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Growing Revenue Despite a Declining Donor File
How One Nonprofit Reached 18% YOY Growth in Three Years
Mark Publow, CFRENicole Pena, Phoenix Rescue Mission
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• Revenue was soft but we weren’t sure why
• Program budgets were expanding but were not accompanied by clear plan for growing revenue
• We were repeating the same fundraising program but seeing diminishing results
• As a result, the financial picture was not good— No cash reserves— Assuming new debt— Total funding to program was declining
Anatomy of the Challenge
Fiscal YearTotal Cash
Contributions Revenue
% Variance
Active 12 mo. donor count % Variance Gift Count %
Variance
FY2011 $8,089,389 NA 44,299 NA
FY2012 $7,399,654 -8.5% 40,213 -9.2% 94,677
FY2013 $7,196,235 -2.7% 37,760 -6.1% 89,552 -5.4%
FY2014 $7,535,102 4.7% 32,751 -13.3% 81,262 -9.3%
FY2015 $8,885,976 17.9% 32,583 -0.5% 84,985 4.6%
Fiscal Year
Donor retention rate
LYBUNT 12
monthsAverage Gift % Variance
Average Donor Giving
Per Year%
Variance
FY2011 63% 16,422 NA $182.61
FY2012 51% 19,436 $ 79.46 $184.01 0.8%
FY2013 59% 15,206 $ 80.36 1.1% $190.58 3.6%
FY2014 54% 14,972 $ 92.72 15.4% $230.07 20.7%
FY2015 64% 11,105 $ 104.56 12.8% $272.72 18.5%
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Architecture of a TurnaroundFour Strategic “Shifts”
A. Shifting from Data Entry to Data OptimizationB. Shifting from Reporting to AnalyticsC. Shifting our Donor MessagingD. Shifting to a High Performance Ecosystem
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Shifting from Data Entry to Data Optimization
Database - The initial problem
• Reports out of RE were not only difficult to set up, but data did not make sense or sometimes did not yeild the same results.
• There had been no real thought (strategic intent) behind how data input into RE had been both structured and maintained, over many years.
Database - The Ah-Ha Moment
• We needed to see the big picture, not so much what were doing, as where we need to be.
• We need to focus on what we want to get out of RE (meaningful reports and dashboards) as a driver for how we input data.
Database - The initial problem
• Reports out of RE were not only difficult to set up, but data did not make sense or sometimes did not yeild the same results.
• There had been no real thought (strategic intent) behind how data input into RE had been both structured and maintained, over many years.
Three Key Streams
• The “did not givers” (LYBUNT) 19,000 people for a loss of 1.4 million in revenue
• The “do not mailers” (complained, overreacted, dead?) - 15,000 marked DNM in 2011
• The “we have no cluers” (matching gift companies, churches, businesses, volunteers – people in the database that were seeking us out )
Database - Discovery• Using the right codes for the wrong reasons
• Seven different ways, in three different places to say “do not mail” in the database
• Solicitation codes: we weren’t sure how to use
• Attribute codes: were used for too many areas
• Constituency codes: were being ignored
• Our direct mail numbers were decreasing precipitously
Database – Course of Action• Brainstormed what we believed were the ‘best’ categories or
descriptions for Solicitation codes, Attribute codes and Constituency codes.
• Sought a Blackbaud consultant to ensure we were doing the right things.
• Updated all of our data for SC’s, AC’s and CC’s (going back one prior year)
• Mailed all of our “do not mailers” with a questionnaire. • Mailed all of our LYBNT’s with an appeal. • Cleaned up our mailing file query. • Began placing constituents into mailing groups to test our
segmentation strategy
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Shifting from Reporting to Analytics
JuneJuly
August
Septem
ber
October
November
December
January
February
March
AprilMay June
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
LYBUNT by Month (Rolling 12 Month Total Each Month)
FY12FY13FY14FY15FY16
LYBU
NT
Dono
rs
Analytics - Course of Action• Determined Key Performance Indicators (KPIs) we would use
• Long-term Donor Value• Net Yield• Average Gift / Gift Frequency• Retention
• Pushed analytics to the forefront of discussions with marketing agency partner(s)• Attempted to push to analytics-led strategy … an uphill
climb• Developed more sophisticated internal reporting and for the
first time internal analytics• Identified (and sourced) external analytics resources / tools
Thanksgiving Appeals FY15 (YTD) - FY14 (12/12/14 data)
FY15 Appeal#
MailedFY15
% RespFY15
Ag GiftFY15 Net Revenue FY14 Appeal
# Mailed
FY14 % Resp
FY14 Ag Gift
FY14 Net Revenue
Thanksgiving Placemat 33,946 9.50% $56.54 $162,458 Thanksgiving 56,232 6.20% $57.58 $161,521
Thanksgiving MSMT 24,344 15.50% $49.61 $167,053 Thanksgiving F/U 56,232 4.50% $49.04 $102,882
Thanks Last Chance 26,655 5.80% $48.27 $56,506 Thanks Women + Kids 55,739 4.20% $41.20 $71,856
TOTAL (YTD) 84,945 $386,017 TOTAL 168,203 $336,259
Note: 590 of 3,766 gifts to MSMT were multiple gifts from the same donor (15.67%) - generally giving the same amount 2xNote: Mailed 49.5% fewer pieces in FY15 and generated 14.8% MORE net revenue to date (appeals still generating revenue)
Analytics – One Example of Change
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Shifting our Donor Messaging
Shifting Our Donor Message
The Challenge
• “Appeal of the Month” approach
• Appeal content was not localized (syndication program)
• Program services underwent dramatic change but marketing program still based on “old” message• Changing Lives Center – dramatic shift from serving
homeless men primarily with addition of a large center serving homeless women and children
Course of Action
• Shifted from Appeal of the Month to 4 Campaigns per year
• To boost retention, restructured newsletter• Brought writing in-house• Shifted from 5-6 newsletters per year to monthly• Expanded monthly mailing of newsletters to include
volunteers, gift-in-kind donors and deeper lapsed
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Shifting to a High Performance Ecosystem
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• Who are your key stakeholders – internal and external?
• How do you build performance that leads to results?
• Creating a healthy and generative ecosystem
High Performance Ecosystem
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• Development staff
• Program staff / partners
• CEO, CFO & Board
• Vendor Partners
• Engaged donors & volunteers
Key Stakeholders
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Results• Increased fundraising despite decline in file size• Created operating reserves; discontinued bank LOC• Established and raised $ for endowment (first-time)• Shifted slowest FR season of the year (summer) to high
performance• Tested and refined story-driven messaging to a variety of
segments• Increased Net Yield to Program by at least 8% a year each
year• Decreased total FR costs by at least 1% a year each year
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Mark Publow, CDO
https://www.facebook.com/phoenixrescuemission/@phxmission
Nicole Pena, Director of Marketing & Public RelationsPhoenix Rescue Mission
Growing Revenue Despite a Declining Donor File
