The Leaky Bucket Nonprofit Blog

What Fundraising Can (and Should) Learn from Sales

Posted by Ellen Bristol on Tue, Dec 18, 2018 @ 10:38 AM

The terms “sales” and "selling" make a lot of nonprofit people nervous, which is too bad. There are many beneficial sales skills nonprofits would be wise to adopt, especially if you're raising major gifts and corporate sponsorship. So kindly overcome your distaste for “sales” and “selling” and read on. Fundraising and selling are two ways to generate income. Why not see what our for-profit brethren are doing that we could use??

Nonprofit leaders, let's come to terms with this idea: fundraising is like sales. Or maybe we should just say fundraising IS sales. We "sell" our missions to people who want to invest in them. Regrettably we continue to hold on to some self-defeating ideas about sales that just don't hold up. Let's do some myth-busting.

Rethinking Sales People
Development people sometimes think of sales people as greedy Closeup portrait of unhappy angry mad, pissed off senior mature woman, annoyed, giving thumbs down looking with negative facial expression disapproval, isolated white background. Emotion, sign, symbolhustlers who are only in it to make money. This is a misconception. Forget the “used-car” mythology. That really doesn't work too well for anybody. Pestering people and trying to con them into buying stuff they don't need might work on late-night TV, but it certainly doesn't work in business-to-business settings where the deals are larger. I hate to say this, but lately, it seems I get the most cold-calls and hustles from nonprofit cold-callers who don't know me. Oh, and political candidates. Ugh. Stop it already.

Major Accounts, Major Donors

So enough with cold calling, arms-length fundraising. Selling major accounts and doing major gift work are nearly identical. In both sectors, you need to:

  • Build rapport, and find areas of alignment.
  • Cultivate the relationship, to learn whether you and your prospect are "right" for one another.
  • Negotiate ways to work together, in the interests of both parties.
  • Respond graciously, whether you win or lose.
  • Stay in touch, pretty much forever. Stewardship anyone??

Major-account managers and major gift officers share so many similarities. They are both mission-driven (yes folks, for-profits have missions too, and they are not simply about making a ton of money). They become close to their clients and donors. They work hard to keep the relationship thriving.

Beneficial Sales-like Disciplines for Fundraising 
Corporate sales teams tend to have more robust support from their management, than appears to be the case in the nonprofit sector.  Just see our Leaky Bucket research for further insights.  Here are a few things nonprofit leaders can adopt from the world of corporate sales. 

  • Sales professionals know what’s expected of them, Modern notebook computer with future technology media symbolswhich creates accountability. Sales teams almost always know how much money they're expected to bring in, how many new buyers, how repeat buyers, and even how many prospects they'll need to reach their targets. By contrast, about 76% lack such performance targets. 
  • They know how to identify and qualify high-potential prospects. Effective sales teams are provided with qualifying criteria, what we'd call ideal donor profiles, because without them, the sales team will waste a ton of time on DOA's. By contrast, 84% of our  respondents lack qualifying criteria. Imagine how much time they're wasting.
  • They rely on their opportunity pipelines to track progress. Sales teams manage their opportunities to keep track of brand-new opportunities, know which ones are mid-way through the process, and which ones are "ripe" enough to forecast with confidence. Nonprofit CRMs, which should provide similar discipline, tend to lack effective opportunity management modules, so it can be difficult for development officers to keep track of everything, and figure out how to move their prospects along the arc of cultivation. Too many balls in the air at one time. 

Management Support
The highest-performing corporate sales team also enjoy something that's relatively rare in fundraising circles: exceptional management support. In thoseTwo male hands reaching out to one another, almost touching, in front of dark clear empty background wall concept sales teams, management personnel are trained to provide coaching, emotional support, and ongoing training to their sales and customer-service representatives.  They get better results, and lower turnover. Fundraising professionals deserve the same kindness. 

Raising money for charity is a difficult, emotionally demanding job.  We ask a lot of our development officers. But our own research shows we don't return the favor. We don't give them decent qualifying criteria, so they won't waste time on deadbeat prospects. We don't give them reasonable performance indicators. We don't train them, or coach them, or measure their progress in clear and simple ways. And we often ask them to do a million other things in addition to what it says in the job description.  That's not great management support.

 

What About Commissions?
This post is about the beneficial sales disciplines we would like to see more fundraising teams adopt, but to be honest, we don't think compensation practices should be part of the conversation. The idea of commission-based sales can drive some nonprofit professionals to distraction (or worse), so let's just hold compensation for another blog, probably one we won't ever publish.

But here's a great alternative. Why not improve our overall fundraising management practices and get better results? If we generated enough income, we could pay our development officers a competitive wage, not to mention all the other staff who deliver the programs, manage the cases, pay the bills, and clean the floors.  Running a charity (or any other kind of nonprofit) doesn't mean sacrificing your own life, health or comfort. Or at least it shouldn't.

Ellen Bristol

Written by Ellen Bristol

Topics: improve fundraising results, successful fundraising management, Nonprofit fundraising, Nonprofit management, sales management, pipeline, Leaky Bucket, Sales

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