Bettering Your Best Isn’t Good Enough Anymore
Posted on December 29, 2012
When it comes to charitable giving results, most of us have been conditioned to think that doing better this year as compared with last year is a reasonable expectation. Not anymore.
Now, every month you can compare your results to the performance of your sector (education, religion, health, etc) and your state (or states) and by donor source (individual, corporation, foundation, and bequests). The information shows last month, last 3 months, last 12 months and the current calendar year. And, even more importantly, you can now see a current forecast of what giving will be in next month, next 3 months, and next 12 months… by sector, by donor source and by state.
Now – you can know if you are gaining or losing market share.
Now – you can build an efficient budget based on a reliable charitable giving forecast.
Now – you have the information you need to plan fundraising campaigns and promotions for maximum impact.
Now – you can evaluate staff performance, campaign performance, and unit performance to a solid measurement tool.
Now – you can measure the impact of specific events or policy changes on your results.
Maybe – you don’t want to know… but soon your board and your boss will AND they will have access to this information.
In June of 2001, I was tapped to head fundraising at the American Cancer Society. Our fiscal year started on September 1. Then horrific day that we will never forget changed everything. The CEO called. “What do you think this means for our giving income?” My response was anemic, “I don’t know John, but it can’t be good. My biggest concern is how long the effects will last.”
A year later, while reporting our giving results to the National Board of Directors, I declared that we had a good year. We believed that ACS was one of the few non-disaster related charities to finish the year with a giving increase… a very, very small increase. “How do you know?” shot back one of the Board members. “We’ve talked with some other organizations” I replied. “Isn’t there a benchmark for national charitable giving?” “Well yes, but numbers for 2002 won’t be released until June of 2003.” …having to give this answer really bothered me.
Then the board member made a suggestion, “My guess is that our charitable giving is directly tied with certain economic and demographic factors that are regularly reported. If you can find out what they are, you should be able to create a benchmark that can be used quarterly or even monthly. You will also have what you need to forecast. This kind of modeling is used by hedge funds to generate big returns.”
Last year, we cracked the code. We engaged a team of 25 PhD researchers to test almost 70 possible variables against 42 years of published US giving results. The result was amazing.
We were able to create an algorithm (formula) with a handful of the input variables that matched 42 years of published charitable giving results with a correlation of 99.5%.
Because the input variables are reported monthly, we are able to measure charitable giving monthly. And, more importantly, we are able to forecast charitable giving for the next 12 months. So we created the Atlas of Giving.
This year we created the models for measuring and forecasting by sectors, by donor sources, and by state. We have used this to create the Atlas of Giving Professional Edition – the ultimate economic intelligence tool for charitable giving.
Atlas Pro will forever change nonprofit management – for the better.
I only wish it had been available for me during my 28 year nonprofit career.