Our Ask An Expert series features real questions answered by Claire Axelrad, J.D., CFRE, our very own Fundraising Coach, also known as Charity Clairity.
Today’s question comes from a nonprofit employee who wants advice on how to persuade their board to scale back events and focus on fundraising strategies that work for them.
Dear Charity Clairity,
Last year we scrapped our in-person Gala and substituted a virtual event. Some of our board stepped up to make individual asks, and we raised almost as much revenue without having to spend all the money and time the Gala generally entails. Net/net it was a huge win. I’d like to do that again this year, and use the resources we save to expand our individual major gift fundraising, but our board is adamant we return to the in-person event. How do I persuade them otherwise?
— Can’t Live with Them; Can’t Live without Them
Dear Can’t Live with Them; Can’t Live without Them,
I hear you loud and clear!
Fundraising events often have an emotional resonance for boards, especially if they’ve gone on for years and become somewhat sacred cows. On top of that, there’s a psychological component as board members often find the concept of selling a ticket easier than asking for a donation. That’s why discussions about fundraising at board meetings and/or development committee meetings often devolve into event brainstorming sessions.
“Let’s put on a show!”
Why? Putting on a show can be exciting, but does it really help you reach your goals? Is it the best use of your limited time and resources? Could you achieve your desired outcomes in other ways that might be more effective? It’s important to make a cool-headed assessment before embarking on any development strategy, and events are no exception. I’ve found boards are often receptive to a practical, bottom-line approach.
Let’s first take a look at the practical side of the event equation. There are some things events do better than many other fundraising strategies, and many things they do worse. That’s why I don’t hate events. I love/hate them.
Here are the biggest pros:
- You host a captive audience to hear your message and experience your mission.
- Your guests meet other like-minded people connected to your organization.
- The event helps foster a sense of community.
- Attendees feel warmly cultivated if you do the requisite pre- and post-event cultivation.
Here are the biggest cons:
- They’re expensive, costing 50 cents on the dollar if you’re lucky.
- They suck time from everyone, staff and volunteers alike.
- They distract from other fundraising responsibilities, resulting in lost opportunities.
- Organizations can become overly reliant on this one form of revenue.
Now let’s take a look at two different asking scenarios.
Selling tickets to an event
Pretend you’re a board member. Imagine you approach a friend and ask them to buy two $500 tickets to your upcoming Gala. You let them know you’re putting together a table because you care deeply about this organization. You’d love them to join you because the event is going to be a lot of fun (and, by the way, it’s for a good cause).
What do they get for their $500 ticket? Well, they might enjoy things like:
- Appetizers and complimentary cocktails
- A musical performance
- A photo booth to capture the memory
- A great three-course meal—as good as they’d get at a restaurant for that price
- A silent auction
- An amazing honoree program with a moving video
- Take-home gifts
You could also imagine asking a friend to purchase a ticket to a golf tournament because they love golf or a bikeathon because they love biking. However, there’s a potential problem here: What they’d be buying would be the experience itself, as opposed to buying in to the organization’s mission, vision, and values.
In other words, these event-based asks are transactional. The perceived value to the ticket buyer evaporates quickly.
Selling a philanthropic investment
Now imagine you ask that friend for the same $1,000 as a direct donation. This will be a heartfelt investment yielding a social return. You let them know about the amazing impact their gift will have. Perhaps you share a story or two about the families and children who will benefit.
You tell them they might be providing things like:
- Emergency relief
- Job assistance
- Volunteer support
It’s well-documented that merely contemplating making a gift to others causes a dopamine jolt in the brain equivalent to that received when eating chocolate, having sex, or engaging in some other “warm glow” activity. In other words, asking for a direct gift can be transformational, not just for the nonprofit but also for the donor. The perceived value can be long lasting, particularly when it is consistently reinforced.
The philanthropy and philanthropist bottom lines
Short-term cost: The event will cost the philanthropic organization, on average, 50 cents on the dollar. If you’re being honest and take into account indirect expenses (e.g. the hours spent by the Executive Director and development staff outside of the Events Coordinator, as well as marketing, I.T., finance, and reception staff), you’ll raise even less; sometimes you’ll net nothing.
The direct donation, on the other hand, will cost very little. You can see a comparison of different types of fundraising strategy costs here.
Long-term cost: The name of the game in sustainable fundraising is donor lifetime value. If you’re not able to renew donors over time, they’re very costly.
It’s much more likely the direct donation donor will renew because:
- They felt they were giving selflessly, not buying fun for themselves.
- They envisioned the direct impact of their philanthropic investment, as opposed to the direct impact of themselves dining, dancing, and schmoozing.
- When they looked in the mirror, they saw a generous, caring person.
Generally, I love events for the purpose of major donor cultivation. They’re a great tool, but they’re only one “move” in a series of potential “moves” in your donor cultivation portfolio. And they must be used within this context, not seen as a one-off transaction.
If you don’t follow up with the folks who attend, you may as well never have held the event at all. All the fun they had and any good feelings about your cause will evaporate quickly unless you put in place strategies to stoke the fires and fan the flames.
Generally, I hate events for the purpose of “creating awareness” or “raising money.” They’re a tool, but likely there are better ones for these purposes.
In a way, when it comes to their board fundraising responsibility, event fundraising lets board members off easy.
They say: “Let’s have a Gala! I’ll come, I’ll get you a silent auction prize, and I’ll bring a friend too! Everyone will want to come; this will be easy!”
You think: “We won’t create awareness among the right people, nor will we raise as much money as we could or should. Their $500 ticket will net us just $250 after paying for the meal, band, video, parking, etc. On top of that, we’ll have all sorts of expenses, not to mention salaries, and this will take up hours and hours of staff and volunteer time. Plus, not everyone will want to come, particularly some of the folks we’ve identified as major donor prospects. We’ll attract lots of people who aren’t likely to become ongoing donors. And our board members will sell one $500 ticket rather than taking on an assignment to cultivate and solicit a $10,000 donor prospect who could become a lifelong supporter.”
Okay, so maybe you don’t want to go into this level of detail as to what you’re thinking with your board; they can get a bit defensive! But do try this practical, bottom-line approach and see if they see the light. And if they don’t quite see it, see if they’ll at least be willing to accept assignments to build closer relationships with the folks who do attend. That’s what will, ultimately, make the event worthwhile.
For a list of other things to make your event more worthwhile, see here.
Here’s to better living, with or without events,
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