Everyone likes a good party, but what do you do when you know in your heart that a fundraising event has reached the end of its effective life? Rather than let the party go on, conduct an objective event audit and let the facts help you decide what do to next.

Alice L. Ferris, CFRE, ACFRE and James S. Anderson, CFRE of GoalBusters recently joined us for a webinar in which they discussed the signs of a failing event, shared tools to analyze the event’s effective return, suggested ways to soften the blow to volunteers of ending a losing program, and outlined strategies to evaluate new events before they even happen.

In case you missed it, you can view the full replay here:

Full Transcript:

Steven: All right, well, Alice and Jim, my watch just struck 1:00. Do you want to go ahead and get started officially?

Alice: Sounds good.

Steven: All right, welcome every one, good afternoon if you are on the East Coast and good morning if you are on the West Coast or somewhere in between. Thanks for being here for today’s webinar: “The Party’s Over – Special Event Audits”. My name is Steven Shattuck and I am the VP of marketing here at Bloomerang and I will be moderating today’s discussion.

Just a couple of housekeeping items before we begin, I just want to let everyone to know that we are recording this presentation and I will be sending out the recordings as well as the slides later on this afternoon, just in case you didn’t get those. So if you have to leave early or perhaps you want to review the content later on, you will be able to do that. Just look for an email from me in just the couple of hours after we conclude.

As you are listening today, please feel free to use that chat box right there on your webinar screen, I will see those questions, so will our guests and we’re going to try to save as much time as possible at the end for a Q&A session. So don’t be shy at all, don’t sit on those hands, we’d love to hear from you and answer just as many questions as possible.

You can follow along today on Twitter with #Bloomerang and @BloomerangTech is our username. We’d love to be chatting with you there as well. If you are listening today over your computer and have any connection problems, try dialing in by phone. It’s usually little bit better by phone, just look for that email from ReadyTalk that went out around the 11:30 Eastern today and you’ll see a dial in number there.

Just in case this is your first webinar with us, welcome. We do these webinars just about every Thursday, but in addition to that Boomerang is provider of donor management software. So if you are interested in that or want to learn more about us, we’d love for you to explore our website. You can even download a quick video demo and see the software in action, so check that out if you are interested. We’d love to talk to you about that later on as well.

So I want to go ahead introduce today’s guests. I’m very excited to have Alice Ferris and Jim Anderson here. Hey there, friends, how’s it going?

Jim: Hello, doing well.

Alice: I am good, and thanks for the invitation.

Steven: Yeah, thanks for accepting it. I was trying to remember where I saw you two speak, but I think I saw you speak at an AFP event and I thought that the presentation was so awesome that I reached out to these two completely out of the blue, I am complete stranger to them but they said yes. They were very gracious and I am just super excited to have them.

Before I kick things over to them, I just want to brag a little bit. If you don’t know Alice and Jim, Alice, CFRE, ACFRE. In fact, she is one of the few who has that ACFRE designation, which is very cool. She is the founding partner over at GoalBusters and she has over 25 years of professional fundraising experience. Alice specializes in strategic and development planning, capital campaign planning studies, board and organizational training and executive leadership coaching. In fact, she had a one such meeting this morning, so she is dialing in in between those meetings, I definitely appreciate that.

Jim, Jim Anderson CFRE, he is another partner at GoalBusters and he has over 30 years of sales and sales training experience. He’s worked in positions with local media and national research companies like Nielsen media, Simmons, Scarborough Research and he is consistently recognized as a top revenue producer. He was even named sales executive and negotiator of the year. He has those awards to his credit.

So I’m just excited to have you both here to talk about special events and seeing how we can get those events maybe working the way we want to or finding out if they are actually working for you. So I am not going to spend any more time, I am going to hand things off to you two to get started, so take it away.

Alice: Thank you very much! And you are not a total stranger because we stalk each other on Twitter.

Steven: That’s it, we are Twitter buddies.

Alice: Well, welcome once again everyone, and thank you very much for joining us for this session. This session is called “The Party’s Over” and the things that I always like about this particular session is that everyone like the good party, right? Well, not everybody. Some people in your non-profitable organizations are either party people or not party people. They are event people or not event people and the line is very very clear. So you will have some people in your organization that are really excited about doing your next special event and you will have some people who will immediately groan when you mention some event that’s going to be done 14 months down the line.

If you are signed up for this webinar, we are assuming that you are an event person, whether because you really embrace it and you really love it or because that’s a role that you have to play. So as we go through this stuff, our goal is to think about special events as one of the tools in your toolkit for your fund raising strategy.

Now, one of the things I want to emphasis is that part of the problem with events is that people can get really attached to them. Events can really be sacred cows in your organization. I am sure a lot of you have that event, either that you have to run or that’s at your organization or an event that you know goes on in your community even, that is one of those things that, well, they always do that.

In our community, Jim and I are actually headquartered in Flagstaff, Arizona, a community of about 55,000-60,000 people, depending on which number you used. So it’s not a very large community, but we have those events that you can schedule your calendar around. There is the hospital gala, which happens the first Saturday on December every single year, there is another gala that happens in February that’s roughly the same time every year. There are certain fun runs and 5K’s and half marathons fundraisers that are consistently scheduled. If you try to touch these things and say, “Hey, reschedule it,” or, “Let’s move it,” or, “Let’s cancel it,” sometimes people completely freak out because this is something that “They have always done.”

So I had the experience of working with one of these events. This was one of those sacred cows for a local organization that was not to be touched. In fact, we had gone into that organization to do an overall development assessment and when I did the introductory presentation to the board, as to the process we were going to go through to evaluate their development program, one of the board members without any hesitation said, “You can tell us to do whatever you want; however, don’t touch the fair”.

This was a craft fair that the organization did around the 4th of July holiday every single year and they did it around the weekend that was closest to the 4th of July holiday. So if the 4th of July happened to fall on Friday, Saturday or Sunday it was perfect, they would do a three-day craft fair and everything would be fine.

Unfortunately, if the 4th of July fell on a Thursday or a Tuesday or a Monday or a Wednesday, they would end up extending the presentation, I mean extending the craft fair to go from whatever that Friday was, to whatever the 4th of July holiday was or vice versa. So it could be up to five-day craft fair, which is a lot of work and totally exhausting for the organization and this was the one thing that the brand new CEO wanted me to come in to evaluate and potentially tell the board to get rid of.

So the entire evaluation process that we were going to walk through today actually was a process that kind of came about because we were doing this assessment. We didn’t really have a formal evaluation structure in place and because this was part of the overall evaluation, it was important to come up with something to measure.

At the end of the process for this particular craft fair, we discovered that an event that they thought they were making $45,000 on, was actually, once you counted for all the various expenses, was actually netting about $7,000. I presented this to the board of directors and to his credit, the person who told me not to touch that craft fair, was the first person to raise his hand and say, “I move that we end this event,” so sometimes numbers do work.

So again, the process that we are going to walk through for this presentation today is the process that we developed through that evaluation process for that nonprofit organization. So first we are going to touch on how events can still be part of your tool box. Then we are going to expend a lot of time going through the evaluation tool, and then we are going to talk about how to evaluate new ideas that comes to you if you end up ending an event. So that’s our overall agenda and with that I’m going to hand it over to Jim.

Jim: Okay, thanks Alice. So it’s obvious events aren’t evil. But you know people out there, maybe you are one of them, that says, “You hate special events,” because I will confess for Alice on her own behalf, that I have heard her say, “I hate special events.” But I know when Alice says that, I know when I hear other fundraisers say that, what they mean it’s not they hate all special events, what they mean is they hate bad special events and it’s really easy to do these events badly.

There are a few reasons because of that, and there are a few things that bring out frustration to when you are doing a special event. There are going to be certain events that are just clearly costing you too much time. You looked at what your return on your investment is and when I say “investment”, we are going to analyze this in more detail soon. When I am talking about investment, I am talking about all kinds of things, from your resources, your personnel, your opportunity costs, all kinds of things. These certain events take up way more time then they deliver any type of return.

Volunteer management can be an absolute nightmare if you are dealing with a large event or you got a lot of moving parts. You may need one or more people just to manage all of the free help you are giving. So that can make special events really difficult because the biggest problem with volunteers are all the people because you just have so many different personalities to manage and you can run in to these little turf wars and cliques can be formed and all kind of things can occur. And people just might not show up for the event, meaning that you end up doing all of the work.

One of the biggies is that anybody can do this. You hear this type of thing all the time. You will have a volunteer on your board or you will have some member of your team that will point out some event and will say, “Well, because the animal shelter did this event, we should do one just like it. They made so much money. We should do one of those.” It’s not always going to be able to be something that’s can be scaled to your organization or that can be applied effectively with the team and resources that you have.

You run into this because everybody thinks they are an expert, everybody thinks that they can throw a party and they think that that’s all that this is, is just throwing a party. In reality, it’s far more than that. So there is another one of your frustrations.

Finally, not enough money, you don’t have enough money put the event on effectively, or you are not going to earn enough money to make this investment worth your while. All of these can be big frustrations that you have when you are trying to put on an event.

But let’s keep in mind that there are some strong values to these events as well. There are great benefits when they are done well and when you are managing them well, when you are evaluating them well and you are executing them well. So, some of the things that you can see as benefits of the events will be the opportunity for you to engage volunteers. It’s always a great way to bring volunteers in, if that something you want to do or maybe you’ve got a lot of volunteers but they are not really doing a lot or they haven’t been really active and contributing strongly. It can be a real team building event when a special event is done well.

Recognize that some of your volunteers only want to participate in the social elements of interacting with and supporting the organization. Granted, they might give you some cash, they might show up and help you write thank you letters or answer phones or whatever the issue might be. But some of them, their personalities drive them to be much more interested in the social aspects and the special events and deliver that to them.

Obviously the ability to acquire new donors is huge. You want to make sure that you are bringing in as many people to the events as possible. There can be few things that are as troublesome as throwing a special event and only seeing the same people that are show up every year and really not making enough money.

I can give you of couple of good examples on this. One of them would be Alice and I have worked with a public radio station in Arizona. We have been their development team for 10 years, and one of the things we do is, yes, about once a year near our pledge drives, we bring in some type of a act, maybe as a musical act, or in the case that I am about to describe, we brought in Hal Holbrook’s show of Mark Twain Tonight. He has being doing this show longer then Mark Twain was alive himself.

Now this station is an NPR, public radio station, and it is in a Southwestern rural area, a lot of agriculture, a lot of military, a lot of folks that aren’t big fans of public radio, frankly. But the ability for us to have put together something that had such universal appeal like Mark Twain, like Hal Holbrook’s brought out more than 1,200 people to this event and I would challenge that fewer than half of them had ever listened to the radio station before. But it was able to create a strong fundraiser for us, that perhaps wasn’t directly in alignment with our mission but close enough because we were serving the community still. But it gave us access to donors we have never, donors and attendees that we never would have spoke to before.

I give you example and on the other end of the spectrum. There is another radio station that we work with. It is in the Midwest. They do an annual gala, okay, and their gala is basically they get some community member or may be a state politician would come in and do a speech. They charge way too little for the tables that they do.

The event only raises few thousand dollars. It has always only raised few thousand dollars and the numbers are diminishing because the people that show up at these events are the same people every year, those of course who have not passed away in the past year. They aren’t generating any new followers. They aren’t generating any new attendees. This is an example of a bad event.

When I was talking a moment ago about how easy it is to do badly, you can think about something like there is a community that we work with that do almost weekly, at least monthly street fairs during the height of their season. Generally, it’s something every week and it’s the exact same thing and it is pretty darn boring. All of it is, a bunch of folks get out, you’ve got some crafts people there, you got a couple of retailers and vendors trying to sell stuff, you’ve got some third tier musician or local band that is playing and that’s about it. They raise few bucks but it just doesn’t accomplish anything to further the mission of their organization.

When we jump back over to some of the benefits, how you can make sure you don’t throw an event like that, also think about the concept that some donors will only respond to a special event. I’ve spent many years working with a psychological consumer profiling system called VALS. VALS stands for the Values and Life Style Segmentation System. If you’d like to learn more about it or take the test yourself, it’s 35 questions, just Google “VALS test” and you will be able to do it yourself.

But at the core of this program, it says that people are motivated, they only take action based on items that gives them the greatest degree of personal satisfaction and that they will have specific alignment with one of three psychological motivations. The first is principle or ideal motivated. These are individuals who make their decisions based on what is good or what is right. Now, these are the folks who are going to support your organization even if the event wasn’t there.

I see that Alice has shared that link with you. If there are going to try to convince somebody to come to your event, they will say to that other person, “We should go because,” and the because will be that you are good cause and you are doing good work and we should go to support them, things like that.

The second group of individuals are going to make their decisions based on status or achievement. They are going to make their decisions based on what looks good or what looks right. So if somebody in that psychological motivation is going to try to motivate somebody else to go to your event, they are going to say, “We have to go because the mayor is going to be there. We have to go because the coach of football team is going to be there,” or so on and so on. It’s going to be much more about what it looks like to be at that event.

Keep in mind, when you are dealing with sponsors, all of your sponsors have to act like they are status motivated. It’s about what they get from this, who they interact with, even if they are personally principle or ideals motivated.

The third group are those individuals who are emotion or action motivated. They make their decisions based on what feels good or what feels right. They’re coming because of the party. Keep in mind that none of us
we’re all unique snowflakes. We all have different blend of these three personality types, but you will see that some are dominant.

So how do you determine whether or not an event is going to be successful? Well, you’ve got to evaluate it. Yeah, if it wasn’t for that pesky job performance, we’d all be experts and end up doing perfectly well in every effort that we have to make. But that’s not a way that we going to let special events exist. We are going to evaluate them.

So specifically what is it that we should be reviewing? Alice is going to take you through a few points here on the work sheet that was made available to you. I just want you to remind you that, most important thing, is that you pick a specific goals and stick to it and let’s just think about the two principle goals that you normally hear people talk about when they say special event. Is it a fundraiser or is it a friend-raiser?

Is this thing is designed primarily to raise money for the organization or is this is designed to raise awareness and engagement with our audience and potential audience? I encourage you to pick one of those two and make that the core of what you focus on. I also will challenge anybody who ever says that if you are putting on a fundraiser and it failed, they will call it a friend-raiser. That’s a lie. If you intended on it being a fundraiser and it failed and you didn’t raise money, you might have raised some awareness, but you failed as a fundraising event.

Alice: So what Jim is referencing is the special event assessment work sheet that was handout as a companion to this session. It is a two-page worksheet that is the compilation of all of the questions that we end up walking through when we are evaluating an event. As you can probably guess, other questions come up depending on the nature of the event, but these are good starting points and you may end up asking additional questions as you go through your own evaluation process. If you don’t have this worksheet, it can be sent along with the follow up, following the webinar with the recording link and with the slides as well.

So the way that this work sheet is set up is that at the top of the work sheet is a description, kind of basic description of what the event was. This is done obviously after the event is concluding, so the event is already over and this is time when you need to take critical step back.

Some people have asked me, “How quickly do you do this assessment?” Usually I kind of wait for about 1 week to 10 days to let the dust settle. If you try to evaluate it immediately after an event, you are going to probably air on the side of making it better event then it was. So that’s the timeframe that I am looking at, just give yourself a little breathing room before you evaluate it.

The first question is about the purpose, which Jim already talked about. Was it friend-raiser or was it a fundraiser and did you achieve that? The next chunk is growth. So if this is something you have done before was this event better than last time? Did you have more attendees? Did you have higher revenue? Did the event just kind of feel better or not? That’s sometimes just a gut feeling thing, but usually if you are looking it about 7-10 days after the event, you should have kind of settled on the numbers.

So was it better than the last year? If it’s a first time event, you’d think that the majority of the attendees will come back for another event like this one. So can you repeat it? That’s the big question. It’s not the, “Did people come and have fun?” You can delude yourself to any degree to say that everyone had fun, it was a great event.

I have literally had a conversation after a really bad event once, where the president and CEO of that organization, 10 days later on a conference call with me said, “That was a fantastic event! I think that went really well!” When in reality, as an attendee along with maybe a half a dozen other volunteers standing in the back of the reception, we were all discussing all the things we would have done differently because it was so bad. So you can easily convince yourself that people had fun.

Did we have fun? Absolutely. We enjoyed ourselves that day but was it an effective event? No. So the question for a first time event is not, “Did people have fun?” It is the, “What percentage of attendees do you think will come back?” If they will come back, then it’s potentially something that you can repeat and sustain. Oh, go ahead.

Jim: Can I toss something in here? I have trained salespeople for almost three decades at this point and I frequently had a similar experience following a failed meeting. You might think about it in this perspective as well. When leaving a sales meeting I would have sales people that would say, “That went great, they loved this, how great was that,” and I would turn to them when we were well out of eye sight and ear shot of the person that we were meeting with and I would say, “We accomplished noting. We are exactly where we were when we walked in.”

So additionally, as you are looking at this growth concept, you want to make sure that you are avoiding continuances with your attendees. They don’t want to end up where you were before they walked in the door. You want to deepen your relationship and have a more significant experience with them in some meaningful way. That’s an advance. You want avoid continuances, the status quo, and you want to have advances and move forward. Thanks, Alice.

Alice: So the other two things that factors into growth are, expenses and then that kind of gut feeling of experience. So the expenses, I mean are your expenses are going to go up or down if you repeat this event? Did it go up or down from last year if it’s already an event that you are repeating. Generally, you don’t want to see the expenses going up, that seems kind of natural. Generally, you don’t want to see things change significantly on either side, so you don’t want the revenue to necessarily go significantly up or down as well. So that’s the evaluation piece to think about in terms of growth.

The other thing, to kind of put this all together with those growth elements, is essentially you want to increase the quality of the events regardless of what that event is. You want to increase the speed in which you can put it together, because if it becomes more difficult year after year, that’s not necessarily something that you want to continue doing. You want to increase the efficiency, which related to speed, but it is also related to how efficiently and effectively can you connect with the people who are attending the event or participating in the event, and can you lower cost.

If all of these things are in alignment, then yeah, your event is probably good. If there is particular area that you are like, “Nah, that doesn’t feel so good,” it will give you an opportunity to focus on one area to make corrections. Or if they are all out of line, then that’s when you start thinking about getting rid of the event.

The next element on the work sheet is promotion and outreach.

Jim: I will touch on just a couple of points that we have here on the work sheet. The first is did the event contribute positively to your organization’s image or brand. This is a really very important point because if you think about some of those events that we talked about already, think about ones that Alice had referred to that are those annual events that everybody goes to and ask yourself, of those annual events that you are part of or that you are aware of, do people go because they really really want to go and support the organization, or do they go because it’s really really is a good party, or do they go because they have to.

Back to those three VALS points. Are they doing this because it supports you? Are they doing this because they need to be seen? Or are they doing this because they just want to have party? And how does that reflect on your organization? Are there events that you could be doing that would negatively affect your brand, things that would leave some people thinking that it was inappropriate for you?

We’ve had experience where there were board members that came away from event and said that this special event was not up to the standards of our organization and it is not with the tone and dignity of our organization. In the example that I am thinking of, I disagreed with them. I thought that it provided some levity for them. But I can totally understand if that is true and if the overall impression is more than just a couple of people, then you got brand image that you need to be aware of. So are those things consistent with who you want to be moving forward?

Then the second point, I touched on this a bit earlier when I gave you the examples of the Mark Twain event and the gala in the Midwest. Did you reach an audience that you haven’t reached before, or are you just interacting with same people you always see? If you are just interacting with same people that you’ve always seen, it’s barely more than a dinner party. You’re talking with your own clique, you are not expanding your reach.

All special events should be expanding your reach. They should be attracting new people so that they can have exposure to what your mission is and what it is that you do, and while at this event learn more about you and potentially support you.

One of the things that I train is that awareness drive interest drives action. No one will ever take action unless they have interest, and they can’t have interest until they have awareness. Awareness drives interest drives action. When you are bringing first timers to special event, you are doing that, you are giving them awareness with potentially piquing their interest at that time and who knows, they might take action and you can do donations then. But even if they don’t, you’ve given them at least the awareness part and the interest and action can follow it.

Alice: The other thing that you need to assess is staffing, and this is probably one of the things that tends to be the things that people don’t measure correctly. We’ll go through this a little when we hit the spreadsheet for the budget and the financial evaluation.

But did you have enough people to do this? And is it something that you can consistently do? Because if you didn’t have enough people and it was hard to get those people to come and volunteer, then it’s not going to be easier next time necessarily. It may be. Maybe this was the first event and people weren’t sure about what they were supposed to do and so they were reluctant to sign up. But then it ended up being a really good event so then people want to sign up the following year.

But really take a hard look at did you have enough bodies to run the event? Because very often that’s the one sticking point that people kind of dismiss. “Oh, we’ll more volunteers next year it will be fine.” But take an evaluation of that. And did you have positions that you thought would be filled by volunteers that you didn’t get volunteers for and ended up having staff for? Because then that’ll add to your cost. So, staffing is a big thing to evaluate

Again, keep track of those people who are really excited about the event and say, “I want to volunteer next time,” because what you want to make sure is that you keep track of those names so you can follow up with them and keep them more and more engaged.

The other things that you need to take into account are just kind of the random things. Were there contributing factors to this event that made it difficult to replicate the results, or extenuating circumstances that put this event at a disadvantage?

Couple of examples here. One of the events that I participated in when I was on the board of directors of a local symphony was a gala that we were bringing in the Glenn Miller Orchestra to come and perform at the convention center and we got the event completely sold out. We got all the sponsorships sold and it was looking like we were going to net six figures for this organization, which was a fantastic event, and we did in fact net that much money for the organization.

So someone on the board of directors made a motion to repeat the event the following year. I voted against that motion and the reason I did that was because the extenuating circumstances that we had for this event was that it was the grand opening of our convention center. It was the first event that was going to happen in this brand new convention center that had been in discussions for close to 20+ years and was finally a reality and somehow our executive director had managed to score the first event stage for this new convention center.

So, the extenuating circumstance was that everybody wanted to get into that building. Everyone in town wanted to know what this place was going to look like and wanted to be able to say that they were there at the grand opening of that convention center. True to form, we ended up doing it again and what ended up happening was we could not replicate those results again because, again, it was a unique situation where everyone wanted to be there.

Another example about the extenuating circumstances that put an event at a disadvantage were any number of nonprofit organizations that happened to have their major fundraisers scheduled in September, October, November or December of 2001. It happened to come up in an organization I was talking to over the last week where they did have a huge event that they had scheduled for late September of 2001, which was obviously not good timing for doing some kind of festive, fun, goofy event.

They ended up canceling it for various reasons, and important reasons I think, but those definitely things that obviously, hopefully we are not going to repeat the situation and the circumstances ever in that case. So, those events were at a disadvantage. This other one was at an unusual advantage for the timing of that event.

One of the questions that came up in chat earlier is kind of related to this area, which is why would you not want revenue to go up? You actually do want revenue to go up, but what you don’t want to project is there an unusual jump in revenue or expenses. If there is any dramatic increase or dramatic decrease in any particular line, that’s when it gets a little weird because then you can’t project on that or it ends up being related to some kind of contributing factor or extenuating circumstance, and that is not necessarily something that makes special events sustainable. So, while yes, you do want revenue to go up, you should have a little bit of queasiness if you are projecting any dramatic increases, significantly out of line increases in revenue.

So, that kind of leads us to, we already kind of touched on the overall assessment of does it feel right for your organization? So that kind of leads us to the spreadsheet. This is where the money people start to get really excited and the people who are not money people star to zone out.

So, this is a chart and there a lot of things that you can track. In fact, I’ve had many organizations that track far more things than this, and I’ve had organizations that track far less. But it’s not enough just to count the revenue. How many times have we heard a board member say, “Oh my gosh, we made $100,000 on that event”? Well, no, you didn’t make $100,000 on that event. Maybe you grossed $100,000 on that event but we’ll see how it works out in the end.

So, you do want to cover cash in your report, and in the evaluation that we’re doing, we are looking at kind of direct cash thing. Direct expenses are any cash item that went out the door. Anything that was required to make the event happen and you had to pay for it out of pocket obviously is a direct expense.

However, other things that are direct expenses can be things that got donated, so there could be in-kind of services, in-kind donations the space, whatever, but if it was required to make the event happen, it should be included as a direct expense. Then of course have a balancing entry for the in-kind donation of the revenue. So that’s how you want to do that, but what you are really trying to capture is that what would’ve the actual cost of doing this event.

That was the case with the pair that we did the evaluation on. Just because the porta-potties were donated, doesn’t mean you don’t count then as an expense. Anyone who has ever done an outdoor event knows that porta-potties can be a significant portion of your expenses and you are not going to go without the porta-potties. So because it was required to make the event happen and because there is some type of cost associated with it, it should be included in the direct expenses. So even though, a lot of people just track cash out the door, it should be the cash out the door plus anything that you had to have.

The indirect expenses are an allocation of time, and this is where that staffing piece that we were talking about earlier comes in to play. You need to take into account not only volunteer time but also allocation of your paid staff time, and this is an area where people generally don’t record it. So, what we’re looking at here is, if you had a staff person who spent 25% of their time on this event for a given period of time, two months, third months, six months, a year, whatever that is, it should be an allocation of that percentage of their salary. If you don’t want to allocate benefits if the person is not full time, it’s really up to you. But there should be some type of cash allocation of that person’s time.

The other thing you want to do is some type of volunteer evaluation, volunteer time evaluation. The number that’s on the worksheet is $18 an hour, which some people have argued is far too high. But if you actually look at the IRS standard for this, that is roughly the IRS standard for how they are evaluating volunteer time. You can adjust it for share appropriate for your market.

If you don’t think anyone would believe that that volunteer got paid $18 an hour to stand that 5K check in the desk, then don’t use that value. Maybe use $10 an hour, maybe even use $5 an hour, but give some kind of valuation for that volunteer time. Then you should also allocate assets that you have that are only used for the events.

Again, back to the fair for a moment, they had barricades that they ended up purchasing because they were tired of renting them year after year after year. So, traffic barricades. They were a social service agency, there was no reason for them on a day to day basis to have traffic barricades and these, yes, at the time of assessment were probably five-year-old or six-year-old barricades. So they had already spent the money but this is an asset that sits around all the time so there was a percentage of cost of that asset that we allocated to the cost of the event.

I’m going to switch over the revenue side for a moment and what we are talking about with the benefit side, it’s not only cash in the door. So you should be measuring, of course, ticket sales, sponsorships, the in-kind evaluation of the services that were donated, any vending, any raffles, and any other cash in the door. But you also want to be measuring the indirect benefits.

Actually, Jim, I’m going to have you jump in for a second to talk about the whole of number of impressions evaluation from your magic box.

Jim: Okay. Actually, Alice, I’m going to hit on something that you were referencing when you were talking about the porta-potties.

Alice: Yeah.

Jim: When you think about any trade of any kind of sponsorship value that you are going to get, you should think of them in three tiers. You have must do trade, you have should do trade, and you have nice to do trade. So you’re going through this evaluation process and as you’re securing sponsorships, you want to go after those must do trade relationships.

A must do trade is anything you would otherwise spend cash for. Alice’s example of the porta-potties is a must do trade. It is a cash equivalency. You want those types of trades and sponsorships. So if you were able to get in-kind donation and they wanted some kind of recognition as a sponsor, it makes perfect sense.

The second is the should do. This is marketing and promotion. You should be doing a lot of marketing and promotion. So if you can get media partners that are going to be giving you immediate exposure in return for their sponsorship, recognize them. But depending upon your organization, you may choose to separate your in-kind sponsorships from your cash sponsorships. Personally, I think that anything that is a cash savings should be recognized as a cash donation. But I don’t have a problem with slating out media sponsorships in a separate block or something like that.

But the third tier I should touch on is those nice to do trades. These things that are donated to the silent auction. You might value them at whatever the dollar amount that you received on that item, but certainly don’t value it at full retail. If somebody gave you some free water bottles with their logo on it that you are going to be giving away to your runners, I wouldn’t count that as a cash equivalency in any way. It’s nice, you gave them something nice, it improved their quality, but it wasn’t something that you would have otherwise purchased, and that’s how you you value it.

Is it something that I would have to purchase? Is it something that need I really wanted to purchase, or was it an afterthought? That’s how you value these in-kind contributions.

Back to Alice’s point about valuing impressions, when you are putting together your review or evaluation of just what you got from your exposure, you can think about things like, “Well, did I get representation in the newspaper that I didn’t have to pay for?” Okay, if you did, then you can generally claim 10% of whatever the value of that advertising would have been. If it was a $5,000 ad, I would claim that 10% or $500 as real value to us.

When you think about exposure, how many people actually saw your logo, or participated if you had your logo various places, they learned more about your organization? Generally value those at a penny a piece.

The concept that Alice is talking to is I have a sponsorship evaluation process that I go through. I call it “the black box”. I put every opinion in that box. If I get free parking that’s made available to me, it goes in the box. If I get website banner, it goes there. If I get links on a website, if I get logo representation on the back of a ticket it goes there, all of these different things go into the box.

Then I also look at a number of variables as to how effective were all these things? On something like exclusivity, I might give a high mark if I was the only person represented in a category. But anyway, come up with the terms, recognize that generally you are not going to get more than a penny a piece or so for impressions or 10% of the real cost of an ad. Going much deeper than that, we don’t have time for today. I would also
well, I’m going to hold my other thought until the next section. I guess it’s the next section.

Alice: Yes, it is.

Jim: Yeah, it is. We went right into it so it’s over. Okay, so the event is over and what do you do if you decide that you are not going to continue with this event? There is a number of things that you want to try to do. First, obviously everybody who has participated in this event in the past that you have decided it is time for something to be phased out or to be ended abruptly, you want to make sure that everybody knows that the investment that they make in the project and the events, that you had created this value. So be authentic, be sincere in the gratitude that you show. Of course make any of those key volunteers or donors aware of your plans to make changes.

Any time that we’ve had experience where were going to change something, whether it’s programming at a radio station or the nature of an event, we reach out directly to those individuals so that they know. It generally minimizes any backlash. Obviously celebrate the past, talk about how great things have been, but that’s also an excellent opportunity to segue to the fact that things aren’t really effective as they used to be.

You may or may not be familiar with the organizational growth curve. It’s a concept that when you start out in phase one, which are forming an organization or event or activity, and if you form this event, there’s a lot of uncertainty, but you’ve got some leaders that are making it happen. You try things, some things fail. You finally start getting things clicking and you enter phase two – the normative stage, where if you keep doing the same thing you have always done, you keep getting more and more and more.

But you always reach a point in phase three – the integrative stage – that if you don’t make changes, if you don’t do something differently, the results of that will start to plateau, or worse, they’ll start to atrophy. Generally what you need to do is you need to shake things up, you need to try something new, and get back into that formative stage so you can continue to grow.

Always stay positive. Don’t point fingers at anybody. If you are in an event, talk about where you’re going next, not where you’ve been or why in too much detail with most people why you’re not going forward.

Understand the concepts of emotional versus intellectual objections. Anytime you are dealing with somebody and they are objecting to what you are doing, and in this case somebody doesn’t want you to end this event, ask yourself, “Is this an intellectual objection?” Is it because they disagree with you on the facts, they disagree with you on the money, on the value, on the benefit, or is it because they are simply emotionally attached to it? Is it an emotional objection? Is it somebody that they knew and loved who was a part of it that had been a founder of this event or something that has passed away and that they are still clinging to the service of that individual? Really important to evaluate all those different things, or to address all of these specific issues as you move forward with ending an event.

But if you’re going to end it, there’s a good possibility that you are going to need to try something new. You are going to have to replace it with something. If that’s the case, how do you decide what do you want to add to your mix in the future, because it can be really challenging.

So when you are going to be going through this process you have a work sheet, you have the evaluation sheet for funding new fundraising ideas is what we’re formally calling it. I actually typically refer to it as the automated no pain no machine because what this sheet is really designed for, it is designed to help you see what the best new ideas, best new events you might try are. But it’s also really, really effective and at killing the really bad ideas because you’ll have people, if you’re in a board meeting and you’re tossing everything up on a whiteboard or something and everybody is giving you all their ideas, people are really emotionally invested in those ideas.

Back to emotional objection versus intellectual. So if they have pitched this idea, it’s very, very hard for them to step back and admit that, “You know what? You guys are right. This isn’t going to perform.” That is, unless you use numbers, because the numbers will make the case for you. So what you do is you let everybody throw out their ideas, as crazy as they might be, put it in the descriptions on the far left, and then you go through it and you rank each of these ideas, these fundraising possibilities on these five variables.

So how much money are you going to make? Is this a bake sale? Are you going to make a couple of hundred bucks, or is going to be some type of event where you could net $10,000, $20,000, $100,000 dollars? Is this going to be easy or hard? Is this something that is going to take a lot of effort to make it successful? Or is it something that is pretty much in the can?

Here I want to caution you about working with third party special event promoters. Folks that might be like golf tournaments or you’ve got people who will come in and they’ll run golf tournaments for you or are stuck like concert promoters, which be really careful with those folks. A lot of times when you are dealing with anybody who is hosting a third party event for you, you have to be very very careful about what you are committing to.

There’s often stuff in the fine print that says you have certain expenses that you have to cover. There are things like a minimum number of sales, stuff that they regularly tell you there’s no upfront cost to you, but reality, you are expected to sell a certain amount of revenue or of tickets, so you have a financial commitment to them even though they might claim that you don’t.

So be careful if you’re working on something that looks like it’s no effort because somebody else is going to do it. This is reality. There could be a lot of pitfalls there. Let’s move on to the third column.

How likely is it to succeed? Is this a slam dunk? If so, give it a chance. If you really have a lack of certainty or you really doubt that it’s going to succeed, then you rank a little bit more on the lower end or in the low range.

Uniqueness. Is this a fashion victim? Is it just another weekly wine and cheese tasting? Is it just another golf tournament every weekend, every day of the summer? If it’s a unique event that nobody else is doing, give it a high ranking. If it is still something that’s just a fashion victim that everybody is doing, the you rank it much lower.

Is it a mission match? Alice shares the story of a person in our group who did in fact want to do a wine and cheese tasting and she had to point out to them, or ask them the question, “Do you realize you are a substance abuse program and it might not be the best idea for you to host a wine and cheese program?”

So think about it. Is what you are doing closely associated with what your mission is? Does it make sense for you to be doing this? Does it scream the name of your organization? Or are you deviating from that mission by creating this event, in which case you would rank it much lower. Add all these things together, you’ll come up with your point totals, the cream will rise to the top, and those bad ideas that you would have had to battle somebody about in a board meeting, that person will not raise their hand to fight for them once they see what the real ranking is.

So there you go – the automated no pain, no machine.

Alice: There was one question in the chat about how to measure success and, really, that’s the gut feeling factor. Do we think that this is going to work? Or is it not going to work? Or do we not know?

Maybe it’s a new event. Maybe it’s a thing that has never been tried before so uniqueness is really high. But you have a gut feeling that it’s something that will fly with your audience, then maybe give it a middle of the road success measurement. But if it’s one of those things where you know it’s been a slam dunk someplace else in some other community that you think is really going to succeed, go ahead and give it a 10. If you’re not sure, then you give it a one or two then hopefully you’re proven wrong or right.

Jim: I think also, Alice, a smart move would be to look around, look for precedent. Granted, we don’t want you to be doing a fashion victim here just because you think it will succeed, but look, has there been precedent for success? Look at the resources that you have. Do you have the team in place to make this happen? Is it a good fit for your community? Is it the right time of the year? Those are variables that I would bring in here when I’m evaluating whether or not I think it’s going to succeed.

Alice: So to summarize the whole evaluation process that we just kind of walked through, what we want to do is make sure that every event the people who are involved, whether it’s the staff people or the volunteers or the board, remembers the goal of the event. You have to pick one. It’s the friend-raiser or fundraiser and you have to figure it out.

The other thing that you want to do is plan for the future. Is this something that you can replicate year after year or time after time? The other thing is does it make you look good? Does it contribute to your brand? Does it feel right? Is it a mission match? How does that work for your organization?

And just kind of the gut feeling of how do we feel about this? Is it time for this to go away? Is it time for it to be retired? Or are we still feeling pretty good about it when we have fresh people coming in time after time?

The other thing is to count all of the money. Don’t just count the gross revenue. Count other revenue that may come in that’s an in-kind contribution, but also count all of the costs.

Then that last part that we talked about was celebrating and honoring whatever you have done before and evaluate it before it comes to fruition. So you are not only evaluating an event after it happens, but you are also doing this level of evaluation with the worksheet that Jim just walked through of whether we want to move forward with it in the first place.

So I think with that we do have one page that we wanted to highlight for our website, which our free resources page. The web address is right there – goalbusters.net/free. These are a bunch of resources and templates, including the two templates that we walked through today that are just posted on our website and you can download them and copy them and make them your own.

We don’t ask for emails or anything like that. You can just take them and run with them. So if you need free templates or resources, we have a bunch of stuff there, and if there are ones that stuff that aren’t on there that you want to suggest, we have a survey on that page as well for suggestions.

With that, I know we have some questions that have lined up, so why don’t we walk through some of those?

Steven: Yeah, great. Alice and Jim, thanks so much. I’ve got a little audience here at Bloomerang listening along, I’m getting some really good feedback. Really enjoyed all the tips and I know people did in the chat as well. I am just going to roll through questions. We’ve probably got time for maybe two or three.

We’ve got one here from Leah. Leah is saying, “Our director wants to have five events a year, which sounds like a lot, with over 500 people at each event. It seems like most successful nonprofits have two to three events a year.” What’s your stance on how many events you should have throughout the year? Is there is a sweet spot, is five too many, is it two to three more palatable? What’s your feeling there? Or does it depend on the organization?

Alice: My favorite answer during graduate school is, “It depends.” I think it does in this case because if they’re smaller events and they feel like you have a different target audience, perhaps, for each of those events, they serve very unique audiences, then I don’t think that unheard of. However, if those five or six or seven or eight events or even two or three events are completely targeting the exact same audience every time, then you can start leading to donor and audience fatigue. So, if the events are unique enough that they’re dealing with different audiences, then I think it’s fine.

Steven: Makes sense. We’ve got one here from Brooke, and Brooke’s wondering about how to kind of bridge that gap between donors and volunteers. Would you recommend inviting missing donors to volunteer as a way to cultivate them? Or maybe the opposite, maybe cultivating your non-donors who do volunteer from you and kind of getting them to give a gift in addition to volunteering?

Alice: I think that, as we probably know from experience, the people who volunteer generally are more engaged and generally become better donors, in theory. That’s the theory. One of the things that we have looked at in terms of our work in smaller and rural communities is this idea of the house of philanthropy. The top of the house, the roof, is the donor pyramid. The base of the house, the foundation of the house is the culture of philanthropy for that community.

Then there are three to four pillars, depending on how you break it out. One of one of the pillars that supports the cash donations is that volunteer pillar. There’s volunteer, there’s in-kind services and donations and then there’s retail, which is kind of raffles and cookie sales and all of that stuff. So the volunteer element can support your donor pyramid. So if you really do feel like you’re cultivating donors through your event, yeah, take that into account. That’s probably one of those other x factor sections of the, “Are we doing good cultivation with this event? If so, maybe we can continue it even if perhaps it is not the highest revenue generator.”

Jim: Before we move on, I want to toss one point back on your first question about should we do five events, should we do two or three? I want you to avoid arbitrary numbers. If the decision for the number of events that you are going to do is simply based on the fact, “Well, we raised $100,000 with one event. We want raise $300,000. Therefore we will do three events next year,” that’s arbitrary. I am liken that to the concept of rules without reason are irrelevant. If you just establish an arbitrary number and there is no reason for it, then it’s irrelevant to try to achieve those goals.

Steven: I love it. That might be a good way to end it. We’re getting close to the 2:00 hour and I know we didn’t get to all the questions. But, Alice and Jim, would you be willing to take additional questions maybe by email or Twitter or something like that?

Alice: Absolutely. Although there is one I think I can answer real quickly from Stacy about the sacred cow. “Is it a good idea to have the volunteers play a role in evaluating a sacred cow event?” Absolutely. As many of those volunteers that you can involved in that evaluation process, the better, because then it’s their idea, not yours.

Steven: I love it. Completely agree. Alice and Jim, this was awesome. Thanks so much for being here, for sharing all your knowledge and spending the time and working it into your travel schedule, I really appreciate as well. So, it was great to have you. Hopefully we’ll have you back again sometime.

Alice: Thank you.

Jim: Excellent. Thank you.

Steven: Thanks to all of you for listening along. I know it’s a busy time of year so I really appreciate you taking an hour out of your work day to join us. Look for an email from me later on today. I’ll send out the recording. You’ll get a little survey when we end things here today. We’d love to hear your feedback.

We’ve got lots of great resources on our website, which you can check out. We’ve got our blog, our video podcast, our newsletter. In our next webinar, I’m really excited about it, we are going to take a week off but we are back two weeks from today, Thursday the 25th.

We are going to talk about overhead, ratings overhead and measuring the impact of the organization. Definitely may be a touchy subject, definitely a controversial subject. Lots of opinions on this and we are going to try to cut through the noise. We’ve got two guests: Richard Neustedter and Barbara O’Reilly are going to talk about overhead. So if that’s something you are interested in, please do join us. That’s a totally free presentation and we’ve got lots of other webinars scheduled throughout the year. So check out that webinar page. You might see another topic there that interests you.

So we’ll call it a day there. Have a great rest of your day. Look for email from me later on this afternoon and hopefully we will see you again on another webinar. So have a great rest of your day and a good weekend.

Kristen Hay

Kristen Hay

Marketing Manager at Bloomerang
Kristen Hay is the Marketing Manager at Bloomerang. From 2018 - 2020, she served as the Director of Communications for the Public Relations Society of America's local Hoosier chapter. Prior to that she served on several different committees and in committee chair roles.