Pandemic Reinforces Need for Nonprofit Development Work
I seldom recommend nonprofits stage special events, and most organizations I’ve had the pleasure to work with are likely tired of hearing the discourse. However, the current pandemic only reinforces the need for nonprofits to become less reliant on those events as a regular revenue stream. So, what is an organization expected to do?
With the COVID-19 outbreak, thousands of events have been cancelled around the country, including theatrical events, concerts, 5Ks, golf outings, galas, runs, walks, chili suppers, festivals, and many others. To soften the blow, some organizations have investigated virtual opportunities, while others have postponed or cancelled the events. The impact on those groups is still being measured, but it stands to affect them for months or years to come. It’s another reason why I encourage organizations to focus more heavily on regular donor development, it can be more stable.
Current event cancellations present an ideal time for Boards and Execs to assess if the risk of staging events goes deeper than those presented by the pandemic. In “normal” times, are they worth the amount of time and money spent? The hard and soft costs can be staggering. I’d like to suggest when it comes to events and donor development, it’s time to ask yourselves What? Why? How?
What do these events provide us? Undoubtedly, there are those who will say, "but we make "x" dollars on them." Do you really? It's not unusual, for organizations to ignore the true cost of staff and volunteer time when making their net profit calculations. In fact, they consistently have difficulty quantifying operational costs. Why? Fixed costs are somewhat hidden in the regular operations, but that is no reason to ignore them. Consider the “opportunity costs.” What could staff, or volunteers be doing if it weren’t for the event? Let's face it, when staff and volunteers are focused on an event, there are a dozen or more other needs that are being ignored, like donor development, membership growth, marketing, volunteer recruitment, database work, etc, etc.
An astute Board of Directors knows to prioritize special event analysis on their annual calendar, well in advance of the next proposed staging. The pandemic presents another opportunity to review them. All costs should be part of a bigger picture review. It's a good time to revisit the goals of the event, the past performance and its impact. Hold nothing back and put everything on the table, even if it happens to be a member's pet project. The Board serves on behalf of the organization, not each other!
Why are we staging this event? Sure, special events can have a purpose, but their staging shouldn't be sustained just because "everyone had a good time," especially if the primary goal is to raise funds. Now, if there's a desperate need to raise awareness or build a database, that's another story, and may be one of the few times I’d recommend embarking on an event.
I advise organizations to answer this question. Is your group's event raising less than $10,000 or consuming more than 200 hours in volunteer and staff time? If you answer yes, there is even more reason to scrutinize the commitment and investment of time and effort in the staging process. Raising more than the target might not even be justified if it consumes all the staff's time and energy that could be reallocated to development work.
How do we raise the revenue if we don’t conduct events? Think short-term pain for long-term gain as you work toward effective donor development. Every organization can cultivate donors passionate about the cause, connect them with the organization, and more efficiently fund their needs. You can raise the same amount, or more money, in less time and with less burden on the organization. This is where a structured and well-thought development program can pay off. I’ve seen it work and helped it advance in several organizations.
Donor development is about developing deeper relationships, engaging donors in your work, and creating an atmosphere of trust and understanding. For some, it may mean a tailored newsletter, creative thank you or personal visit. Others may need a tour of your facility or regular reminders of your stories or how you used their donation. Now is a great time to identify your prospects, get to know them, and let them know they are one of a few who give a heightened level of support to your organization.
Special events can have their place, but they often languish on for years before someone asks that all important question...."Why are we doing this?" Now is the time for you to be the one to do the asking! Then, seek to develop your donor database in new and exciting ways, one on one with the people who share the passion for your organization