Methodologies

RBKC

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The shock result of June’s UK general election was undoubtedly the victory in the Royal Borough of Kensington & Chelsea (K&C) of the left-leaning Labour Party, when many had assumed K&C, (London’s wealthiest Borough), would, by nature of its affluence, forever remain a safe Conservative seat.

EDCpic

On closer inspection the shock is not entirely merited, especially given K&C’s “startling” inequality. Simmering grievances in the Borough, at least partly the result of gaping wealth differentials, were exposed just days after the election by the visceral local reaction to a lethal fire at (Council-owned and run) Grenfell Tower in the north of the Borough, and the Council’s abject response to it. Indeed, the yawning gap between rich and poor in K&C is an open secret to locals; as victorious Labour candidate Emma Dent Coad (pictured above, who before winning was a K&C Councillor) said in a powerful acceptance speech, K&C has “areas of extreme poverty…[p]eople [in K&C] are getting poorer, their income is dropping, life expectancy is dropping and their health is getting worse. There is no trickle down in Golborne ward and there is no trickle down anywhere in Kensington”. Dent Coad’s more recent public statements claim Victorian-era diseases like TB and rickets are still present in K&C, and that, so compressed are the Borough’s geographic inequalities of affluence, simply crossing the road can see the average income of residents fall by ten times. While it is an outlier, K&C is not entirely unrepresentative of the modern trend of wide divergences between haves and have-nots.

rbkceconpic
All of this matters for fundraising – a lot. In the UK and elsewhere, wealth is held in fewer and fewer hands, with distributions of wealth and income increasingly lopsided. Contemporary fundraising technologies, many with their genesis in postwar fundraising efforts, often rely on broad participation across society. A shrunken middle-class restricts this, with fewer citizens able to afford to support good causes, which in turn means fewer funds raised and less participation. And economic changes are colliding with a tougher regulatory regime in which marketing is increasingly challenging, and which may rule out go-to methods of acquisition-based business models. With such strong headwinds, declining participation in the sector might seem inevitable, and with it any hopes of maintaining donation levels, let alone increasing the amount donated.

The cloud may, however, have a silver lining, in this case the fact that our ability to tailor approaches to higher value audiences has never been greater. Databases like the Luxemburg Income Study and the World Top Income Database offer unprecedented scope to analyse the social dynamics of wealth in the UK and across the world to a remarkable degree of granularity. Much of this information was assembled by a cohort of academics, lead by the eminent Professor Sir Tony Atkinson (who sadly died earlier this year), and including Professors Thomas Piketty (of Capital in the 21st Century fame), Emmanual Saez and Gabriel Zucman, (the latter’s recent work having shone much light on the widespread use of tax havens). We know more, in more detail, than we ever have about how to identify those with the means to support our great causes. And at a more practical level, moves towards data-driven methods have been taken, notably by research consultancy Factary, whose approach to database screening has, they say, been “revolutionised” by the use of data on “socio- and geo-demographic factors” to “prioritise the database” according to ability and likelihood to give. Rather than using a bank of more or less static data produced by desk research work to screen against, Factary now use overlaid data, to indicate those most likely to give. While I am not familiar with the precise data used, such methodologies are surely the future for fundraising research, especially considering that those able to donate major gifts (say of £10,000 or more) are likely to be located in fewer than 10,000 of the 1.8m postcodes in the UK. Data (academic or publicly available) is accessible like never before, making analysis of economic geography sensible and achievable, and could, if used properly, give a much-needed lease of life to British high-value fundraising. Such a pivot towards high-value is not without risks, perhaps the greatest being the chance of the interests of a minority being heard more loudly than those of the majority. However, while the Third Sector would surely lose credibility if it were seen to give undue attention to niche interests, no-one thinks UK not-for-profits face SuperPAC-type capture anytime soon. More likely is the familiar issue of certain causes being harder to raise for than others, which is as old as the sector itself, and probably insoluble. More regulation, or a hard interpretation of the DPA or GDPR precluding analysis like that described above, is another risk, but, by retaining manual elements in analytical processes and taking a truly donor-centred approach, one which should be able to be mitigated.

Navigating these risks would, however, have the benefit of diversifying the income base for a sector whose overall revenue remains stubbornly flat. And if you think that increasing the amount donated to not-for-profits in this way seems unrealistic, is it any more so than, say, Labour winning in Kensington & Chelsea?

Run DMCMC

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Run DMCMC

Turning the geek factor up to 11 for a moment, there are some interesting possibilities for mathematical techniques used in technologies like predictive text to be used to assess fundraising interventions.  Ever since an influential 1948 paper by Claude Shannon – “the Father of the Information Age” – so-called ‘Markov Chain’ models (a variant of which is  ‘Markov Chain Monte Carlo’, or MCMC) have been “widely used in speech recognition, handwriting recognition, information retrieval, data compression, and spam filtering”, as well as ‘Natural Language Processing’/word prediction, by assigning probabilities to ‘state transitions’, ie the probability of one letter or word following another.  Using such chains to predict which fundraising interventions are most likely to lead to a gift would be a huge boon for the industry, leading (in theory at least) to far more efficient donor journeys and more granular understandings of business process value.  So, who wants to Run DMCMC?

Ratio’s(ination)

Imagine an ant crawling along a beach, left and right, forward and back, up and down, as it navigates home. It’s chosen path looks something like this:

Ant walk pic

The route is complex, but the complexity is a product of the environment, not the ant, whose decision-making power is minimal.  The example is abstract but relevant for people, too: “human beings, viewed as behaving systems, are quite simple. The apparent complexity of our behavior over time is largely a reflection of the complexity of the environment in which we find ourselves.”

The question of how to navigate complex environments using limited decisionmaking capacity and incomplete information is at least as relevant for organisations as it is for animals.  As a fascinating recent post [login required] to the Prospect-DMM email forum suggests, the answer may lie partly in the use of ratios, which offer an elegant, contextualised ways to cut through bewildering amounts of information.  Simple, powerful metrics to use in fundraising could include:

  • Last five years giving/lifetime total
  • Responses/contacts
  • Number of appeal/number of gifts
  • Cost of appeals/lifetime donations

One obstacle is not being able to integrate or even extract information from our database systems to begin with.  Recent news that insurance giant Aviva has made great strides in integrating database systems to the great advantage of their business raised a thought which is highly relevant for many charities: are we prisoners or masters of our IT/database systems?  And, when techniques like database screening may be restricted or even off-limits in future, can we afford not to try to mine other data for insights?

Weapons of Math Destruction

If, as the ICO believes, the British public would experience “substantial distress” in learning their data had been processed in a wealth screening, the public will surely be distraught should they ever read Cathy O’Neils 2016 book Weapons of Math Destruction: How Big Data Increases Inequality and Threatens Democracy.  The many ways in which mathematical models and algorithms – the so-called ‘WMDs’ – are used to make crucial decisions relating to the public realm and, increasingly, private lives are as worrying and widespread as they are opaque and unaccountable.  Across vital issues like criminal justice (where court decisions increasingly use automated quantitative modelling and scoring), access to credit, finance and education (where credit scoring and rating of teachers increasingly rely on WMDs), jobs and employment (where a missed payment could mean being overlooked for a job interview) and even the feelings and emotions we experience (thanks again, Facebook), WMD’s are in wide and growing use.  This largely unseen trend is worrying as WMD’s inevitably contain errors and anomalies which, if not caught, can have significant effects for those affected by their scores or results.  Even worse, WMDs can have pernicious effects when they run perfectly – many contain implicit value judgements which end up disadvantaging poorer groups, or, in the case of aggressive advertising, are designed to target these very people.  Yet all too often WMDs’ methods and results go unchallenged.

O’Neils Mathbabe blog is an engaging mix of political commentary, engaging geekery and knitted hats – well worth a read.  And both are valuable and timely in helping us to understand – and hopefully better manage – our algorithmic overlords.

Where is the Money (Going to Be)?

In No Country for Old Men, menacing assassin Anton Chigurh (Javier Bardem) shuns Woody Harrelson’s frightened offer of help to find a satchel loaded with millions of dollars.  “I can find it from the riverbank”, a terrified Harrelson pleads at gunpoint, “I know where it is”.  “I know something better”, counters the icy Chigurh, “I know where it’s going to be”.

Chigurh Hotel Scene pic

As fundraising researchers, we spend a lot of time focusing on where the money is.  But do we spend enough thinking about where it is going to be?  The scene is a reminder that to prospect by relying on companies or sectors enjoying current success (as a way to assess employees’ affluence) is to miss a trick.  Do we prospect often enough by trying to predict which sectors will become successful in the future?  It may sound like a fool’s errand, but understanding which sectors and products are on a strong growth path and likely to experience an uptick in growth – wearable tech, virtual reality, voice recognition technologies and peer-to-peer finance come to mind – would be a boon for prospect research.  Intelligence on mergers & acquisitions, IPOs and other comparable ‘liquidity events’ is equally valuable (lookin’ at you, Aramco).  Such horizon-scanning need not be resource-intensive and is par for the course for many investors and businesses – for very good reason.

Calling Bullshit

How to call bullshit in the age of Big Data?  There is now a whole course designed to do just that, and it is the best thing ever (no b*llshit).

callingbullshit

Heat & Light

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Heat & Light

The Information Commissioner’s recent decision to fine several charities for data processing and consent transgressions has generated a remarkable amount of heat (in the form of impassioned comment) but, from my perspective as a practitioner, somewhat less light (ie actionable insights).  So I have collected a short list of questions below – these are presented as honest enquiries, informed by an awareness that change in fundraising practices is inevitable, that better ways of working are possible, even desirable, and that tomorrow’s ICO compliance conference is likely to be a big part of this change.

Before the questions, though, permit a historical detour, as it is absolutely imperative to recognise the antecedents of current regulatory attention on charities.  Even the most cursory search of recent Fundraising Standards Board’s (FRSB) Annual Complaints Reports shows total complaints received doubled in four years, from 33,744 in 2012 to 66,814 in 2015, complaints which were prompted some 60 billion fundraising contacts over this time.  Strikingly, the FRSB estimated that for each complaint received, a further 20 people are annoyed but do not complain; this puts the 2015 total at around 1.3m.  Their source seems clear: “half of all complaints are incurred by less than 2% of charities reporting”…”just 1% of reporting charities (all of which have voluntary income of £10 million and over) generate six in every ten complaints”.  Frustration at continued inaction in addressing the issue led outgoing FRSB Chair Andrew Hind to deliver a strongly worded rebuke in his 2016 Complaint Report foreword:

“[T]his report shows that more than 66,000 people were so unhappy about a charity fundraising activity targeted at them last year that they took the time and trouble to make a formal complaint about it to the charity concerned…The stark reality identified by this report is therefore that, in all likelihood, some 1.3 million people were dissatisfied by the impact that a charity fundraising technique had on them in 2015. That’s enough unhappy people to fill Wembley stadium 15 times over.  Just three fundraising activities – direct mail, telephone calls and doorstep fundraising – are responsible for more than seven in ten of these concerns” [italics added]

A brief word also on the Daily Fail, whose 2015 ‘New Shame of Charities’ story is widely thought to have precipitated the current storm?  It should be remembered that the story was prompted by a concerned whistleblower, as DM Investigations Editor Katherine Faulkner made clear in her evidence (given in a closed session) to the Commons Public Administration and Constitutional Affairs Committee (PACAC) in October 2015.  The DM were not even the first newspaper to run such whistleblower stories in recent years – in 2009 the Daily Mirror published a similar one relating to charity telemarketing, while, in 2012 the Telegraph ran an exposé of what it called “aggressive, intimidatory and potentially unlawful [fundraising] tactics”, after an undercover Telegraph reporter worked at Tag Communications for 12 days, the FRSB later found Tag had “deliberately confused and misled the public” in their fundraising activities.  This story used the very same method as did the DM in 2015; indeed, it seems highly unlikely the DM would have covered charities in such detail in recent years had earlier stories not set a marker and had a whistleblower not approached them. Media coverage obviously caught the ICO’s attention (their reply to my recent Freedom of Information request says “[a]llegations have been made in the media that individuals are being overwhelmed by fundraising requests”).  But, odious as the DM is, there is a wider backstory of public dissatisfaction with and frustration towards charity fundraising which cannot, and should not, be ignored.  The current climate may make the above look like the case for the prosecution; it is not, but those who cannot remember the past are condemned to repeat it and I, for one, do not wish to see the recent past of British charity fundraising repeated anytime soon.

I would add that the recent ICO rulings seem to me to present a real opportunity for the sector.  I cannot escape the conclusion that affinity and engagement are the key determinants of large contributions, and I see no reason why an increased emphasis on measuring and acting on these attributes cannot yield substantial gains for many charities.  Odd as it sounds, I also welcome the recent scrutiny on screening – the ICO’s actions can in important ways be seen as a catalyst for fundamentally more open and transparent relationships with our donors.  They are also a spur to re-examine longstanding practices, a result of which may well be an increased capacity to build enduring relationships with supporters.

All that said, my questions are:

  1. Consents & reasonable expectations.  We travel magically to a Utopia where charities have in the recent past secured every necessary consent, perfect privacy statements are publicly displayed and where, thanks to a concerted communications campaign, “substantial distress” would not reasonably be expected to be caused upon learning that ones data been processed in a wealth screening.  In this world, is wealth screening illegal?
  2. Types of screening.  Any organisation with significant data assets screens regularly – so as not to send mail to deceased people/so use the correct address, and for any number of other reasons.  Is the risk of “substantial distress” the main, or only, difference between these processes?
  3. Substantial distress.  Both the recent ICO Civil Monetary Penalty notices and paper accompanying the imminent Fundraising & Regulatory Compliance Conference stress the likelihood that “substantial distress” would be caused were data controllers to learn their data had been processed in a wealth screening.  This might be true, however no evidence is cited to support this claim in the judgement or the paper, and subsequent Freedom of Information requests have been refused or are awaiting a reply (Note to Madeline Bowles: whoever you are, thankyou!).
    1. Related: how can we know “substantial distress” is likely when such distress is itself partly the result of the manner in which the activity in question is described or explained?
  4. Understanding capacity to give.  Quite simply, how are charities to arrive at an understanding of who might have capacity to be able to make a major donation without analysing publicly available sources?

Do also check out Factary’s very good recent “5 Questions to Ask the ICO“.

For those attending the conference tomorrow – enjoy.  For everyone else – catch you at online at #FRCC2017!

Heat & Light II: “Let Sunshine Win the Day”

George Osborne revelled in his role as the ‘Austerity Chancellor’.  However, for all his talk of “tough choices”, this austerity did not, it seems, extend to charitable sector spending, where at times his decisions seem generous almost to the point of profligacy.  Nowhere is this clearer than in the case of disbursals of funds raised by fines on banks, in which Osborne had significant – if not sole – say in directing the funds, totalling by some estimates almost £900m. Some edited highlights of these disbursals include:

  • £50m to the Cadet Expansion Programme (itself established in 2012 by the Coalition) to place 500 Cadets in British schools, each cadet costing, it seems, a cool £100,000, more than many whole charities cost each year
  • £7.6m towards the refurbishment of Wentworth Woodhouse, which led the Guardian to question the surprise choice – with a £42m total cost of renovation, £7.6m will only pay for the roof to be fixed and some other structural repairs at a private home which only granted access to the public in the 1980’s.  The funds were said to be contingent on the Wentworth Woodhouse Preservation Trust publishing a business case which, at the time of writing in February 2017, did not seem to have been posted to the Trust’s website
  • £20m towards the costs of the National Rehabilitation Centre at Stanford Hall in Nottinghamshire, which Ceasefire magazine have cogently and persuasively argued should really be a cost borne by Government, who sent affected veterans to battle in the first place
  • £35m towards the Armed Forces Covenant (Libor) fund.  The Fund was established in 2010 by the new Coalition Government – David Cameron himself tasked the initial  working group with producing a “low-cost” ideas for rebuilding the Covenant.  Again, this is arguably money which should have been provided by Government to care for veterans.

A recent Private Eye story also reported on the continued expense of the National Citizenship Service (NCS), which (it reports) will receive £1.26bn from 2016-2020.  This includes £187m in 2016-17 making it one of the largest charities in the country according to recent figures from Professor Cathy Pharoah at the Centre for Giving and Philanthropy at Cass Business School.  Despite this, the NCS is on track to miss participation targets by some 40%, with a recent National Audit Office report, saying “[w]eaknesses in governance and cost control need to be addressed”, concerns which led Meg Hillier MP, Chair of the influential Parliamentary Public Accounts Committee, to say “it is difficult to see how [the NCS] will be sustainable in the long term”.

Charities faced allegations of misspending or getting poor value for money from LIBOR funds they received, but surely the bigger question surrounds opaque Government decisionmaking.  It is concerning that not long before the Kids Company enquiry, the Treasury and MoD were making highly centralised decisions as to who would receive hundreds of millions of pounds, with very little transparency, and with MP’s apparently lobbying for a share of the funds.  As Civil Society reporter Helen Sharman wrote in late 2016, “[w]hen an MP writes to the man in charge of the government’s chequebook, seeking preferential treatment for a charity he supports, and the charity then receives a considerable chunk of what is on offer, we cannot help being slightly suspicious that public money is being distributed to charities because of patronage, rather than merit.”  Ms Sharman’s Civil Society colleague Gareth Jones sums the issue up well in saying “the longer the Treasury declines to outline a detailed decision-making process for these grants, the more we will have to infer that there simply isn’t one.  With charitable funding so scarce, it is vital that every penny is directed in the most targeted, effective way. No doubt the vast majority of causes receiving Libor funding (if not all) are very worthy, but do we know that there aren’t other causes that are more deserving?”

In 2006, David Cameron famously used his first Conservative conference as leader to urge colleagues to “let sunshine win the day”.  Will this Government let some sunshine illuminate their decisions around how charity funding choices are made?

Bricks and Mortar

With legacy bequests left to British charities measured in the billions and the value of British residential real estate measured in the trillions, why is high-value legacy fundraising not top of every fundraising directors to-do list?  The estimated value of members of the Sunday Times Rich List has grown from £99bn in 1997 to more than £500bn in 2016.  However, even this astronomical growth is dwarfed by the explosion in the estimated value of British real estate, whose value a 2016 Saville’s research report estimates at more than £6tn (trillion).  To put that into perspective, if everything in the UK were to be sold, it would fetch an estimated £8tn.  In answering the question “where is the money”, the answer, in the UK at least, is clear: “bricks and mortar”.

This is an urgent issue for British charities.  A perfect storm of more activist regulation, stubbornly high attrition/low response rates and a struggling cost-per-acquisition business model mean charity Direct Marketing is both waving and drowning.  Of charities’ existing major revenue streams, only legacies, major donations and ‘mid-value’ giving seem to have any chance of filling the gap left by falling or flatlining direct mail, face-to-face, door-to-door, telephone and DRTV.  And Legacies offer far greater scope for much-needed unrestricted funds than do major gifts, as well as the chance for collaboration between fundraising teams to build a value proposition stretching across the life course.

And crucially, legacies are highly unequal – in a good way.  A colleague recently recounted how a former charity received around 200 legacy bequests each year, with half a dozen accounting for around 40% of the total received – just one or two more of these big bequests would have transformed the charity’s financial outlook.  For a sector populated largely by micro-organisations, many with few or no paid employees, legacies are far more realistic proposition than securing and stewarding major donations.  Substantial legacies are possible for far more people than major lifetime gifts.  Many households in middle-England would never have the means to give a gift in the hundreds of thousands, but far more would could consider a legacy of this scale.
Property wealth is also far more broadly distributed than cash, meaning legacies enable more regional charities to raise big gifts. Many HNWI’s are London-based, however property wealth is far more broadly distributed, meaning charities across the country can seek and secure significant legacies.  The UK, already unequal and set to become even more so in the near future, offers far more opportunities to raise funds from property wealth than cash.  We should recognise this, and act accordingly.

Josh Birkholz interview: “Fundraising is industrialising…analytics has a big role to play”

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Josh is a world-leader in fundraising analytics, and talks in the interview about how not-for-profits can use analytics to raise more, more effectively, how to move toward data-driven prospecting for philanthropy and regular giving, and the future of fundraising innovation.

The interview is available as an audio file to download here: https://soundcloud.com/benrymer/josh-birkholz-interview-fund-raising-voices

Cargo Cult Fundraising

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During World War Two, a tribe in the Pacific Islands saw American supply planes disembark their cargo onto a landing strip.  Having a strong belief in the divine, they reasoned that the planes were sent by a God, and that, were they to build a replica airstrip, correct in every detail, the God would send them planes laden with valuable supplies (‘cargo‘).  So they set about building wooden huts, a wooden airstrip, painting their chests with ‘U.S.A’, even staffing the huts with people and building fires alongside them to mimic guide lights.  But the planes were not sent by a God, they were built and flown by the American army, and none brought the hoped-for cargo to the Islanders’ airstrip.

cargo cult pic

Cargo cults are a famous example of ‘magical thinking’, where a conclusion is reached that evidence does not support, or even suggest.  Fundraising seems to be suffering from a classic case of magical thinking.  The patient is serious but stable, although the long-term prospects are dim.  Exhibit A: digital fundraising.  By looking for the next ice bucket challenge or #nomakeupselfie — in effect praying for free money to fall out of the sky — we may as well build our own plywood airstrips.  No doubt a strong digital brand is a prerequisite for many organisations in this day and age.  However, in scrambling to co-opt the next trending hashtag, we are diverted from the demanding, but rewarding and necessary work of building enduring donor relationships of long-term value.  We are also labeled cynical and opportunistic by the very audience we sought to engage; ultimately, this is not an arms race with a winner, it ends in scorched earth and attrition.  Exhibit B: certain types of direct fundraising, including philanthropy and individual giving.  In these areas, for different reasons and in different ways, wishing harder seems to be an accepted methodology.  At major donor seminars, the almost palpable hope is for a wealthy philanthropist to come to the first event they are invited to, immediately write a huge cheque with no expectation of reporting or stewardship, and do the same the next year.  And individual giving keeps a-wishin’ — despite continued 90%+ non–responder rates — for a white knight (looking at you, behavioural economics) to come and save the day, despite no evidence that either response rates nor overall giving will grow, or even remain static, with current methods.  The gifts keep not coming or coming more slowly, but we still build our wooden airstrips, light the fires and wait for the cargo to arrive.

These are off-the-cuff examples — there are more. The point is that growing giving will be disruptive and require a complete refutation of the ‘churn and burn’/’just ask more’ mindset which is “as baffling as it is persistent“.  Innovation always bears risk.  But the risk posed by business as usual is surely greater still.  To mitigate it, we could do worse than follow Rene Bekkers’ suggested agenda to increase donations, proposed recently at the University of Kent:
  1. A serious political discussion about the role of philanthropy in public policy.
  2. Decent research informing policy decisions, paying attention to undesirable side-effects.
  3. An Impact Philanthropy Lab (IPL): creation and evaluation of new philanthropic / business investment instruments.
  4. Knowledge about what works in fundraising, and about failures

My addition to the list would be to discuss failure openly and constructively.  Learning from failure is fundamental to progress and innovation but often, it seems, we brush it under the carpet or quietly shelve ‘failed’ projects.  Organisations such as Glass Pockets and Fail Forward, taking their lead from initiatives like Engineers Without Borders Canada’s ‘Failure Report’, are helping not-for-profits learn that, as NPC said recently,  “the public wants to see charities use evidence to become more effective and don’t mind hearing about past failures as part of this process”.

failure report

Choosing whether to take these lessons on board may now not be a matter for charities, in the UK at least.  The British Government announced this week that, following recent high-profile scandals and tragedies, it would back new laws to limit charity fundraising communications; the first step in this being a review of charity self-regulation by NCVO Chief Executive Sir Stuart Etherington.  Charities’ Minister Rob Wilson has left no doubt that charities are losing control of their own destiny in saying recently: “[c]harities need to take more responsibility for their […] fundraising, and ask themselves how they would feel if they were on the receiving end of their organisation’s fundraising practices..[n]o one should try to deny that there is a problem here or that there are indefensible practices taking place..[charities] do not have the luxury of time. There are demands for immediate action not words…I urge you to take that window of opportunity seriously as [it] may not remain open for much longer.”

The calls for actions should not be a surprise.  As previous interviewee on this site Charlie Hulme pointed out in a brilliant polemic this week, their causes have deep roots in our methodologies, particularly the singular failure to understand donor motivation: “[w]hat do we actually know about the people we systematically bombard with requests for more money? We know their transactional history and demographic profile. But knowing who gave, what they gave, when they gave and how they gave tells us nothing, nothing, NOTHING about why they gave or would give again….As a sector growth is stagnant. Retention rates are catastrophic. And fewer and fewer people like, much less trust, us.  Our jaded, complacent, timid sector is mired in bad business and bad ethics. Bad business because, despite the rhetoric, we do nothing to change a set up that, by definition, precludes the concept of being ‘donor centric’ from being anything more than a buzzword. Bad ethics because this stops us growing and making the slightest dent in mission.”  These are strong words, but to quote economist John Maynard Keynes, to have their full impact “words ought to be a little wild”.  Charlie, Kevin Schulman, Roger Craver, Ken Burnett and others have warned for years (and decades) of the risks associated with ‘just ask more’.  They are surely being proven right now, and deserve to be listened to.

wright bros plane

Charities can persist — as cargo cults do — or they can change and thrive.  The causes we represent are the best imaginable, but as Sir Stuart Etherington said this week, “[c]harities can only do the work they do because of the trust, confidence and overwhelming generosity of the British people”.  Not regaining this trust and confidence will be the death knell for ambitions to grow, or even maintain, giving.  Nobel Prize-winning physicist Richard Feynman famously said that to avoid ‘cargo cult thinking’, “the first principle is that you must not fool yourself–and you are the easiest person to fool”.  Rather than fooling ourselves, we should dare to know why our supporters choose the charities and causes they do, and dare to break the ‘ask less’ taboo.  Rigorous use of evidence, learning from ‘failure’, being honest with ourselves and donors, and actively seeking out disruptive innovation will all be key parts of our being able to raise, and do, more for those who need us.

The planes will not land unless we have the courage and skill to build them.

Marianne Pelletier interview: “We assume we don’t share prospects, but of course we do”

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Marianne

Marianne is Senior Consultant at Cornell University, and formerly worked at Carnegie Mellon and Harvard Universities.  She is a leader in advancement services, donor modelling and data mining and understanding donor engagement, speaking regularly at conferences and seminars on these subjects.  She tweets at @mpellet771.

A few points from the interview:

The use of insight can have powerful effects, increasing income and allowing not-for-profits to build stronger supporter relationships.  In the UK, prospect research has traditionally involved less quantitative or statistical methods.  However, ‘prospect research’ is different in the US, where it is largely data-driven.

Wealth screening: we all know it and use it.  And yet, even vendors admit that their information only covers around half of the millionaires in the population (and that total is probably an underestimate).  So, here will be a significant portion of the HNWI population whom charities are not aware of, sitting on their databases.  If not-for-profits modelled and analysed the level of wealth in more detail, they would almost certainly raise more form these groups.

Social media is coming to the fore in gaining valuable, ‘soft’ information on supporter preferences and interests.  Marianne’s team includes a full-time person scraping information from the web (and hand-connecting this to relevant supporter records), including network information, which is mapped in NodeXL.  Text analytics is also in vogue.

The web has fundamentally changed customer care, and Marianne describes some of the key ways in which this has happened.  First, Amazon “spoiled it for us” by raising the bar for the level of customer service users now regularly expect.  Next day delivery, automated, ‘you might like’ suggestions, and hugely responsive customer service are now all par for the course, whereas before they were considered exceptional.  Charities must keep up with these developments or be left behind.

There is lots more in the interview — I hope you enjoy it.