In this thought-provoking panel discussion on Nov. 10, sponsored by NJBIZ and PNC Institutional Management®, some of the state's most experienced nonprofit leaders talked about how to evaluate an organization's success relative to its mission and how best to communicate it to donors and stakeholders.
The comments in this Question & Answer recap of the event were edited for space reasons and to aid in the flow of the written content. It was prepared by NJBIZ Editor Tom Bergeron.
NJBIZ: Let’s start with a big question: What are donors looking for today?
Nina Stack: What I see and hear from our members is that they want to understand the world in which the grantees and the applicants are operating. Its important to have ongoing communication; that’s not just when you’re applying for the grant, but understanding the context. There will be nonprofits now that are reaching out to their key donors to explain what they’re watching for with the new administration as things change, and keeping them informed about how things are going to change for them. It is key to treat donors and stakeholders as part of the process to help them understand the world in which you are operating.
What are the biggest trends in the nonprofit sector?
Hans Dekker: I think there are two big trends that if I ran a service-based nonprofit that I would pay attention to. The first is, giving has become globalized. Over the last 30 years, the opportunities for people to give have expanded exponentially. It has expanded within the state. I think every 10 years the number of nonprofits doubles within the state of New Jersey. And it has expanded where you can put a malaria net on a bed in Africa more easily than you can give to a homeless shelter in Morris County. This has put a ton of pressure on local nonprofits to have a crisp, compelling message. I think there’s a huge leakage of donors to international giving and opportunities that have packaged themselves in a way that’s very compelling.
The second thing is giving through social media. After the flooding in Louisiana this spring, more money was given to GoFundMe pages set up by individual victims than was given to individual charities. There was something like 7,000 individual pages. I found it very interesting that people found it more compelling to give to GoFundMe, where they didn’t get a deduction, than to give to the Red Cross or the Salvation Army or the like. In some ways, we have this global issue, and we also have this ability to target at a very micro level your gift, and I wonder what that means for the nonprofits in the middle.
NJBIZ: Organizations are not only competing against other nonprofits but often others with the same mission. How do you keep your message relevant within a highly competitive landscape?
Hans Dekker: The nonprofits I admire are the ones who lift their heads up and understand the sector that they operate in, that they see the other organizations that are doing similar work to them and they recognize them, but in an artful way say, ‘Here’s our niche.’ The example I always use: There’s something like 72 after-school programs in Newark. So, as a funder, you get almost numb to how would I distinguish between After School A and After School B or After School C.
The organizations that can sort of lift their message up and say, ‘Here’s how after school education works in Newark, here’s what’s effective, here’s what’s not effective and here’s the role we play,’ I think gets donors to pause for a moment and think ‘I’m going to bet on that intervention because they’ve told me more about the landscape,’ than I am going to be on folks who are so narrow and so, ‘We’re the only game in town’ and ‘You have to go with us.’ Understanding the context is critical.
NJBIZ: How do you keep donors connected to the mission after they have given?
Sandy Carapezza: For us, it’s sharing stories. Make sure your donors really understand what you do and how they play a role in that story. That requires more than just the foundation staff to do that; we need to make sure that our board of trustees, our volunteers, our other management staff that are involved in the clinical sector, can all articulate and share stories. We also ask them to listen for those stories so we can share them with the foundation. We can communicate them in all sorts of different methods to the donors. You need to be able to do it face-to-face, through print, through Facebook, Twitter, Instagram. We need to be consistently reminding donors that they are playing a part in saving lives, because that’s what we do.
NJBIZ: Getting new donors is paramount. But it can’t always be the same pitch from the same people. How can you use existing donors to reach new donors?
SC: We’ve reached out to our board members and asked them if they can host a small event about one specific topic that’s very important to that board member. Maybe we have 15 to 20 people. Not only does the board member speak and say why this is important, but we have someone in the program, it could be someone like a family who had a child come through the neonatal unit and now that child has graduated college and is doing great, speak. Putting the face of the results of your program in front of the perspective donor is what we have found to be the most meaningful. This can grow organically. We’ll find donors say, ‘I wouldn’t mind hosting one.’ It is not a global way to acquire donors, but it is an effective way.
NJBIZ: Let’s talk about another way to get new donors: social media. Is that the future of giving?
HD: Sometimes, I think a lot of the vehicles we try to design for giving are elaborate ways to get around sitting down at lunch and asking somebody for money, and social media is at the top of that list. I don’t know the data, but my hunch is there are a relatively small number of nonprofits that raise a lot of money through social media. And the rest of the folks are doing it in very traditional ways, by building relationships with people and asking relatively high net worth donors to support them. I think there’s a role for social media. I think it’s sort of the artillery that softens up folks and get the message out and communicates the impact of the work you’re doing throughout the year, but I think I’m on boards where we’ve surveyed companies and found a small percentage where getting a small percentage from social media. Most were doing it in traditional ways.
What advice would each of you offer to nonprofits in the state, especially smaller ones looking to get established?
Nina Stack: There’s a great resource online called, ‘Stand for your Mission.’ It’s a tool kit that you can download to work with your board. The board is the most essential to your organization. Getting them to be the effective fundraisers, the ambassadors, the advocates, helping you with strategy, is key.
Sandy Carapezza: You can reach the number of people that you want, but you need to maximize that message. The board are your ambassadors in the community. You really need to engage them, educate them, take them on some really easy meetings so they realize they can do this.
Hans Dekker: I would focus on the crispness of articulating your message in the community. And really spend time thinking about what that sounds like when you do it in an elevator, when you do it in your written materials, when you do it in social media. I think, in general, we’re too soft in how that works. I think we send mixed messages without knowing it.
NJBIZ: Fair points, but the fact remains the next generation of givers live on social media. How are you adjusting to the millennial generation? In many it’s been the most giving and kind generation to come along, but it does it in different ways. How are you reaching them if not by simply tweeting at them?
SC: It’s reaching them individually. We have very involved parents in our neonatal unit that want to be involved and pay it forward. And while they are not your major donors, what we have seen is, if you engage them in an areas of volunteerism, they will stay involved. And as they grow and mature and hopefully make more money, they may develop into more substantial donors. We’ve started patient-family committees surrounding these neonatal intensive care and centers for child development where these parents are involved in areas of decision that require a set of eyes from outside. And we have found by involving them in that way, we’re keep them in our family. And while their gifts are modest, they are important. They continue to give every year, and we’ve developed some of those families into major donors today.
NJBIZ: Speaking of major donors: Do you see high cost of living in New Jersey forcing donors to move elsewhere and then donating elsewhere? How much impact will the recent repeal of the estate tax have?
HD: I think there’s no question that we are losing wealth out of New Jersey. Take 1999 to 2004 and 2004 to 2009. A study showed the wealth we gained in the state in the five years prior to 2004 was a $110 billion in new wealth, which was attached to $2 to $3 billion in charitable giving. And in the five years after 2004, we lost $70 billion in wealth and $2 billion in giving.
Linda Bowden is the New Jersey regional president of PNC Bank, but she’s far from the stereotypical banker.
Bowden began her career as a teacher and, even after joining the banking world, she said she always has felt a strong desire to help the community. “That always has been a gravitational pull for me,” she told the audience at Advancing Your Organization’s Mission: Insights from New Jersey Nonprofit Executives, an event sponsored by PNC Bank.
Her life’s work backs up that idea.
Bowden sits on a number of boards, including the Drumthwacket Foundation, the New Jersey State Chamber of Commerce, the New Jersey Symphony Orchestra and Choose New Jersey.
At PNC, Bowden makes it a mission to aid nonprofits however possible. That idea starts from having an understanding of their needs. At the conference, Bowden listed what she felt are the top five issues facing nonprofits today:
3 Increased benefits and insurance costs: If you have a staff, you can’t avoid that.
2 Better branding and communication: How can you brand yourself, how can you get the word out about what you are doing.
1 Financial uncertainty: It’s always the top challenge.
There are lots of reasons people are moving. This is where the debate gets hot, but there’s no question some folks felt they were paying a lot in property tax and income tax and, with an estate tax at the end, felt like they needed to get out of the state. We think getting rid of the estate tax is a huge opportunity for new charitable giving in the state. We genuinely believe that people don’t want to go to Florida, that they feel they have been locked out of their house and are waiting to get back to where the grandkids are.
NJBIZ: The donors of today, no matter where they come from, are different. Tell us how — and how you are dealing with that?
HD: One of the other big trends is that nobody wants to give to operating support. We hear this over and over again. There is this sense that people want to pick the individual folks even within the nonprofit that they are helping. Think of the United Way. People used to throw money in the pot for the community, you gave at the office and were glad to because you knew the United Way was doing good work in your community. You didn’t necessarily care if the dollar went to nonprofit A or nonprofit B. That’s all gone. Now you designate the charity, and they often don’t give to the United Way because they want to give directly to a place where they can count the impact they are having. And part of that stems from, we don’t do a good job of saying organizationally, ‘Here’s the impact we’re having.’ We let people pull us apart.
NS: I have this little story I tell when people start talking about program support. So, when you go to your dry cleaner, you tell them that they can only use your money on the dry cleaning fluid and that they are not allowed to use it to pay their rent or employees or a bookkeeper. Because that’s the absurdity that you’re talking about.
NJBIZ: So let’s end on this, addressing one of the bigger issues in the sector. Foundations have come under a bit of criticism or scrutiny this year. Both presidential candidates are connected to foundations that came under the microscope, and neither looked good to the general public. What impact will the recent campaign have on the nonprofit community?
NS: This is something we need to talk about, because there was a lot of talk about those foundations. We need to be prepared in the entire sector (because) there’s going to be a lot more scrutiny, a lot more exploring into how we are operating, what we are doing. Shining some light can help educate the other communities that don’t know what nonprofits do. It’s an opportunity to tell good stories about the impact we have and how nonprofits are problem-solvers within the community. But there will be a lot of scrutiny, whether it’s in Congress or the media or elsewhere, and I think we have to be prepared for it. The key is educating the public.
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