Strategic Fundraising Through E-mail

The following material is provided merely for background and reference information, and should not be considered or substituted for legal advice. Please consult with your organization's legal counsel for more information. The past three years have seen the development of an overwhelming number of online fundraising resources, and the subsequent shakeout of more than a few third party online fundraising services. As Arthur Rieman, attorney/principal of the Sherman Oaks, CA nonprofit-centered law firm Nonprofit Incorporators wrote in the 4/18/01 edition of the direct marketer publication DM News, the role of various third-parties in nonprofit charity Internet giving raise a whole host of issues including: the compliance of charitable giving brokers and online malls with IRS rules areas of fraud with which nonprofits (and their supporters) should be aware the tax-deductability of contributions to nonprofits, based, in no small part, on direct contributions to a charitable organization, versus the services of third-party credit card transaction services possible blurring of the lines of "solicitation" versus "conduit" by third-party services in the eyes of regulators and state authorities Rieman's article, however, does not mention how effective these online services are in the context of tying development activity into a more coordinated and integrated range of overall nonprofit online activity. The reason is possibly two-fold: there is not yet enough evidence, or even more simply, that's not what these services are designed to do. No online service can replace or supplant the need for strategic nonprofit activity to emanate from actual strategic nonprofit thought-- encompassing outreach, communications, information gathering, marketing, and building a support base, for advocacy, mission fulfillment, or fundraising. It is striking to note, then, that one Internet-related tool that has actually generated some data, in terms of its effectiveness not just for development, but also development as an element of connecting with audiences, is also one of the simplest: e-mail. While strategic advocacy through the use of online tools is an ongoing topic of exploration, discussion, and debate, we might be able to discern some helpful lessons learned in the area of strategic fundraising itself. This is the notion that some level of responsibility for development can be placed in volunteers, supporters, and affiliates of your organization/network-- and not the core staff or directorship. This is then combined with other fundraising and development efforts into something akin to an actual strategic plan, based on organizational assessment and stakeholder analysis, that meets certain performance targets and priorities. Todd Cohen, editor of Nonprofit Xpress, wrote a 9/01/00 Nonprofit Times column about Harvard University utilizing e-mail and Web tools for fundraising. Harvard had been using the Web to provide news to alumni about university happenings and fundraising progress. As a result of US$125,000 spent on a set of donor appeal e-mail messages to a 126,000 alumni donor base, Harvard managed to snag some US$4.5 million by June 30, 2000. During the spring of 2000, the university sent a set of messages to 59,000 spread out over six alumni classes, with a whopping 2% stating their preference to not receive future e-mail. Another message generated funds from 4,000 alumni, with 200 giving US$38,000. This convinced them to weave an e-mail appeal into their normal direct marketing. The attraction is that it generates a quicker response, at a cheaper cost. The university, wrote Cohen, also decided to integrate the website (revamped in January 2001) with the e-mail appeals, such that it the e-mail drives people to the site to ultimately make contributions, download/print pledge forms, etc. In December 2000. the 12/11/00 edition of the Food4Thought nonprofit email newsletter produced by CompassPoint Nonprofit Services cited a September 2000 Stanford University study regarding the value and impact of an e-mail newsletter to its alumni, and their subsequent financial contributions to the university. By way of background, the Stanford Alumni Association and Stanford News Service launched the free monthly e-newsletter, @Stanford, in October 1998. The market research folks had wanted to get a better understanding of their audience, so they devised a set of online survey tools to learn: what audiences it reaches how and when people read it how the audiences react to the e-newsletter how well it works as a communications tool how well it works as a means to raise awareness of university happenings whether it encourages the use of Stanford-related resources (especially through the links included) if the e-newsletter is "passed along" to others if it influences attitudes, perceptions, and feelings about Stanford how the e-newsletter meshes with the goals of its producers, and expectations of the readership if, and how, the e-newsletter affects giving The primary circulation of the @Stanford newsletter, by the time of the February 2000 online readership surveying, was around 40,000 e-mail addresses. A random sample of roughly 1700 e-mail addresses selected, with the sample receiving an e-mail notice with a link to an online survey. Any addresses with a "stanford.edu" domain were excluded, in order to separate alumni from students and employees, yielding a final base of 738 alumni. The researchers looked at the data nearly 30 distinct ways, and found some interesting things: in general, the respondent pool tended to reflect people who elect to receive the newsletter, and actually read it. This is instructive, because most of the original subscriber base was simply added to a mailing list, and not asked about their preference back in 1998 when the e-newsletter launched. An assumption could be made that most people simply did not elect to be taken off the list from the outset, which, even without express consent, still constitutes a dedicated subscriber base.
  • 92% of the newsletter recipients (versus 52% of non-recipients) visited a Standford-related website. 64%, of subscribers, and 22% of non-subscribers, actually bookmarked a Stanford-related site. (Researchers also discovered that the newsletter recipients were more likely to visit pages in the newsletter more frequently via repeat visits)
  • 8 out of 10 e-newsletter recipients actually followed the links in the newsletter, and about 1/3 provided links to content in the newsletter.
  • 20% forwarded content to others (alumni and non-alumni alike), and 23% forwarded specific content (versus the whole edition) to others
  • 49% of recipients (versus 34% of non-recipients) donated in fiscal year 2000. Of those who donated the previous fiscal year, 78% of the newsletter recipients (versus 73% of the non-recipients) renewed their giving. More telling: for those folks who had given before (but declined to give in) fiscal year 1999, 32% of newsletter recipients (versus 22% of non-recipients) gave in fiscal year 2000. And even more telling: 13% of recipients (versus 5% of non-recipients) made their first-ever gift in fiscal year 2000.
  • regular e-mail newsletters had a positive effect on giving. It turns out that more e-mail newsletter recipients made a donation in the 2000 fiscal year than those who did not.
      We'll skip over the findings about reader expectations and the producer goals being met, and some other interesting breakdowns of giving by certain alumni demographics. The basic gist of the overall research is this: Stanford alumni who are better informed about happenings at the school were more inclined to give money, because they had a better impression of those happenings. There are a number of firms that tout expertise in strategic fundraising or development, but without playing favorites in this space, there are some resources that can be helpful in locating good choices for your organization to consider.
      • A good (though possibly dated) summary sheet of basic strategic fundraising options for nonprofits can be found online, courtesy of the St. Norbert's College Business Administration Program
      • The St. Norbert's College material is largely drawn from the Grantsmanship Center, which offers a five-day strategic fundraising workshop of note (it runs somewhere in the US$800-900 range), conducted in different parts of the country throughout the year.
      • Chapter 9 of "Fundraising for the Long Haul" by Kim Klein is devoted to strategic fundraising (this book is the companion to "Fundraising for Social Change"-- in its 4th edition as of this writing). Klein is also the author/publisher of the Grassroots Fundraising Journal. These and other publications on fundraising for progressive grassroots groups are put out by Chardon Press, and a number of sample chapters are available for free
      • the Chesapeake Bay Foundation's, Building Blocks for Emerging Environmental Non-Profit Organizations, in particular the section on "Dollars for the Chesapeake Bay: CBF's Comprehensive Strategy for Fundraising Financial Support," provides a set of lessons learned in strategic fundraising components, that can be applied to a wide range of nonprofit organizations
      • Strategic Fundraising for Social Services is a monthly print newsletter (about US$159 annually] with useful tips and advice.
      • "Designing a Communications Plan To Enhance Your Fundraising Campaign," addresses how to develop the case for support" for a fundraising campaign, crafting a brochure (off-line), and then announcing and publicizing the campaign
      • "Nonprofits: The Dot Coms, Dot Orgs, and Other Dots," by Don Griesman, features an extensive set of resources under its "Grants and Grant Writing" section
      Despite all the things we know e-mail has allowed nonprofits to do in general, e-mail's impact on nonprofit giving raises some interesting arenas for further study. Why? Because the same issues raised with respect to: gauging the target versus actual readership of an organization's material building an ongoing relationship with key audiences encouraging more (and repeated) online traffic to the web content your nonprofit group produces providing a regularized distribution channel for content that is valued, useful, and informative over a long-period of time providing a connection between remotely-engaged audiences and an organization through a medium that requires more attention and active participation on the part of the "reader" while more measurable in a fundraising context, also have value to discussions of engaging an "audience for advocacy" via e-mail. Simply put: using e-mail not as an information and communications tool, but as a strategic information and communications tool, can help nonprofits in both their fundraising and advocacy. Resources Cited "Walking the Tightrope of Web-Based Solicitation" DM News (4/16/01) Arthur Rieman Nonprofit Xpress 9/01/00 Nonprofit Times (9/1/00) Todd Cohen 12/11/00 Food4Thought (12/11/00) CompassPoint Nonprofit Services @Stanford Survey Findings Summary Full Report Stanford University (September 2000) Strategic Fundraising materials St. Norbert's College Business Administration Program (1997) Grantmanship Center Strategic Fundraising Workshop "Fundraising for the Long Haul" Fundraising for Social Change Grassroots Fundraising Journal Kim Klein (available from Chardon Press "Dollars for the Chesapeake Bay: CBF's Comprehensive Strategy for Fundraising Financial Support" Building Blocks for Emerging Environmental Non-Profit Organizations: Lessons from the Chesapeake Bay Foundation pages 42-47 (Acrobat PDF document); pages 45-50 (Acrobat PDF printed version) Strategic Fundraising for Social Services Advancement Communications E-mail: advancecom@worldnet.att.net Phone/Fax: 203=245-6888 "Nonprofits: The Dot Coms, Dot Orgs, and Other Dots" Don Griesmann Project for the Future of Equal Justice Equal Justice Network
back to Blog