AASP: Navigating Change in the Nonprofit Sector

Steve MacLaughlin from Blackbaud kicked off the conference with the keynote address on change in the nonprofit sector. The first thing he addressed is generational change. Currently the average age of a donor in the US is 65. He divided the generations into Matures, Boomers, Gen X and Gen Y. Boomers currently give the most charitable gifts with 72% giving. 88% of matures give, but it's a smaller population among Gen X and Gen Y, with around 60% giving.

The other key factor here is that Generations X and Y combined are not as populous as the Boomers. Not only that, but Matures give to the highest number of individuals whereas Generations X and Y give only to an average of 3.3 organizations, about half of the number of organizations supported by Matures.

When I saw Kim Klein speak at the Oregon Nonprofit Leadership Conference this spring, she also addressed this issue. With an increasing number of nonprofit organizations and a smaller donor pool to choose from, competition is heating up in the nonprofit sector.

Steve next talked about channel engagement and discussed the evolution from single channel to multichannel to cross channel to what he calls omnichannel, which is a big messy mix of online and off-line engagement. He also pointed out that young people don't understand that there even is a distinction between online and off-line communication methods. Because they have lived their whole life with online, that distinction is arbitrary to young people.

He discussed one of the problems in creating omnichannel strategies, which is that organizations tend to create a number of islands, e.g. "Major Donor Island" or "Annual Donor Island. He also quipped that every organization wants Annual Donor Island to grow every year but without a volcano, that's unlikely.

He talked about the differences in methods of engagement between generations. Gen X, boomers and matures have similar behavior in certain ways. However, Gen Y and Gen X are far more likely to do participatory events, e.g. fun runs. All of the generations are giving online now. Among younger people giving at the point of purchase is of greater interest. Additionally, street canvassing is increasing in popularity among younger donor groups.

Steve talked quite a bit about online giving. He discussed a study done by Campbell and Company. Steve pointed out that it seems like the donors are giving online in spite of the obstacles nonprofits are erecting. For example, 65% of organizations studied required at least three clicks to give. Another 84% of the online giving sites were not mobile-optimized. And finally 86% online giving sites created no sense of urgency.

He also discussed some classic questions about online giving, including the day of week and time of day to drive people to online giving sites. It turns out the day of the week doesn't matter so much, since weekday giving is about the same across the board. There is a significant dent on Saturdays and Sundays however. What really makes a difference is hour of the day. 11 AM to 4 PM is the sweet spot for giving, so this is the best way to time to drive people to your online getting site.

Steve also said email is not dead. Last year 51% of all emails were opened on a mobile device and at this time up to 20% of  online giving traffic is driven from a mobile device.  Blackbaud did an experiment regarding thank you calls. They made 200,000 calls six months after a new donor's first gift to an organization. They had a 15 to 1 net return on investment with a 56% increase in retention rates. This bump persisted three years later even though there have been no additional phone calls to these donors.

Finally, Steve also talked about change management overall. He offered a formula for change management.

C = (D x V x F) > R

In this equation C equals change, D is dissatisfaction, V equals a shared clear vision, F is a clear first step, and R equals resistance. The concept is that you need to have sufficient dissatisfaction, vision and a clear first step to overcome resistance.

He also pointed out that change efforts tend to cause a dip in morale and productivity before the effort is successful, ultimately resulting in increased morale and productivity. He says that often change management is a matter of minimizing this dip.