See What’s Out There

I was quoted a bunch in the latest issue of the Chronicle of Philanthropy. The article is about the decline of direct mail and the rise of online prospecting. Four — count ‘em, 4 — of our clients are mentioned in the article. Amnesty International, American Jewish World Service, AVODAH: The Jewish Service Corp and ISIS.

They even linked to the microsite we did for AVODAH, Jews4NewOrleans.org. If you haven’t seen it, go there and donate.

Here’s the article:

From the issue dated April 3, 2008

New Rules of Attraction

As traditional fund-raising methods falter, charities look for new ways to appeal to online donors

By Holly Hall

This week the Nature Conservancy will kick off a campaign to ask online donors to give $1 apiece to help the charity plant a billion trees in Brazil’s rain forest. But conservancy officials have no idea if the electronic drive will meet its goal of raising $1-million.

The Plant a Billion campaign is designed to attract people who have never previously given to the environmental organization. But it could “go gangbusters or be a flop,” says Sue Citro, the charity’s senior manager for digital membership.

For an organization that raises more money than all but a handful of charities, such uncertainty is unusual. But at big charities across the country, fund raisers face that same queasy feeling as they try to figure out a solution to an unsettling reality. Traditional approaches to seeking new donors by mail or telephone are growing less effective and more expensive every year, yet online appeals are not raising enough to replace them.

“Direct mail is on life support,” says Michael Hoffman, chief executive of See3, a Chicago consulting firm that specializes in nonprofit fund raising and communications. “Charities that have relied on direct mail to get new donors have to start thinking about what’s next, or they will wake up one day and find that an aggressive start-up has taken their place.”

Mailings Lose Ground

Plenty of charities still raise most of their contributions with direct mail, but mass mailings are losing their power to attract new supporters. In 2007, the number of new donors who responded to charity mailings dropped by a median of 6.2 percent in a study of 72 of the nation’s biggest charities, on top of another 10.4-percent median drop in 2006.

Online fund raising offers a promising alternative, especially since people who make their first gift to charity online give one and a half times as much as those whose first gift was made by mail, according to Target Analytics, a Boston company that conducted the studies of both online and direct-mail results. Repeat gifts by online donors also tend to be larger.

But persuading donors to give online for the first time is not easy, says Ettore Rossetti, associate director of Internet marketing at Save the Children. The charity has solicited donations from people who signed an online petition to help needy children, but that approach has achieved only “mixed success,” he says.

“Advocacy people tend to be engaged in lending their voice, not necessarily opening their wallet.”

To figure out what approaches will attract first-time donors, many charities are hiring extra staff members to devise and test new ideas, and are upgrading software to analyze the results. Until such solicitations become more lucrative, however, most charities are still spending about as much as they did on direct mail, telemarketing, and other traditional ways of finding new donors.

“I get executive directors all the time who want to abandon direct-mail acquisition completely,” says Jeff Patrick, president of Common Knowledge, a San Francisco company that advises charities on online fund raising and marketing. “Online fund raising will continue to grow, but it will not replace direct mail in five years,” Mr. Patrick predicts. The movement from offline to online giving, he adds, “is an evolution, not a revolution.”

Other fund-raising experts agree that online fund raising has a long way to go before it becomes a successful way to attract new donors.

“This is an extremely confusing period,” says Mark Rovner, president of Sea Change Strategies, a Takoma Park, Md., fund-raising consulting company. “The old ways aren’t working, and the new ways are not clear.”

Still, fund raisers have found some new approaches in recent months that are helping them better attract donors who can eventually become the lifeblood of an organization. Among them:

Make pitches in person. World Vision, the international relief group, asks people who make monthly gifts to “sponsor” a needy child overseas to volunteer to seek donations from other people.

Two and a half years ago, the charity started recruiting people to give presentations about monthly giving to their colleagues at work or church. People who give at least eight presentations a year are named “Child Ambassadors.” Members of the ambassador group, which has grown to 255 people, must apply for the volunteer position and agree to a background check.

Last year, volunteers recruited more than 4,000 new monthly donors.

Vicki Casper, a flight attendant at Southwest Airlines, is World Vision’s most successful recruiter. She has single-handedly persuaded 400 people in the past two years to become monthly donors, including a passenger on a recent flight to Indianapolis. He offered to sponsor a dozen children for at least a year and, as he got off the plane, handed Ms. Casper checks for each child totaling more than $5,000.

If her results don’t attest to Ms. Casper’s dedication, the recorded greeting on her cell phone does: “Hi, this is Vicki Casper, World Vision Child Ambassador, standing as a link between you and the poor and needy of this world.”

With the ambassadors, “we’ve seen big potential,” says Miyon Kautz, World Vision’s national director of volunteers. In fact, she says, the charity has just finished training three new staff members who will recruit ambassadors regionally. The goal for each region: obtaining 1,000 new monthly donors over the next 12 months.

Tap existing online donors. Charities can take a lesson from the “member-get-a-member” drives held by professional societies, says Kevin Whorley, a Bethesda, Md., consultant. After running direct-mail fund raising at Catholic Relief Services for several years, Mr. Whorley now advises associations.

Holding contests and offering prizes or other rewards can improve charities’ ability to get donors engaged in finding new supporters, he says.

As an example, he points to the National Association of Home Builders’ annual membership day, in which local branches compete during the year to see which one can sign up the most new members.

Winners receive modest prizes, such as an upgrade to a better hotel at the association’s annual conference or a fleece jacket, notes Mr. Whorley. The most recent membership day yielded more than 12,000 new members.

“It is fascinating to me how the member-get-a-member thing, which is an old-school technique, gets new traction in this new world of online relationships,” says Mr. Hoffman, the consultant. He is now working with American Jewish World Service, an international relief group, to design an online campaign to persuade the charity’s donors to get involved in finding new supporters.

Mr. Hoffman suggests, based on his research into what makes such campaigns successful for associations, that charities include in their pitches to existing supporters incentives such as the chance to win a trip, a clear description of what difference donors’ participation will make, easy-to-use online tools, and concrete goals for enlisting new donors.

“You can’t just say, ‘Tell your friends about this great organization,’” Mr. Hoffman says. “It is far better to say, ‘Help us recruit 500 new members by June 1 so we can send 5,000 mosquito nets to Africa at the beginning of mosquito season to fight malaria.’”

Couple advocacy projects with online fund raising. The Planned Parenthood Federation of America knew that anti-abortion protesters planned to show up at 10 of the charity’s clinics over 40 days in the fall, so it used the occasion to start “I am Emily X,” an online video diary and blog.

The site featured videotaped statements from Planned Parenthood clinic workers who described the effects of the demonstration on both themselves and patients, some of whom were harassed by the protesters.

Visitors to the site were invited to post comments and messages to the clinics throughout the protest, and they were asked to pledge a small amount of money, anywhere from 5 cents to $10, for each of the 511 protesters Planned Parenthood counted in front of its clinics.

The site, coupled with e-mail appeals about the project, raised $96,531, and more than half of those who gave were new donors, says Tom Subak, Planned Parenthood’s vice president for online services. “We got a phenomenal response.”

Test fund-raising elements of Web sites. Amnesty International is using new software to randomly send online visitors to slightly different versions of a single Web page so it can see which online elements do the most to persuade people to make a donation or visit other parts of the organization’s site.

After two months, Amnesty found a version of its donation page that increased the number of people who made a gift from 35 to 55 percent, says Steve Daigneault, managing director of Internet communications. In the month of December alone, he says, Amnesty raised $128,000 more with the improved donation page; than it would have otherwise. Those returns, he adds, are many times greater than the cost of the software.

Mr. Daigneault is now conducting additional tests to improve the organization’s online action center, where visitors can sign petitions and engage in other forms of advocacy; that part of the site is the main way in which Amnesty collects e-mail addresses of potential donors.

“I don’t think many nonprofits realize how important this is,” he says of the tests. “Once people catch on, it will be huge.”

Get a celebrity to talk up an online appeal. Save the Children recruited 1,800 new donors and generated more than $50,000 with an online campaign that enabled visitors to its Web site to download or send electronic Valentine’s Day cards in exchange for a donation of $1 or more.

But the holiday alone was not enough to make the online greeting cards work for the children’s charity. The key to success, Mr. Rossetti says, was the actress Julianne Moore, who agreed to lend her support to the effort. To that end, she promoted the online cards when she appeared on The View, a popular daytime current-events show aimed at women. The actress has agreed to promote the e-cards again next year.

Do a year-end campaign online. Planned Parenthood has recruited thousands of new donors by sending a series of e-mail messages during the final month of the year. In December, before asking for any money, the charity sent 50,000 people a survey via e-mail to assess their interest in Planned Parenthood programs. That was followed by two other e-mail messages: a holiday greeting and a link to a YouTube video slide show highlighting the charity’s work over the past year. A fourth message asked for a donation.

The monthlong online campaign raised $1.6-million, including more than $500,000 in a single day, December 31. Out of the 8,957 donors, more than 1,200 contributors who gave a total of $246,000 last year were new to the organization.

The online year-end campaign has proven to be “one of our primary recruitment methods,” says Mr. Subak, the charity’s vice president for online services.

Promote online projects in social networks. Internet Sexuality Information Services, an Oakland, Calif., group, initially drew few entries when it asked people age 15 to 30 to enter an online video contest to express their views on sex education.

That began to change after two staff members began combing through social-networking sites, commenting on blogs, searching online news outlets, writing to reporters, and sharing the group’s own news — that it had received the first 10 entries, for example. By the time the deadline for entries passed three months later, the charity had received 70 entries.

While the video contest was not designed to raise money, the publicity efforts are helping the group attract contributions from new donors, says Deb Levine, executive director of the organization.

Three foundations have asked the group to submit proposals, two for six-figure grants. “This is a result of the visibility we generated through the contest and our positioning ourselves as thought leaders online,” she says.

Build a dedicated Web site. Some charities are creating stand-alone Web sites for specific projects, rather than just sending people to find information on one big site. The separate sites can be promoted to potential donors with related interests.

Avodah: the Jewish Service Corps, which involves young people in yearlong public-service projects in Chicago, New York, and Washington, has a new Web site that promotes its plan to start working in New Orleans in September. The charity tested the new site in December, using it to raise $15,000 to match a grant of the same amount contributed by an anonymous donor.

“People went to this site who we wouldn’t have contact with normally,” says Ilanit Gerblich Kalir, Avodah’s associate executive director. She says that the charity is seeking another challenge grant and plans to promote the site more aggressively online in coming months to people who have an interest in New Orleans and relief work.

“This is a low-cost way to get the word out to an audience you would otherwise not reach,” says Ms. Kalir. “We are a very small organization. We don’t have the money to do acquisition with direct mail.”

The New York Times Magazine on Sunday was all about philanthropy.

Here’s what you need to read:

What Makes People Give?

This article is really about how some social scientists, economist types are looking at why people give. It turns out that much of what fundraisers think they know is right, but there is a lot of subtlety. The main example in the article is about matching programs. The research suggests matches lead to more giving, but the type of match — whether 1x or 2x or 3x the gift — had no impact at all. The article looks at the psychology of giving.

Some highlights:

For a long time, philanthropy was mostly ignored by social scientists. It’s not an especially large part of the economy, and most charities operate on a shoestring, without the resources to finance research projects. But this is starting to change. Americans gave $295 billion to charity in 2006, equal to 2.2 percent of the country’s gross domestic product, up from about 1.8 percent from the mid-’70s to the mid-’90s, according to the Center on Philanthropy at Indiana University. Most philanthropy still comes in the form of small gifts, but there is also a growing group of donors, like Bill and Melinda Gates, who are interested in bringing some of the quantitative rigor of big business to philanthropy.

Academics, for their part, have come to realize that charities provide an excellent laboratory for studying human behavior, in part because so many of them are desperate for the kind of free-of-charge consulting Karlan was offering. When charities are designing their donor appeals, they often go by nothing more than a few rules of thumb, some of which may be profoundly insightful and others a good deal less so. “I think some fund-raisers have developed terrific intuitions, passed on through the fraternity of fund-raisers,” says Paul Brest, president of the William and Flora Hewlett Foundation in Menlo Park, Calif., which often works with charities. “But a lot of the intuitions don’t work. Look at how much junk mail you get.” Matching gifts were another good example. People figured that they worked, because — well, how could they not? They seem so sensible. …

…Last year, Princeton University held a conference at which List, Croson, Andreoni and others who study charitable giving got together with fund-raisers from Africare, the National MS Society and elsewhere. I spoke with three people who listened to the academics present their work, and all said they found it invigorating. “We all have different strategies and takes on how to reach out to potential donors,” said Nicole Eley of Africare, which sends development and relief aid to Africa. “Many of them work, some don’t — it’s a trial-and-error process.” It’s easy to imagine that the academic research may eventually serve as the building blocks for a unified theory of how to raise money.

The Celebrity Solution

This article is about celebrity involvement in philanthropy and specifically looks at Natalie Portman, someone who has become the spokesperson for the growing field of micro-lending.

Some highlights:

In 2004, Natalie Portman, then a 22-year-old fresh from college, went to Capitol Hill to talk to Congress on behalf of the Foundation for International Community Assistance, or Finca, a microfinance organization for which she served as “ambassador.” She found herself wondering what she was doing there, but her colleagues assured her: “We got the meetings because of you.” For lawmakers, Natalie Portman was not simply a young woman — she was the beautiful Padmé from “Star Wars.” “And I was like, ‘That seems totally nuts to me,’ ” Portman told me recently. It’s the way it works, I guess. I’m not particularly proud that in our country I can get a meeting with a representative more easily than the head of a nonprofit can.”

Well, who is? But it is the way it works. Stars — movie stars, rock stars, sports stars — exercise a ludicrous influence over the public consciousness. Many are happy to exploit that power; others are wrecked by it. In recent years, stars have learned that their intense presentness in people’s daily lives and their access to the uppermost realms of politics, business and the media offer them a peculiar kind of moral position, should they care to use it. And many of those with the most leverage — Bono and Angelina Jolie and Brad Pitt and George Clooney and, yes, Natalie Portman — have increasingly chosen to mount that pedestal. Hollywood celebrities have become central players on deeply political issues like development aid, refugees and government-sponsored violence in Darfur.

For Good, Measure

This article is about how foundations have found Jesus in metrics.

Some highlights:

The question that troubles many of the newest philanthropists, though, is whether their bequests will have a notable impact. Much of their money either goes into or comes out of private foundations, those largely opaque institutions with huge endowments that, in the jargon-rich environment of philanthropy, differ from charities like the Red Cross in their tendency to engage in long-term “strategic grant-making.” Such foundations do not exist to give emergency aid during crises arising from war or natural disaster; instead, their purpose is to attack social and scientific problems at the root, a process that sometimes requires substantial allocations of grant money over 5, 10 or even 20 years. That’s a long time to wait before you know whether your money is doing any good. As Judith Rodin, the head of the Rockefeller Foundation since 2005, puts it: “Critics have talked about the field of philanthropy and said: ‘Has it really made a difference. And how would you know?’ ” To Rodin, these are perfectly legitimate questions, even when they’re posed indiscreetly by business titans who only recently entered the genteel world of charity. “If we really want to do work that makes a difference, work that has some effect, then we have to know whether it is working,” she told me recently. “And if you really do it well, you don’t only want to know what works; you want to know how it works.”

Faces of Social Entrepreneurship

You can learn about and see some social entrepreneurs.

Michael Gainer started Buffalo ReUse to creatively salvage materials from the 10,000 abandoned houses the city is demolishing over the next 10 years.

Other Articles worth reading include:

Self-Made Philanthropists

This is a profile of Herb and Marion Sandler

How Many Billionaires Does It Take To Fix A School System?

“Last month, The New York Times Magazine invited five interested parties to lunch to discuss the new world of educational philanthropy. What follows is an edited transcript of the conversation.”

What the Orthodox Jewish sect can teach us about how to use Facebook, MySpace, YouTube and the emerging social web.

It would seem that the ultra-orthodox Chabad Lubavitch have little in common with your nonprofit. Whether you are a direct service provider, an international relief agency, an advocacy group or a trade association, you probably couldn’t imagine what a bunch of black-suited, black-hatted ultra-religious Jews could teach you about outreach, marketing and fundraising. And it seems far fetched to imagine that they have something to say about social networking and internet strategy, in all of its universalistic narcissistic decadence.

But alas, they have a lot to teach us.

I don’t know what you know, if anything, about the Chabad-Lubavitch, so first, a little background. Here I am going to quote extensively from the Wikipedia article on Lubavitch.

Chabad-Lubavitch (also known as Chabad, Habad or Lubavitch), is one of the largest branches of Hasidic Judaism and one of the largest Jewish movements worldwide, especially in the United States, the Former Soviet Union, Europe and Israel. Chabad (חב”ד ) is a Hebrew acronym for “חכמה Chochmah, בינה Binah, דעת Da’at” (”Wisdom, Understanding, Knowledge“). Lubavitch, taken from the Russian Любавичи, Lyubavichi, is the name of the town that served as the movement’s headquarters for over a century. In 1993 there were over 200,000 adherents to the movement some estimate today that there are over a million.

OK, so we have this Jewish sect with maybe a million members. If you live in New York, or a college town, you have probably seen some Chabaniks around town. They look like this.

(photo by Mordechai Der Yid)

Chabad, unlike other ultra-Orthodox Jewish sects, don’t keep to themselves. They have it in their DNA to go out into the world and, with incredible passion, reach out to every Jew they can.

Rabbi Menachem Mendel Schneerson spurred on the movement to what has become known as shlichus (”being emissaries [performing outreach]”) after becoming Rebbe in 1950-1951. As a result, Chabad shluchim (”emissaries”, sing. shliach) have moved all over the world with the stated mission of helping all Jews, regardless of denomination or affiliation. They assist Jews with all their religious needs, as well as with physical assistance and spiritual guidance and teaching. The ultimate goal is to encourage Jews to learn more about their Jewish heritage and to practice Judaism.

The movement, motivated by Rabbi Schneerson, trained and ordained thousands of rabbis, educators, ritual slaughterers, and ritual circumcisers, who are then accompanied by their spouses to many locations around the world. Typically a young Lubavitch rabbi and his wife, in their early twenties, with one or two children, will move to a new location, and as they settle in will raise a large family who as a family unit, will aim to fulfill their mandate of bringing Jewish people closer to Orthodox Judaism and encouraging gentiles to adhere to the Seven Laws of Noah. They will carefully seek out and search for and recruit Jews they have identified and contact them and start the process of encouraging them to observe Judaism, encourage Jews to strengthen their commitment to Judaism. All over the world Lubavitchers (including those not formally in the position of emissaries) assist and support the religious needs of tens of thousands of Jews.

Chabad Houses

Chabad today has centers around the world. Centers are called a Chabad Houses. They are Jewish community centers providing educational and outreach activities for the Jewish community. Level of observance is irrelevant; no minimal level of observance is a requirement for using facilities. The centers are informal in setup. They primarily serve both educational and observance purposes. Effort is made to provide an atmosphere in which the nonobservant will not feel intimidated by any perceived contrast between their lack of knowledge of Jewish practice and the advanced knowledge of some of the people they meet there.

Mitzvah campaigns

Chabad aims to attract non-Orthodox Jews to become Orthodox, and believes this is part of the process of bringing the Messiah. This practice is called “mivtzoim” - meaning “campaigns” or “endeavors.” At one time, Schneerson issued a call to every Jew: “Even if you are not fully committed to a Torah life, do something. Begin with a mitzvah - any mitzvah - its value will not be diminished by the fact that there are others which you are not prepared to do”. Schneerson also suggested ten specific mitzvot that he believed were ideally suited for the emissaries to introduce to non-observant Jews. These were: lighting candles before Shabbat and the Jewish holidays by Jewish women; putting on tefillin; affixing a mezuzah; regular Torah study; giving charity; purchasing Jewish books; keeping kosher; kindness to others; Jewish education, and keeping the family purity laws.

Camps

Chabad has set up an extensive network of camps around the world, most using the name Gan Israel, a name chosen by Rabbi Schneerson for the first overnight camp. There are 1,200 sites serving 210,000 children—most of whom do not come from Orthodox homes. Of these, 500 camps are in the United States.

Campus

In recent years Chabad has greatly expanded its reach on university and college campuses. Chabad Student Centers are active on over 100 campuses, and Chabad offers varied activities at an additional 150 universities worldwide. Professor Alan Dershowitz has said that “Chabad’s presence on college campuses today is absolutely crucial”, and “We cannot rest until Chabad is on every major college campus in the world”.

So what we have here is a group that is mission driven. They have created a vast network of people able to carry their message out to the world. And they are investing in young kids and college kids.

I must mention that the Chabad are not without controversy. Rav Eliezer Shach, who was the patriarch of some of the largest ultra-orthodox communities around the world acerbically called Chabad the “sect closest to Judaism” because of the movement within Chabad to proclaim their late Rabbi Schnerson the messiah.

In addition Chabad has been active in the right-wing of Israeli politics, while at the same time taking a non-Zionist stance (meaning the modern State of Israel is not a theologically consistent phenomenon and that “the only thing that unites Jews is the Torah, not a secular state that happens to be planted on holy land.”

And while I have a serious problem with both of those issues, there is no arguing with their success in building communities of active supporters all over the world. There is no arguing with their success in getting secular Jews to take on some aspects of Jewish observance (a high priority among those who believe intermarriage and assimilation are the biggest threats to Jewish continuity). There is no arguing with their success in getting high-net-worth individuals to part with their money. And there is no arguing with their success in getting people who don’t even believe in their world view to support them every year with donations large and small.

And don’t think that they have this massive centralized fundraising machine that makes it all happen. More from Wikipedia:

Fundraising

Funds for activities of a Chabad center rely entirely on the local community. Chabad centers do not receive funding from Lubavitch headquarters. For the day to day operations, local emissaries do all the fundraising by themselves. The monies fundraised in the local community is invested in that local community. The emissary takes a minimum salary and seldom goes on vacation. Sue Fishcoff writes, “Emissaries in the field may sink millions of dollars into their center, synagogues and Mikvahs, but their own homes are modest, again patterned after their Rebbe’s lack of personal ostentation.”

So how have they done it? How have they been able to get people who will never adopt their lifestyle or world view to support them financially? How are they able to send ultra-Orthodox rabbis to places like Boise, Idaho and expect – know – that they will make it somehow? How are they able to bring non-religious Jews into their synagogues and to their events when their world view and lifestyle is so foreign? And finally, what can their success teach us about fundraising generally and online social networks specifically?

A Theory of Acceptance – Or At Least Tolerance

If I went into a typical Orthodox synagogue in a t-shirt and jeans during the Sabbath service, I would likely have someone ask me to leave. They would tell me that, while they mean no offense, that my clothes are not appropriate for the day or the place and that I am welcome to return in more appropriate attire. If I walk in to a Chabad synagogue on the Sabbath in a t-shirt and jeans I am likely to be given an Aliah – a special honor when you are called to participate in the Torah service. From the Chabad perspective, the one who doesn’t know enough to wear the right clothes is just the person who needs to be brought in and cultivated, not turned away.

Another example. Most Orthodox synagogues close off their parking lots on the Sabbath. Why? You are not allowed to drive on the Sabbath according to Orthodox rules, so having the parking lot open is an tacit invitation to drive, an invitation to break the Sabbath. Makes sense, no? While the Lubavitch take their Sabbath observance very seriously, their parking lots are open and they won’t tell you not to drive. If you drive, drive. Just come.

When Conservative or Orthodox synagogues have group Friday night meals (the beginning of the Sabbath), the evening will include rubber chicken that you most likely had to pay $35 (in advance) to get in the first place. In a Chabad House, you will often get a more elaborate and home-cooked meal (usually prepared by the Rabbi’s wife) and a side order of rousing singing and flowing alcohol. It’s a lot of fun. In fact, the feelings of camaraderie are infectious. No one will ever be made to feel that they are bad or wrong for not taking the Lubavitch path. And no one will ever be asked to pay!

In these three examples we get the core of Lubavitch success that I will try to distill into a few principles:

· Show acceptance and understanding for where people come from
· Never make people feel bad about what they don’t know
· Make them feel welcome in your space
· Teach them by first by example and only explicitly when they ask
· Give them small, non-threatening steps to advance their connection

The most secular person in the world can have a terrific time at a Lubavitch event or even attend their services on a regular basis. They can enjoy speaking to a rabbi whose life is light-years removed from the secular world. And they routinely go out and tell anyone who will listen about the amazing soul that accepts the visitor and gives of themselves without asking for anything in return. That’s magic. Imagine people talking about your organization like that!

Taking the Lessons to Our Fundraising

The lesson I take away from their success for organizational fundraising is that guilt is a losing long-term strategy. Yes, it can work in the short-term. But instead of making me feel bad about what I haven’t done or what I need to do, make me feel good about what you are doing. Inspire me with your dedication. Allow me to participate in a small way, but don’t treat me like a small person for it. Cultivate those who take the first step as if they can become the biggest donor you have and make them feel important for whatever it is they have chosen to do.

The number of organizations that use guilt is staggering. It’s an easy strategy to implement and we see it a lot in direct mail. I recently received a mailing with a nickel in it. “Don’t let this nickel go to waste” they begged me. The same is true with mailing labels. Here are these things with your name on it and you will surely feel guilty is you use them and don’t pay us. This is not how you create deep connections and long-term supporters. (Here is an article in Fundraising Success Magazine that looked at and ranked emotional motivators for fundraising. Guilt was near the end of the list.)

Another lesson that organizations can take from the Lubavitch is in having people on board who are passionate about what they do. Now I don’t expect that most organizations can get to the level of passion of the Lubavitch. These folks believe that their lives, all of our lives, and the future of the universe is at stake. That’s strong motivation and most people who work at your nonprofit won’t come with that level of dedication. But if you are choosing between two employees and one is deeply passionate about your mission and the other one, though more qualified, is seeing it as just another job, pick for passion. (You can see this dedication at work in many organizations. I am seeing it more and more with environmental group staff who are genuinely scared for our collective future and energized by the change that is possible. You can see this dedication in the staff of the New Israel Fund — those in Israel in particular — where I was once a fundraiser. The Israel staff wants desperately to live in a democratic Israel and so they live the change they want to see every day.)

Lessons for Social Networks

The reason I wrote this post was because of a eureka moment I had in connecting the Lubavitch success with social networking. I had this moment last week when I was in Manhattan and I passed the Chabad Mitzvah Tank in Midtown. I had my handy-dandy video camera with me, so you can see:

(I have to pause thank Beka Economopoulos here for planting the seeds of this idea. Beka works for Greenpeace. I saw her speak at the Yearly Kos conference and then suggested that we at See3 invite her to co-present with us at the Craigslist Foundation Nonprofit Boot Camp in New York a couple weeks ago. Beka runs the Greenpeace online organizing program and has seen some amazing success with it and we are grateful for her participation with us in what turned out to be a terrific and well-attended session.)

The average organization, if they have a social network strategy at all, think of social networks as a way to meet people, with the goal of then convincing those people to give the organization their email address, go to their donation link or otherwise become members/donors/activists of the organization in the same way everyone else is. Meaning, they will get the same emails, see the same website, and take the same path to further activity as other prospects. They are using the social networks to meet people, but only see their outreach as successful if they can get those people to do what everyone else is doing.

Part of the problem here is that organizational management hasn’t yet internalized social networking metrics. For Greenpeace, those 68,000 friends on MySpace are just like 68,000 email addresses. For most organizations that would not be true. You are looking at email opens and average gifts from your online donations and these metrics are not really reflective of the potential you have in social networking. (Allan Benamer, a big believer in these tools, writes about this problem on his blog. You should also be reading Beth Kanter and Ruby Sinreich on these subjects.)

Now think of the Lubavitch philosophy. You are a MySpace person. You are comfortable on MySpace. I build a MySpace page to show you I can speak your language. This is where you live. Acceptance means I have to stop trying to get you to leave. Acceptance means creating things you can do right there on MySpace. Acceptance means treating my ability to message you on MySpace the same as if you are on my email list – without forcing you to change.

When you start to care enough you might come on over to our site. When you are impressed with how we “walk the walk” you might get out of your comfort zone by doing something offline. I am not going to force you to change. I am not going to limit your access or the information you can get because you live this “alternative lifestyle”. I am going to respect you for who you are! (Or at least I am going to pretend to.)

All of this is connected to the permission-based marketing society we are in today. Top down advertising is working less and less. Word-of-mouth is more important than ever.

Showing people what you do and why it matters is critical to capture people’s attention. Getting your supporters to recruit others is becoming a central strategy. Your content and your passion are what will carry the day and bring people to your cause. Social media marketing is not about tricks or techniques as much as it is about finding your authentic voice and inviting people to share in your passion at the level they are most comfortable in the venue of their choosing.

[The irony of all of this is that Chabad-Lubavitch does everything wrong on their own MySpace page, which I assume is run by one person in a decentralized way. They don’t follow their own script for offline engagement, which would also bring them online success. On MySpace they seem insular, political and shrill – everything they don’t seem in person.]

In Sum

Be passionate in your work and be grateful to those who come and take interest – at every level. Meet people where they are without judgment or condescension. Make your programs and your content accessible to those who come from a different place than you do. This philosophy is the core of what you need to be successful in social networking strategy.

Tell me how you do or don’t apply these principles to your own online and offline marketing by leaving a comment.

Why should I donate? Yes, you do good work. Yes, I care about these issues. OK, you got me. I will donate. But not now. When I get around to it. (Which might not actually happen any time soon.)

I think this is a common subconscious set of thoughts from donors. I will get to it. I made that pledge, but I didn’t return the envelope. Not because I didn’t intend to do it, but because it’s not URGENT. Creating urgency is an important part of fundraising. OK, I get you do good work. But why is it important that I donate now. Right now. Why not tomorrow? Why not next month?

One way to solve the urgency issue is to use a matching program. A typical match program will get a high-net-worth donor to conditionally pledge some money, say, $75,000. They will pay the pledge if you can get another $75,000 to match it. Often this is a nice way to up a gift from a major donor as well as getting your base excited. I was thinking about this recently because I saw two case studies for running matching gift programs online.

The first is from the American Jewish World Service (AJWS). They sent out an email about a week ago to their list saying that a family foundation has agreed to provide $75,000 if the amount could be matched. In about two days the $75,000 came in online. Here’s the amazing thing… a lot more money came in phone calls! “I just got this email about the matching and I want to donate.” So they were over their goal. (Don’t forget, if you get calls or letters that reference an online campaign, the online campaign needs to be credited for those gifts in your database so you can accurately measure the impact of the campaign.)

Within a couple days, the whole experience got someone else excited about the matching possibilities and I got this email from Ruth Messinger, the head of AJWS:

Dear Michael,

During these Days of Awe I am particularly grateful for your ongoing commitment to AJWS.

Last week I shared the news that, in the spirit of the High Holy Days, a family foundation agreed to match your contributions up to $75,000.

I am so pleased that, thanks to an outpouring of support, we have met the match.

However, the generosity of our supporters did not stop there. After hearing of the success of the first match, an anonymous donor came forward and offered an additional $100,000 in match funds!

This is the first time in AJWS history that we have been able to extend such a generous offer to our supporters, so please, help us reach our new goal of $175,000 by making a donation today.

With the ongoing help of the AJWS community, we are confronting some of the world’s most difficult challenges. We support the world’s most vulnerable people - where the need is greatest - in communities that have not been reached and not been served by others.

So please, don’t miss this special opportunity to contribute today - your donation will go twice as far and will help AJWS raise up to $350,000 for our critical work around the world!

Thank you for your commitment to global social justice and support of AJWS. May we all be inscribed in the Book of Life.

Warm regards,

Ruth Messinger
President, American Jewish World Service

The second case study is from the Obama campaign. What’s interesting about their approach is the idea of matching real people to each other to create a kind of virtuous circle of leveraged gifts. The Obama people are combining the urgency of the match with the idea of creating community, which has been a lot of what their campaign is about. And they also throw in here a little “prove to me that you’re a man” kind of stuff for added punch (which is the part I don’t really like because I think it dilutes the power of the community sell.) Have a look:

Dear Michael,

Somebody out there believes that you’re ready to own a piece of this campaign.

A fellow supporter has promised that if you make a donation right now, they will match what you give.

So take the next step.

Prove to them that they were right to put their faith in you. Make a donation now and double your impact:

https://donate.barackobama.com/match

This isn’t an anonymous donor program backed by big checks from Washington lobbyists or corporate fat cats. This is a one-to-one, supporter-to-supporter effort.

If you make a donation, you’ll be matched up with a real person — another supporter who has put their faith in you. And you’ll be able to read a note from them and send a response.

Here’s how it works:

You choose the amount you’re willing to give — it will be doubled by someone willing to match that amount

You’ll see the name and town of the fellow Obama supporter who agreed to double your donation

You’ll be able to write a note to the person who matched you and let them know why you decided to own a piece of this campaign
https://donate.barackobama.com/match

Our movement is funded by actual people — individuals who are moved to give whatever they can afford, whether it’s five dollars or five hundred dollars.

Most campaigns do not realize the value of contributions from ordinary people — they are focused on the money that comes from Washington lobbyists and special interest groups.

But we reject the notion that lobbyists and PACs represent “real people,” and we’ve refused their money since this campaign began.

So it’s up to you.

Make a donation and show your support. Double your impact by giving today and being a part of our supporter match campaign:

https://donate.barackobama.com/match

According to the Campaign Finance Institute, we have raised more money in small dollar contributions than any major campaign in history.

If we keep building our movement this way, we have the potential to fundamentally reshape the political process.

We can end the days of lobbyists and political action committees paying for access and influence.

That’s why we’re so focused on bringing new donors into the campaign. For the next ten days you will write the history of this presidential election through your actions.

You have the opportunity to build the biggest grassroots campaign politics has ever seen.

Make a donation, connect with another supporter, and double your impact now:

https://donate.barackobama.com/match

Thanks for your support,

David

David Plouffe
Campaign Manager
Obama for America

Matching programs can work. So if you haven’t tried it, you should. One rule of creating urgency is that you shouldn’t abuse it. You can’t tell people in every communication you have with them all the time that the sky is falling (even if it is!). If you say, “We need you to act today!” and you say it again next week, they will get burned out. They will begin to feel that they can never solve your problems, that you just take and take and no matter how much they give you are still in this crazy urgent situation. And if they feel that way, then your appeals start to make them feel guilty, and guilt is not a tricky tactic in fundraising. Most of the time people will avoid guilt-inducing situations.

If you have your own matching gift story, leave it in a comment here to share it with your nonprofit colleagues.

There was an article in the New York Times yesterday about philanthropic gifts by the very wealthy and whether those gifts were truly deserving of the tax breaks they get.

Here’s the frame of the debate:

The rich are giving more to charity than ever, but people like Mr. Broad are not the only ones footing the bill for such generosity. For every three dollars they give away, the federal government typically gives up a dollar or more in tax revenue, because of the charitable tax deduction and by not collecting estate taxes…

A common perception of philanthropy is that one of its central purposes is to alleviate the suffering of society’s least fortunate and therefore promote greater equality, taking some of the burden off government. In exchange, the United States is one of a handful of countries to allow givers a tax deduction. In essence, the public is letting private individuals decide how to allocate money on their behalf.

What qualifies for that tax deduction has broadened over the 90 years since its creation to include everything from university golf teams to puppet theaters — even an organization established after Hurricane Katrina to help practitioners of sadomasochism obtain gear they had lost in the storm.

Roughly three-quarters of charitable gifts of $50 million and more from 2002 through March 31 went to universities, private foundations, hospitals and art museums, according to the Center on Philanthropy at Indiana University.

Of the rest, the Bill and Melinda Gates Foundation accounted for half on the center’s list.

What you need to know is that “Research shows that less than 10 percent of the money Americans give to charity addresses basic human needs, like sheltering the homeless, feeding the hungry and caring for the indigent sick, and that the wealthiest typically devote an even smaller portion of their giving to such causes than everyone else.”

So the question becomes, is it worth it for taxpayers to be footing the bill?

To sum up the pro-tax-break position:

[The philanthropist and billionaire] Mr. Broad (rhymes with road) says his gifts provide a greater public benefit than if the money goes to taxes for the government to spend. “I believe the public benefit is significantly greater than the tax benefit an individual receives,” Mr. Broad said. “I think there’s a multiplier effect. What smart, entrepreneurial philanthropists and their foundations do is get greater value for how they invest their money than if the government were doing it.”

To sum up the anti-tax-break position:

“When millions of people are dying of AIDS and malaria in Africa, it is hard to justify the umpteenth society gala held for the benefit of a performing arts center or an art museum,” he wrote in his investment commentary this month. “A $30 million gift to a concert hall is not philanthropy, it is a Napoleonic coronation.”

Clearly there is a need for reform:

The charitable deduction cost the government $40 billion in lost tax revenue last year, according to the Joint Committee on Taxation, more than the government spends altogether on managing public lands, protecting the environment and developing new energy sources.

The right answer is probably keeping the deduction but tightening up what can be deducted. For example, arts organization donors might not get deductions for donations that are not to be used for scholarships or education and maybe only 50% for capital expenses. It’s complicated and I wouldn’t expect to see change anytime soon.

As my long time readers know I am very interested in the issue of corporate social responsibility as well as what Muhammad Yunis calls social enterprises, which are profitable companies that exist for the purpose of doing good. Two interesting articles in the Friday Times. One is about how Norway, with more than $300 billion in oil wealth, has decided to put a social filter on their investment decisions. This is a lot of money and it’s not making Wal-Mart or the American government happy, because of who is on their list.

The second article was about the Robin Hood benefit. If you don’t know the Robin Hood Foundation, they have a great message, ending poverty in NYC. That’s it. What they also have are hedge fund managers as supporters, among others. And so while American Idol raised $60 million by beating all of America over the head on national television, Robin Hood raised $71 million in a few hours with a bunch of very wealthy people. This event comes on the heals of the annual release of info about what these hedge fund guys make. I think I read that right… the top 25 hedge fund managers make $14 billion this past year. So yeah, it’s nice to give $71 million… but let’s keep it in perspective.

At See3 we create compelling media content for organizations to tell their stories. We create original video, we repurpose existing material and we help build organizational capacity so that nonprofits can integrate a culture of documentation and media development into their daily business.

But we don’t work in a vacuum. The priority of organizations is to advance their mission and to have enough resources to survive and thrive. So we frame our work in terms of its impact on program and on fundraising. The link is not always direct and so we have been thinking and collaborating on how to make donor programs more integrated with video and digital storytelling. How can organizations best maximize their use of compelling narratives to have a direct impact on their fundraising?

We just moved this initiative forward in a big way with our formal partnering with Norman Rosenberg. Norman is one of Washington’s most respected nonprofit professionals. With 30 years of experience leading major public interest organizations, Norman knows every aspect of nonprofit management. Now a consultant, his focus is unique in that he is not shying away from directly addressing major gifts programs and helping organizations build fundraising capacity. He knows what he is talking about, having raised hundreds of millions dollars from high-net-worth individuals and family foundations over his career.

I recently interviewed Norman about his work and his thoughts on collaborating with See3. Here’s the first in a series.