Know the Donor, Be the Donor: Engagement Fundraising with Greg Warner, Part 2 : Successful Nonprofits

Episode 113

Know the Donor, Be the Donor: Engagement Fundraising with Greg Warner, Part 2

Listen on  iTunes    Android     Stitcher  Libsyn

Episode 113

Know the Donor, Be the Donor: Engagement Fundraising with Greg Warner, Part 2

Listen on  iTunes    Android     Stitcher  Libsyn

by goldenburggroup

Can spam. (Even though, legally, you don’t have to.)

Greg Warner, author of Engagement Fundraising: How to Raise More Money for Less in the 21st Century, returns, and once again, it’s a no-holds-barred conversation! In this episode, Dolph and Greg discuss what engagement fundraising really means, and why it’s a live-or-die proposition for nonprofits today.

*****Timestamped Highlights*****

(4:55) Everyone has his or her own cartoon
(7:05) Show ‘em that you know ‘em!
(8:45) 193 out of 30,000
(9:03) Stupid simple
(10:24) Ya gotta dance
(14:05) If I finally make it in business, I want to be with a company that has smart in the name.

Nonprofits have to have a giving mindset. They have to give to their donors.

(16:40) Look Mom!
(20:03) The post-sell
(24:25) Holy crap! Holy cow! (No bleeps needed this time.)
(30:33) The Milgram Experiment
(33:52) You know what they think? Screw you!

Links:

Greg’s site: www.imarketsmart.com
Engagement Fundraising: How to Raise More Money for Less in the 21st Century
Free fundraising report card: www.FundraisingReportCard.com
Greg’s Engagement Fundraising Podcast 
Greg’s Metrics That Matter Podcast
(Episode) How Greg Built His Fundraising Consultancy


Read the Transcript for Episode 113 Below or Click Here!

Transcript

Episode 113 – Know the Donor, Be the Donor: Engagement Fundraising with Greg Warner, Part 2

I feel awesome.
I’m an awesome person.
I’m finding meaning in my life.
I’m going to live on after my lifetime.
My kids think I’m awesome.
Everything is great.
(That’s what the donor wants.)

Dolph Goldenburg: Welcome to the Successful Nonprofits™ Podcast. I’m your host Dolph Goldenburg. You may recall that last week we spoke with Greg Warner. It was an energetic, lively, and important conversation. We started to talk about engagement fundraising because that’s the book that he’s the author of, Engagement Fundraising. Then, we went over and talked some about boards and board development and then, of course, talked about marketing and branding. It was an incredible episode, but I have to share with you we were going overtime on that episode. Thankfully, Greg had a few extra minutes for us to do an additional episode, so think of this as a whole other segment with Greg Warner. I know that you are really going to enjoy it. Let me first just remind you that Greg Warner is the author of Engagement Fundraising, an incredible book. I read it, and when I was reading it, I knew that I had to have him on our podcast because he can help people figure out how to raise more money in less time and with less money. So, if you want to spend less in terms of money and time and raise more money, this is the episode for you. Now, if you did not hear last week’s, go back and listen to last week’s as well. Just like last week, Greg brings so much gold that we’re scrapping the mid-point break. We’re just going to talk until we’re almost out of time and hopefully, have time to ask them to Off-the-Map question, and then we’ll say goodbye to everybody. So, let’s cue the music and welcome Greg Warner.

Hey Greg, welcome back to the podcast.

Greg Warner: What’s up man? It’s not often that people like, invite me back anywhere. So, thank you.

Dolph Goldenburg: One of the great things about podcast time is while these two episodes are separated by a week, it probably just feels like it’s only minutes to us.

Greg Warner: It’s a time warp. It’s amazing. You’re a technologist, a wizard. Thank you.

Dolph Goldenburg: Yeah, that’s what I love about podcast time. It’s truly incredible.

I wanted to make sure that we had time to do a deep dive on engagement fundraising, and as we were wrapping up in the last episode, we were really just starting to talk about how it’s really creating those relationships with your donors and really starting to develop impact. So, let’s do that deep dive.

In this day and age where every donor gets a ton of emails, a ton of regular mail, and some of [these nonprofits] even get texts, you know, solicitations. How does the nonprofit communication rise above that loud roar?

Greg Warner: Yeah. Okay. So, this is simple yet sophisticated. It’s actually not complex. It’s just sophisticated. Who was it? Confucius said, “Simplicity is the ultimate, but everybody makes it more complicated than it needs to be.” Anyway, he didn’t say it like that. I’m from New Jersey. I say it differently. What I mean when I say it’s simple is every donor is different. Every donor is different. Even a husband, a wife, a husband, a husband, a couple, you know, it doesn’t matter. They’re all different. We’re living in a world where people want to be treated like individuals, and you just have to treat them that way if you really want to grow, build, scale, deliver value, okay? Now, the companies that do this, the companies that do this, and don’t take it from me. I mean it’s right in front of you.

In fact, it arrives at your doorstep every day. You get an Amazon box with a nice smile on a box, and you know, what did you do? You went in there. You logged on. They know exactly who you are, what you like. You’re going to start looking for something. They’re going to give you 15 recommendations that work for you. Okay? There’s another one that’s a humongous company, grew really, really fast, really fast, and that’s Netflix, right? They’re not worried about personas, and like when you go to buy your wealth data, you know, there’s the glorious givers or the soccer mom mommies nonsense. I mean, you can’t target people. It’s not about targeting. It’s about one-to-one relationships. So, Netflix, how do they do this? Well, they started out with personas and all that stuff, but it didn’t work.

So, what do they do? Now, you log in. Well, you got your little cartoons, you know, wife or husband has a cartoon, and then their kids have a cartoon, right? You log in because if you log into the wrong one, you’re going to get all the stuff that you don’t want. It doesn’t feel good. There’s no value there when it’s not the right stuff. So, those are just two lessons of companies that are doing it right talking one-to-one, but now here’s something different, a different wrinkle that’s very different because that’s all transactional. You get a movie. Done. You buy toilet paper on Amazon. Done. It’s all transactional. The difference in fundraising, especially where 80 percent of your revenue is going to come from, which is major gifts and legacy gifts, is that there is a consideration process that is involved in that decision.

People don’t actually want to be thanked. What they really want is to feel good.

It’s slow sometimes over many years, even many decades, sometimes a little bit faster, so you have to take this individuality that I’m talking about, and then you have to sort of cross hatch it. I talk about it in a book. I make it like a Rubik’s cube, but you have to crosshatch that with the consideration continuum. So, when you know a person (who they are, why they care, how, who they want to be, how they want to find meaning in their life, what they want to get, what’s the value they want to get in exchange for their money) but then cross hatch that with where they reside in the consideration process, then you can start to think about engagement offers that will appeal to people. There’s going to be very few that are in the position of ready to take action, but there will be a lot more that are in either the desire stage and then (as you get further out) to the interest. And in the awareness stage, there’s going to be more and more in each of those buckets.

You have to understand that, and you have to monitor, especially again for major gifts and legacy gifts, you have to monitor and understand who these people are at each stage of the consideration process and then show them that you know them like Netflix and Amazon do if you really want to massively increase your revenue from major and legacy gifts. It’s funny because I’ve looked at some data and like there’s one organization we were looking at. It’s 190 people make up 93 percent of all their revenue. 190 people.

Dolph Goldenburg: So, how big is this organization’s budget?

Greg Warner: 30,000 donors. 30,000.

Dolph Goldenburg: Wow! So, 193 people. So, really less than one 10th of one percent.

Greg Warner: Yeah. We see that all the time. I mean, in general, when you bring it down though, generally it’s about 10 percent of the revenue that comes from probably like 95 percent of the donors.

Dolph Goldenburg: I think it’s kind of common, but to be a fraction of a percentage. Wow.

Greg Warner: You know what they’ve really cultivated relationships with those people. So, I just say, “Well, why don’t we go get another 190? I mean you got 30,000 in your list. We can go double that, and then you’ll double your revenue almost.” Then they’re like, “Well gee, well, but we’ve got this direct mail that we’re doing and…” Hold on. What’s the return on all that direct mail? I’m not talking about the returns of the junk that goes to the wrong addresses. What’s your ROI? They respond, “Whoa, we’re lucky if we break even sometimes you know.” [inaudible] That’s not doing that good.

Dolph Goldenburg: So, how do you look through a stack of almost 30,000 other donors and figure out which ones are likely to join the ranks of the 193 major donors?

Greg Warner: Brilliant question, brilliant, love it.

Dolph Goldenburg: Well, it’s a softball, but it’s the question that every executive director, development director and board member listening right now is asking, “Well, how do I do that?”

Greg Warner: It’s so simple. You ready? It’s stupid simple. You ask your donors, you survey them, you survey them. I wrote an eBook. It’s on our website. If you go into the resources, it’s How to Create a Donor Survey, right? Because unfortunately, everybody that ever says to us, they’re not going to work with us. Then they say, “Well, we’re going to do it on our own.” They screw it up. They screw it up because they get the communications department involved and then the PR department and then some lawyer. No, you got to understand the purpose of what you’re really doing. So, if your purpose is to generate a funnel, a pipeline, understand each donor and where they reside in the consideration continuum, you definitely do not want your PR or communications person in there. You need to understand exactly what you’re doing and keep them the hell out of it.

Pictures are powerful. Video too. There’s no better way to get emotion out of people.

Okay, so I wrote the eBooks on this to help people out, or you can just buy from us, of course. Not everybody wants to do that. They should. They should. It works. It works every time. Step number one, survey people.

Dolph Goldenburg: What types of questions are in that survey that help you figure out where your next 193 major donors are coming from?

Greg Warner: Well, first, don’t ask the money question right away. People often will be like… you got to dance. You got to dance. Everything about engagement fundraising is being empathetic and making people feel good. So, put yourself in their shoes. Do you want the first question to be like, how much are you going to give next year? That’s not nice. Come on. So, what you got to do is you’ve got to ask them about themselves.

It’s like when you go on a date or you meet someone at a dinner party. You’re not going to be like, you want to get married? That’s not what you do. You start with, what are your interests? What do you like to do? What are you trying to do with your life? What are, what are your goals? What are you, what are you trying to get out of this? You know, things like that. So, you ask them about themselves. How did you first become connected with us? Why? Was there somebody that influenced you? You know, so let’s suppose it’s a college or university. A lot of times we see it’s a professor. If it’s like health care, it’s like a nurse. Then we have a dropdown. It’s like, okay, what was their name? Woo, that’s important. You know, would you like a reunion with your professor?

You know, are you coming by campus? We could set it up. Do you want to see the old hall? Oh, by the way, you know the hall that you used to go to? It’s in disrepair, not that we need you to fund the development of it, but you know what I mean, but yeah. Then you move gently… Hey, look, you have to treat it like you’re having a real conversation. They used to call this donor discovery. I don’t know if people really do this anymore. It’s very time consuming, tedious and expensive to do it one-to-one, set up all those appointments and meet people and do donor discovery to put them onto a portfolio, [pieceload]. Right? What I’m saying is leverage technology, and print is technology by the way. You could do it with print but send them a survey and ask them questions about themselves.

Once you get them past the ease, give them the easy ones, the layups. Then you can go into the questions usually with a [licher] scale. How likely would you be to get involved with the campaign? How interested would you be in taking a board position? Do you have a donor-advised fund? Would you be likely to give from your donor-advised fund? Do you have a family foundation? Would you be interested in learning about giving assets or property? Are you an entrepreneur? Oh, you’re retired? Okay. That’s interesting to know. Why? You can find out stuff like they just sold their company, so they’re bored and have too much money. Perfect. So, do you understand?

Dolph Goldenburg: Absolutely. I’ll share with you we promised the listeners gold, and Greg, we’ve already delivered. That is gold just right there, but I also share with you that, while I don’t do a lot of fundraising consulting, a client that I worked with on some other projects asked me to help them with a donor survey, and there were some questions they did not want it to survey. For example, if this organization offer the opportunity for you to donate stock, would you be interested? They’re like, “No, no one’s going to donate stock.” I was like, “Well let’s just ask the question. It doesn’t cost us anything, you know, it’s digital. We’re not paying for the print. Let’s just ask the question.” I mean, it was a small percentage, but you know, if five people are donating stock, those are typically not $100 gifts. Those are typically gifts of thousands of dollars.

Greg Warner: Yeah. Well, remember what we talked about just before where it was like X percent of one fraction of a percent that’s making up 93 percent of their revenue. You just got to look at that and say, “Well, hold on. We’re looking for the needle in the haystack.”

Look, dummies. Alright. Fundraising smart people – this is why I called the company iMarketSmart. The reason is because I failed out of business school, and I was like, “Well, if I finally make it in business, I mean I want it to be with a company that has smart in the, in the name.” So, anyway, I digress. If you want to really double revenue, you’re not going to do it by pummeling 30,000 more people. You’re just not going to do it. It’s very expensive. You’re going to pollute the environment, and you’re going to tick a lot of people off. Raise your hand if you really love getting those direct mailers. I’m sorry, but not everybody loves it.

Dolph Goldenburg: As a former fundraiser, I still love getting them because like you know, this is 25 years ago. I would, I would always open them up and if I liked them, they go my sample file. Like, “Oh, that’s really neat. Let me hold onto that.”

Everything about engagement fundraising is being empathetic and making people feel good. Put yourself in their shoes.

Greg Warner: Here. I’m going to show you something because we’re sharing video, and then you’re going to explain or will explain to them. So, I give to a lot of charities, my friend, and I match dollar for dollar every donation that all my employees ever do. Dollar for dollar, right? Well, I want them to feel good about giving because I need them to understand what it feels like to be a donor, and not all of them were giving. So, now they give and are happy to give because they know I’m going to double it. Right? So, that’s good, but it also gets them to see what happens after they donate, you know? Here’s something that my daughter participates in, and after the first gift I ever gave, I got this.

This is pathetic looking. This newsletter I’m showing it to you. Of course, you could describe it. It’s pathetic. It’s printed off a printer. I don’t know about branding. It’s not even folded correctly. Then they write me a note right on the front here, a personal note: Thanks for giving. Right? They’re pointing to somebody. There’s a little girl in that picture you could see.

Dolph Goldenburg: …who’s not her daughter. Let me guess.

Greg Warner: No, that’s my daughter. That’s my daughter. That is my daughter. They took the time to go into the newsletter and put an arrow to show me that my daughter is in their newsletter.

Dolph Goldenburg: That’s impressive.

Greg Warner: Right? Now, these people know how to do it. I mean that. So, what did I do? I sent them more money because they made me feel how? Good. So, now they sent me another one that says happy new year, right near just passed. You know, I’m Jewish.

Dolph Goldenburg: And your daughter is on the cover of the postcard. Wow.

Greg Warner: They gave me a custom postcard with my daughter, a picture of my daughter holding a sign saying, you know, and they put her name on there. It’s Maddie. Yeah.

Dolph Goldenburg: Yeah. And actually had it addressed to her mom, too. She’s holding a sign that says, “Look, mom.” Wow, that’s incredible.

Greg Warner: Am I not gonna give to them? How could I not give to them? I love it.

Dolph Goldenburg: So, it’s funny. One of the things that I say over and over again is whether we are talking digital gifts that come in online or print gifts, we don’t get pictures anymore. So, anytime you’ve got the opportunity to send an actual picture in the United States mail, even though you know it’s as slow the pony express to a donor, we don’t get printed pictures anymore. I’ve actually walked into donors homes and seen printed pictures that I’ve sent them of themselves at an event or at our facility or whatever on their refrigerator or on their home desk. That’s how important they are. They put them somewhere where they’re going to see them.

Begin with a donor survey. Make it like a first date…ask people about themselves.

Greg Warner: Yeah, I mean pictures are powerful. There’s no better way to get emotion out of people and video, too.

Dolph Goldenburg: I have to share with you. I have one former client who a few years ago something happened. As a result of that, like about 300 people all gave in one day to this organization, and then they were kind of surprised that almost none of them ever gave again. And so, my first question was, “Oh, how did you thank them?” The said, “Oh, well they got our standard thank you.” It was not: Oh, thanks so much. You gave because of dot, dot, dot. Let us tell you what we’re going to be doing around this. There was also no follow-up. The reason why they gave is that changed and evolved. In two months, there was no: Hey, two months ago you gave to us because of XYZ and here’s what we’re doing about that now. Then a year later, when you send them an email that says, “Hey, it’s been a year since you made your gift, would you give again?” No, they’ve had no relationship with them.

Greg Warner: So many falsehoods are being thrown out there in this sector. It drives me nuts. This is why I don’t go to those conferences really is that people don’t actually want to be thanked. Okay, this is another one. There’s all the research that shows that people want to be thanked. They want to be thanked of course, if you ask people, should you be thanked? Do you want to be thanked after you give it? Yeah, of course, I want to be thanked, but that’s not what they really want. They want to feel good. Don’t misunderstand. It’s not that they want to be thanked. So, here’s what happens is everybody goes to the conferences and they say, “Okay, well, we got to thank people.” What do they do? They do a half-ass job of thanking, and they’re like, “Well check. We did it. We thanked them.” You didn’t because what they really wanted was to be involved. They wanted to build a relationship. They wanted to find a home that I just showed you with this stuff. They wanted to feel like you know them. They know you. You’re giving, and you’re helping. Something happened. They’re making you feel good in exchange. This is how the relationship works. It’s not you gave, so I gave you a thank you, thumbs up. That’s, bullsh**. That’s not how it works.

Dolph Goldenburg: This is one of the most powerful lines I’ve ever received in a thank you note, and it was something along the lines of (and it was the first gift): When you gave to our organization, you made a good decision. With for-profit sales, that’s known as the post-sale. So, a lot of people have buyer’s remorse. They go, “Oh, should I really have made that $50 or $500 gift?” The first thing you do is you confirm [they] made a good decision. Now, already I’m feeling good about myself. Make them think, “Hey, I’m smart. I made a good decision when I gave to them.” Then, of course, they’re going to tell me why I made a good decision. It only makes me feel better about myself and about them.

Greg Warner: True. I would say they did an okay job, but here’s the real trick. Here’s how you really put on the afterburners. Okay?

Dolph Goldenburg: Tell me more.

Greg Warner: The trick is not to tell people that they did a good job and not to give them the bullet points. The real trick, the real mastery happens – this is part of what we do after the survey, by the way – because the survey’s the very beginning. If all you do is a survey, you’re stupid. Everything happens after the survey when they’re wondering, do I trust them? How are they going to treat me? All this kind of stuff. The real trick though is when you can get people to talk to themselves about why it was a good decision, and no salesperson can tell you that you made a good decision buying the car that you bought.

If they ask you, why do you think you made a good decision? It’s almost another survey. Not a bad idea to send in the mail or saying, “Here are all the reasons why you made a good decision,” but it would be better to say, “Thank you so much for giving. Can you tell us a little bit about why you made that decision?”

Dolph Goldenburg: I totally get it. Yeah. Help people come to that conclusion on their own. Yeah.

Major and legacy gifts involve a consideration continuum. Fine tune engagement with an awareness of where the donor is on that continuum.

Greg Warner: Yeah. When people talk to themselves, this is like when you have a boss. You’re like, she’s never going to do it unless it’s her idea. No sh**. This has been proven in sales 40 years ago, man. All the research, everybody in sales knows this. You can’t make anybody do anything. They have to decide on their own to do it. So, yes, it’s nice to give them that, to show them the proof. We talked about, you know, showing them the impact and telling them, “Yes, you made a good decision.” The real trick is in figuring out how you get them to say to themselves and their friends, especially if they’re major donors because then their friends are all rich, “I made this awesome decision to give to this organization.” It’s not about the giving.

What they’re really saying is, “I feel awesome. I’m an awesome person. I’m finding meaning in my life. I’m going to live on after my lifetime. My kids think I’m awesome. Everything is great. You should do all this, too.” Then, they get their friend to join them, and then they even get the power of the bandwidth, the social influences. They go, “Well now it’s the two of us against the world contributing to this. This is even more fun now that I have my buddy doing it.” That’s awesome. So, you want to get people to do that. The trick is (and this gets back to the real tactics of engagement fundraising) first, you do the survey. You understand why people care, what’s really in their hearts, what’s in their passions, and a little bit about why or how they might want to give. You got to ask them, “Where are you in the consideration process for each of these or some of these are any of these?”

You got to get this crosshatch, like I call it with the Rubik’s cube, and then you’ve got to understand that. That’s the beginning because you have to take that information, and let’s suppose you do a survey for a thousand people, 10,000, $100,000 doesn’t matter. Then you start carving it up. Let’s suppose it was 1,000 people. Then you got five donors who care, who said that they might be interested in giving real estate. Three of them want to stay in their home for the rest of their lives. Now, you got five leads thinking about giving you real estate, and two of them say they’re considering it right now, one that wants to stay in their home and one that doesn’t. The others are not really ready, so you’re going to want to send them maybe an offer for a free report or a cutout from an article in New York Times explaining why this is such a good idea.

Explain on and on. That’s for the people that are not quite ready. You understand you’ve got to cultivate that. The people, the two that I just explained already, well, one of them wants to stay in her home for the rest of her life. She thinks it’s a good idea, but she’s thinking, “I’m not going to do this because I want to stay in my home.” Well, she could do a retained life estate. I don’t want to get all complicated with legal stuff, but she’s at that stage where she just didn’t know. So, with a retained life estate, she actually could. She could sign the contract. She could do that. She could get a huge tax break, humongous tax break. She can end up getting checks from the government in addition to social security. Plus, she can get checks like annuity checks from the charity. She can stay in her home for the rest of her life.

Holy Crap! How much would that be worth? Look her home up on Zillow. If you have our dashboard, you’d find this already because it’s all right there. All this that I just told you. All that for those five people? That one? It’s all in our dashboard plug. There’s my software. How much is their home worth? Well, it’s worth 1.4 Million dollars. Holy Cow! She’s been in there for 60 years or something. She’s 84 years old, so she’s going to die soon. This sounds crass. She’s going to die soon, dude. She’s going to die soon. It’s worth whatever. I said one point. $1,300,000. It’s paid off. You only need one of those. Then people are like, “Well, we’re too small. We’re just a thousand. We only have a thousand dollars.” You can’t afford not to do this. You can’t afford not to do it. They think, “No, no, no, no, no. We’re just going to go back and spam everybody.” Okay, good. Treat everybody the same spam. They’re going to be upset, and then you’re going to get the fundraising climate change like I said in the other podcast, and then somebody will kill himself. No, they won’t do it. If you listen to the other podcasts, you’ll see what I’m talking about. Yeah. Okay. Got that? I’m getting hot.

Dolph Goldenburg: I am grinning from ear to ear. That was awesome. That was totally awesome. I totally get what you’re saying. You’ve got to take the data from your survey, and then you’ve got to use that data. So, you know, it’s not an anonymous survey. It’s easy to do a non-anonymous survey even in simple systems Iike Questionpro or Survey Monkey. If you send it out, the emails know through that system, then it tags the email address. They know when the person comes back you can trace them back to each other. That’s a great way to find what I hear you saying is your major donors, your planned givers, your stock givers. You know, it’s a great way to find all of those folks.

Greg Warner: Without a doubt. I mean it works. I’ve been doing this now 10 years. We got all the logos. We got all the customers. It works. It’s just a matter of like, can you get out of the rat race and the hamster wheel of doing it the way you used to do it? That means you just sign a purchase order, and you let somebody go pummel your donors until they bleed. Do you want to do that? Why don’t you let them pummel somebody else’s donors so that they get them mad at that charity, and then those donors [are] engaged properly by you, because you actually show that you care about them. You don’t need 30,000. You only need, like I said before, 193 I think it was for that client. You know, the rich are getting richer and the poor are only getting… and the data shows that the less people are giving.

Amazon and Netflix
offer customized experiences that recognize individuality to their customers.
Do that.

So, what do you do? Do you want to fight that trend? You’re going to fight climate change? You can’t fight it. Well, we can fight it, but you know what I’m saying? The fundraising climate change, though, you can’t fight. It’s just happening. It’s going to happen, and it’s not gonna change. It doesn’t matter how much mail you pummel people with or how many times you spam them. Just because you’re a nonprofit doesn’t mean that you shouldn’t adhere to the CAN-SPAM Act. I say this to people, and they’re like, “What is the CAN-SPAM?” You don’t even know what the law is because you don’t have to adhere to it. Look, you don’t like getting spam, so stop spamming people.

Dolph Goldenburg: I have to say that I think that is the perfect summary as well. When you customize, none of us like to be spammed. When we’re reaching out to people digitally, let’s treat folks the way we want to be treated.

Greg Warner: Yeah, well I don’t beat up the fundraisers. I never beat up the fundraisers. It’s not their fault. Okay, here’s why they pummel people. This was proven like 40 years ago in something called the Milgram Experiment, which you may know about. I mean, I’m the one who reads all this stuff. I’m always interested in this, right? I was trying to figure it out. How is it that a fundraiser can get into a nonprofit and do exactly what they hate to their own donors? They’re eating lunch that day after they hit the spam button, and they’re eating lunch paid for by the donors. How do they do that? Well, the Milgram Experiment explains that, and this experiment was done at Yale University where a person was dressed up in a lab coat like the doctor (authority). They got two students, and they said, “Both of you come in here. Now, you, you’re going to sit in this chair. The other person, you, are going to tie this person to the chair. Now, we’re going to put these electrodes on this person. You see the wires? They go out through the hole into the other room, right? Okay. Just put these… don’t worry about it. We have to do this. Don’t worry. You just have to do it.”

So, they put the electrodes on, and then they go, “Okay, we’re going to go in the other room now. Okay, bye bye, sir. See you later.” They go in the other room, right? The person with the lab coat goes, “Okay. I want you to ask the dude in the other room… I want you to ask this question of him.” Then they asked the question. He gets it wrong, and then the guy in the lab coat goes to the person.

He goes, “Okay, shock them. Press that button. Shock them.” The [test guy] goes, “What are you talking about?” He says, “You must continue. It’s part of the experiment. You must do it. Just press the button. Shock them.” So, he presses the button, and you know what? Every time they press the button. So, then he goes, and he turns the dial from like 1 to 2. Then he goes, “Okay, ask them another question.” He gets it wrong. He responds, “Okay, you hit the button.” The [test guy] is like, “But, but, but…He responds, “No you must hit the button. It’s part of the experiment.” He hits the button. Now, almost all of them get it up to a certain point before they finally refused and said, “I can’t stop.” Sadly, a large percentage of them got it all the way to 10.

Here’s the clincher! The dude in the other room is screaming, begging for them to stop, and the person pressing the button kept looking at the person in authority and saying, “Well, what do you want me to do?” You must do it. It’s part of the experiment. Now, what the person pressing the button didn’t know is that the other student who was tied up was actually an actor. Okay. He didn’t get hurt. Okay. What they were trying to see was how far someone would go simply because authority tells them to do it, and this is what’s happening in the nonprofit sector. Authority says you must continue. Just press that button. Spam them one more time. We need another hundred dollars, and they’re so far removed. They can’t even hear the people screaming. It’s like you were saying when you were talking about direct mail, you don’t know who’s thrown it in the trash. So, if you get a one percent response rate, you think, “Well that’s good.” Well, what about the 99 percent? It’s not good. It’s just not nice.

Dolph Goldenburg: You refer to it as fundraising climate change, and that’s where I think that’s such an accurate term because 40 years ago it was [paint by] numbers. You’re like, okay, we’re going to put together a letter. Here’s, the format all these letters have to take. We’re going to send it out. We know based on this list we’re going to get X percent response. Our net is going to be Y. Okay, you know, push the button. We know what we’re going to get, and the climate has really changed. That’s why I love your term, Fundraising Climate Change.

Greg Warner: Look, the storm clouds have been gathering a long, long time. You know, they’re here. It’s not even like it’s coming. They’re here. You can see it in your own data. If you use my app, go ahead. It’s free. Upload your data, and you’ll see. Your retention rates suck. Even big donors are not coming back. Why? Because they’re not getting value from you. This is the thing. Nonprofits and fundraisers, everybody at a nonprofit has to have a giving mindset. They have to give to their donors. I’ve even heard the leader of a nonprofit say, “They ought to give.” I was like, “Wow, you really think your charity is just amazing, don’t you?” There are like 1.5 million nonprofits in America, not to mention all around the world, and you think these people on your list ought to give? Well, you know what they think? Screw you.

Dolph Goldenburg: So, it’s funny you say this. I actually had a conversation yesterday with a development director of an organization that I have given to regularly, not at a huge level, but you know, the like the thousand-dollar level or something like that. I said, “Well, you know, this is really what motivates me to give. These are the things that I think about.” I kind of also had to say to her, there are a lot of charities out there, and I’m sure you know there are charities out there that you can kind of fit all of these criteria. So, it’s really important to me that when I give to you, it fits all of these criteria. It’s like no one ought to give to me. Maybe everyone should be given to somebody, but no one, you know, it’s not like I as a nonprofit, you know, deserve a donation because I exist.

Greg Warner: No, I mean they’re crazy. If they really feel that way, then why do they sell their lists to each other, their own competition? It’s like, yeah, have at it. What do you… this is lunacy. I would never give my list of my customers to somebody and say, “Go for it.” Mind-boggling.

Dolph Goldenburg: It is absolutely mind-boggling. Greg, I have to tell you, I could talk with you all day long. We batch-record the podcast. So, unfortunately, I’ve got another podcast recording. It starts in 13 minutes. There’s a reason we’re not doing it made point break. We’re not doing the Off-the-Map question with this is this conversation is gold, and I want listeners to get as much food as possible. Let me remind our listeners. In the first episode, we talked about this. You can find Greg at www.imarketsmart.com. Again, put us lowercase I in front of it or an upper case if you want, www.imarketsmart.com. You can get a copy of his book at www.engagementfundraisingbook.com, and check out www.fundraisingreportcard.com. He offers you a gazillion free resources there, but the fundraising report card will actually allow you to put all of your information in and get your own fundraising report card out so you can see how your organization is doing. Hey, Greg, incredible. I know that, while this is the second time you’re on the podcast, this will not, let me repeat, will not be the last time that you’re on the podcast. Thank you so much for joining us.

Greg Warner: Thanks so much for having me.

Dolph Goldenburg: So, listeners, have you been scrubbing the tub while you’ve been listening to this and found yourself without a writing implement to write down those three URLs of Greg’s? Because I know all of our listeners do things so well, I know you have already scrubbed the tub so well that you cannot even scratch the URLs into the soap scum on the tub. No worries. We got you. You will find all of Greg’s information in our show notes at www.successfulnonprofits.com. Now, I always ask, please make sure you rate, review, share the podcast. That’s how this podcast grows. That is our show for this week. I hope you have gained some insight that will help your nonprofit thrive in a competitive environment.

(Disclaimer) I’m not an accountant or attorney, and neither I nor the Successful Nonprofits™ provide tax, legal or accounting advice. This material has been providing for informational purposes only and is not intended or should not be relied on for tax, legal, or accounting advice. Always consult a qualified licensed professional

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