Performing Arts –– Why is Marketing More Important than Fundraising?

Working with performing arts clients, I frequently observe a competitive tension between the marketing and development departments. Instead of an esprit de corps, I see yin and yang. If these two departments can’t play in the sandbox together, it will eventually show up at the board level–and even more disastrously, at the donor and patron level.

So what’s causing the rift? It’s largely due to the finite resources available in these

organizations, coupled with the sizeable growth goals each department is tasked to achieve. The problem with this “us versus them” attitude is that it hurts the organization, deeply, and it’s absolutely avoidable.

Many institutions choose the wrong course. To avoid the pain, they place marketing as the alpha and development second in command, sacrificing contributed revenue opportunities and strategies for a perceived increase in ticket sales. This eventually chokes off both efforts. But how can the relationship be synergistic when the goals for each department are so aggressive?

Step one: understand and accept the balance between the two departments and create a productive environment that helps both thrive.

The ticket buyer is not the primary customer; the other department is the primary customer. You’re both in the “acquire, retain, upgrade” business, right? The development office should keep in mind the large majority of donors are also ticket buyers, and should therefore greatly respect the marketing process.

Step two: acknowledge that marketing’s success is also development’s success.

Marketing has to be focused in the proper area – namely, subscriber growth.  If the marketing department successfully creates a pathway for patrons – from single ticket buyer, to a multi-ticket buyer, to a subscriber, then they are creating patrons. Patrons, who are not only good for frequent concert attendance, but also good for making philanthropic contributions. Once converted to a donor, we know that the value of a patron increases, as does their lifetime value. 

Step three: acknowledge that development’s success is also marketing’s success.

So, when do we convert a subscriber into a donor? While conventional wisdom says three years, RSC rejects that premise; we find it most effective to convert them almost immediately. Since a new subscriber has not fully defined their role, it becomes paramount to get an entry-level gift right away. This allows your organization to tell its story from the very beginning of the patron relationship and to reinforce it over time. By starting early, you’re able to share your mission and worth, and turn what would otherwise be purely an ‘entertainment option’ into a highly-valued, prized organization, worthy of support. 

If marketing and development want a harmonious relationship, they must look at each other as their single largest customer. Then, together, they can accomplish their larger mission: serving their community.

RSC can help integrate your organization’s development and marketing planning strategies to build a successful fundraising program. If you would like to learn more about how RSC successfully helps arts and cultural organizations reach their fundraising goals, call us at 317.300.4443 or visit our website.

Have You Reached Your Limit?

A recent television commercial boasts, “More is better. We want more!”.  Arts and cultural organizations have meditated on this mantra for years – they can always use “more.” More money. More staff. More donors. More everything. But, can there be too much of a good thing? In some cases, RSC says, “yes”.  Take, for instance, the tenure of a board member and the idea of term limits.

What -- No Bait Left?

Successful non-profit boards and staffs build their fundraising programs through “relationship-based” fundraising. Simply put, it’s about asking people who you actually know to support the organization.  When done correctly, it provides very effective fundraising leverage. The down side is that each board member has a finite number of relationships – the “black book” is only so thick. In the long run, the less your organization rotates board members, the fewer new relationships you’ll have over time – and your fundraising efforts will certainly suffer.

For that reason alone, your organization should exercise term limits on its board. Loyal and active board members sometimes balk at this idea, but RSC’s conclusion is that a board member serving 20+ years has likely tapped his/her community connections – and the well of new names ran dry years ago. So, exercising term limits to make room for new relationships becomes essential.

Your fundraising isn’t the only thing to suffer. Good governance is also at risk. Each board member comes with a limited set of views, ideas and solutions. A mix of seasoned and fresh perspectives is a great recipe for creative problem solving and relationship building – but quickly gets stale when the board doesn’t change.

RSC believes successful nonprofits are aligned with their community’s needs. One way to build that continuity is to expand the board in a way that allows a variety of people (with a variety of community backgrounds) to serve. Over time, allowing this broader group to own the ‘organizational mission’ creates more stewards and caretakers throughout the community. More ownership means more buy-in. More problem-solving. More support.

Is there a downside to enforcing term limits? Perhaps – but there are also plenty of opportunities, too.  Institutional history is a valuable resource – so keep it! Just because someone is rotating off of the board doesn’t mean they have to rotate out of the organization. Keep them engaged in an advisory capacity as your organization looks to the future. They have an emotional connection that inspires others. Channel that dedication by implementing a succession plan that engages these long time supporters in new ways. Create an advisory board to keep long-time members engaged. Put them on a committee or a task force.  Just create an engagement strategy for those who want to be engaged beyond board leadership.

If your board does not have or exercise its term limits, ask “why not?” Start the conversation in your governance/nominating committee meetings. Research and outline the important reasons for change. Determine an adequate board size and build a strategy to reach your organization’s goals over the next few years. Be sure to develop and nurture a quality board volunteer experience that also benefits your organization. The board should always lead this conversation – not the staff.

Change can be uncomfortable and it takes time, so take the long view. When bringing on new board members, invest in their learning curve, even if it doesn’t feel efficient at first. Building productive momentum takes time, but the payoff is meaningful – organizational sustainability and broader ownership of stakeholders.

During any board transition, a thoughtful process is needed – and RSC can help. When done correctly, your board members will be happy and productive, even as their role changes and matures. New supporters are eager to be engaged as volunteers, and over the years, new energy permeates and strengthens the entire organization.

Healthy leadership. Healthy organization. Sustainable future. There’s no limit!

RSC Launches Fundraising Educational Video Series for Non-Profit Organizations

Scott Giffen, cfre

Indianapolis – Robert Swaney Consulting, Inc. (RSC) has released the video series, “RSC: Arts Fundraising / Engaging and Keeping Partners”, available to the public free of charge, and accessible via Youtube. Featuring RSC Senior Consultant (and certified fundraising executive) Scott Giffen, the series captures excerpts from a workshop generously sponsored by the Missouri Arts Council and presented to local arts leaders in Springfield, Missouri. Aimed to provide “best practices” related to non-profit fundraising, RSC’s seven-part video series focuses on various sub-topics ranging from the 'Components of the Right Ask', 'Ask Techniques' and 'Thanking Your Donors'.
 
“Scott did a terrific job with his presentation that reinforces some very basic but very important principles of fundraising,” states RSC Founder and CEO Robert Swaney, “and RSC is pleased to make these videos available to a global audience. RSC is committed to helping non-profit organizations improve their contributed revenue growth results and we therefore trust that this new video resource proves valuable to those organizations.”

“RSC: Arts Fundraising / Engaging and Keeping Partners” is available via Youtube.com and can be accessed by clicking here to begin the first video, or search “RSC Giffen” in the Youtube search bar.

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Established in 2006, Robert Swaney Consulting (RSC) is a national provider of contributed revenue growth strategies and hands-on interim management for arts and cultural institutions. The firm has offices in Indiana, Missouri and Georgia.

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The Fiscal Cliff Deal and Your Non-Profit: Moving Forward with Practical Advice and Action

contributing writing by RSC Senior Consultant Jeremy Hatch, cfre

Welcome to 2013! Less than a week into the New Year and already our world is changing with some mixed news from 

Your Donors Can Make It!

Congress. Over the past few months, many RSC clients (along with board members, volunteers and donors) have expressed concern and fear about changes to tax law in 2013.  Some donors have stated that they will likely not be able to give with the same fervor as they once did because of the impending changes. 

Before donor-paralysis sets in, let’s look at what we know so far, based on the agreement passed by Congress on January 1:

• Tax deductibility of charitable gifts: The agreement does not include (as feared by many) any “across the board” limit or cap on the deductibility of charitable gifts for 2013 but rather places a cap on itemized deductions for some families earning more than $300,000 per year, or some individuals earning more than $250,000 per year. It is a somewhat complex calculation but shouldn’t have a significant impact on the vast majority of our donors.  click here for an excellent sample scenario, provided by the League of American Orchestras. 

• IRA Charitable Rollover continues for 2013: In happier news for the non-profit community, this popular giving vehicle has been reinstated and allows donors who are 70 ½ or older the option to make charitable gifts directly from IRA accounts. The measure is retroactive to 2012 (giving donors the opportunity to make a 2012 gift via this vehicle if completed by January 31, 2013).

Most non-profit organizations are asking about what these changes mean.  How should you prepare, react and respond?  Is your current Annual Fund program affected?  What about planned gifts?

In response, RSC says, “Slow down, take a breath and initiate some practical steps that will encourage your donors to continue being generous:

• Step #1—Stay the course. There may be bigger changes ahead in future years with our tax code, but for 2013 the tax benefit is unchanged for the vast majority of your donors and prospects. It is vitally important to stick to your solicitation plan and calendar. The development committee needs to keep focused and your direct response plans should proceed without delay.

• Step #2—Communicate the facts to your board and volunteers: Let your key volunteers and solicitors (especially those who expressed concern last fall) know about these changes and coach them through talking about the issues with prospects and donors.   

• Step #3—Communicate with your donors: The IRA rollover has proven very popular in recent years as a giving vehicle. Strategize internally about prospects who might be a good fit for this opportunity (older donors with pending major gift pledge payments, etc.) and consider a custom communication in the coming weeks and months to market this opportunity.

• Step #4—Make it personal:  For a small percentage of our donors and prospects, this situation might be a disincentive to invest in your non-profit’s good work. This is all the more reason to cultivate donors personally via peer-to-peer activity. If one of your key donors has slightly less to give away in 2013, you had better realize they will make a meaningful investment where they feel best connected, most appreciated, and personally invested. Make sure it is to you.

• Step #5—Stay engaged with RSC:  Growing your fundraising capacity for arts and cultural organizations is our business, regardless of the external factors. We can offer strategies, counsel and practical advice. Together we can make 2013 your year to achieve Fundraising Growth Now!

RSC believes that one key to success is to continue communicating with your patrons in times of celebration, success, struggle or uncertainty.  Mailing information can be helpful, but personally reaching out and talking with your most vested stakeholders is paramount.  Always be ready to encourage them to continue their support and always direct them to their financial advisor to deal with specific situations.  If you haven’t reached out to your patrons regarding the tax changes, do it today.

Tasking Your Development Committee Without Pain or Panic

contributing writing by RSC Senior Consultant Jeremy Hatch, cfre

Your season is launched, your direct mail campaign is underway, sponsorship is at a post recession high and renewals are coming along. What’s next?

 

It’s time to task your development committee for year-end fundraising success.

Before we get ahead of ourselves and send our highly-valued board-level volunteers out into the community to promote our good work, let’s pause for a moment to help your organization avoid a lot of pain and panic by first examining a short list of what a Development Committee is not (or shouldn’t be) and what it is (or should be).

Your Development Committee...

IS NOT:

A group that meets monthly, forevermore, to throw around names, eat the bagels, and talk about things that have no immediate effect —“We can approach Mr. Smith after the divorce finalizes and once the leveraged buy-out is approved. In 2018.”  Too little.  Too late.

IS:

Focused on specific prospects for this year with the urgency of a fixed deadline (year-end, before Thanksgiving, in time for the school series) and aimed at prospects with whom volunteers personally know and can ask for support.

IS NOT:

Responsible for direct mail solicitation copy. Give ten earnest volunteers the opportunity to edit your solicitation letter and you will have yourself ten rounds of edits and a month long delay getting our the renewals...and still no peer-to-peer follow-up calls.

IS:

Coached by staff to articulate in a personal way the mission of your organization. Not everyone is a natural salesperson but all volunteers can open doors and facilitate relationships -- which is a highly-valued and irreplaceable asset.

IS NOT:

A reactive group evaluating and / or criticizing the Development staff’s efforts and plans, after the fact.

IS:

In partnership with staff to make specific financial asks to prospects. This is a challenge for volunteers everywhere. Too often our volunteers want to send an email or plan to chat up their prospects in a casual setting.  The "partnership" approach is well-planned, more thoughtful, more focused and more personal.

As a successful board-level volunteer who is focused on fundraising results, you need to:

• Be Prepared:  Know your prospect (don't just "take a name") and then study what you can about   him / her.  What this giving history?  What's this year's target?  Does s/he give to other places?  Does s/he make gifts through a family foundation?  Is there a special affinity for giving, such as education and outreach?  Let the staff help you by preparing you with as much background information as they have available and then prepare for your call.

• Be Comfortable and Confident:  You are representing a dynamic organization worthy of investment.  Your organization is likely a great "sell".

• Be Yourself:  Tell the organization’s story in your own words. Make the prospect comfortable. Tell a funny story about your first opera experience or the time you tried to lead the audience in wild applause between movements Mahler's Symphony No. 3.  You don't have to be an expert in the arts field, you just have to be yourself -- one person talking to another about why supporting a community treasure is important.

• Be Engaging:  Don’t make the meeting about the written proposal or pledge card. Instead, engage in a personal conversation about an organization that is important to you.  Ask good questions and listen carefully to what the prospect is saying.  Why don't we simply send a direct mail piece?  Because we want you to have a real conversation.

• Be Specific: in your request for the gift and with any related points and / or follow-ups.

• Be Purposeful:  It is most important that a volunteer approach this work as seriously as you would your own business.  The meeting can have lighthearted moments, but always remember that securing contributed revenue is most often the lifeblood of the organization you are representing.  Your success is therefore vital to the organization.

Asking for money is serious business -- but it shouldn't incite panic or induce pain.  If your organization believes in the power of peer-to-peer, relationship-based, leadership fundraising, but struggles with fully engaging your volunteers, click here to contact RSC for information about how we can support your important work.  We would be happy to help you – and your volunteers – achieve Fundraising Growth Now!