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By Emily Haynes
After 25 years researching donors, Penelope Burk plans to retire in December. Burk, president of the consulting firm Cygnus Applied Research, trademarked the strategy of donor-centered fundraising in 2000. Fundraisers have relied on her sharp analysis for decades, packing into conference halls to hear her speak and asking her to sign dog-eared copies of her books. She has championed donors throughout her years as a researcher, providing fundraisers with empirical evidence about why donors give. “It is unbelievably rewarding to spend a career in the midst of donors,” she says.
As she nears retirement, Burk spoke with the Chronicle in two conversations about how philanthropy has changed and where she thinks it’s headed. The interviews have been edited for brevity and clarity.
You started the survey in 2009. What are some of the biggest changes you’ve seen in donor attitudes?
Among donors, the biggest overall change is their seriousness about their philanthropy, the degree to which they will do their research before giving for the first time or giving again. Fundraisers used to be able to say, ‘OK, here comes the appeal! I want you to give now, and this is why I want you to do it.’ They have to shift from gatekeeper to customer service agent. It’s much more like, ‘How can we give you what you need?’
In our research, donors are very clear in telling us what they need. They want restricted giving. They want to be acknowledged promptly and in a gratifying and gracious way. And they want measurable results before they’re asked to give again. And if they get them, they’ll stay.
What changes have you seen among fundraisers and how they operate?
The fundraiser’s job becomes: How can I knock my donor’s socks off with the quality of the thank-you letter that I write? How can I encourage my CEO and the programs people to give me good information that proves we are doing a great job with the money that donors give us. It’s kind of like managing up inside your own not-for-profit — all the way up to the board. The fundraisers who are going to end up in the prominent, top positions in the country are those that can manage that transition from the dictator to customer service.
Can you tell me about your first role in fundraising? How did you get into it?
It was very advantageous, but entirely accidental. I was in my early thirties and I responded to a job ad that said communications and marketing, but it was really all fundraising. That organization did nothing but fundraising events. I had spent years in the arts, where everything builds up to an opening night, so I was in sync with the idea of fundraising events and how they could mobilize people. I’d done market research studies to put myself through college. Market research teaches you not just how to articulate a good and interesting question but to stand back from the entire industry and say, “From this distance, what’s working and what isn’t? What are the differences between what donors want and what fundraisers are doing?”
I could never just take what people said as fact — which, of course, drove everybody crazy. I’d go to a conference and the person giving the lecture would say, “You can solicit a donor seven times in a year.” And up would go my hand: “Why is it seven? Why isn’t it three or 12 or any other number?” There’d be a pause and their answer would be, “Well, because we’re the experts.” “We’re the experts” didn’t cut it with me. It was pretty easy to poke holes in a lot of the things that are taken for granted — still — in the fundraising industry.
There’s some things that are phenomenal about fundraising — in major-gift relationship-building and in the stunning field of planned giving. But there are some things which should be done away with completely or definitely modified because they’re hurting or limiting the ability of not-for-profits to hold onto donors long enough for them to get interested in major or planned gifts.
What needs to change?
Most of that stuff that causes a high level of donor attrition very early happens at the bottom of the giving pyramid. It’s a huge shame because donors are quite deliberate when they decide to support a not-for-profit for the first time.
If a donor gets back what they feel is a good response — and that is the definition of donor-centered fundraising — then they’re ready to give again and to give more generously the next time. The stunning rate of donor attrition between the first gift and the second appeal, which is over 65 percent and getting worse all the time, is absolute proof that the fundraising industry is not donor-centered. If you treat your donors at the bottom poorly and shake your finger at them and expect them to somehow get to a higher gift value and then you’re going to be nice to them, then you’ve got it backwards.
You trademarked the concept of donor-centric fundraising. In recent years, there’s been some pushback against that model in favor of community-centric fundraising. Do you see those philosophies at odds with each other?
No, they’re not at odds. Donor-centered fundraising is not some grand philosophy of behavior.
Donor-centered fundraising is an approach to raising money where all your donors — regardless of their gift level or the amount of time they’ve been supporting your organization — get the following three things every time they give. First, they get a compelling, genuinely gracious thank-you letter as quickly as possible after they give. Second, they get the gifts that they just made assigned to a program or a project more narrow than the charity brand or mission as a whole. The third and final thing is that before they are asked for another gift, donors receive a report of some kind that includes meaningful and measurable information on the progress made so far in that project or initiatives to which their gifts had been assigned. That’s it. That’s the definition.
The reason I’ve written two books on it is because stating the definition of donor-centered fundraising is simple, but actually doing it in an environment where fundraising works differently from that approach takes some skill and practice.
Donors measure their self-worth through their philanthropy. They want to know they’re not just taking up room on this planet. They want to know they’re actually contributing to society. It really does require fundraisers to understand that and then help them feel good about themselves.
But good fundraising never gives into whims of a donor that are not within the strategy that the organization is fulfilling in the first place.
Do you think it happens?
Occasionally, but it’s rare. It’s the issue of that one high-maintenance donor; they want X done and they want you to do it, even if it doesn’t fit within your strategy. Some organizations will acquiesce to that if the gift value is high enough — but they never should. I had high-maintenance donors when I was a frontline fundraiser, and the best strategy is always to take that donor by the hand and say, “We don’t do this and we won’t in the near or distant future, so you’re never going to be satisfied here. Let me take you over to this not-for-profit whose mission and programs are more in line with what you want to accomplish.”
A not-for-profit that does not have a clearly identified, prioritized strategy for programs and services is always at the whim of a donor who wants to march in and dictate things. But most donors don’t want to do that.
Some critics of donor-centric fundraising say it is overly focused on the impact a single wealthy individual can make. Is it possible for fundraisers to communicate impact to donors without casting them as saviors?
Donors should not be treated as their gift values. And the strongest proponents of that are donors themselves. There are practical, life reasons why somebody at this moment in time maybe isn’t giving at a level that you think they should be giving because it’s helpful to you, but they’re doing the best they can and they’ll be back. You need to treat those parents who are sending their kids to college or the single mom with respect, just as you would any other donor.
For this latest donor report, you sliced the data along racial and demographic lines. Eighty-five percent of respondents identified as white, so the nonwhite data was more or less anecdotal. What knowledge do you think fundraisers are missing out on because there’s so little data collection on donors of color?
It’s completely essential that research as in-depth and continuous as ours has been reflects the actual American population and the giving population in America. Let’s say I wasn’t retiring and I could find sources to develop lists where I could access a greater percentage of nonwhite donors. Because their lives are not my experience at all, the question is: Am I the best person to be doing this? And I think the answer is no.
I have a lot of assets, but I’m still a white person from a relatively privileged upbringing and background, and I don’t know what I don’t know. If it suddenly became the main mission of Cygnus Applied Research to do diversity research on donors and on giving — I’m not qualified. Exceptional, continuing research needs to come out of the diverse populations and diverse fundraisers.
I’ve been doing research on donors for fundraisers for 25 years. About five years ago, the number of children born that year who were nonwhite exceeded the number of white children in the States for the first time. Twenty-five years from now, they’ll be donors. They’ll be the majority giving population, I assume. We’re in a constant state of flux, and fundraising has changed and adopted many great new ideas. But it’s facing a world of change going forward.