Whole Foods: A Success Story in For-Profit Leadership In Giving

I was one of the masses who joined in the voucher “feeding frenzy” on September 13^th.  I don’t know if I’m proud of this or not but I know a good deal when I see one.

Living Social offered me $20 worth of groceries at Whole Foods for $10.  I shop at Whole Foods regularly so it didn’t take more than a second to figure I was saving $10 with the voucher.  I bought it.

So did one million other people.

Yes – they sold out in 24-hours.  At times, the site noted they were selling 80 vouchers per second.

And the most interesting part of this campaign was one I hadn’t even noticed at first.  For every voucher sold, Whole Foods donated 5% of the sales price to its Whole Kids Foundation, a “nonprofit organization the grocery chain started to help schools improve nutrition.” 

If you go to their Facebook website you can vote (by Sept. 30^th) for one of three choices for how the funds would be spent: (a) Teacher Nutrition Education  (b) School Garden Grants or (c) Salad Bars to Schools.   

What does this say about the changing face of corporate philanthropy?

Whole Foods not only ensured that it kept me as a loyal customer, it made me aware of their foundation and generated funding for it at the same time!

Did they really donate 5% of the full selling price of the vouchers?  Selling out a million of them at $10/each would generate $10 million (imagine the interest…).  The foundation would have made $500K off that success!

I hope that my math (and my assumption) is correct and that $500K goes to one of the “choice” activities they’ve targeted.

Even more, I hope that other leaders in for-profit organizations, especially those with foundations, see the beauty of this campaign.  They should recognize how funds can be generated for foundations and nonprofits they have created or with whom they choose to affiliate or partner. 

We need more “good works” leadership.  And it’s a win-win for the consumer as well as the company and the nonprofit. 

Well done, Whole Foods!

Is philanthropy dying? (Part 2)

Last week I attended the DMA Nonprofit Conference in NYC.  It had been a few years and I’m pleased to report that the programs are much more engaging than I remember in years past.  From the keynote speaker to the session in general I found them of interest.  One session entitled The Retention of Attention: Metrics Beyond Donations that was exemplary.

The panel for this session was:

• Ashley Delamar, Div. Dir. of Dev., The Salvation Army/NSC Divisional HQ’s
• Jacqui Groseth,  Marketing & Comm. Dir., Union Rescue Mission, Los Angeles
• Glenn Waterman, Dir. of Dev., The Leprosy Mission Canada
• Moderator: Bill Jacobs, President, Donor-Central

After the presentations, I had the opportunity to ask the question I posed in my last blog: based on my conversation with an E.D. of a nonprofit based in NYC, and the changes she is witnessing in how fundraising is conducted, what does the future of “philanthropy,” or  major giving, look like?  

The panel gave great answers. In general, they all stressed that we need new metrics for donor involvement (sound familiar to those reading my blogs.  In particular, they talked about what motivates younger donors.

The late 20s/early 30s donors – the “up and coming” – want to be more involved in the mission of the organization.  Ashley Delamar indicated that he had a significant donor who pressed for certain goals that were not on The Salvation Army’s “agenda” but that were of importance to the donor.  Instead of turning down – or turning away – this potential funding and donor – they requested that he become involved in the process of realizing his vision for the organization and for his goals.  They “engaged” him to a much fuller extent into the workings of the organization – thereby realizing his dream, achieving his goals, gaining far greater achievements for the community, and cultivating further engagement and donations from him (and his colleagues). 

It appears that the “new paradigm” is to seek and allow these newer/younger donors to be more involved.  To engage them in the "process."  They seek to be more involved in the direction of the organization – so the new reality is allowing them to be involved, to “step up” and help bring new focus to the issues that excite and commit them.  This makes them more embedded and more valuable. 

I was excited and encouraged to see that there are paradigm shifts going on so that, as always, we are adopting to the “new generation” of donors.  I encourage you to let me know of other changes you see taking place in the world of major donors. 

Is “philanthropy” dying?

I recently had the privilege of speaking with the Executive Director of a nonprofit involved in cancer research/funding.  She described the changes she is witnessing in how fundraising is conducted and voiced her concern about the future of what has classically been defined as “philanthropy,” or  major giving. 

Her logic is as follows: if younger donors are giving through new channels (i.e. online, mobile) on impulse, with small donations, because of specific events and not because of an emotional or intellectual involvement with a cause or an organization, what will does this mean for the development of major donors in the future?   Major donors – those who give in very large amounts – are few and far between.  They are cultivated over time and, over the time, they have usually aligned themselves with cause(s) with which they have a passion, ranging from academia (where they went to school, for example) to the arts to others in the sciences, environment, social justice, etc.   

Major donors, as a general rule, have been cultivated.  They become associated with an organization because of their passion or involvement with the mission.  Most importantly, however, their donations end up funding roughly 50 - 60% of the operating costs for a nonprofit…

But where are we today?  Younger donors can make a “quick hit” donation via mobile or other digital device in an instant – on an emotional whim.  What’s a $10 or $25 or even $50 donation if you can afford it?  For major catastrophes or other “events” this works fine.  But this is not helping to cultivate the idea of involvement or mission that grooms major donors for the future.

So what are E.D.s and Development offices to do?  How do they cultivate future donors?   Do they hope that they can match the sexy digital “quick hits” of the “event” driven causes?  Do they stick to the tried and true fundraising techniques that have worked in the past, and hone their targeting skills?  Do they continue to work on personal relationships with donors – focusing on the new young wealth and developing them? 

Is the model truly broken?  Or is it simply a matter of using what’s traditionally worked in the past, testing new ideas and methods, and continuing to reshape what philanthropy can be for the future?

What are your thoughts? 

Face-to-Face Connections

I just returned from one of my favorite rituals: attending the National Assoc. of College & University Mail Services (NACUMS) conference.  Yes, it’s a limited audience – so the show is small and intimate.  Perhaps that’s what makes it such a pleasure to attend. 

After five years it feels more like a reunion than a conference or trade show.  Familiar faces and friends get hugs (not your usual vendor greeting).  We get to sit down and talk or go out for dinner over the course of a few days.  And I get to hear what people are really thinking.  Not the usual “five minutes” before we all move on, feet tired, bleary-eyed typical show surroundings.     

No, this show is different because of its small size. And it helps to bring back what’s important in business – relationships.  Because, in truth, people buy from people.  Even in a business environment relationships matter.  Perhaps more so in a nonprofit environment.

With all our advanced technologies and our ability to “stay in touch” and “reach out” digitally, it’s important to remember that the face-to-face interaction is still the basis for everything.  Meeting someone in person makes a world of difference.  Seeing facial expressions, learning body language, understanding other perspectives in conversation.  And I think that everyone – in nonprofit and for-profit organizations – needs to remember that all our current “personalization” techniques are just an effort to replicate this special relationship.

   

I cherish the personal interactions at NACUMS and look forward to returning again next year.  Perhaps this brief reminder will inspire you to reach out and rekindle a connection, too. 

Craving Social Responsibility

I rarely (read: never) write about the company I currently work for (Pitney Bowes).  However, something interesting that happened last week made me decide to include them in my blog today. (Note: PB has no input or responsibility for anything I write here.) 

Because of a particular project I’ve been working on, we created a press release entitled “Pitney Bowes Adds Social Responsibility to Connect+ Printer Capability.”  I won’t go into the details of the campaign – suffice it to say that the new campaign seeks to promote national nonprofit organizations.  The hope and goal of the campaign is that it will increase these nonprofits' visibility and (hopefully) donations to their cause(s).

What I found most interesting was media reaction to the news. We had pick-ups from over two dozen publications, ranging from Philanthropy World Magazine to msn.com.  From large to small.  From for-profit to nonprofit. 

It’s striking that the market is craving social responsibility from corporations.  Media outlets are looking for examples of it.  People want to see companies making their mark in this direction.  Companies, as well, seem to want to know how it’s done.  The public, in general, wants to know that companies are involved in this type of activity.

I think it’s wonderful that Pitney Bowes is engaged in this direction.  But more importantly, I think it’s critical that we notice the public (and media ) is not only engaged but eager and on the lookout for this type of attitude and action. 

It’s a call for us all to realize there’s far too little of it going on.  Far greater need.  And there may be far greater success for everyone concerned if more would think in this direction – in both the for-profit and nonprofit sectors. 

Survey results (yawn): 2/3 of Executive Directors plan to leave. The shocker? 1/3 plan to stay!

On Monday, the results of the newest study on nonprofit leadership were released by CompassPoint Nonprofit Services and the Meyer Foundation.  They’d surveyed 3,000+ executive directors on issues ranging from career paths to boards and the impact of the recession on their organizations. The results of the survey were very similar to other types of studies that have been done recently, essentially stating:

• Boards are not performing their duties as they should be (in this case, almost half had not reviewed the Executive Director’s performance within the past year).
• The recession is having a large negative impact from the recession (again, no surprises).  
• Nonprofit organizations have dwindling operating reserves, if any. 
• Few organizations are providing executive coaching, though respondents feel it is  “a very effective professional development” tool.   

I’m not quite sure why organizations keep funding this type of research.  Perhaps to continue to validate the findings of the previous one, two, three studies? 

What surprises me, thinking about the depths of the economy, the lack of support from Boards, and the stress of the executive position, is that 1/3 of nonprofit leaders want to stay in their roles.  Bless their dedication and strength!  

So - let's say we get it now.  Let's say we see that nonprofit leadership is stressed and in serious trouble.  What do we do?   I suggest that’s what we need a study to figure out – let's get some answers.

I have one suggestion.  How about starting with better executive compensation?  I’m not talking about millions here – I do believe in staying within a reasonable range.  But I object to the extremely low pay they usually get.  It limits the market of who can afford to take these positions. 

Let’s actually treat these leaders - their positions - as if their organizations, staff, and all the thousands (millions?) of people they serve depend on them.  (Not to mention the animals, the planet, the arts, and other worthy causes…)  I suggest we stop worrying about what it might “look like” and think more about paying them what they actually deserve for their work.  Let's think about the value of the role to society.  How's that for a project. 

As I said, it's a suggestion… your thoughts? 

De-listed as a Nonprofit by the IRS? No great loss...

It’s official – 275,000 organizations have been listed by the Internal Revenue Service as no longer tax-exempt because they did not file the required documents.  You can search on this list, thanks to the Chronicle of Philanthropy link.

I took a look at my hometown just to get a sense of the injustice.  To be honest, I can’t say I’m too appalled.  Of the 50 entities listed, the majority appear to have been set up in someone’s apartment or house for a cause they felt was worthy and then left relatively dormant over time. 

Don’t get me wrong - I have nothing against worthy causes set up by individuals.  I did so myself years ago.  However, if they aren’t going to be ongoing – if they aren’t aware enough to “keep up” with regulations like this – my feeling is they can’t be too concerned with their nonprofit status, so why should I be?

It appears that the larger, more “ongoing” concerns are NOT listed and still ok with the IRS.  So I'm not worried losing programs for children getting daycare or homeless shelters or food pantries. 

How can I be so callous and make such a blanket, value-laden statement?  Here are some of the names I came across:

• Blue Knights Motorcycle Club
• Boon Family Foundation Inc.
• Independent Order of Odd Fellows
• John & Mildred Wright Foundation
• Quidditch Foundation, Inc.  

Now, I have nothing against motorcycle clubs, fans of Harry Potter, odd fellows who associate with one another, or family foundations.  I just think that if you set up one of these entities you have a responsibility to either keep it up or let it go.  The IRS has stated that they haven’t kept these up so - so now they have to re-do their efforts or let it go (with regard to their nonprofit status). 

Believe me, I’ve ranted about issues with the IRS changes previously – I have no love for their changes to the 990 (which I think have done nothing at all with regard to changing behavior).  However, in this case, I don’t think they’ve done much harm at all, except maybe to wake some sleepy people up.

What do you think?