James (Jim) Greenfield, ACFRE, FAHP, FAFP, About The Fundraising Effectiveness Project

From the AFP's 2018 International Conference on Fundraising in New Orleans, Amy Eisenstein interviews Jim Greenfield about donor retention, the Fundraising Effectiveness Project and tools you can use to improve your fundraising.

Video Transcript
 

Amy Eisenstein: Hi. I'm Amy Eisenstein, and today I'm here with Jim Greenfield, who is the author of 10 books. He has worked at universities and hospitals. He was one of the first CFREs and one of the first ACFREs, and I'm so excited to have him here.

Amy Eisenstein: Hi Jim.

Jim Greenfield: Good morning.

Amy Eisenstein: Thanks for joining me.

Jim Greenfield: My pleasure.

Amy Eisenstein: Today we're going to talk about the GIG and the FEP.

Jim Greenfield: Oh, you get to explain that, now.

Amy Eisenstein: Tell us what those are.

Jim Greenfield: Well, the Growth in Giving Initiative and the Fundraising Effectiveness Project.

Amy Eisenstein: Yes.

Jim Greenfield: The Fundraising Effectiveness Project has been in operation as a project of the AFP Research Council since 2006, so in our 12th year of gathering data on donors and their behavior with regards to their engagement with nonprofits. Currently, we have about 13 thousand nonprofits participating in the program, something in excess of 100 million gifts over those many years, so we have big data.

Amy Eisenstein: Yeah. That is big data. Are you able to share some of the results? What can you tell us about the findings?

Jim Greenfield: Every year we monitor several aspects of this, because one of the things that nonprofit organizations are interested in is how much money did we raise, or how are we doing raising money? So, we have data on the gifts. The information that we receive to drive all of this is the actual identification number, which is anonymized. I didn't know you could anonymize people.

Amy Eisenstein: That's good to know.

Jim Greenfield: Just a number, an identification number, an amount of gift, and date of gift, and then we put that into an Excel worksheet and then it grinds away. For example, if an organization were to submit their information, cash transactions—not pledges, not planned gifts, et cetera, just their cash transactions—to the fundraising fitness test, which is where you start, and they get back several reports. Actually, quite a few reports with a lot of data that allows them to see how their performance in many areas. For example, not just how much did they raise, but how much did they raise last year compared to this year and what difference did it make.

But, what we're really interested in is, how many donors did they acquire, how many did they renew, how many gave the same, how many gave less, how many upgraded. And so we can then look across a spectrum, because we can divide it by gift size, gift level.

We have [donor groups for] under 100, and 100 to 250, on up to 5,000 and above. So, an organization can look and see across the spectrum, for example, that they lost four $5,000 dollar donors last year, who didn't repeat. Now, as a fundraiser, it's like, "Yikes. What's going on, and where did they go, and do we know, and have we talked to them, and et cetera?"

Amy Eisenstein: Where does the data come from? Who are the participating organizations, I guess? 

Jim Greenfield: Well, the 13 thousand, actually the information comes from their donor software management firm. So, DonorPerfect or Neon, et cetera, are the data providers ...

Amy Eisenstein: Bloomerang.

Jim Greenfield: …Bloomerang, and eTapestry, which is actually Blackbaud. And so those folks provide the data anonymized to us. But an individual organization can submit its information direct to the Fitness test.

Amy Eisenstein: Oh, great. Where do they find that?

Jim Greenfield: It's on the AFP FEP website. That's https://afpglobal.org/fep, and all the information about how to submit. Now the Fundraising Fitness test is administered by PSI. PSI is the office called Philanthropic Services for Organizations of the Adventist Church national headquarters. There's a young man there by the name of Randy Fox, who you can talk to and get your information presented correctly, and he runs it in about 20 seconds. It sends back 11 reports with a lot of information, and so then, using your own information, you can compare that against the national statistics.

Amy Eisenstein: Oh, great. So, what kind of results, or what kind of data are people looking for? What is the most useful data? I know you mentioned a few points.

Jim Greenfield: Well, one of the things that we've been tracking and are very conscious of, is that for the last 10 years, the actual donor renewal rate has declined even though we've raised more money. This group has raised more money, so if an organization reports back, or receives a report back that their retention rate is 62% of their donors from the prior year, they compare that to the national group and it's 45% or 46%, and they look pretty good.

Amy Eisenstein: Yeah, but they have to start also comparing themselves year over year, right?

Jim Greenfield: Yes, and that's really the first level of performance evaluation, is yourself. So, here is a set of data, and we can take you and give you a six-year background report. So, how are you doing over the six years? Fundraising goes in cycles. You're in a campaign. You're out of the campaign, and it's hard to kind of keep that level of enthusiasm until the next campaign, et cetera.

So, the giving performance of all organizations varies from year to year, but you want to monitor and watch how many donors have you acquired, and are you acquiring new donors, because some are leaving. At 46% renewed, 54% did not, and replacing them is the challenge. It's a challenge. As we know, acquiring new, first-time donors is expensive and takes time. Then we have to renew them, and if we renew them a third time, they usually will stay with us.

Amy Eisenstein: Yeah. What does the data show us on that? Do you have the statistics?

Jim Greenfield: Five to seven more years.

Amy Eisenstein: That's really significant.

Jim Greenfield: And what's happening in that period of time, if we pay attention to them, if we make nice? They can increase their gifts, they can do more than one gift, and so their value to the organization as a loyal supporter just increases.

Amy Eisenstein: Yeah. So, when organizations find that they don't have good retention rates or even if they do, what can they do to improve their retention rates?

Jim Greenfield: It's called donor stewardship. We all know what that means. I just call it, the department of make-nice. That's what we do, and that's what we should do more of. But, we can now look at the performance and see, for example, the four $5,000 dollar donors that did not give again. Where did they go or what happened? Let's reach out to them and see if we can recover them.

Amy Eisenstein: Yeah. So, and the data will show, or help organizations figure out which donors didn't renew?

Jim Greenfield: By giving level. By giving level. Now there's a group in the middle, 250 and above, 1000 and above. That's where significantly great wealth also resides, and these are very good donors. These are donors who have a potential for growing for the organization. Not only is their continuation valid and important for us, but they can obviously stay with us and grow. They are the best candidates for upgrading.

Amy Eisenstein: Excellent. Any last thoughts? Any other results you'd want to share, or specific data points that you want people to pay attention to?

Jim Greenfield: Well, I'd like, really, to encourage organizations to submit their data to PSI and get their fitness test reports. Then they can use that as a guide against the benchmarks, or the guidelines, that the fundraising effectiveness program provides. And that can help them, help them sort out. Now, if their say, acquisition rates, or renewal rates, or upgrade rates, are not quite in the same ballpark, again, these are small to mid-size organizations fundraising of $10 million dollars or less. That's 80%, 85% of all non-profits in that size. So, they can see themselves relatively against a reasonable comparison, so the guidelines can be very helpful to guide them into how they might, or where they might, focus.

Amy Eisenstein: Oh, that's great. Okay, good. So, we'll have those links available for folks, so that they can go ahead and input their own data. All right. Excellent. Well, thank you so much for sharing this amazing resource. I'm sure that people will really flock to it once they know about it.

Jim Greenfield: Well, we hope so, but we're ready for them if they come.

Amy Eisenstein: Excellent. Thanks so much for joining us.

Jim Greenfield: Thank you, Amy.

Amy Eisenstein: Take care, Jim.

Amy Eisenstein: Thanks so much for joining me. For even more videos, interviews, tools, and resources, I hope you'll visit my website, amyeisenstein.com, and subscribe to my weekly newsletter.

For even more interviews, tools, and resources, I hope you’ll visit my website www.amyeisenstein.com.