Dunham+Company

Input always determines output

gggorman — Thu, 10 May 2012 21:38:09 +0000

Results will not be the same regardless of how you execute a strategy

Rick Dunham, President+CEO of Dunham+Company, blogging about leadership challenges for fundraisers:

I think I may just have a new addition to our Top Ten Fundraising Mistakes. And that’s the assumption that different inputs will produce the same output. Let me explain what I mean.

Over the years, I’ve worked with many organizations that have decided to bring a part of the program in-house or to have another vendor work on a project, all to save money. The thinking goes something like this: “We need to find a way to save money, so let’s …

Read the full post at Rick’s blog.

You can also subscribe to an email feed of Rick’s blog.

Ministry nonprofits see 20% growth in online revenue, study shows

gggorman — Tue, 01 May 2012 04:01:40 +0000

2012 Convio benchmark study provides important findings for Christian ministries

Online fundraising and constituent engagement services provider Convio recently released their 2012 Online Marketing Nonprofit Benchmark Index Study. The study was conducted across more than 700 Convio client organizations, 51 of which are Christian ministries.

Dunham+Company has distilled the following findings from the Christian ministry segment of the study:

Growth in online revenue: 20.1%
Average online gift: $93.45
Average online gift for first time donations: $133.15
Percent conversion of collecting email addresses online: 2.5%
Value of a usable email address: $15.43
eAppeal open rate: 19.82%
eAppeal click rate: 1.87%
eAppeal response rate: .17%
eNewsletter open rate: 21.63%
eNewsletter click rate: 3.56%
Advocates acquired online who donate: 26.95%

“Many of the findings confirm much of what we are experiencing in online behavior, although the eAppeal and eNewsletter click rates seem depressed. However, what we find particularly interesting is the study’s findings related to converting online advocacy constituents (those willing to take action on behalf of a ministry) to donors. Convio’s research implies that ministries that acquire advocates online will see more than one in four of them convert to donors,” says Rick Dunham, President+CEO of Dunham+Company.

Download the full study (PDF document).

Wealthy donors in UK push Deputy Prime Minister to reverse charity tax-break limit

gggorman — Thu, 26 Apr 2012 03:33:22 +0000

Cap on tax-free giving set to be lifted to appease ‘furious philanthropists’

From Philanthropy.com:

Nick Clegg, Britain’s deputy prime minister, told a private gathering of wealthy philanthropists this week that the government will amend its controversial plan to cap tax deductions on charitable gifts, according to The Telegraph.

The daily newspaper says a compromise proposal could be announced next month and a likely option is a 50-percent limit on the amount of gross income for which a taxpayer can claim charity tax relief, in line with U.S. law. The current U.K. government proposal is to limit the total amount of deductions an individual can claim per year to $80,000 or a quarter of income, whichever is higher.

Is everyone entitled to their opinion?

gggorman — Thu, 19 Apr 2012 21:49:21 +0000

Seth Godin says two things disqualify someone from being heard

Author and marketing expert Seth Godin:

When you walk up to an artist and tell her you don't like her painting style, you should probably be ignored. If you've never purchased expensive original art, don't own a gallery and don't write an influential column in ArtNews, then by all means, you must be ignored.

Last week, Rick Dunham, President+CEO of Dunham+Company, blogged about a related topic:

Over the years, I’ve often seen well-intentioned efforts on the part of fundraising staff actually undermine the effectiveness of the organization’s fundraising program. As I’ve consulted with these organizations, what happens is that they begin to second-guess recommended strategic direction. This can happen with high-level strategy down to the more granular work of direct mail.

Again, as I posted recently, they begin to believe that they can change the “input” into the fundraising strategy and execution and still experience the same “output” or results… or even improve results. This is especially dangerous when it comes to effective direct response copy, a craft that is highly specialized.

Study shows email still stronger driver of consumer purchases than Facebook, text messages

gggorman — Fri, 13 Apr 2012 20:36:16 +0000

Social media gaining for personal communications, but email still the most popular marketing channel

From Business Wire:

A new study released today by global interactive marketing provider ExactTarget (NYSE:ET) found two thirds of online Americans have made a purchase as a result of email, nearly twice the percentage who have purchased after receiving marketing messages delivered via both Facebook and text messaging.

Key findings of the research include:

96 percent of online consumers use email at least weekly.

66 percent have made a purchase after receiving an email marketing message.

76 percent prefer email over all other channels for customer service messages.

68 percent of online consumers use text messaging at least weekly.

16 percent have made a purchase after receiving a text (SMS) marketing message.

70 percent of online consumers use Facebook at least weekly.

20 percent have made a purchase after receiving a marketing message on Facebook.

4 percent prefer Facebook over all other channels for permission-based marketing.

While this study centers on consumer purchasing behavior, it corroborates our own experience across many clients that email is still the most highly valued and effective nontraditional marketing/fundraising channel for nonprofits across all demographics.

The danger of an inactive email list

gggorman — Tue, 10 Apr 2012 15:45:36 +0000

Sophisticated spam filters raising the stakes for e-fundraisers

From Philanthropy.com:

Inactive e-mail lists have always posed a challenge to fundraisers, but as spam filters get more sophisticated, the stakes are getting higher, Dan Atherton, a consultant at Chapman Cubine Adams + Hussey, told participants in San Francisco at the Nonprofit Technology Conference.

He said e-mail providers like Google, Hotmail, and Yahoo monitor how people interact with an organization’s e-mail communication, and if not enough supporters open the messages, the providers will stop delivering the messages to subscribers’ inboxes.

“If nobody in the first wave of e-mails I send out opens my e-mail, other people won’t even see that e-mail,” said Mr. Atherton. “It will go into their spam folder.”

Jesus Didn’t Want Higher Taxes

D+C Site Administrator — Mon, 13 Feb 2012 18:06:44 +0000

This opinion editorial by Rick Dunham was originally published in The Philadelphia Inquirer and on their website, Philly.com. It is reposted here by permission.

Rick Dunham is the president of Dunham+Co., which advises charities, and the author of Secure: Discovering True Security in Turbulent Financial Times

In a rather bizarre line of reasoning, President Obama claimed at the recent National Prayer Breakfast that Jesus would favor his plan to increase taxes on the rich. His logic is based on two passages in the Bible:

“To whom much has been given, much is required” (Luke 12:48)

“Love thy neighbor as thyself” (Matthew 22:39)

There’s no doubt that Jesus cared for the down and out. He healed the sick, fed the hungry, and poured his life out for the outcasts of society. And his teaching was filled with challenges to his followers to do the same. Obama is right; Jesus does want us to love our neighbor as ourselves.

But that raises the question of who exactly is our neighbor. Evidently, Obama, who releases his proposed budget Monday, believes it is the bloated government bureaucracy that is massively in debt. Actually, I don’t believe Jesus had the government in mind when he said “neighbor.”

In Luke 10, Jesus tells us what he meant by neighbor in the story of the Good Samaritan. He makes it clear that it is the person we see in need whom we have the capacity to help. That’s our neighbor, not Uncle Sam.

But what about the rich? How did Jesus view their responsibility? We get an idea in a conversation he had with a very rich man.

The rich man asked what he needed to do to inherit eternal life. Jesus gave him a list of commandments to keep, and in response the rich man said he had kept all the commandments since he was a boy. The passage goes on to say:

“When Jesus heard this, He said to him, ‘You still lack one thing. Sell everything you have, and give to the poor, and you will have treasure in heaven. Then come, follow me.’ When he heard this, he became very sad, because he was a man of great wealth” (Luke 18:22-23).

The man had come to trust his wealth for his security. Jesus knew money had become his god, so he challenged the man to give it up and come follow him. Jesus wanted the man to place his faith in him rather than the man’s wealth.

And where did Jesus say to give it? He didn’t encourage him to pay more taxes to the government, but to give it to the poor.

If the president really wants to follow in the footsteps of Jesus, he ought to find ways to increase the incentive for the rich to give more to charitable organizations that effectively serve the poor. In fact, in a recent national poll conducted by our company, three out of four Americans indicated they believe that private charities are better at promoting social good than the government.

So, President Obama, if you are truly concerned about the poor and needy, if you really want to see the rich share their wealth more generously to benefit those who are struggling, then not only should you retain the current charitable tax deduction for households making $200,000 or more; you should find new and creative ways to encourage even greater philanthropy to support the charities that do social good.

That’s how you can encourage those to whom much has been given to do even more to love their neighbors as themselves.

View the original article at The Philadelphia Inquirer.

Three-fourths of Americans favor charitable tax deduction

D+C Site Administrator — Tue, 07 Feb 2012 18:07:24 +0000

Survey indicates any changes to system would face strong opposition

With the release of the 2013 Federal budget, the Obama administration has once again called for the capping of the charitable tax deduction for high net-worth households, taking it out of step with what the American public wants, according to a study (PDF download) conducted by Wilson Perkins Allen Opinion Research on behalf of Dunham+Company.

Americans have made it clear that they value the deduction as it currently stands as more than three-quarters (78 percent) indicated that they agree with the following statement:

“Tax deductions to charities should not be cut, capped, or limited because charitable tax deductions encourage people to give their money to help others without getting anything tangible in return.”

President Barack Obama had indicated a shift in his policy and a willingness to preserve the charitable deduction for high net-worth households during his State of the Union address. But the 2013 Budget calls for a cap of 28 percent on the charitable tax deduction for households making $200,000 or more.

“The attitude among the American public regarding the charitable tax deduction is clear: Regardless of household income, education, age, race, or gender, Americans overwhelmingly support the current tax deduction for charitable contributions,” said Rick Dunham, President+CEO of Dunham+Company. “President Obama has once again shown he does not embrace the importance of retaining the charitable tax deduction at its current level, even though these households, representing less than 3 percent of households, provide $100 billion, over 40 percent, of all individual charitable contributions.”

Not capping, cutting, or limiting the charitable tax deduction is especially strong among women, with 82 percent agreeing with the statement, and in the key donor demographic of 55-64 years old, with 84 percent agreeing with it.

The study shows that cutting, capping, or limiting the charitable tax deduction for those who make over $200,000 per year would likely drop total donations by as much as $5 billion to $7 billion. This would spell significant trouble for nonprofits that rely heavily on support from high net-worth individuals.

The study uncovers areas of giving that could be most affected if the charitable tax deduction were to be cut, capped, or limited. For example, the impact is most significant to those 45-54 years of age, an important emerging donor demographic. This particular group shows a potential 19.1 percent decrease.

Also concerning is the potential drop in donations in the Northeast and Midwest. Donors in the Northeast indicate that they would reduce their giving 18 percent; and in the Midwest, the variance is even greater with donors saying they would reduce their giving by 25 percent.

The survey also found that most Americans (73 percent) believe that private nonprofits are better at promoting social good than the government.

“The United States has the most robust charitable sector in the world, and one of the main reasons is our unique system of tax incentives for those who give so generously,” Dunham said. “The social good the deduction generates far outweighs the money it costs. And things like education of our youth, healthcare, help for the needy, and funding for the arts can’t be measured on a balance sheet, so the Administration should do all it can to retain the charitable tax deduction as it stands for high net-worth households.”

The study was part of Wilson Perkins Allen Opinion Research’s January Omnibus Study of 1,000 adults nationwide. All respondents were contacted via Random Digit Dialing methodology. Interviews were conducted via live telephone interview Jan. 5-8, 2012. A sample of 1,000 has a margin of error of plus or minus 3.1 percent at the 95 percent confidence level.

Dunham+Company Study Shows Charitable Giving Should Continue to Rebound in 2012

D+C Site Administrator — Thu, 26 Jan 2012 17:41:16 +0000

According to our annual New Year’s Philanthropy Survey conducted by Wilson Perkins Allen Opinion Research, Americans continue to show an increasing willingness to financially support charitable organizations.

For the second year in a row, more Americans indicated they planned to give more (18 percent) to charity in the coming year than those who plan to give less (13 percent). Most Americans (68 percent) plan to give the same amount to charity in 2012 as they did in 2011, which is two percent higher than last year.

“Overall, the findings of this year’s survey are very encouraging as they show a continued strengthening in donor confidence,” said Rick Dunham, President+CEO of Dunham+Company. “Based on the survey, we believe individual charitable contributions should rise by between 4 and 5 percent in 2012, which is very encouraging. It has been a very hard road for many charities over the last four years.”

If contributions do rise even 4 percent, that would represent approximately $9 billion more in individual charitable giving over 2011.

The poll shows that donor confidence has recovered from a low in 2010 when 27 percent of Americans said they would give less to charity; this year, less than half (13 percent) say the same. In addition, there has been a 28 percent increase in those who say they will give more, a trend that continues from 2011.

This upbeat news for charities is bolstered by the fact that 71 percent of American households plan to give to charitable organizations in 2012. If they follow through on their intentions, participation in giving could be near record levels as the last year data is available (2006) 65.5 percent of households gave to charity.

Most importantly, high-income earners ($125,000+ per year) indicate they will increase their giving. A year ago, 19 percent of these high-income earners planned to give more in the upcoming year than they did the previous year. This year, 21 percent plan to give more than they did last year. In fact, every income group indicated a greater likelihood to give more than they gave in 2011, except for households in the $50,000-75,000 income bracket which are much more likely to continue to give at their current levels.

This positive news for charities holds true in three of the four Census regions. More adults in the Midwest (16 percent in 2012 vs. 14 percent in 2011), the South (22 vs. 21) and especially the West (21 vs. 16) indicate they plan to give more to charity in the upcoming year than they did the previous year. Only adults in the Northeast are indicating they are less likely to increase their charitable giving (21 percent in 2011; 9 percent in 2012).

“The sharp drop in the percentage of donors in the Northeast who indicate they plan to give more from 2011 to 2012 is a bit concerning, but should not be a cause for great alarm as nearly 3 out of 4 indicated they plan to give the same as last year,” Dunham added.

Younger donors (18-34 years old) indicated an especially high interest in increasing their giving in the coming year with more than 1 out of 4 indicating as such. But organizations need to temper their expectations of this younger group as the amount they intend to give is less than the older demographics, although the 25-34 year olds show potential to give at a greater level.

Members of one of the most important donor demographics, adults ages 45-54, show an especially strong intention to give more this year than they did last year with a 28 percent increase in those who say they will give more (18 percent in 2012 vs. 14 percent in 2011).

Likewise, even older Americans plan to continue or increase their giving this year. The same percentage of adults ages 55-64 as last year indicate they are going to give more to charity than they did in the past (14 percent in 2012 and 2011). Even adults aged 65 or older are indicating a higher likelihood to give more. Last year only 5 percent indicated they were going to give more in the upcoming year. This year 9 percent indicate they are going to give more to charity, an 80 percent increase.

This is the fifth year the survey has been conducted, dating to 2008 when the recession began.

Many U.S. charities facing increased demand, signs of fiscal stress

D+C Site Administrator — Thu, 15 Dec 2011 21:58:43 +0000

Organizations below $3 million in expenditures experiencing greatest challenges

PREFACE: “It is no surprise that many charities, especially smaller ones, continue to struggle,” said Rick Dunham, President+CEO of Dunham+Company. “In a climate of cutting budgets, charities need to guard carefully those expenditures that generate revenue to ensure their situation doesn’t worsen. And they must focus attention on creating sustainable and scalable streams of revenue and not just one time gifts.”

Sixty-five percent of charities surveyed report increased demand for their services in 2011, but just 41 percent saw increased fundraising results in the first nine months of 2011 compared to the same period a year ago, according to the Late Fall 2011Nonprofit Fundraising Study, conducted by the Nonprofit Research Collaborative (NRC).

Smaller charities, those with less than $3 million in total expenditures and which make up 90 percent of the nation’s nonprofit organizations, saw disproportionate declines in funds raised and were more likely to report they are planning budget and services cuts in 2012.

“Every day, almost every American is touched by a nonprofit organization, whether it’s the health facility that provides medical care or the school that educates our children, and they are being asked to take on an even more critical role in this tough economy,” said Bob Ottenhoff, president and CEO of GuideStar, a member of the NRC. “We know nonprofits are already struggling, and more than half say their fundraising results have not improved to date in 2011. In this study, we found that 79 percent of smaller charities report experiencing four or more of the nine signs of fiscal stress described in the study. Many smaller organizations are stressed, which will affect the availability and quality of their services.”

The Late Fall 2011 Nonprofit Fundraising Study found that in addition to increases in demand, organizations of all sizes anticipate starting 2012 with reduced revenue from numerous sources, including:

Philanthropic support, which was flat or lower at 59 percent of responding nonprofits through the first three quarters of 2011, compared to the same period in 2010;
Government funding, with more than half (54 percent) of those with government funding reporting a decline compared to 2010; and
Funding from sources other than contributions reported down by 46 percent of respondents.

“With demand up and resources constrained, responding charitable organizations face difficult choices for 2012,” according to Tom Pollak, director of the National Center for Charitable Statistics. “About 49 percent in this survey plan increased spending on program activities, yet about 60 percent plan no new hires and no layoffs, indicating some intend to increase activities with the same staffing levels.”

Smaller organizations worse off by nearly every measure

While many nonprofit organizations saw fundraising results flat or down in the first nine months of 2011, and many are planning conservatively for 2012 budgets, smaller organizations (total expenditures of less than $3 million) are more challenged. In comparison to larger organizations, smaller survey respondents reported:

Greater likelihood of decreased in contributions to date in 2011, with 31 percent of smaller organizations reporting a decline compared with 17 percent of larger charities;
Greater likelihood of plans to reduce staff in 2012, at 29 percent of smaller organizations compared with 20 percent for larger organizations.

About the Survey

The Nonprofit Research Collaborative (NRC) conducts surveys three times a year. The current report and prior reports from the Nonprofit Research Collaborative are available here.

This survey was conducted online in October 2011 about fundraising results from January through September 2011 compared with the same period in 2010, and about plans for 2012. The 875 respondents form a convenience sample. There is no margin of error, as it is not a random sample of the population studied. Reported results are statistically significant using chi-square analysis by organizational size. There were no statistically significant differences when comparing organizational responses grouped by organizational mission (subsector) or region of the United States.

About the Nonprofit Research Collaborative (NRC)

Six organizations form the NRC. Each has, at a minimum, a decade of direct experience studying nonprofits’ charitable receipts or fundraising practices. Partners are: Association of Fundraising Professionals; Blackbaud, Inc.; The Center on Philanthropy at Indiana University; Giving USA Foundation; GuideStar USA, Inc.; and the National Center for Charitable Statistics at the Urban Institute.