Chapter 2

Discovering the New Donor Culture

"The world is moving so fast that the person who says it can't be done is generally interrupted by someone doing it."

-Elbert Hubbard

As the director of donor events for the San Francisco Museum of Modern Art, Cimeron was buzzing with excitement. She had assembled an amazing showcase hosted by museums around the city that would open their doors for one evening only. The 2017 "Art Bash" was the fundraising event of the year. Nine months of preparation and hundreds of thousands of dollars had been spent on decor, entertainment, marketing, and enticing celebrities to bring this night to life. At the end of the night (and with a multitude of happy donors), the museum grossed well over a million dollars.

Just a few years later in the depths of the pandemic, Cimeron left the nonprofit world and accepted an exceptional offer from a cutting-edge marketing firm. Soon after we met, she shared some acute changes she had faced before leaving the museum.

"The fundamentals of fundraising are changing," she said. "There used to be established donors who wanted their names on the building, but they are all in their 80s now. Then their children began to inherit the family fortune, but they don't look at the long term and have different values than the previous generations. Their homes are international, and they don't want to be committed for more than one year."

Research confirms that classic nonprofit fundraising is no longer enough. The next generation of donors is unlike any who have come before, and you need to connect to them via a new language.

Are Nonprofits the Next RadioShack?

I remember when RadioShack and Kmart were the go-to places if I wanted to buy a Walkman when I was a kid. Then people started to realize that everything at RadioShack and Kmart could be found on Amazon. When store sales began to slide, I imagined the conversation in the corporate boardroom meeting. "There will always be a place for the storefront."

In the mid-2000s, RadioShack and Kmart woke up to find their stores empty. Websites were quickly built, but the shopping process was clunky. Society had pivoted, and they hadn't pivoted with it quickly enough.

Many much-needed, impactful nonprofits are sliding toward the same unfortunate demise because they haven't changed with the societal shifts. Those who are just beginning to understand the change and only make a halfhearted shift will certainly face the same fate as RadioShack and Kmart.

Enter Digital Marketing Funnels

Five years ago, a new change hit the marketplace. People had slowly stopped going to websites to search and shop and started allowing search algorithms to bring exact products to them. Now the store web domain is more of a brochure for the business, while real revenue is being produced through product "sales funnels" and upselling after the sale.

Walmart recognized this early and, following Amazon's lead, has modified its online store to compete with Amazon. The two online giants' websites now function like the aforementioned sales funnel.

For example, you run across an ad that matches a search you recently initiated or a conversation with a friend that was picked up on your cellphone. (Yes, they are listening.) Because it's relevant to your current need, you click on the picture or ad for the single product. Suddenly, you are on a single product sales site with the option to upgrade to a larger or higher-quality item. When you decide to check out and pay, you are told, "Others who bought this product also purchased this, or this, or this."

This is a classic funnel

Next, you are offered a one-time offer: "Click here to get 15% off this sale by applying for our credit card. FREE for 30 days." (Shhh. and only 26% interest after all.) That was the upsell.

You filled out the "quick" credit card application, didn't you? That's alright, I did, too.

What had happened in the early 2000s with the "product sales" websites started to become relevant to nonprofits almost five years later, and nonprofits started seeing the power of their website to drive funding and community connection. By 2005, a nonprofit without a vibrant website was sliding into obscurity. Just a short decade later, we see this happening again. The year 2016 was the beginning of the online sales funnel boom. Now we're pushing past five years later, and online funnels are mature and ready for nonprofits.

We historically used marketing flyers and newsletters for our nonprofits; we advertised in phone directories and newspapers. Then, as transition caused us to take a turn, we were pushed into website development and training our staff to use phone campaigns.

As marketing has changed with the times, so has the necessity for nonprofits to pivot into the next technology that is engaging the population. That's where we will find our next generation of donors, and that is why we find ourselves considering how to use digital marketing funnel templates and repurposing them for community engagement and funding drives.

What's Next?

I hear you wondering, "What's the next change for buyers? What's the next shift in market-driven communication?"

We are still about five years away from the next big shift, and another few beyond that before it will be strongly impacting us as nonprofits. The answer to the above question, I believe, is in the language of the internet and its acceptance of "blockchain" technology.

In the meantime, let's focus on the art and skillsets of building amazing email attraction funnels and donation funnel campaigns and allowing the speed and programs within digital marketing to do the work of dozens of our volunteers.

Let's strategize vibrant email-attraction funnels to introduce your organization to millions of potential donors and begin the relationships that will raise lots of funding for your next programs.

How Easy is it to Find New Donors?

If you ask the birdwatcher who is standing in Washington state how easy it is to find an African fish eagle, the answer is near impossible. But if you are in the sub-Saharan region of Africa, you'll find them easily. What I'm saying is, you need to go to where the donors are, or create an environment of such value the donors will leave their comfort zone to come to you.

So, where are your future donors?

Nine out of ten Americans are communicating through email, and 50% worldwide are daily checking their email. In fact, email generates $42 for every $1 spent, which is an astounding 4,200% ROI, making it one of the most effective options available.1

Currently, more than half (53%) of the global population use social media, which is a 12.3% year-over-year increase.2

According to the latest official data, Instagram has 1 billion monthly active users (MAUs) globally, with 130 million users in the United States alone.3

TikTok users open their account 8 times every day.4 The U.S. audience is now over 100 million. The U.S. population, in the second I typed this onto my page, is 332,569,415. That means in your city, 1 out of 3 people are logging onto TikTok, and it is now available in 154 countries worldwide. This data comes straight from TikTok.

E-commerce, as an industry, did not exist 30 years ago. Now it is the largest mover of finance in the history of global economics. The North American e-commerce market is worth just under $912 billion and is growing at a rate of 13% a year.5

David Williams of RJMetrics reported their finding in the "2015 Ecommerce Growth Benchmark Report."6 They studied 200+ ecommerce businesses, 31 million customers, and $25 billion in transactions ".at three months the average e-commerce site is generating just over $150,000 in monthly revenue by the end of year one.

"By year two, businesses are averaging almost $330,000 in monthly revenue. After three years, they're bringing in over $1 million in revenue every month, an increase of over 230% between year one and year three. On average, an e-commerce site has generated over $20 million in revenue by the end of year three in business."

In 2020, Digital Commerce 360 reported that 21.3% of money that was exchanged was using "U.S. Ecommerce rather than Retail Stores."7 American consumers are quickly shifting to using online sites and funnels as their premier source of revenue exchange.

What can you learn from this data? First, your community is online, and that is the premier way of connecting and starting new relationships. Second, your donor language is a digital one. Either you learn to speak their language, or you will never attract their ear. Third, pivot or die. Your nonprofit needs to embrace the pain to upskill and learn this new language or become more and more irrelevant and eventually close your doors.

If your nonprofit vision is to thrive and meet the needs built into your purpose, then you need to act now.

A Small Test Study

We did a study of 96 501(c)s in Yakima Valley, WA, an area with a population of...