Creating a recessionresilient fundraising organisation Presentation to lots and lots of consultants

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Creating a recession-resilient fundraising
organisationPresentation to lots and lots of
consultantsJoe SaxtonMarch 2009
Telephone [phone] e-mail
joe.saxton_at_nfpsynergy.net Web www.nfpsynergy.net
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The economics of the recession
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Hard times ahead???
Durex profits surged 46 first half of this
financial year 32.5 million made by SLL
Source London Paper, 26/11/08
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Real GDP growth, quarter on quarter
Data up to Q4 2008
Source National Statistics/nVision Base UK
21240 Economic Snapshot
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Inflation The three main measures
Data up to December 2008
Source National Statistics/nVision Base UK
21238 Economic Snapshot
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Interest rate, at end of month
Data up to December 2008
Source National Statistics/nVision Base UK
21239 Economic Snapshot
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Unemployment
Among all aged 16, 3-month averages, seasonally
adjusted
Data to November 2008
Source National Statistics/nVision Base UK
21242 Economic Snapshot
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UK house prices Year-on-year growth
Data to Dec 2008. Halifax data from 1984 within
chart.
Source Halifax Nationwide house price
indices/nVision Base UK
19281 Economic Snapshot
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FTSE 100 share index
Share index, April 1984-January 2009
Figures shown are at the close of market trading
every Monday. Data from 1984 is included within
the datasheet. See notes for further details
Source FTSE/nVision Base UK
4933 Economic Snapshot
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The value of Sterling
Value of 1 in terms of Euros and US Dollars.
Monthly averages. Data to January 21st.
Source Bank of England/nVision
22228 Economic Snapshot
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The value of retail sales
Year on year change in total sales
Source British Retail Consortium/nVision Base UK
19274 Economic Snapshot
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The price of oil
per barrel
nVision/Experian forecast, October 2008-based
projection (based on Q2 2008 data)
Source Financial Times/nVision
18358 Economic Prospects
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FTSE 100 share index
Share index, April 1984-November 2008
Figures shown are at the close of market trading
every Monday. Data from 1984 is included within
the datasheet.
Source FTSE/nVision Base UK
4933 Consumer Market Outlook
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Impact ondonor behaviour
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Confidence about employment and major purchases
Data to October 2008
Source Experian, Martin Hamblin
Gfk/nVision Base UK
22235 Economic Snapshot
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Optimism about household finances
Data to October 2008
Source Experian, Martin Hamblin
Gfk/nVision Base UK
19280 Economic Snapshot
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Optimism about the UK economy
Data to October 2008
Source Experian, Martin Hamblin
Gfk/nVision Base UK
22234 Economic Snapshot
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Consumer confidence index Monthly
Data up to December 2008
Source Experian, Martin Hamblin
Gfk/nVision Base UK
21647 Economic Snapshot
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Reasons for changes in spending behaviour
who cite specific reasons for influencing their
shopping behaviour in the past 6 months
If you have made any significant changes to your
spending please indicate your top 3 reasons for
this. Record in order of mention from the list
below
Source Institute of Grocery Distribution
(IGD)/nVision Base 1,002 respondents aged 18,
GB, 2008
21723
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Consumer spending

• A strong relationship between GDP and spending is
  seen in categories such as
• Out-of-Home Leisure restaurants/cafés,
  recreational and cultural services
• Consumer durables household appliances, major
  outdoor durables, furniture, tools
• Alcoholic beverages
• Personal care
• Personal effects
• Spending on food, health, fuel/electricity and
  education are much less dependent on GDP growth

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Donations to charityHave you donated to charity
in the last 3 months? Yes
P-Paper survey, O-Online survey
Base 1,000 adults 16, Britain. Source Charity
Awareness Monitor, Sep 08, nfpSynergy
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Areas people are economising on
of shoppers who have economised on the
following activities in the last 6 months
Have you economised in the last 6 months on any
of the following?
Source Institute of Grocery Distribution
(IGD)/nVision Base 1,002 respondents aged 18,
GB, 2008
21724
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Cut backs Do you expect to cut back on your
spending in any of the following areas in the
next 12 months?
Source CAM, nfpSynergy Base 1,000 respondents
aged 16, GB, Oct 2008
21724
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Cut backs Looking back over the last year or so,
would you say that you or your household has
given to charity more or less than in previous
years? / Looking forward to the year ahead, do
you expect you will increase or cut down on the
amount you give to charity?
Source CAM, nfpSynergy Base 1,000 respondents
aged 16, GB, Oct 2008
21724
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Ten things to do in a recession.
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A rule, a question and a warning

• The rule most things that are done in a
  recession would make sense outside a recession
• The question how many donor decisions would it
  take to lose half your income
• The warning perception is reality when it comes
  to giving

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Step 1 Cut fixed costs

• Staff are fixed costs
• Focus on support staff
• 1 to 10 not 1 to 1
• Create sustainable savings

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Step 2 Review variable costs

• Print
• Travel
• IT
• Properties
• Training
• Postage
• Consultants
• Research

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Step 3 Prioritise expenditure which delivers
shorter-term results

• How long before profitable
• How much profit
• How much risk

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Chart 2 Gestation period vs profit potential for
different fundraising techniques
Legacies
High length of time to reach profitability
Charity shops
Individual giving
Low potential profit
High potential profit
One-off donation
Major donors
Tin-rattling
Short length of time to reach profitability
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Step 4 Create a balanced portfolio of risk and
return
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Risk vs return matrix for different fundraising
techniques
Major donors
Increasing donation size
Direct debits
Lower returns if appeal is successful
Higher return if appeal is successful
One-off donation
Low risk of raising nothing
High risk of raising nothing
Tin-rattling
Decreasing donation size
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Step 5 Have a clear income strategy

• Helps decide the most importance activities
• Helps makes decisions about where to invest
  resources
• Stops tactical responses to the latest
  opportunities
• What are your top five priorities for the coming
  year?

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Developing ideas for growing your income

• The next chart helps identify the options
• The key is to systematically explore each of the
  options using brainstorming, desk research and
  competitor analysis (and brutal self analysis)

j
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Identifying your strategic options
Increasing net income
Cut Costs
Increase revenue
objective 1. Increase revenue by increasing the
number of relationships
objective 2. Increasing income by increasing
the value of each relationship
objective 3. Cut fixed or variable costs
strategy 6. Cut variable costs
strategy 3. Get relationships to last for longer
strategy 1. Increase no. from existing markets
strategy 4. Increase value of each relationship
activity
strategy 7. Cut fixed costs
strategy 2. Increase no from new markets
strategy 5. Get donors to do more each year
BRAND-BUILDING ACTIVITIES
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Step 6 Remember the three legged stool

• Income thats given
• Income thats earned
• Income thats granted

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Step 7 Make everyone a fundraiser

• Many of the best fundraisers are not fundraisers
  but frontline staff
• Fundraising shouldnt be ghettoised and left to
  fundraisers
• The CEO should lead the fundraising way

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Step 8 Be passionate, persuasive and personal
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Step 9 Be really clear about your target
audiences
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Step 10 Start preparing now for the next
recession
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Any questions?
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• You can get an edited version of these slides by
  giving me your business card or emailing me at
• joe.saxton_at_nfpsynergy.net