Show Me the Data!: Discovering Your Value Prop

As a nonprofit organization, your mission statement is your guiding light. It is at the heart of every grant you write and outreach letter you send and is the first metric you use to measure your impact year to year. Chances are that each member of your staff and board knows your mission by heart. But what about your value proposition?

According to Tim Kachuriak, founder and Chief Innovation and Optimization Officer for the fundraising research lab NextAfter, if he were to contact your organization and ask, “What is your value proposition?” he would likely end up with a different answer from every source. One reason is that many do not know how to define their value prop, let alone express it succinctly. Tim sat down with Steve McLaughlin as part of the Blackbaud Institute Index’s 10th Anniversary Celebration series to discuss how testing and data are critical to identifying and optimizing your value prop. In this conversation, they emphasized how organizations are most effective when they aren’t trying to be all things to all people. Identifying your unique value and presenting it to your audience in a way that speaks directly to your ideal donors can be the #1 factor that moves the needle in your fundraising efforts.

So, how do you define it? Your value prop is an effective way of connecting with donors that goes beyond your mission statement. It isn’t your organization’s values, delivery model, or social impact. Your value prop answers one specific and critical question: “If I am your ideal donor, why should I give to you rather than another organization or none at all?” Your mission statement may be the internal compass of your organization, but your value prop is how the outside world perceives you. It can’t be declared; it must be discovered in the hearts and minds of your donors. It can even shift depending on which segment of your audience you’re speaking to. It may sound elusive, but there is one surefire way to nail down your value prop: experimentation!

As Tim Kachuriak pointed out, “We don’t have to be expert fundraisers, instead we should become expert experimenters. We can allow donors to teach us through their behaviors. But we must set up a system to listen.” Testing can take you from casting a wide net with unpredictable returns to building relationships with donors who will stick with you for the long haul. It is the only way to understand how donors perceive and truly value your work. While testing may seem risky, the fear of a failed experiment should not be a deterrent. In the end, testing creates pathways for learning and evolution, making it the best risk mitigation tool in your arsenal.

The Hypothesis: Stating Your Value Proposition

If you are starting from scratch, as most organizations are, finding your value prop can take the form of a brainstorming session with a focus group of your staff, board, and even a sampling of your most loyal donors. With a variety of perspectives, you can form your value prop around these key dimensions and questions:

  • Appeal – What change are you making in the world? Is it appealing to a large segment of the population.  Do enough people want it?
  • Exclusivity – How do you stand out from other worthy organizations tackling the same or similar challenges? Are there many organizations working on the same issue, or are there only a few?  What is that you do differently that makes your solution unique?
  • Credibility – Why can donors trust you? Why are you the organization to deliver on your promise or mission? What data or facts can you point to that substantiate your claims?
  • Clarity – Is your message clear? Can donors understand your work without the benefit of being a part of the day-to-day operations?

Identifying Your Ideal Donor

When optimizing your value proposition, you must consider any possible tradeoffs.  A highly effective value proposition may have the power to attract some people and repel others. The true power of the value prop is in how it directly appeals to those donors who are most invested in your work, but even still donors give for many different reasons. With these aspects in mind, you can begin testing which messages and approaches work for your donors. A few key factors are:

  • A Sense of Belonging – How does your organization build community?
  • Impact – What tangible effects are your donors making on the world by supporting you?
  • Anger – Nothing motivates giving like the desire for change. The same “fire in your belly” that drives your work will drive your donors to support you!
  • Duty and Responsibility – Anyone who invests their time or money into a charitable organization understands that they are giving a part of themselves to the greater good. While this is most evident with high-level donors, it is also a driving force for sustainers and those who give regularly at lower amounts.

Not every donor will be driven by the same factors. As Steve McLaughlin pointed out in his conversation, “the impact that [donors] make in the world comes in different shapes and sizes.” For example, new donors will be looking for different messages than established donors; or you may see an influx of donations around a polarizing moment and want to retain these new supporters.

Ultimately, you won’t know what your donors want without testing. Thankfully, the scale of your testing can meet the scale of your organization. For his tips and tricks, we invite you to check out the entire conversation with Tim Kachuriak, available now on demand. In his “fireside chat,” he presents options ranging from simple A/B testing with your e-newsletter to following the lead of publicly traded companies. Using these techniques, you can not only broaden your donor pool but tailor your messages to build a community deeply invested in your work.

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