A tale of two donors – or the ENOR­MOUS dif­fer­ence in val­ue between what’ and why’

Written by
Charlie Hulme
June 16, 2016

Charlotte and Emily have never met. They are the same age, live in the same area, have the same income, the same outgoings and the same number of children.

Three years ago today both were out shopping when, independently, they stopped and spoke to one of your fundraisers. Both were moved by what they heard as it chimed with their own values so each made a donation by text of £3. A few weeks later, when they got a call from another of your fundraisers asking if they could support on a monthly basis, they both agreed to a regular gift of £5 a month.

So far they are identical on your CRM system; all that differentiates them is their donor ID. Over the next few months both were sent on the same ‘journey’, receiving the same set of pre-ordained touch points: mail, calls, magazine, etc.

Today, three years on, only two things have changed. The first is they’re three years older. The second is that Charlotte’s lifetime value is £207, whereas Emily’s is £33. Charlotte now sits in your ‘loyal’ file, achieving average lifetime value. Emily has been moved to your lapsed file and is costing you a lot of money in your vain attempts to win her back.

If nothing’s changed what’s the variable in their value?

The answer is ‘what we choose to care about’

We’ve been using phrases like ‘donor-centric’ and ‘supporter relationship’ for decades. But if pushed to define them, or give evidence of actually being or doing them, what could we say? The best we could do would be to point to creative technique; always use ‘you’ never ‘us’, or show where we’d been ‘emotional’ and told ‘stories’, etc. Or we’d point to our selection criteria, how we’ve sliced our house file based on giving history, recency, frequency, value and so on. Maybe some of us would point to the money we’d spent appending lifestyle demographics.

All well and good, but these things tell us absolutely nothing about why Charlotte’s lifetime value is so very different from Emily’s.

‘Why? is the only question that matters, but it’s one CRM fundraising can never answer. All it records is what happened. And because that’s all we’re recording that’s all we focus on. So we decide Charlotte is loyal and Emily isn’t. Where can we go from there? We don’t know why Charlotte is, so there’s nothing we can do to further forge that link. And we don’t know why Emily isn’t, so we throw good money after bad forever guessing at what’ll get her back.

And yet all the while there’s an incredibly simple answer to why Emily left. 

Six months into her ‘relationship’ with you she had a bad experience that went unrecorded because your CRM couldn’t record it. It could have happened during any number of the interactions you exposed her to, but in this case it was the second upgrade call she received. She had a couple of questions your agent couldn’t answer. Nothing major, but her frustration led to mistrust, which led to her decision to leave you and support an identical looking organisation. And just that simply, she was gone, along with all the money you invested (aka wasted) trying to get her back.

Now imagine a world where being ‘donor-centric’ meant you were, well, actually ‘donor centric’. What would that look like? 

After Emily’s call she received a short automated email asking how the call went; was the agent knowledgeable, was she able to answer your questions and so on? You included an open-end text box that Emily filled in to let you know how she felt. When you heard about that bad experience you acted immediately with a follow-up call to smooth everything out. So instead of her last impression of you being frustration it’s now appreciation. She not only stays but she upgrades and keeps her value identical with Charlotte’s.

The cost of that donor service interaction was £3.51 and Emily's lifetime value rocketed from £33 to £207. 

Simple. Powerful. Cost effective. So why don’t we do it?

The idea that this isn’t scalable is simply ludicrous. If you can afford to lose that many ‘Emilys’ in their first year, and lose still more money vainly chasing them, surely you could assign some of that spend to where it will actually have an impact?

Let’s face it, our sector has way more ‘Emilys’ than ‘Charlottes’. How many more years are we going to spend throwing money at poor ‘Emily’ (who believes in what you believe in, but no longer believes in you) before we admit we are working with an incomplete set of tools?

About the author: Charlie Hulme

Charlie Hulme is managing director of DonorVoice. He helps charities uncover what, of all the things they do, improves the strength of relationships  and what is harmful. Partners see a massive improvement in performance, value and retention.

Voted top speaker at the Institute of Fundraising’s National Convention in 2013, he writes frequently for SOFII, 101fundraising, the Institute of Fundraising and many others.

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