Season 2 EP15 - The Donor Changing Landscaspe

Welcome to Season 2 - Episode 15 of The Bridge to Kindness Project Podcast.

On this Episode you will hear from the following organization:

Dickerson/Bakker - Andrew Olsen - "Changing donor landscape"        00:00 - 24:30

Each episode features interviews on how you can be involved, volunteer, donate and make a difference being a part of these non-profits in our region.  To learn how your organization can become a part of The Bridge to Kindness project send an email to theBridgetoKindness@gmail.com.  Thanks for listening!  New episodes air each week at 1pm on Saturdays.

You can also find out about The Bridge to Kindness Project by visiting our website at www.TheBridgetoKindness.com.

Transcript

SPEAKER_02 0:30

On our website, thebridge to kindness.com, you'll find out more about our mission and have access to links to the organization's websites we spot on, as well as an archives of the interviews we have here on the podcast. We would love to hear from you. Whether you're a volunteer or you lead a nonprofit organization, you can register the website or email us at thebridgetomindness at gmail.com. Today we welcome Andrew Olson. Andrew Olson's mission is to help ministries and other nonprofits accelerate revenue growth and activate more major donors for your organization. They work across a wide spectrum from those seeking to meet individual needs in their local communities to those hoping to make a global impact for eternity. Founded in 1985, Dickerson Baker has an unbroken track record of providing professional consulting services to nonprofit clients for nearly 40 years. They've helped hundreds of organizations raise billions of dollars through capital campaigns and other development consulting programs. They have achieved local impact with a global reach. With corporate offices in both North Carolina and Texas, and consulting team offices spread across the country, they partner with groups throughout the United States as well as in Canada and overseas. Welcome, Andrew. We are so excited to have you with us on today's show. Your personal amazing background and experience is what led you to be a part of the nonprofit community. Can you share with us the story behind it?

SPEAKER_01 2:11

Yeah, for sure. Um, thanks for that question. So I have been uh serving nonprofit organizations, ministries, and social service organizations primarily for 25 years now. And uh, you know, when I got into this work, it was simply a job. I had been working in commercial real estate and uh was in a firm that I didn't quite love. So I was looking for something else. And my father-in-law introduced me to a gentleman who happened to work in a firm that uh supported nonprofits through marketing and and fundraising activities. But what I what I really hadn't worked through personally at that point, you know, when I was 22, 23 years old, is um my own personal experience as a child and a teen growing up in a in a home that was affected by by poverty and addiction. And uh I was 15 when when my family was evicted from our home because we hadn't uh paid our mortgage in in a year and a half and uh ended up homeless and then eventually couch surfed for a couple of years until until we were able to get back on our feet. But that experience, you know, it really shook me as a teen, as an adult. It clarified for me that uh, you know, I believe that I'm called um to end as much suffering as possible in the world. And and the skill set that I have uh and the tools that I've been been given by God, though those allow me to do that work by helping organizations share their story and get their message out in a way that's compelling and that um incentivizes generous people across the country and across the world to uh in turn support them.

SPEAKER_02 3:46

Do you have a story that comes to mind that tells you I'm in the right place and the right time doing what I do today?

SPEAKER_01 3:52

Yeah, you know, uh I remember distinctly standing in the welfare line with my mom as a 15-year-old, uh, um amongst a bunch of other people who looked, you know, not not dissimilar to us, uh, thinking to myself, I thought this is what poor people did. Right? Because we had been middle class uh you know before that, and and as I stood there in the line, I realized, huh? Where are those people now? We ten days ago we had everything we thought we needed, and today the only way we can make ends meet is uh is to you know to go onto a government assistance program. And my mom was a uh teacher's assistant at a school, you know, she made, I don't know, eight or nine bucks an hour, right? Not not nothing significant. And uh at the end of of every week, once some of the folks in her school district knew what was going on, she'd find a bag of groceries in her locker, or she'd find a gift card for the grocery store or something like that. And um it was in those moments where where it was really clarifying because those were the times when the night before she had sat up crying and you know, cook clipping coupons, trying to figure out like how do I stretch the last $23 that we have to make sure that the kids and I can you know have a meal and we can also pay uh for gas for her to get to work and all those sort of things, right? And and uh and so fast forward you know 20-some years, I'm standing at uh at the entrance to the Greater Boston Food Bank, which is a uh organization that I was serving, and talking to moms and kids who were in line there for the same types of services that that I received. Uh and and it was like it just hit me in the face. Like, this is exactly where I'm supposed to be.

SPEAKER_02 6:01

You had the experience a lot of nonprofits today are trying to find the ways to cope with the ever-changing environment we are in today. How are nonprofits adjusting to who they are in these times?

SPEAKER_01 6:13

Yeah, you know, the this whole issue of change, you know, I I think a decade ago, even five, seven years ago, we used to have this theory that change was a project. It was a thing you did occasionally um out of necessity. And then we had things like the uh 2008 financial crisis, we had 9-11, we had uh certainly the the COVID pandemic, um, and and you know, things that have gone on since then. And and I think what's happened is it's become real, uh it's become a reality that change is a constant, right? You layer on top of that some of the technological advances in the last five years, and things are changing at a at a more rapid rate today than than they did for for decades before, right? And so what organizations are really struggling with is not just the the fact that they have to change, but the pace of change and the velocity of it. And it's interesting because we we conduct it, uh I work for a firm called Dickerson Baker. We're a uh philanthropic advisory firm. And one of the things that we do every year is we conduct a study. We we survey uh CEOs in the nonprofit sector, we survey frontline fundraisers, and we we ask a series of different questions. And we've done some research around this issue of change. And what's so interesting to me is that you know, nearly 80% of folks in the nonprofit C-suite and frontline staff say, we know we need to change. And then almost 70% of the people who say that turn around and also say, we have no plan for change. And and what we've discovered in conversation with so many is that it is a crippling fear in in many organizations, right? It's it's the idea of sort of, you know, the fear, the uncertainty, and the doubt related to, well, what if I do it wrong? And what's it going to mean for our organization and those we serve and the community we're in if we get this wrong? But at the same time, the real the I think the greater risk is staying where you are, right? Because the the world is changing so fast that if you don't adapt, if you don't, you know, take on change efforts that that will move your organization forward, you will get left behind. And we see that with so many things, right? We see that with in the fundraising arena. I've I've talked to many organizations who say things to me like, Well, I never built a major donor fundraising program because my newsletter worked so well, or I had this community event that did so great, and and now it doesn't anymore, or something in our community changed and that's no longer available to me. And now I'm scrambling to make payroll because we didn't have the liquidity to deal with that issue. And that's just one example. Uh, and I think there are there are so many more. Um, if you look at the advancements of uh online giving and the changes that happen there, right? Where someone you know might say, well, I built this website seven years ago, it's worked just fine for us. But what they don't realize is that they haven't adapted that for the way givers' behavior has changed over the last seven years. They're not making anywhere near the kind of uh impact in their fundraising that they would be if they if there was a modern platform that they were using. And so those are you know a couple of simple things, but what they point me to is um the the the risk aversion in the nonprofit sector. And and those, you know, the folks who lead nonprofits are great people. They work really hard, they're dedicated oftentimes. They they work at a below market rate salary. I mean, there's a lot of challenges in the space, and part of that I think produces a fear that keeps many people uh stagnant instead of moving forward. And uh what we find is the organizations and the leaders who are most willing to test and try new things are those that often have the greatest breakthroughs. And so my encouragement is even when it's frightening, take a step forward, right? Just test, see what happens, learn from it, recalibrate, do it again. Organizations that are doing that are succeeding at a rate far beyond those who are staying put.

SPEAKER_02 10:26

Are there any specific disruptions that you see that are similar coming through the nonprofit space?

SPEAKER_01 10:31

There are so yes, there are disruptions that are uh sort of um worldwide, uh regardless of nonprofit things like uh technology, right? So we're we're all aware of artificial intelligence and what's going on in the AI space and the fact that you know, six weeks ago Chat GPT must may have been the you know preeminent platform, and then yesterday someone may have done an update to another platform, and all of a sudden chat GPT is old news, right? Like the the rate at which technology is advancing today is far beyond anything it's done in the last decade. And so um that that's a that's a big one. I would say another one is the shift in generations. So what we're seeing in younger audiences, which is very um uh important for nonprofit organizations, baby boomers, even Gen Xers, one of the hallmarks of giving in those uh age cohorts was a loyalty to brand. So if you are the American Cancer Society, uh a donor who is a baby boomer, let's say, might support you because they say, I want to support um, you know, cancer research and I trust American Cancer Society. Today, younger donors are saying we don't really care about the brand. We don't trust brands largely because of what we've seen go on with Enron and all you know, all this other uh sort of fraud and different things that happen in the marketplace. So they've said, we want to solve this problem. We're gonna invest in the organization that we believe is gonna do that the best. And we don't care if it's a big brand, we don't care if it's a small brand. You know what? If it's the family over across the street who happens to be dealing personally with cancer, we might just give to them through GoFundMe or something like that, instead of giving to an institution. And most nonprofits are nowhere near prepared for that.

SPEAKER_02 12:24

When we come back, we'll talk with Andrew about the future of fundraising. That comes your way next. As the Bridge to Kindness podcast continues, everyone Smith will be right back.

SPEAKER_00 12:40

You're listening to the Bridge to Kindness Podcast. The purpose of this podcast is to encourage you to identify your gifts and talents and to help you identify ways that you can use those to bless others and serve your community. For additional information about the Bridge to Kindness Project or any of the guests appearing on today's podcast, visit www.thebridge tokindness.com or email us at thebridge tokindness at gmail.com. This podcast is made possible through the kindness of EPS, signature comfort hair, expressions floral design, and Lindsay Hunt.

SPEAKER_02 13:30

Welcome back to the Bridge to Kindness Podcast. I'm Ron Smith. With us is Andrew Olsen with Dickerson Baker, whose mission is to help nonprofits with fundraising and donor support. Back in the day, our generation grew up with telethons to raise money. I remember on a national level the Jerry Lewis Labor Day MD telethon to raise money for muscular dystrophy. And even locally, our local TV stations joined to feature the Children's Hospital Miracles Network telethon. The entire donor environment has shifted. What trends are you seeing in the donor space?

SPEAKER_01 14:04

What we're seeing right now is the rate of participation in charitable giving has decreased significantly over the last 15 to 20 years. And um and right now in most organizations, if you look at where in the donor audience they're generating net revenue, it's coming from like the top two to five percent of their supporters. So um there's a there's a massive uh concentration of uh of charitable capital coming from primarily what we would call major donors. And part of that is is economic driven, right? If you look at um there there was a research study done by Pew Charitable Trust um uh a few years ago, and what they pinpointed, which I think is really critical for our sector, is um the the percentage of aggregate of the middle class in the US has decreased by 47% over the last 50 years. And why that's important to nonprofits is middle class Americans make up the bulk of people who generate who who give uh charitably, right? And and so what's happened is that group has lost so much of their aggregate wealth over the last uh 50 years that there's much less available to give to charity in in those households. At the same time, the the very you know upper level earners in the country have amassed significant wealth. Not much has changed for those in the lowest income bracket. Um so so there's a saturation of giving from high net worth individuals, and it corresponds pretty closely with the saturation of wealth there. And um, at the same time, organizations have have structured in many cases the experience that they provide donors for the top two to five percent of their supporters. They say, you know, we can we can provide an elegant, you know, thoughtful experience for a hundred people based on our staff, right? Everyone else gets put into kind of a churn and burn sort of program where you know, I might send you a lot of solicitations, I might ask you for money a lot, but I'm not building a relationship, I'm not asking for your input, I'm not inviting you in to be a part of the organization, I'm not um you know, thoughtfully thanking and engaging you because I don't have the time or resources to do that. And and that's a very real problem, but that further uh exacerbates the issue of you know the saturation of giving at the very top. And so one of the things that I think is critical for organizations as as they move forward is to identify ways, this is something that we do quite a bit at our firm, identify ways to treat every one of their donors like a major donor, whether they give a million dollars or 50. And it's not to say that you're gonna put the CEO of an organization into every household, right? That that's silly. But there are things that we can do to make sure that no matter where a donor sits kind of on their on the pyramid in an organization, uh they are being engaged in a thoughtful way, in a way that respects them, treats them like a real human being, and not like an ATM. Um, but but the in order to do that, organizations have to stop and say, we're gonna break the process that we've used before because it's not working. And and we're going to be intentional about changing the way we engage our supporters so that people feel seen and heard, and then in that process, hopefully, if they do it well, improving the number of supporters that stick around with them every year and who continue to give. Because I my real fear is that we don't have a lot of time to fix this uh before we get to the point where we are purely sustaining charitable activity on the top two to three percent of high net worth earners in the country.

SPEAKER_02 17:57

There seems to be a battle between old school and new school being involved as a donor, supporter, or volunteer versus AI, which has changed the way things work at a nonprofit from something as simple as addressing a donor letter to the personalization of a thank you note. Where's the balance between the old and the new?

SPEAKER_01 18:16

Yeah, it's a that's a great question. I think it's one that so many of us are wrestling with right now. I would say the first thing is we would advocate that you should use AI to facilitate relationship development versus to replace it, right? I think there are a lot of organizations who are thinking uh or or leaders who are thinking, well, how can I use AI to reduce headcount in my organization so that I can do this more cost effectively, um, so that I can, you know, if I only need uh two people plus uh systems, that's that's more you know financially efficient than if I need 10 people. Um what what we the way that we see that is instead of thinking of it in that respect, think about the ways that AI can get you time leverage. How can you buy back portions of your day so that your staff can actually be in relationship building activity with your supporters versus doing a bunch of tasks that are keeping them at their desk. You know, one of the worst things, particularly for a fundraiser, is the task list that that requires you to sit at a computer terminal all day and update spreadsheets and databases and things like that, when in reality, your highest and best use is to be out talking to other human beings in the community to build support. So I think that's the the primary uh way that we see this differently. In fact, our CEO, Derek Baker, he's he's actually um just in the next month releasing a book that's called A Better Way to Fundraise, Treat Every Donor Like a Major Donor, how AI is enabling major giving at scale and reshaping the future of philanthropy. And I think what um what is important about that work is that it is actually a manifesto for how organizations can do this differently, can fully leverage AI, but in a way that allows them to be able to build relationships at scale. Um, and and so you know it's it's I think largely about creating uh free free space and time uh in a fundraiser's day, but also things like can we use AI and technology to get better at surveying our donors so that we're actually asking them their opinion, we're we're listening to what they want and need, and then we're using that same technology to turn around and personalize their content that we send them so that it's reflective of what they actually told us, right? I was with a couple organizations recently asking them about their surveys, and they said, Oh, we use surveys, but we only use the survey because we know it increases the response to our mailing. We don't actually catalog any of the data, we don't we don't attach it to a donor record. So if if Sally tells me that she loves this program and that she loves it because her grandson is impacted by that program, that never makes it in the database. They're just happy that Sally responded, right? And and I think a lot of organizations fall into that trap. They they are under uh understaffed, they're under-resourced, and so they're doing those sort of things because they know that they can get a financial improvement from it, but they're not actually taking that information and using it to the benefit of the relationship with the supporter. And that's the kind of thing that that we would say use AI to help you do that so that you can then actually build a better relationship with Sally, bring her closer to the organization, and create an opportunity for a transformational donation.

SPEAKER_02 21:30

It is important that nonprofits find a way to learn about today's technology and how it impacts the operations of our nonprofits and how they continue to be effective in their mission in the years to come.

SPEAKER_01 21:42

I think the the bottom line for us is we believe there's a better way for organizations to raise revenue. And and we believe that that's not that's not a cliche, it's not a marketing tagline, it it is an imperative for our industry, right? It's an Imperative for our communities. When I think about the you know the people who are sleeping on the streets tonight, or the young girl who's being trafficked uh to pay for someone's drug habit, or the you know the animal that's being abused, all these different things that all these different causes that our our communities support and and the fact that we as an industry, as a sector, we live paycheck to paycheck, right? Because we've not built the kind of capital reserves to to protect our organizations and to be able to invest in growth strategically. And if we don't solve that, we're gonna be in a world of hurt in the next decade. And we we've seen it, you know, an anytime there's a crisis, an inflection point, whether it's a man-made or a natural disaster or anything like that, an economic issue, um, the wheels almost come off. Right? And and as as society becomes more reliant on safety net support, this is gonna become even more important. And so if we don't adapt and and embrace those better ways to to raise revenue and to engage supporter communities, um we're gonna leave a lot of people in a really bad place. And so I I think the most important thing for us is for organizations, for fundraisers, for CEOs to understand that that there is a better way to do this, and it it it is a relationship-first way. Um and that there are there are folks like us out there helping to enable that, right? Um uh but but accepting the status quo won't get you there.

SPEAKER_02 23:36

That brings to a close this edition of the Bridge to Kindness Podcast. This podcast is made possible through the generosity of EPS, signature carpet care, expressions floral design, and Lindsay Honda. Special thanks to Andrew Olson. Take a moment and think about how you can engage with a nonprofit or an organization in your community to make a difference in those around you. Join us again on our next episode, and we'll profile more individuals and nonprofits in the Columbus region and share how they help people and how you can be involved. Until then, from all of us at the Bridge to Kindness, I'm Ron Smith. Make a difference, make an impact.