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Nonprofits: Standing Out from the Competition and Building Connections with New Donors

"Saying hello doesn't have an ROI. It's about building relationships."
Gary Vaynerchuk

The nonprofit sector has been steadily growing in the United States for the past two decades. In 2016, over 1.5 million nonprofit organizations were registered with the IRS, a nearly five percent increase from 2006 (NCCS Project Team, 2019). This growth is in direct opposition to the amount of money being donated to nonprofits. While COVID-19 is blamed for a steep decline in donations, the truth is that small and medium-sized donations were down significantly before 2020. In 2016, nearly 54 percent of American households donated to a legally recognized charity organization, a 1.5 percent drop from 2014 and an 11.5 percent drop from 2008 (Rooney, 2019).

Between growing competition and fewer available dollars, your nonprofit needs a successful strategy to build your brand and attract donors. Unlike for-profit businesses that rely on transactional connections, ie: what the customer gets in exchange for their dollars, a nonprofit has to build their outreach and growth strategy by building human connections and tapping into emotions. To help you do this, our strategic planning company in Minneapolis is sharing five steps that will help you stand out from other organizations and quickly connect and build trust with prospective donors.

Understand the Problem and How Your Organization Is Solving It

Do your stakeholders know your mission? Can they clearly define it?

The first step to successfully standing out from your competition and connecting with donors is to clearly answer the following questions:

  • Who are you?
    • What does your nonprofit do?
    • Who are your stakeholders?
  • Why is this necessary?
    • What is the challenge that requires a solution?
    • Who is affected?
    • What is the scale of the issue? That is to ask, what is the effect on individuals at a micro and a macro level?
  • How does your organization help?
    • How do you provide a solution and serve the population affected?

    Oftentimes, people give to a charity or nonprofit because they want to make an impact and help others (Sanders and Smith, 2014). If someone doesn’t know the answers to these three questions, they won’t understand how their donation will make an impact or how they are helping others.

    Frequently, the lack of clarity comes from within the organization itself. Ask ten people within your nonprofit, including people in leadership, the three questions above. Are answers consistent? Before you do anything else, you need to get everyone on the same page.

    Understand What Sets You Apart from Other Organizations

    Be assured, competition does exist within the nonprofit world. By communicating your organization’s purpose, you can more easily clarify market differentiation. What you do is different and important. Perhaps your organization is serving a unique population, is the only one in your city, or you have a different vision for what you see as your goal. Be clear about what it is that separates you from your competition and use that to build and portray your brand.

    Carving out a unique niche in the marketplace is an effective strategy to engage with your donors.

    The Power of One: Create a Story That Shows the Human Element of Your Organization

    Use the Power of One to reach your constituents. One story is powerful because we can all put ourselves in another individual’s place. The Power of One also shows the challenge at a human level and also shows that the challenge is not insurmountable (Small, Loewenstein, and Slovic, 2007).

    Prospective donors are much more likely to engage with you when you’re sharing the success stories profiling individual clients who have made significant gains as a result of your interventions. Highlight a success story (with the individual’s permission, where applicable) that personalizes the challenge. Highlight what it is that your organization works to solve as well as brings your mission statement to life. Use that story to build trust and make connections with your donors.

    Show the Metrics of Your Impact

    While overwhelming a potential donor with negative statistics can turn them away from donating, seeing the benefit of what you do and the impact of their gift is one of the most effective ways to attract younger donors (Moon and Liu, 2017). Show potential donors that their money is being put to good use. Be prudent.

    Remember, create clear messaging. Use your mission statement in all of your various media. Donors will understand the impact their donations will have and will feel more confident in giving to your organization when you have clear, action-oriented messaging that communicates who you are, and how you are addressing your various stakeholders’ needs and challenges.

    Contact Woodland Strategies for Nonprofit Strategic Planning to Increase Donors

    At Woodland Strategies, we understand that it can be challenging to undergo a dramatic shift in messaging and change how you reach potential donors. We are here to assist you in creating a communication strategy that starts from within the organization and then launches outward. To set up a consultation, reach out to us today via our contact form.

NCCS Project Team. "The Nonprofit Sector in Brief 2019</a>.” National Center for Charitable Statistics. Retrieved online 5/16/2021. https://nccs.urban.org/publication/nonprofit-sector-brief-2019#:~:text=Back%20to%20top-,Highlights,of%204.5%20percent%20from%202006.&text=This%20is%20a%201.6%20percent,hours%20is%20approximately%20%24195.0%20billion Rooney, Patrick. “Where Have All the Donors Gone? The Continued Decline of the Small Donor and the Growth of Mega Donors.” Nonprofit Quarterly. Retrieved online 5/16/2021. https://nonprofitquarterly.org/where-have-all-the-donors-gone-the-continued-decline-of-the-small-donor-and-the-growth-of-megadonors/ Sanders, Michael and Sarah Smith. “A Warm Glow in the After Life? The Determinants of Charitable Bequests.” The Centre for Market and Public Organisation. Retrieved online 5/16/2021. http://www.bristol.ac.uk/media-library/sites/cmpo/migrated/documents/wp326.pdf Small, Deborah, George Lowenstein, Paul Slovic." Sympathy and Callousness: The Impact of Deliberative Thought on Donations to Identifiable and Statistical Victims.” Organizational Behavior and Human Decision Processes. Retrieved online 5/16/2021 https://www.sciencedirect.com/science/article/abs/pii/S0749597806000057 Moon Ph.D., Lee J., Liu Xi, M.A. "What Motivates Online Charitable Giving Among Unaware and Not-So-Involved Publics?” Public Relations Journal. Accessed online 5/16/2021. https://prjournal.instituteforpr.org/wp-content/uploads/Online-Giving-Situational-Theory-1.pdf

This article or any other promotional material(s) from Woodland Strategies, Inc. is in no way intended to be a comprehensive plan.

Please note all markets, circumstances, and results vary. Any strategic plan or marketing initiatives must follow all State and Federal laws and regulations, accordingly.

Please contact us directly for a complete assessment and plan for your individual organizational needs.

Ten Steps to a Successful Strategic Plan

Strategic planning is a significant undertaking. It requires energy, creativity, time and money. Your resources are important and limited. Get what you want! This is what we do at Woodland Strategies. Here are a few tips as you consider your upcoming planning project.

Choosing the Right Consultant

Consultants can provide valuable service and offer an objective perspective to assist organizations and team members in a variety of areas. Woodland Strategies, a business consulting firm in Minneapolis, MN, offers an assortment of consultancy services including Strategic Planning, Marketing Strategy, Development and Fundraising Strategy, and also Leadership Coaching.

How long does a typical strategic planning process take?

This is a question we are regularly asked at Woodland Strategies. Typically, a full strategic planning process can take up to six to eight months, depending on how in-depth the organizational planning team wants to take things.Your messaging – your values, mission and vision statements – can, and should, last between eight and twelve weeks. This is really the most fundamental part of your plan. It should never be rushed.

Succession Planning for Your Nonprofit Board

Leadership transitions within organizations can be anticipated or be quite sudden. Transitions may be due to a personal change for a board member or staff, or they may be the result of a thoughtful and long-term decision to make a change. If you are looking to keep your nonprofit sustainable, you will want to be sure that you have a written succession plan ready to go.