Moving Out of a Membership Mindset

Jeff Schreifels 

Do you have a membership model as part of your organization’s strategy? Many non-profits do. If that’s you, you may have wondered: where does mid and major gifts fit into a membership-based fundraising model? On today’s podcast episode, we’re doing a deep dive on this topic, and we’ve invited a special guest. Joining us today is Joyce MacDonald, CEO of Greater Public. She’ll share what happened when organizations she worked with shift from basically a membership-only model to invest in a mid and major gift fundraising program. Listen to find out the results.

 

Recorded 

Welcome to the Nothing But Major Gifts podcast from Veritus Group featuring Richard Perry and Jeff Schreifels. Twice a month, we bring you the latest and best thinking about major gift fundraising so you can develop authentic relationships with your major donors. Here are your hosts, Richard and Jeff.

 

Jeff Schreifels 

Welcome to the podcast today. I’m Jeff Schreifels, and Richard is off today. And I’ve invited Karen Kendrick, our Director of Learning who oversees all of our training at Veritus. And she’s going to co-host with me, but we also have a very special guest who has joined us. About five years ago, Joyce MacDonald joined Greater Public, this is the Association for Public Media stations, as their CEO. And Joyce had a vision to help public media stations around the country engage donors in a more meaningful way, so that donors can make a greater impact beyond their membership. And over that time, Veritus has come together to partner with Joyce and Greater Public on developing mid and major gift programs for public media stations around the country. And I gotta say, the results have been incredible. Now, I know many of you listening work for organizations that have membership models as a key part of your fundraising strategy. And this is why I’m so excited to have Joyce here with us today to talk about the history of membership models, how to move from a membership mindset to mid and major gifts, and really to help you learn from the success that these public media stations have had. So welcome, Joyce.

 

Joyce MacDonald 

It’s a pleasure to be here, Jeff, and Karen.

 

Karen Kendrick 

Yay. Thank you. This is gonna be a great conversation. So Joyce, to get us started, give us some context, share a little bit about the history of membership programs at public media.

 

Joyce MacDonald 

Absolutely, it is a deep and and wonderful history. So public media, was born back in the 1960s, 1970s, supported with government funding, and over the years, began asking for contributions on the air and found that the service that they were providing was so valuable that people were willing to give. And over the past, say 20 years, public media organizations’ audiences have grown tremendously. And we’d sort of tend to view a donation as a vote from an audience member telling us that were important in their lives. And as the audience grew, membership revenue became for many organizations, the largest piece of their revenue pie, right, dwarfing government money. You know, sponsorship is a piece of the pie. Major giving was a thin slice. But membership is huge. And Jeff, you and I have looked at and analyzed many public media organizations’ donor files by now. And I remember you saying, Wow, other organizations would be thrilled to have this many donors who are this loyal, and you know, who remained engaged with the organization over the years, the way our donors do.

 

Karen Kendrick 

20 years, 30 years? A long time.

 

Joyce MacDonald 

Yes.

 

Jeff Schreifels 

I know. I mean, the donor files were just amazing. To see donors every year giving faithfully and that’s what membership did. It created that kind of a community and mindset to give every year.

 

Joyce MacDonald 

Exactly, exactly. So, you know, we’re very proud of our membership programs and our stations, a considerable amount of investment has been made. And, of course, we use all of the direct marketing tools that most non-profits use. But we also have television and radio stations.

 

Karen Kendrick 

Kinda handy.

 

Joyce MacDonald 

Yeah, it is kind of handy. And we know that our audience is loyal and listening. And we know that when we go on the air and ask for contributions, the audience comes through. Now, I will say that, as the media landscape evolves, and use of media is becoming more and more fragmented, we have a very large audience. In some markets, our public media stations are the number one station in the market. Wow. But we’re looking at the trends and thinking, hmm, I don’t know that we’re going to see the kind of growth that we saw over the past 20 to 30 years for our broadcast content, right. So as we start to look at other platforms, the way we use digital, the way we use social, etc, both as a content distribution vehicle, but also a fundraising vehicle. And so, for the past couple of years, we’ve seen diminishing growth, in particular, in new members. And you sort of alluded to me coming into Greater Public with a vision. And really, my vision was formed by many years of experience in this industry and other roles. And then you both have heard me say this before, but for 20 plus years, hearing leaders at public media organizations saying that major giving is our big opportunity. And looking at our track record in major giving, it wasn’t all that big. And so I thought, well, if there’s one thing that I’m gonna focus on, it’s major giving.

 

Jeff Schreifels 

Yeah. Not big, I would say miniscule.

 

Joyce MacDonald 

You can say that. You know, I know good efforts have happened. But again, I’ll say, because we’ve been so spectacularly successful with the membership model, most of the time and attention and investment has gone there. And as you well know, if you don’t invest and build the kind of structure that you need to have a successful major giving program, you know, donors are going to give what you asked for, right? And you’ve all heard us on the air talking about how $120 a year is going to get you a coffee mug. And so that’s what people have been giving.

 

Jeff Schreifels 

So why do you think stations… you said, they’d started talking about this, but why do stations now want to start doing something about building a major gift program?

 

Joyce MacDonald 

I think it’s partly because, as I said, there’s a flattening happening in membership revenue. And I’ll just say that, even given the miniscule performance, you know, there is a correlation between stations that invest more in major giving, and stations that don’t invest in major giving. And so while within the industry, we consider organizations successful in major giving, the truth is they really have not tapped their potential. And that’s what I learned in working with you guys. That, like every industry, we compare ourselves to whoever in our industry is doing the best. And what we now know is, there’s a lot more headroom than even the largest organizations and public media have been achieving.

 

Jeff Schreifels

Yeah.

 

Karen Kendrick 

So, you know, it makes a lot of sense, right? What’s working and what’s successful, that’s what you invest in and spend time in, and so everybody, all your systems and structures and thinking has been around membership. And then Joyce, you’re coming in saying, you know, we really need to invest in major gifts. This is where we have the best ROI. But that’s a lot of mindset and thinking and stuff, lectures and systems to change, like, how did you start creating that buy-in with leadership and other key decision makers to move in that direction in a more substantial way?

 

Joyce MacDonald 

Well, based on all of my experience in business, with leadership, numbers talk. And everybody’s looking for something that has worked really well somewhere. And so, you know, when the team at Veritus supply supplied some of these stations with five- year projections, looking at what they could achieve if they invest and sort of follow the best practices, and use the tools that Veritus provides, they were stunned. They were, in a happy way, blown away by really understanding the potential of their current donor list. And so we put together a pilot with four stations across the country, and sort of ran an experiment for two years, with Veritus, working directly with those organizations and their fundraising teams. And the results were tremendous and spoke for themselves. So we are now in the process of sort of sharing those results, and talking to other organizations, about what they, what their potential is, at their individual station. And, you know, as I said, revenue talks.

 

Jeff Schreifels 

Yeah, so I’m just gonna, I’m gonna reiterate, just go back. So public media has built basically on the bedrock of membership and sustainers. And building that up. And that’s why we saw in the data when we were doing our assessment that we always talk about…

 

Karen Kendrick 

Which is free, by the way.

 

Jeff Schreifels 

We saw this incredible loyalty, but donors giving the same amount every year. And we saw donors who may be giving, let’s say, $5,000 a year to the public media station, but probably are giving $100,000, millions of dollars somewhere else. Because no one’s actually developed relationships, one-to-one relationships with these donors. And this is what Joyce, this is what you were sensing many, many years ago, like you started seeing, like, okay, the membership thing is starting to wane a bit here. There’s got to be another source of revenue that we’ve got to be able to bring into public media stations. Major gifts is untapped for us. They may have had capital campaigns, they may have done some things where they’ve been, you know, they got some big gifts here and there. But there was never a structured major gift program that was really trying to build one-to-one relationships with donors and take them to another level.

 

Joyce MacDonald 

That’s right. Right. And actually, for many, many years in public media, a major gift is $1,000. Yeah. And so what ended up happening, you know, organizations that that said, oh, you know, our donors have more capacity. So let’s create a leadership circle where if you give $1,000 or $1,200 a year, you get the lapel pin and the fleece vest with our logo on it. Right. And you get to come to a cocktail party twice a year.

 

Karen Kendrick 

And do you wear the fleece vest to the cocktail party?

 

 

 

Joyce MacDonald 

It is compulsory, yes. And donors responded, right? They, you know, I will tell you though, that in many cases, donors given the option of getting the fleece vest, and the lapel pin, will say “No thank you. I’d rather have my donation go to the work of public media.” But because our heritage was so much about that membership model, and you know, I’m not going to say the word… tote bag. But that was our mentality, and that’s what we were good at. So you know, good move, right? Create this leadership level. And so when stations talked about major giving, they were talking about growth in that section of the file. Yeah. And that’s what we found, right, Jeff, when you guys looked at the data? And it’s interesting. We, I would put it this way. We thought we had mid-level programs we wanted when we went into this major giving work with you. But really what we have is enhanced membership, we have sort of a Giving Club. And there, there isn’t a very personalized approach there. And there also isn’t communication focused on the value and the impact of the organization at that mid-level. That I think we agree that that is a missing piece, and a missing part of the pipeline, that public media organizations need to address along with their major giving work. So it’s now mid-level and major, hand in hand.

 

Jeff Schreifels 

Yeah. So that higher level membership kind of thing you’re talking about is still what I would call, a friend of mine calls “at arm’s length fundraising.” So it’s like, think about yourself holding your arm out, it’s still, you’re not actually inviting the donor within a conversation. And the donor may be getting at higher levels to get the bigger, the nicer tote bag, but you’re still not developed, you’re still not trying to figure out what’s the donor passionate about, as it relates to the station here? So that I can actually bring offers that inspire the donor to do something greater? That is what we introduced in this pilot program.

 

Joyce MacDonald 

That’s right.

Jeff Schreifels

So in that pilot program, yeah, we created that structure, and all those things, all to move away from arm’s length fundraising, or transactional, to try to start that conversation and develop offers that connect to the donor in a much deeper way. And you alluded to the fact that, you know, there was some great results through that. You want to talk specifically a little bit about, what did we find?

 

Joyce MacDonald 

Well, first of all, what we found was public media can succeed in philanthropic revenue generation, the way other institutions and communities do. And there were doubts about that. There were leaders that said, I’m just not convinced.

 

Jeff Schreifels 

I mean, we had station managers say, I just don’t know if we’re gonna get gifts like they could get at the opera or the museum down the street or whatever.

 

 

Joyce MacDonald 

That’s right. That’s right. But we believed, and, you know, when you think about the role of public media, and media in general, you know, we’re part of people’s lives every single day. They may go to the museum once a month. And we’re a very important part of our core listeners’ lives. And they’re very passionate about what we do for them and for their communities. But we had not been speaking to that, at all, in our fundraising, it was transactional, or sort of based around, well you love this particular program, so support us. And, you know, so what we found was, number one, just by creating a real mid-level program, right, with a mid-level officer who’s doing one-to-some communication, right, doing surveys, you know, addressing what those listeners were most interested in passionate about near communication with them. I don’t know how many sort of unprompted upgrades, you know, just based on that outreach happened. And then in terms of major giving officer work, you know, we had recommended adding staff in some cases, and major giving officers and really going through the process of qualifying and donors, like between that mid-level and then moving them into major gift portfolios. And as a result, major giving officers are working with people who already said they want to engage. And that is a fundraiser’s dream, right? And did it work? Heck yeah. We saw on average across the four stations, double the revenue in major giving over the course of the two years. Retention. So the donor value attrition was, I want to say, an average of minus 40% going into the pilot. Yeah. And after two years that that, that attrition was completely wiped away. So, you know, the path is pretty clear.

 

Jeff Schreifels 

I mean, if you said to any executive director from any non-profit to say, in two years, we’ll double your major gift revenue. Yeah. I’ll sign up for that one.

 

Joyce MacDonald 

Right. Right. Yeah. So those are the really exciting conversations that we’re having now. You know, I think all of the stations really engaged, their leadership engaged. You know, so that culture piece, which is an important part of this was put in place, so that the major giving folks in the mid-level folks had the support of the programming people and the finance people and the marketing people and sort of having them understand what this work was about and why they were being asked for this or that. It really was a cultural change, I think for these organizations.

 

Karen Kendrick 

I mean, I think about it, Joyce, you brought leaders in on board using data with the assessment and provided a pilot, like let’s give this a whirl, give it a try. And you’re seeing already such incredible results in two years. What do you think are some of the other key learnings in addition to focused caseloads, qualified donors and all that sort of Veritus system and structure that you’re learning in this process that really helped bring success?

 

Joyce MacDonald 

Well, I think that the sort of transformational effect on mid-level giving was something that that was, I think, much more profound than I expected going in. But, you know, seeing these organizations invest in that level and add positions at that level, I think is, you know, has been a key step for them. I also think that the role of the general manager or President, CEO, is much better to find now, you know. I think in the past, you know, boards of directors would look at a CEO and say, Okay, what are you doing, you know, to get the big gifts in, right. Yeah. And have you joined the Country Club where I recommended, you know, and I think there was this misperception that somehow, the CEO was going to be able to just, you know, spend a lot of their time out harpooning big whales, and bringing in transformational gifts with no structure in place to support them in that work. And, you know, a good major giving team is going to invite the CEO to the table for the right conversations with the right people at the right time. And I think that the CEOs have really appreciated a better definition of their role in the process, and certainly appreciates telling the board about the results.

 

Jeff Schreifels 

Yeah, definitely. So you’ve been in this now for a while Joyce, so and I mean, through the thick of this stuff. So what did you see as your role in this process? And then what do you think helped you to be successful in advocating for this approach?

 

Joyce MacDonald 

I think that that my role here was to connect dots, right? To sort of say, look, you know, other sectors in the non-profit world have figured out a way to get these kinds of gifts and to get them on a regular basis. What are they doing that we’re not doing? Right? And that’s where you guys came in as, you know, an incredible resource to me and to public media, in helping us understand that there is a pathway, that it is not a magical, you know, pixie dust occurrence. But that there’s a very disciplined and focused way to go about building a major gift program. And so I think my role was really to make that connection. And I think, if there’s one thing I would point to in terms of success in that role, it’s that, and I say this half-jokingly, but, you know, I’ve been in this industry for 20 plus years, and not been a jerk.

 

Jeff Schreifels

Yeah. It’s true.

 

Karen Kendrick 

Built strong relationships. Yeah.

 

Joyce MacDonald 

You know, and people trust me enough to say, hmm, what’s Joyce Mac talking about here? There must be something in it if Joyce Mac is talking about it, you know?

 

Jeff Schreifels 

Yeah, that thing, Joyce, that whole trust thing that everyone had in you? Because I saw it firsthand when we go on a roadshow, right, was that you got in the door and got the meeting. Everyone wanted to meet with, no one would ever say no. Right? They want to at least hear what you had to say. And then here’s, Karen, the other cool thing about Joyce was she learned this stuff so quickly, like, was able to speak to this as if she had worked with us for years, with after just a couple of months of like, really understanding what it is this major gifting is all about. I mean, she knew that we needed major gifts and public media. But she also then learned all the ins and outs of it so that she could speak intelligently and speak with authority. So the station manager like, not only do I love Joyce, but my gosh, she knows what she’s talking about. And here’s all the data to support it. But then the final thing, Karen, about Joyce was that she never gave up. She just kept going at it. Like, you know, the station was like, No, I’m not – fine. We’ll go to another station that really wants to do this. And you just kept at it, Joyce, and you still are keeping at it. You haven’t, you have not stopped, your energy level on this has not stopped. So like five years ago, you had his vision, but you’ve continued, but just keep it going. And for all of those other folks that are listening at their own non-profits that have membership programs, and you’re trying to figure out how do I get through this? That is probably the number one thing is that you just don’t give up. You just keep going step by step at one foot in front of the other and don’t stop. Because you know it’s the right thing. When we knew that, right Joyce?

 

Joyce MacDonald 

Yeah. Well, I will say the reason I’m so bullish about it, and I’m thrilled to have every conversation that I have, with colleagues and public media, about major giving is because I have you guys as my partners, right? And we’ve seen the success, and I believe I fully believe it can happen. I have absolutely no doubt. And that is a great motivator, right? And I love public media, and I want it to not just survive, but thrive. And there are so many ways that public media can invest and grow and reach new audiences. You know, create products for new platforms, you know, all the things, all the things that I look at and know, this is going to cost money. Right. So we’ve been able to operate based on an overwhelmingly membership-oriented revenue budget. But we need margin. And, you know, so there’s the need, but then there’s also this amazing pool of donors and listeners to every public media organization across the country who love us, and giving them the pathway to really support our work in a robust way, and ensure our viability and relevance into the future makes them very happy.

 

Jeff Schreifels 

Yeah, yeah.

 

Karen Kendrick 

Well, Joyce, I know, in addition to this pilot, you’ve brought hundreds of people through our VGA training. And I’ve seen you over the years continue to show up and hold that confidence and truth and speak articulately to this path and process that you see working, that really helps folks because it’s, you know, this creates fear for folks. Change is always tough. And you know, it’s a little scary for folks to really move in and make these changes. I know one area that some folks get scared about are donors, right? So we’ve trained our donors to be membership donors. And so our donor is going to be upset, and how do we move donors into a new culture and mindset and experience with us? So, speak a moment to that.

 

Joyce MacDonald 

Yeah, you know, change – you spoke truth, change is hard. And are people going to be upset? You know, I always point people to what happens on the content side, in a public media organization, if you cancel a show, right? You replace a program with a different program. And, you know, a certain number of listeners will email or call and express their disappointment and dismay, right? And, you know, over the years in this industry, you know, hearing folks talk about, oh, our listeners were so upset. And I would say, how many did you hear from? And what is that as a proportion of your total audience? You know, change is, yes, it’s hard. But there are times when it’s absolutely necessary. And in my point of view, you know, our ability to continue to serve communities and individuals, and this country, you know, it’s a critical mission. And for every donor that might express some problem with the shift, hundreds and hundreds of others are going to welcome the opportunity to engage more with these organizations and support them.

 

Karen Kendrick 

Like you’re saying, Joyce, like what 80% of donors would rather just their money go towards you well, and not get the tote bag, right? When you when you gave them the option

 

Joyce MacDonald 

When you give them the option, yeah. And, you know, they get it. In a lot of ways, our audience understands our value more than we do.

 

Karen Kendrick 

How exciting, Joyce, for a donor who loves you to be sat down with and a relationship built with to find out their interests and passions and really, steward that and share with them, the impact they’re making, and the difference they’re making in a very individualized way. You know, what a beautiful way to honor all that history with them, but also give them a much more meaningful experience with you.

 

Joyce MacDonald 

Absolutely. And they love it. That, you know, hey, we’re on the radio. People think we’re celebrities of some kind. You know, that’s a little bit of magic pixie dust. But really what they love the most is our mission to provide, you know, fact-based information, to provide companionship, and access to arts and culture. You know, every donor has their sort of specific entryway, and what they what they really love about us, but it all adds up to impact on their lives, and the kind of impact that they want us to have in their communities.

 

Karen Kendrick 

So Joyce, I’m listening to this, it’s kind of interesting. What would you say to me and all those listening, where do I start? This all sounds exciting, I have some of the same challenges. Where do I need to start?

 

Joyce MacDonald 

Go to veritusgroup.net. I mean, I think it was extremely helpful to me. And you know, and bear in mind, I don’t come from, you know, a fundraising background, my background is much more on this in sales. But it was extremely helpful to me when I first started on this journey, and was sort of looking for the best information that I could get about how you do this, and what to expect, to find it with you guys, because you make it so understandable. Actionable. And the support you provide is, you know, is just brilliant. And, you know, Jeff, you said, I’m a quick student, well, I would say I had good teachers, you know. And get your leadership, whatever position you’re at whether you’re a CEO, and you want to get your board onboard. You know, Jeff, and Richard wrote a couple of books that are really super. You know, I found it incredibly helpful to have a voice at the table with the kind of experience that Veritus has, and I know that the stations we’ve worked with, feel the same way. That you know, expertise in this work is critical. And expertise combined with, you know, the kind of data focus that you guys bring.

 

Jeff Schreifels 

And with the trust they had in you. So they were able to believe it, you know, so if you believe that they could feel, okay, if Joyce’s bought into this thing? Because she’s one of us. And that’s another interesting thing. If you’re a membership organization, you know, that if you’re someone who is trusted within your organization, and you bring this to them, and you provide the outside expertise, you provide the data. It’s going to be listened to.

 

Joyce MacDonald 

Yep. Yep. And it’s powerful.

 

Jeff Schreifels 

Well, this has been awesome. This has been good stuff. I think the big I think another big point, Joyce, in all of this is that we’re not saying you should get rid of membership at all.

 

Joyce MacDonald 

No, no.

 

Jeff Schreifels

Oh, no. It’s not just membership, or. It’s membership, and.

 

Joyce MacDonald 

Absolutely.

 

Jeff Schreifels 

Because membership programs are amazing, one, to acquire donors into, but also then to cultivate and start to really develop, you know, that initial relationship with. But the major gift, the mid and the major gift piece is when you really start to develop the one-to-one, really starting to understand the donors’ passions and interests. And so it’s not one or the other. It’s both and.

 

Joyce MacDonald 

Exactly, exactly. That’s right. And, you know, and one of the wonderful things about looking at mid-level and major giving is, you know, the return on investment for those positions, is what is going to fund your program people’s vision. Right. And so, when an organization is looking at, you know, do we invest in this program? Or do we invest in our major giving program? I say, you know, choose the major giving program, and then you can invest in both.

 

Jeff Schreifels 

Yes, yes. Because the membership program is really a beginning for the donor. But the major gift and the planned giving it goes into that, that’s the destination for some of these donors. That’s right. And to have a destination is when you will be successful. And when you don’t have that destination for the donor, they’re going to be stuck. They’re not going to give to their full potential for you.

 

Joyce MacDonald 

Right. Right.

 

Jeff Schreifels 

Wow. So thank you so much for this great insight and the tips to help people see how they can move from a membership mindset into major gifts. And before we wrap up our conversation, I want to make sure you all know some about some great resources that can help you make this change in your organization. Our certification courses for major gift fundraisers and fundraising managers and leaders will provide you with a system and structure that will help you for more meaningful relationships and move out of that membership only mindset, while still using membership programs is a great cultivation tool. And if you want more a more personalized approach for your organization, you can contact my colleague Amy Chapman to discuss how we can help you move your organization into a major gifts approach.

 

Karen Kendrick 

This has just been a great conversation. Joyce, thank you so much as always, for your wisdom, your insight and your presence today. We really appreciate it.

 

Joyce MacDonald 

It was an absolute pleasure as always you too.

 

Jeff Schreifels 

And thank you for listening today and we’ll see you next time.

 

Recorded 

Thank you for joining us for the Nothing But Major Gifts podcast from Veritus Group. Richard and Jeff also write an ongoing blog that you can subscribe to for free at veritusgroup.net. Please join us again next time.