I don’t drink beer.

I don’t like it.

I had a Dos Equis last night. 

I liked it.

Why?

In the last three years, Dos Equis has gone from a little quaffed boutique brew to a often quoted and more frequently consumed phenomenon.

Why?

Brand Equity.

A brand, in its most elemental form, is a unique promise that the consumer equates with the product.  It is not tangible and is the end product of a lot of subtle processes, like positioning, that are too many to name here.

The longer a segment of the market associates good things with a product, the stronger the product’s brand equity.  The stronger the brand equity of a product, the more the market seeks to affiliate itself with the product.

The equity of a brand is a fragile thing, however, and when it fails, so does the product.

Consider my favorite car company:  Ford.  In the early 1990′s, Ford motorcar had two new products:  the Ford Taurus and the Ford Escort.  They were constructed as well built, reliable vehicles and, for a while, renewed the Ford brand.

Yet, through the 1990′s, Ford failed to evolve the product line.  The cars became tired and the public became bored with them.  Sales declined and Ford was at the brink of bankruptcy.

Brand Fatigue.

Appeal Fatigue.

The non profit sector is as competitive as the American motorcar industry and, like Ford, many Diocesan development departments have maintained their annual programs as if they were museum pieces and they have remained unchanged for many, many years.

Signs of Appeal Fatigue?

Loyal donors, those who given for more than five years, leaving your program.  They are your canary in the Appeal coalmine.

Stay Thirsty my Friends.

Once a month, I get my retirement statement in an envelope that is really hard to open.

No, really.

Hulk Hogan could not open this thing.

So I throw them out.

I opened one last week, with the help of two members of the Romanian weight lifting team.

I passed out.

I don’t often pass out.

I am a trusting sort.

I believe that the people I hire to do stuff will do it well.

Suffice to say, if things keep going the way that they look to be going, I will be writing this blog until I am in my mid 90s.

Where did all that value go?

I hear a similar question from a lot of the diocesan development directors I speak to.

Where did all my donors go?

Donor attrition is not a new phenomenon in Diocesan annual fund programs, but, there seems to be a lot more of it going on in a lot more places.

An interesting exercise, if you are so inclined:

Run a report from your constituent management system that lists all of the donors that stopped giving to your annual program this year while listing all of the gifts they made to the annual program in the last ten years. 

What percentage of the donors that you lost this year were “loyal” donors (those who have supported the annual program for more than five of the last ten years)?

There is a common rule of thumb that says that a donor becomes “sticky” after three years of sustained giving to a charitable cause.  There is an inverse relationship, therefore, between donor giving longevity and donor attrition.

The longer they give, the longer they stick around.

Sticky donors.

What if, however, after you run that report,  you find that more than 15% of the donors that you lost this year have been giving to your annual program for 5 or more years.

They have not all died.  You may want to believe that, but the majority are, as my grandmother used to say, “sitting up and taking nourishment.”

They have not all moved to Florida.

They are very much alive, in their homes, and they just don’t support your annual program anymore.

Why?

Donor fatigue?

Maybe.

Appeal fatigue?

Probably.

What, you may ask, is appeal fatigue?

I will let you know at the next post. 

 I have to go speak to my broker.

My house is charming.

It is also 100 years old.

Which means continuous investment and work.

I am, well, to be kind, eager, but ignorant when it comes to home improvement.

“The wall socket in the bathroom is not working.”

So I grabbed the two lead wires with a pair of pliers and got blown across the room.

I had forgotten to flip the curcuit breaker in the basement.

A simple thing.

Simple things are important, really important, when it comes to annual fund management.

I get solicited a lot through direct mail. I subscribe to several non profit magazines and, apparently, my name gets sold to needy non profit entities seeking support.

I collect all solicitations that I receive by direct mail and review them at the end of each month. It’s an educational process, but, more often than not, I respond to few.

I found one last month that got my attention. I put it down, went about my business and then went back to it.

I had lost the letter that came in the direct mail package, but found the return envelope and the remittance buckslip.

The letter had inspired me to give, had a suggested gift amount, and it was gone.

I threw the buckslip out.

When creating your solicitation letter, do not use a distinct and loose remittance piece.

Consider moving to an 8.5 x 14 solicitation letter with a remittance piece that is perforated at the bottom of the letter. Make sure that the request for support that appears in the letter is highlighted in the remittance piece.

It will not get lost and your response rates will increase.

Remember, the simple stuff matters.

Right now, I can’t plan any lawn parties for a lot of my friends that have made a choice to have children.  Like that bird that returns to Capistrano each year, my child rearing friends make their annual trek down to Disney World to swelter in long lines and to spend their hard earned money on varied trinkets that only a plaintiff look can hope to secure.

Disney World.

Disney Land.

The Disney Empire.

As of late, behind the placid façade of Epcot and the Magical Kingdom, there has been a battle in the Disney boardroom that would make Attila the Hun’s blood run cold.

Michael Eisner, Disney’s outgoing chief executive officer, left an organization with a contentious board of directors, a stalled “Disney World China”, and declining stock prices.

Enter Roger Iger, the new chief executive officer.

Iger knew that he had to stabilize the board and increase shareholder value.

He did both.

How?

“He understood tradition.  He honored tradition.  He was not bound by it”

The Roman Catholic Church shares many points of commonality with a long established company like Disney.  Like Disney, the Roman Catholic Church operates within a management paradigm that is chiefly driven by and informed by tradition.  As the very heart of the faith, of the organization, rests upon immovable truths, these points of theology can inform management pedagogy.

Ask yourself how many times you have heard these things in a meeting within your chancery:

“Like we did last year … “

“We have always done it that way …”

Now, take a look at your annual appeal program.  Open your operational calendar from last year and compare it to the same calendar you may have used five years ago.

Is there any difference?

Probably not.

Now open your “year end”  appeal analysis from last year and compare it to the same reports from the past five fiscal years.

Is there any difference?

Probably.

And not for the better.

Our challenge as diocesan development directors is to embrace innovation without creating alienation from those managers who must approve those changes to our annual program. 

If a mouse with gloves can do it, so can we.

For the last quarter century, I have had the same breakfast.

I call it constancy of character, most people call it another sign post that is evidence of a mild obsessive – compulsive disorder.

Grapenuts.

Yes, that is right, Grapenuts.

This morning, I shambled to the counter and poured a bowl of the stuff and sat down with the newspaper and a cup of coffee.

What I put in my mouth, however, horrified me.

I looked at the box:

“Grapeguts:  Just Like the Stuff You Have Eaten for the Last Quarter Century”

“Idi Amin would not eat these,” I remarked.

“They are cheaper.” I was told.

You get what you pay for.

When we look to make purchasing decisions based upon price, we, as Americans, usually allow price point to be the driving factor when we are purchasing commodities such as salt, sugar, and flour.

We will pay more when the added price point delivers real, or perceived, value.

Just ask Starbucks.

I spend a lot of time with a lot of Diocesan development directors.

Many of their annual programs are experiencing, in some shape or form, contraction.

Yet, many, still insist on spending as little as possible on those services that are essential in the management of their appeal program.

You get what you pay for.

Many diocesan appeals, in order to remain competitive in the quickly growing non profit landscape, need to deploy programs outside of direct mail that will attract new donors and reunite lapsed donors with the diocesan cause concepts.

Yet, unfortunately, many still secure the services of the least expensive mailhouse or printing firms to implement a direct mail paradigm that has remained unchanged for decades.

Instead of considering the cost of campaign related services, diocesan development directors may wish to consider those services from the perspective of return on investment.

Does it make more sense, for example, to spend as little as possible to facilitate a diminishing annual program or to spend more to raise more money and to reacquire lapsed donors?

Remember, you get what you pay for.