The economic ramifications of the pandemic triggered strategic discussions at nonprofits that were negatively impacted in one way or another. While the pandemic is ongoing, it is wonderful to see organizations reopening and even thriving.
As we all know, this was not the case this time last year. According to a joint Candid and Center for Disaster Philanthropy 2020 study, between 7 and 34 percent of all nonprofits were at risk of closing because of the pandemic (Philanthropy and COVID-19: Measuring one year of giving). At the heart of the discussions were budgets. Typical revenue-generating sources such as tuition, event attendance, membership, or entrance fees weren’t enough to fill coffers. Now is the time to build more sustainable models and diversify revenue streams. Advancement programs are an answer!
However, many organizations were not ready to invest in advancement. It was seen as an expense instead of an investment. And in tight budget times, cutting expenses is necessary. It may turn out that an organization needs to limit what it invests in for any number of reasons, but hopefully not without assessing the potential return.
Yes, I am suggesting that investing is necessary. Some of you would reply, “Easy for you to say.” I hear that but think if you put a process in place that examines the opportunity costs of investing vs. not investing and attempt to calculate what the return could be on the investment, you can make a more informed decision.
What are some ways to approach investing in your advancement program with an eye on the return?
Step 1: Scope the Next Level
Start with defining success or the need. Be specific about your goal. Getting more gifts is too broad and even striving to generate a certain amount, like $100,000 in gift revenue, needs more detail.
- What group will you engage to raise that amount?
- How will you approach them?
- What is the message you will use?
Some organizations might say they need to get funds from new supporters, others might look to the middle, and others might need to focus more on major gift prospects.
Step 2: Reflect and Refine
Another important step is to reflect on what you are currently doing and what grade you would give the result. It can be difficult to have perspective, so invite someone else to be part of the process with you. Listen to what they say about the strengths and gaps they see. For example, if you are raising your current revenue via an event and the inputs are high relative to what you are raising, consider how you could reallocate the resources to generate greater engagement and financial support. That might mean sunsetting previous goals for new strategies such as X, Y, or Z.
Once you have defined the goal, assessed what you do now and the result, and identified options for new strategies, you are nearly on your way.
Step 3: Messages and Audience
Examine your target audience (aligned with step 1) and what they need to know or understand or get from your organization to respond the way you want. Once you have determined what is needed, assess your case, your collateral, and your overall messaging so you understand the resource requirements and levels of adoption necessary. Make sure the important decisions made in step 1 and step 2 are key considerations in the decisions made in step 3.
Step 4: Evaluate the Investment
Now that you have identified your goal, reviewed prior methods compared with new approaches, and examined your audience’s needs, you can assess if the approach has the potential to meet your objective. If it does, you should invest in that opportunity. This includes potentially reworking your case, collateral, and messages.
If it doesn’t, the time spent was well worth it. The process is important, and even though it consumes some resources, there are mile markers along the way. At any point you might determine that the objective doesn’t match the inputs, or there may be doubt you will meet your goal. Each step warrants the time it takes and can keep you moving in the most effective direction for your organization.
As you engage in this process, remind yourself why it started in the first place. The pandemic will end, but we need to learn and change course based on what our organizations experienced. The need for alternative revenue sources is critical to most organization’s long-term success. Philanthropy has a crucial role to play, and aligning your advancement program effectively through a strategic process that examines opportunities and potential return positions your organization for success.
As always, BWF is here to support and partner with you. Have questions? Want guidance on how to build your program? Just reach out. We have consultants who were practitioners in all different sectors prior to consulting and they are ready to listen, form a plan, and help implement that plan for your success.