Great Nonprofit Lessons from Black Friday

Why do we get so excited about Black Friday?  Black Friday sounds more like a contractible malady than a good time. Nevertheless, we push ourselves back from the dinner table each Thanksgiving with excitement and wonder at the late night bargains to be had.

What is it about Black Friday that causes this Pavlovian response and what can nonprofit organizations learn from the aura that Black Friday creates?

Black Friday is a powerful brand.

The term is an umbrella brand for all retailers. Black Friday has come to signify bargains, late night shopping, chaos, long lines, shameless capitalism, and did I mention bargains?

The takeaway for nonprofits: When building your organization’s brand be clear about its characteristics. There should be a direct correlation between your Mission and Vision statements in the creation of your brand. Choose your words carefully for the tagline, logo, marketing messages, positioning statements, etc. These help create and support your brand. Be as clear and concise as possible when crafting these statements.

Black Friday creates excitement and good stories.

As a shopper you know what you are getting on Black Friday from long lines to good deals and everything in between. Whatever your personal expectations are, every Black Friday shopper comes home with a story about ‘the greatest deal ever’ or ‘the one that got away’. If you partake in Black Friday shopping you WILL come out of the experience with a good story. Promise of the story is part of the reason that shoppers return to the chaos year after year.

The takeaway for nonprofits: Provide the raw material to your donors, volunteers, and staff to create their own story about their involvement in your organization. Provide your supporters with actual client experiences and get them excited about your growth and sustainability as an organization. Give them a forum (newsletter, luncheon or event, Facebook) to share their experiences with others. This will create a personal investment in your organization and turn your supporters into ambassadors for your cause.   

Black Friday produces a positive ROI.

Shoppers know that they will get their best deal if they stay up late and battle the crowds. No pain, no gain. Shoppers are willing to suffer a bit for an extra 10% off so they feel like they have gotten the best possible price and spent their money wisely.

The takeaway for nonprofits: Producing a positive ROI is critical for the health of your organization. But you don’t have to make your donors suffer. The most effective way to create a positive ROI is through diligent stewardship. There are many ways to be grateful and appreciative to your donors and volunteers without being annoying (see my post ‘How to Say Thank You in Chinese’ 11/15/11). The reason that 6 out of 10 donors do not give in the second year is that those donors are not appropriately stewarded. It is ten times harder to regain a lapsed donor or volunteer than to correctly steward an existing one.    

Black Friday-one phrase fits all.

Every retailer uses this same phrase to mean bargains. The only difference is the ‘at Walmart’ or ‘at Target’ or ‘at Macy’s’.

Takeaway for nonprofits: Consider partnering with organizations within your sector to create a larger presence. Create an event or conference with an umbrella title for the benefit of all of the partners. The effect is two-fold. Donors will witness the strength of the sector and the variety of its programs while organizations can create program partnerships and cross pollenate their base of supporters. Ultimately, productive partnerships can lead to more efficient organizational structures.

Black Friday is always the day after Thanksgiving.

It is already on the calendar for next year. Black Friday is always the same day although getting earlier and earlier (will shoppers really embrace Grey Thursday? It remains to be seen).

Takeaway for nonprofits: There is merit to having consistency in your event planning. Having an event on the same day every year creates an ‘appointment event’. It is already blocked off on the calendar and has a higher likelihood of attendance.

Happy Thanksgiving and Happy Shopping!!

(Little known Black Friday fact: The term was coined in this country by the Philadelphia Police Department referring to the gridlock traffic in Center City Philadelphia the day after Thanksgiving).  

What Nonprofits Can Learn from Organized Crime

Mark Goodman, senior advisor to Interpol and founder of the Future Crimes Institute wrote a brilliant article in the November issue of the Harvard Business Review titled ‘What Business Can Learn from Organized Crime’. The article identifies ‘best practices’ of organized crime and argues that business can learn from organized crime’s ability to recruit great talent, use technology, and adapt quickly to market conditions. We in the nonprofit sector can also learn valuable lessons from organized crime.

Let’s discuss Mr. Goodman’s five areas of learning opportunity and explore what we in the nonprofit sector can learn and how we can use that information to get ahead.

1) Use the news to create opportunity. Criminals capitalized on the disaster in Haiti to set up false mobile media donation networks through Facebook and Twitter.

What can we learn? We should be aware of the news, assess potential trending that may affect your business, and use the most efficient media tools to disseminate information.

How we can get ahead: Set up social media tools as soon as possible and understand the value of each for your organization. Don’t wait until a news opportunity presents itself to set up your information disbursement network.

2) Outsource to specialists. These days, the confederations of terrorist networks like Al Quaeda are made up largely of loose affiliations and freelancers.  Organized crime is fantastic at outsourcing talent and drawing upon the strengths of individuals over vast geographic regions.

What can we learn? As nonprofit organizations with a constant eye on keeping overhead costs down, we can think about outsourcing certain functions such as grant writing to freelancers. Also consider consolidating back office services with other nonprofit organizations.

How we can get ahead: Network, network, network. Talk to colleagues and build a database of well-respected freelance professionals. Begin a dialogue with other organizations to assess the feasibility of sharing services.

3) Cash isn’t the only incentive. No doubt organized crime pays well, but these days there is a trend of people who are drawn to the world crime as much for the money as for the intellectual stimulation and the ability to ‘beat the system.’

What can we learn? Nonprofits excel at creating a culture of belonging and recognition so keep the culture going.

How we can get ahead: A feeling of belonging and of recognition for employees as well as donors is created through stewardship and appreciation. For donors, build a stewardship system in which every gift is acknowledged seven times (see my post ‘How to say Thank You in Chinese’ for more information), and for employees something as simple as cupcakes in the office or a designated ‘Employee Appreciation Day’ can do the trick.

4) Exploit the long tail. This is my favorite lesson because here we can begin to think differently. According to Mr. Goodman, there is a trend among criminals to execute many smaller crimes versus one large and splashy crime. Executing many smaller crimes reduces the likelihood of detection and therefore creates a stronger and more sustainable enterprise. Credit card fraud is a perfect example in which many small transactions are favored over a single large purchase.

What can we learn? Nonprofit organizations can increase their likelihood of sustainability if they look ahead and continually ask ‘what’s next?’ Sending out many feelers into the market by talking to colleagues and attending conferences on economic and technology issues can identify societal or economic shifts that may impact the future of your organization. If you are not aware of these changes your organization may be scrambling to react to the new reality rather than creating systemic proactive change.

How we can get ahead: As part of your Board committee structure create an Innovation Committee with board and staff members to discuss trends in the nonprofit industry and in your sector. If possible, form a multi agency committee to share viewpoints and ideas. 

5) Collaborate across borders. Organized crime partners with competitors to expand into new markets. The Colombian drug cartels have partnered with the mafia in Eastern Europe to expand their international drug market and increase their business opportunities.

What can we learn? The economic downturn of 2008 forced the consolidation of many nonprofit organizations with similar Missions. The advent of these partnerships is a positive outcome born from economic necessity. Further, more and more foundations are requiring organizations to partner to be considered for grant money. It is in the nonprofit sector’s interest to seek out healthy partnerships. Partnerships can create strength and sustainability.

How we can get ahead: Partnerships can promote organizational efficiency and introduce new avenues of exploratory thinking. But effective partnerships can only come about through strong leadership. To create a successful partnership, leaders should create employee incentive programs based upon the goals of the new partnership and be intolerant of departmental silos. Partnerships can substantially increase an organization’s impact in the market, but like all relationships, have to be managed by clear policies and transparent practices.

Criminal enterprises are market and technology savvy and employ innovative practices to expand their market share. As a sector, we can learn a lot about adaptability to societal and economic forces and adoptability of creative practices from these illegal ventures. The next time you are watching a news story about a criminal group ask yourself, ‘How can my organization benefit from organized crime?’

(My thanks to Marc Goodman for providing the framework for this post. For Marc’s full article please see the November 2011 issue of the Harvard Business Review).

How to Say Thank You in Chinese

In China it is customary to thank someone for a gift seven times-Wow! That’s a lot of thanking.

November is a great month to hear about successful thank you tools at work in the nonprofit world. But what if you are just a start up with a few employees, NO budget for a video or a splashy thank you card, and not yet set up to capture potential donors with social media?

There are some very effective ways to thank donors that are low cost and high impact. Some may even be considered ‘old school’, but are refreshing to donors because they are not practiced much anymore.

So, let’s go back to the Chinese practice of thanking someone for a gift seven times. Every time I mention this is at a presentation or to a client the immediate reaction is ‘NO WAY, I don’t have time for that and it would annoy my donors’. BUT, let’s consider what thanking someone seven times really looks like.

Your organization has received a donation in the mail.

          1)  Make a phone call. Call your donor and leave a message on their voicemail thanking them for the donation and how it will be used. For example:

‘Hi John. Thank you so much for your generous donation to XYZ. We are excited to put your gift toward the expansion of our furry puppy rescue program. Thank you for making XYZ a priority for your personal giving.’

            This takes about 15 seconds and will make your donor feel very special.

2)     Send a letter. The IRS requires this and a great opportunity to give a bit more information about how many furry puppies John’s gift will help.

3)   Send an Email. Make a note on your calendar to send John an email midway through the year (think of this as the mid grant report that you would send to foundation funders) with a quick update about the affect of his gift on your furry puppy rescue program. This doesn’t have to be long, just informative to John. Be sure to mention any future plans for the program that may be of interest.

4)   Newsletter. John, and all of your donors will be mentioned in your annual newsletter and/or annual report. If possible, attach a Post-it note with ‘John-Thanks for providing care for furry puppies’. If you email your newsletter, make sure to thank John in the subject line.

5)    Send a card. Send a birthday, holiday, Mother’s or Father’s Day, or a card if there is a day/month of the year dedicated to your cause.

6)   Newspaper article. At some point during the year your organization will probably have some press worthy activity or point of view. Make a point of copying this article and attaching a Post-it note thanking your donor again for his gift. You are keeping your donor informed of the developments within the organization, which will be appreciated. To cut down on mailing costs email the article to your donor with a subject line like ‘ Hi John- See how your gift has helped Furry Puppy Rescue succeed!’ Needless to say, this is NOT recommended for negative press articles (kind of goes without saying).

7)   Send an invitation. Eventually there will be a party or event for your organization. Write a handwritten note on the invitation for John thanking him for his support with the addition of either looking forward to seeing him again or looking forward to meeting him in person. These invitations can also be emailed, but impact and response rates are typically greater with a mailed invitation.

Here we have seven painless ways to thank and acknowledge donors. It is surprisingly easy, part of a healthy stewardship program and keeps your organization top of mind for your donor. If your donors feel respected and well informed they are likely to give again. Setting up a stewardship calendar will help your organization to manage your stewardship program.

Wishing all the best in your fundraising endeavors!

Program and Development staff: Together at Last!

Are you a member of a development office that is fully integrated into your organization, and part of programming and long range planning meetings? If so, congratulations and read no further, this article is not meant for you. This article is for the vast majority of development staff who has a back office and is expected to conjure up the funds to run your organization’s programs. 

Why is integrating programming and development staff so important? Brian Reich in his newest book, Shift and Reset: Strategies for Addressing Serious Issues in a Connected Society, gets to the heart of the matter, ‘Funders want wins, not tries.’ The funding world is competitive. Organizations need to solicit fresh perspectives and to create a holistic and organic approach to serving their mission most effectively. Breaking down internal silos and promoting partnerships between departments allows for a freer exchange of ideas and a better understanding of the larger issues that impact an organization’s sustainability.

So rather than focusing on WHY this trend is so prevalent, let’s focus on HOW to better integrate the development and programming functions. Typically, development staff intersects with program staff at events and at meetings with major donors. More frequent contact and communication between development and program staff members will help to create a more efficient and targeted organization. The goal is to create a true partnership between the program and development functions. Here are some ideas to create a better-integrated organization (and make your job easier!)

-Share: Invite program staff to a development meeting to discusses current and prospective grants and current trends in funding. Likewise, request that development staff be present in program planning meetings. Synergies are likely to arise between funding opportunities and program direction.

-Involve: When writing grant proposals, ask program staff for their comments about the need and efficacy of the program. They will feel more involved and therefore more invested in the outcome of the proposal.

-Communicate: The development department can help program staff develop better programs. Ask program staff members for their opinion about what could be better executed within a program. In many instances funders are able to suggest partners to enhance program execution or consultants to assist with organizational structure.

-Set a Time Limit: Everyone is busy and overworked, so set a limit of 30-45 minutes for all meetings. Include an agenda with time limits on each section. Any in depth follow up can be done by email.

-Serve Food: A sure fire way to get high attendance at meetings.

The programming and development functions are interdependent and need each other to survive. More effective communication and an open forum for the sharing of ideas will create a healthier and more vibrant organization, and will make your job substantially more enjoyable.