerable to rational analysis."
And here's where we get to my problem with this so-called "rational analysis." As part of the whole, "nonprofits need to operate more like businesses" meme, the means for analysis are primarily market-driven tools for evaluating programs that exist because of market failures.

Anti-poverty programs are a direct response to the realization that the operation of a free market society will always create a certain number of citizens who fall between the cracks - who are not economically viable. Culture and arts programs, too, exist as nonprofits where and when the free market cannot or will not support them as businesses, so how can you evaluate them as if they were held to the same market principals?

So, why help one person in poverty in the U.S. when the same investment can help ten people, or maybe even 100,  in poverty elsewhere?

The "rational" person, using their head and all the correct data, knows that the third-world philanthropic investment will give them far better ROI and results. Effective Philanthropy Achieved!

The "irrational" person, using only their heart and a little common sense, knows that they are part of a community, and that if they allow poverty to grow around them it will become a cancer, raising crime, lowering property values, and decreasing that immeasurable thing called "happiness."

Yes, we need to evaluate our programs, and yes, as nonprofit professionals we need to be as effective as we can be with the limited resources at our disposal. But the idea that one can eliminate the heart from philanthropy is one that I'm very pleased to see fading.

Monday, March 17, 2014

Reaching Across Generations

How are you involving millenials in your organization's work? This is a question we've all been hearing a lot lately. But I'm not sure that I like some of the answers.

I've been in several conversations and meetings in recent months where the idea of creating a "millenial advisory group" was brought up. It was generally agreed among my peers (those of us between 40 and 65) that the younger generation may not be ready for the responsibility of being on a board of directors.

"Oh, they're too busy with their careers, or starting families, or doing whatever it is they do with their tweet machines..." And yet, everybody nods and agrees that without the active involvement of millenials, their development of new donors and volunteers is dead in the water.

And so, the Millenial Advisory Group. A group of young folk to come up with recommendations for the groups of older folk to consider: a committee to involve millenials without actually having to talk to them directly.

At one recent meeting where this idea was being presented, I turned to the 20-something person beside me and asked, "Does any of this sound at all patronizing to you?" She glanced quickly to each side before giving a quick nod and quietly saying, "A little bit."

The question isn't whether or not you're going to invite millenials to the table. The question is whether you're going to invite them to the adults table in the dining room, or send them off to the kids table in the kitchen.

Instead of a "Millenial Advisory Committee" why not just add a few millenials to your existing Volunteer Outreach Committee or your Development & Communications Committee? And if you don't have any such committees already, maybe that's why your organization is failing to attract new donors or volunteers.

Just a thought...

Friday, November 29, 2013

Why Common Core Will Fail

You've likely heard or read about Common Core by now. The latest in educational "fixes," promoted by the Bill & Melinda Gates Foundation, the National Governors Association, and the Obama administration, the Common Core initiative was developed "to provide a clear and consistent framework to prepare our children for college and the workforce." And it will fail to improve our failing schools, wasting time, resources, and money in the process.

There are lots of critics around who can explain the problems with Common Core and how the standards were developed. But I have a different issue with Common Core: it attacks the wrong problem.

I've been thinking about this for a while, but it was brought to the fore for me last week when I attended Social Innovation Summit 2013 at Stanford University. Among two days of presentations, ranging from a panel on "Unleashing Green Chemistry," to a speech from Robert Swan, OBE, Arctic Explorer, there were several that touched on innovation in education with examples that work.

Beth Schmidt was a new 10th grade English teacher who was frustrated when only 5% of her inner-city students turned in their writing assignment. The problem, she soon realized, was that the research assignment she gave them had no relevance to their lives. When she tied the assignment to their desires and interests - to their passions - 85% turned it in.

The problem wasn't that she or her students didn't have access to uniform, national curriculum standards. The problem was that the "achievement gap" between her school and successful ones in her region was a direct result the hope and opportunity gap that low-income kids face when thinking about their future.

Today, Ms. Schmidt is the founder of Wishbone, a crowdfunding site that helps low-income high school students to pursue their passions through attending extra-curricular camps and other programs, redefining their future, and opening up new opportunities.

At Roosevelt High School, in Boyle Heights, East Los Angeles, Grammy winning recording artist's foundation has partnered with College Track to give kids not only the tools to go to college, but to finish college. After-school programs combine the students' passions with practical advice and strategies to pay for school and stick with it.

According to Enrique Legaspi, Chief of Staff of the Foundation, Roosevelt has 2,600 kids, a 50% dropout rate, and only one college counselor. Contrast that to Taft High School in Woodland Hills, where I graduated from many years ago. Taft currently has 2,700 kids and a 12% dropout rate. Both schools are within the LA Unified School District. Both are in California, which already had high standards before the Common Core.

The difference was that, at least when I attended Taft, there was an expectation that we all could and would graduate, and that most of us would go on to college and have reasonably successful careers. The middle-class was the lowest rung we were expected to shoot for. Not so in Boyle Heights.

Ask the kids dropping out from either school if the lack of unified national curriculum standards was at fault. I doubt that's the reason they'll give. Lack of relevancy or hope for opportunity is far more likely. Kids in failing schools need more than a new textbook; they need someone to show them a realistic path to a good life. As said to us (via satellite), "Athletics shouldn't be the only thing that gets kids out of the ghetto."

Microsoft's TEALS program (Technology Education and Literacy in Schools) puts engineer volunteers (not just from Microsoft, but other tech companies as well) into classrooms in districts that could not otherwise afford technology programs. Sometimes this is in person, but frequently they teach virtually, and so can reach places mostly forgotten by the rest of America.

At the Social Innovation Summit we saw a short video focusing on the effect the program is having in a small, rural community in Kentucky, where the TEALS volunteers are giving hope where there was none before, showing the children of coal miners the possibility of a rewarding career that does not carry the risk of black lung disease, and giving them a reason to pursue a college education. (Computer programing is not part of the Common Core, in case you were wondering.)

The examples above are from a single two-day conference. One came from a frustrated teacher starting a nonprofit organization, another from an entertainer/philanthropist giving back to his old neighborhood, and the third from a corporation concerned about training their next generation workforce.

Each very different players, with different approaches and resources, but all focusing on the individual passions of the children and creating opportunities for them to succeed. Each takes local circumstances into consideration. None of them are top-down, one-size-fits-all approaches. These are just a few of the hundreds of examples of successful programs out there.

For schools that are already succeeding in sending kids on to higher education and professional careers, Common Core is an annoyance at best, and at worst a distraction that will keep them from giving needed attention to the few students who are failing. For them, transitioning from one set of curriculum standards to another is just so much fixing what ain't broke to begin with.

For schools that have high dropout rates and low hopes for their students, Common Core may provide a temporary lift, as new grants, materials, and teacher training become available. But in the long run, this too will peter out, as it will do nothing to address the lack of economic opportunity available to low-income kids, and nothing to change either their expectations, or the expectations of those around them.

You say you want to close the achievement gap in education? Then work to close the opportunity gap in the economy. Hope requires more personal attention than just a modified curriculum.

(Note: this is cross-posted on both, my personal and work blogs, as it is relevant to the general voting public as well as nonprofit professionals.)

Saturday, November 09, 2013

Multichannel Communications - Management & Tips

A point I've been harping on for some time whenever I speak to groups of nonprofits is the importance of communicating to your supporters the way they want, not the ways you're used to. In other words, while some of your supporters may still be looking for that annual holiday letter in the mail, others want to hear from you on Facebook, or by email, at an event, or even by the old telephone. This is what we mean by multichannel communications.

This guest post is from Madeleine Hammond. Maddie is a marketing executive at Skeleton Productions - One of the UK's leading video production companies. Here’s what She has to say about managing multichannel communications...

Multichannel marketing is not a trend likely to end soon - and for good reason. With the constant evolution of new technologies, new social platforms, and new ways to communicate with your audience, nonprofits are currently able to enjoy a whole plethora of potential communication options. Managing these various outlets however is where things can get a little... messy, especially if you’re a charity doing this on the cheap.

To successfully manage all your data, you really need to understand the information you are receiving. So with that in mind, here are some tips that can hopefully help you in the management of your various channels…

1) (Social) Network, Network, Network!: Now, this one is a biggy. According to studies, email open rates are on the decline with more people of all ages switching to social media as their primary form of communication. This means organizations have to think about not only growing their presence in relevant social networks, but they also have to think about growing their “lists” in these environments—much like you think about growing your email list. The great thing about social media is that - mostly - it is free, and you can reach a ha-uge potential audience with some persistent marketing. Make sure to have Facebook, Twitter & Linkedin profiles for your nonprofit. Managing them is simple, especially if you make use of their mobile features - just don’t forget about them!

2) Don’t Forget About Emails!: Yes bringing emails into the equation after talking about social media’s superiority may seem like a contradiction, but just because it’s not 1999 anymore doesn't mean email appeals are no longer relevant. It does mean you have to get more creative however. An email blast to your entire list with the same plea won’t work - in fact, you’ll be lucky if it gets read at all & not marked as spam. Segment your database & create specific templates for those segments, matching the profiles of your supporters. Always test these groups with various content & measure the response. You can even create filters within your inbox so you can monitor responses more successfully. By creating filters & recipient segments, it is easy for you to keep on top of your email campaigns.

3) Keep Track: Tracking is a crucial factor in understanding how your channels are working for you - If you are not measuring what is working via unique tracking links for your petitions and fundraising pages or using Google analytics, you are not listening to what is working for you and what is working against you. As the ol’ social media saying goes; ‘measure, listen and adapt’. Remember its important to connect and communicate with your supporters based on what you know about them, so track and measure what is working and adapt and adopt appeals to suit your audience needs accordingly.  It needn’t cost you much either, as tools like Google Analytics are free.

4) Have a Strong Profile: Creating a strong profile for your nonprofit is essential in targeting donors and audiences. Creating supporter profiles will also help target your audiences in different channels more effectively. Each customer profile has different needs, and your channel of communication should adapt to that. Different channels should be used to translate different communications to different audiences. This may take time (and some saint-like patience!) but it could make a huge difference to your campaign.

Wednesday, July 17, 2013

The Irregularity of Regular Giving

We love our regular donors. As nonprofit professionals, we just love to look over our donor rolls and know that there's a good percentage of those listed who will give again and again, year after year, and all we have to do is send them a nice annual letter. Maybe there's even a few of those donors who have trusted us enough to let us charge a small amount to their credit card every month without even asking. Man, do we love them! But don't get too complacent.

With each successive generation, giving is changing. New technologies play a roll in that, but so do overall trends in society and culture. Changing economic realities affect not only the amounts given, but the level of scrutiny and revue a donor puts an ask through. The loss of trust in institutions along with increased access to a world of information are changing the types of asks donors respond to.

There is a growing body of research into these generational differences. The Next Generation of American Giving by Convio, Edge Research, and Sea Change Strategies (2010 - download here) breaks donor groups down by the Matures (born before 1945), Boomers (1946-1964), Gen X (1965-1980), and Gen Y (1981-1991). One of the problems that becomes evident in this study is that most of our accepted knowledge and best practices around fundraising were designed to appeal to the Matures, who now account for only 21% of donors. Gen X outnumbers them at 25% of donors, with Gen Y (19%) coming up right behind (and growing). Boomers are the largest cohort at 35%, but are outnumbered when you consider Gens X and Y together.

Among the differences in donor attitude between these groups are the way in which donors give. 77% of Matures send checks through the mail, while only 26% of Gen Y donors have. Meanwhile, 14% of Gen Y donors and 13% of Gen X have donated by text, while only 2% of Matures have done so.

As to the type of requests younger donors respond to, the 2010 Millennial Impact Report by Achieve and Johnson, Grossnickle, and Associates (download here) found that more than half of respondents were likely to respond to a specific request, while less than 8% were likely to respond to a general request (such as an annual appeal). This feeling was repeated in their 2012 survey which identified "not knowing how my gift will make a difference" as Millennial's biggest pet peeve.

Younger donors are also less likely to take your word for it that your organization is doing great work. They need to be able to know who the end beneficiaries are, and what impact their donation will make. They do, however, trust their peers: 74.6% said they would give if asked by a family member and 62.8% would give if asked by a friend.

Younger donors are not just more responsive to appeals from friends and family; they are also more willing to take part and help spread the word about your organization once they are on board. 19% of Gen Y and 14% of Gen X donors are willing to promote their chosen charities online compared to only 9% of Boomers and 5% of Matures.

So, what does all this have to do with regular, annual giving?

The bad news is that donor engagement is going to require more work going forward. The good news is that this engagement will be more meaningful and keep you focused on your mission.

In a world where you cannot rely on your annual holiday letter (delivered via USPS) to generate a flow of checks, your organization will need to engage across multiple channels, and communicate consistently throughout the year.

Your focus also has to shift to be more future oriented. Rather than looking back at the good work you've done, asks will need to be forward looking and explain how the next donation will be used. These asks will need to demonstrate impact and explain exactly who will benefit. You will need to experiment with new tools and trust your current supporters to make the pitch to new potential donors.

In a sense, the traditional annual campaign ("Remember us? We do great things, and you always support us: Time to send your check.") is dead. And, frankly, it's about time.

In this new world, every ask is a first ask. Yes, it will take more work than just updating last year's letter. But it will be relevant, it will be inspiring, and it will be empowering. In the end, it will make us better fundraisers and advocates for our causes.

And, if we do it right, it will keep donors coming back to us, year after year.


NOTE: The day after I posted this blog, the Millennial Impact Project released their 2013 report. Among the findings, the respondents said, "they were turned off when a nonprofit's Web site had not been updated recently." 60% wanted information and success stories about the people served by their donation. While 52% would be interested in making monthly gifts, 70% said they would be willing to raise money for an organization they cared about, and 64% have raised money in a fundraising walk or race. The full report can be downloaded here.