What Keeps You Up at Night? A VISUAL GUIDE TO FUNDRAISING CHALLENGES & THEIR SOLUTIONS STOP PUTTING OUT FIRES Increased Demand for Services & Heavier Workloads GROWING DEMAND FOR ACCOUNTABILITY Maintaining Donor Retention Rates Increasingly Outdated Technology Threats to Security Avoiding Financial Fraud & Other Risks USE PERSONALIZED COMMUNICATIONS Data Capture & Donor Acknowledgements Replace Legacy Technology Systems Maintain Best Practices for Data Security & Fraud Prevention As the U.S. continues to emerge from the Great Recession and the years of slow recovery that followed, charitable giving has increased significantly. But despite these favorable trends, nonprofit fundraisers are still losing sleep due to several key challenges facing fundraising. A recently updated white paper from CDS Global, “What Keeps You Up at Night? Creating Systems to Solve the Challenges Facing Fundraising,” offers the latest statistics, trends and actionable insights on how nonprofit leaders can overcome these challenges. This infographic offers a sampling of some of the biggest challenges facing fundraising discussed in the white paper – along with some specific solutions that nonprofits can start implementing today! CHALLENGES SOLUTIONS 2013 2014 80 Nonprofits reported increased demand for programs and services Nonprofits that feel increased pressure from donors to be more accountable with measurable results Accountability and transparency are important to younger donors Young donors are accustomed to the online crowdfunding model of fundraising: • Make their decisions based on facts, not emotion • Are more interested in the impact of their donation • Value foundation accountability • Want to be well-informed and analytical about their decisions Social media to communicate with key audiences Narrative storytelling to emphasize results Improve clickthrough rates by Boost conversion rate by More data and statistics in annual reports Lack of time to produce quality content Lack of budget for direct expenses Lack of clear strategy Nonprofits were unable to meet demand SOURCE: Nonprofit Finance Fund SOURCE: Nonprofit Marketing Guide SOURCE: The NonProfit Times SOURCE: Philadelphia Business Journal SOURCE: Blackbaud SOURCE: Nonprofit Marketing Guide SOURCE: CDS Global SOURCE: Forbes SOURCE: CTK Blog SOURCE: CTK Blog SOURCE: TechSoup SOURCE: TechSoup SOURCE: Eisner Amper SOURCE: Venable LLP SOURCE: Venable LLP SOURCE: National Center for Charitable Statistics TOP NONPROFIT COMMUNICATIONS CHALLENGES TO BE MORE TRANSPARENT, MORE NONPROFITS ARE USING: IN A SURVEY OF FUNDRAISING PROFESSIONALS, DONORS HAVE MORE OPTIONS THAN EVER BEFORE AVERAGE DONOR RETENTION RATES FOR NONPROFITS RETENTION HAS BECOME A TOP PRIORITY FOR NONPROFIT FUNDRAISERS: SAID DONORS: 56 42 37 31 Looking to manage growing demands on your organization while avoiding excessive workloads for your staff? Create systems to manage common administrative tasks and prevent operational emergencies. DEVELOP STANDARDIZED PROCEDURES FOR MAIL PROCESSING AND DONATION DEPOSITING: • Minimize inefficiencies and risk • Maximize consistency • Control access throughout the entire process IMPLEMENT BEST PRACTICES FOR DONATIONS PROCESSING: • Create a detailed processing manual to document the various ways of processing payments and donations • Open up lines of communication between the gift processing team and other departments • Make security and compliance a priority • Process in a secure area • Ensure methods are SAS 70 compliant (audits) and PCI compliant (credit cards), and that accounting practices comply with Sarbanes-Oxley legislation SET GOALS FOR TIMELINESS: Deposit and capture data from donations within 24 to 48 hours of receipt AIM TO CAPTURE 100% OF INFORMATION FROM DONATIONS: This includes handwritten information, demographic data and information about the interaction itself (time of donation, donation amount, device used to donate, etc.) CHALLENGE CHALLENGE CHALLENGE CHALLENGE SOLUTION SOLUTION SOLUTION SOLUTION 92 61% 89 66 SOURCE: Direct Marketing IQ SOURCE: HubSpot 60 % 14% 10% 59% of successful direct mail marketing pieces are personalized with variable data of fundraising organizations use personalization in direct mail Improving donor retention rates begins with capturing more donor data to better understand and communicate with your donors and ends with a meaningful Why should donors give to YOUR organization instead of one of the 1.5 million others? Nonprofits that have rated RETENTION as a top 3 goal Paper files Spreadsheets QuickBooks Retention among multi-year donors Retention of first-year donors NONPROFITS ARE NOT IMMUNE TO DATA BREACHES & HACKER ATTACKS IS ALSO A MAJOR CONCERN FOR NONPROFITS: BIGGEST CAUSES OF DATA BREACHES IN 2014 WERE: The cause? Thank You! 1.5 MILLION tax-exempt organizations in the U.S. 2014 2015 30% 53% 58% 27% 49% 2 HOURS BILLION PER WORKDAY Nonprofit software buyers currently use manual recordkeeping: Average time a typical service provider spends on keeping records with paper systems NONPROFITS ARE PARTICULARLY VULNERABLE TO FRAUD AND EMPLOYEE EMBEZZLEMENT BECAUSE: • Management and board members are often too trusting • They tend to have less stringent financial controls • Administrators often rely too heavily on independent audits to catch fraud Source: Software Advice Source: TechImpact Nonprofits that use at least one cloud-based service Mid-sized nonprofits planning to adopt more cloud technologies within the next 1-3 years 64% 53% 6% 20% 21% 2014 customer cards were compromised Goodwill Industries July 2014 Malware in a third-party vendor’s system Nonprofits lose approximately to fraud each year Hackers Insider threats Theft or loss of computers or hard drives Accidental leakage 4 FRAUD FRAUD ANTI-FRAUD BEST PRACTICES: • Don’t give too much control over spending to any one employee, executive or board member • Double signatures and authorizations: Require multiple layers of approval • Require prior written approval for purchases above a certain amount • Backup documentation: Only pay original invoices • Segregate duties: No single person should be responsible for an entire transaction • Create transparency and accountability: Set up multiple steps with multiple people to: } Approve donations } Authorize payments } Reconcile bank statements Our white paper will give you actionable insights on how to put systems in place that create more consistent processes and improve operational efficiency. Download “What Keeps You Up at Night? Creating Systems to Solve the Challenges Facing Fundraising” to get the latest thinking from nonprofit sector experts on how to attain cost-effective solutions for whatever challenges your nonprofit might be facing. Want to learn more about how nonprofits can overcome the challenges facing fundraising? It is important for donors to know that they personally matter to the success of your organization ONLINE FUNDRAISING is ideal for personalization because fundraisers can: • Target specific audiences • Test different messages • Easily collect donor data PERSONALIZED EMAILS: Funds earmarked for specific purposes Immediate, visible results DATA CAPTURE 4 Steps to Effectively Use Donor Data: Collect Aggregate Analyze Use to improve donor communications Every point of contact with donors is an opportunity to gather donor data: Integrate online and offline donor data CASE STUDY: Operation Smile Canada combined offline donor information from phone calls with online donor information in their CRM system to achieve: • Faster gift acknowledgements • Better communication with donors • Higher efficiency • Lower costs DONOR ACKNOWLEDGEMENTS Successful Acknowledgements Should: Be governed by standard internal processes that determine when and how they are sent Open up a larger conversation: give donors a chance to respond with ideas, input and feedback Tell stories that speak to the recipient’s values Elicit emotion Express genuine gratitude NONPROFITS ARE FACING SEVERAL TECHNOLOGY-RELATED CHALLENGES: Disparate databases that don’t sync Outdated program models no longer supported by service providers Increasing reliance on volunteers for data management One important aspect of accountability is showing donors how their money will be used. By personalizing your communications, your organization can address donors’ unique interests and concerns, and show their funds are being used in a way that matters to them. VARIABLE DATA PRINTING (VDP) TECHNOLOGY makes it easier to create and send personal messages to donors: Nonprofits should evaluate their software and IT systems to determine if they are ready for an upgrade. Effective use of scalable systems can help nonprofits save money and work more efficiently in the long run. THE BEST NONPROFIT TECHNOLOGY SYSTEMS: • Eliminate manual data entry errors • Prevent decision-making errors • Maximize staff and volunteers’ time • Provide for a consistent fundraising strategy Data security and fraud prevention might sound overwhelming and scary, but there are many simple things your organization can do today to make your data (and dollars) safer! BEST PRACTICES FOR NONPROFIT DATA SECURITY: • Update software regularly – especially operating systems and productivity software (like Microsoft Office) } Regular updates help defend against malware! • Avoid storing sensitive data on mobile devices and drives } These devices are easier to lose and steal • Control access to sensitive data } Not all employees need to access all information • Remove access to data for former employees } Change passwords after former employees exit the organization Fundraising/donor management is the most requested application by nonprofit software buyers Nonprofit software buyers that are seeking to improve efficiency with their software upgrades CLOUD-BASED SOFTWARE ENABLES NONPROFITS TO: • Store their data online • Host IT systems online • Save money by using third-party subscription services • Reduce costs of owning IT assets 51% Social media Membership meetings Phone calls Events Surveys Emails