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For years, nonprofit growth was largely a volume game.
Acquire more donors by increasing mail volume in order to expand the organization’s reach. And for a long time, that model worked.
But the way people engage with one another, and with the world, has changed dramatically. Yet many organizations are still operating systems designed for an environment that increasingly no longer exists.
And while that optimization happens, we see donor participation steadily decline.
The Comfort of Optimization
Optimization of the old feels productive. Numbers showing improvements in response rates, open rates, and new-donor conversion give us hope that we can change the trajectory of donor files. And it does help us improve our performance year over year, learn more, and get better at cultivating donors in the channels we are in.
The problem is that optimization assumes the underlying model is still correct.
And increasingly, that assumption deserves scrutiny.
Many organizations are getting incrementally better at systems that are producing diminishing returns.
The result is a kind of strategic inertia:
- The same channels
- The same donor journeys
- The same attribution models
- The same fundraising assumptions
Refined endlessly while donor behavior changes underneath them.
Attribution is Hindering Experimentation
Many organizations evaluate innovation and testing through short-term attribution. If something cannot immediately prove itself through source codes, last-touch reporting, or directly attributable gifts, it often struggles to get tested.
That creates a dangerous dynamic: Organizations end up only funding what is easy to measure while undervaluing what actually drives long-term donor relationships.
The problem is that some of the most important drivers of donor behavior are notoriously difficult to measure cleanly:
- Trust
- Emotional resonance
- Memorability
- Storytelling
- Perceived value
- Brand affinity
- Donor identity
Those factors rarely fit neatly into attribution dashboards. But they shape donor behavior anyway.
Innovation in Our Space Is About Connecting With Donors
Years ago, at Masterworks, we noticed that digital donors rarely, if ever, responded with a gift through the mail. The direct ROI in sending these donors a piece of mail was abysmal. So we figured we should stop doing it.
That assumption sounded logical, but it was also incomplete. Although the mail did not receive credit for the donor’s giving, it still played a role in building the donor relationship.
Luckily, we tested it, and instead of evaluating performance at the source code level for the pieces of mail we sent (or did not send), we looked at the donors’ overall behavior over the test period. This allowed us to evaluate the role of the mailbox in the donor relationship.
What we learned over time was that mail played a role for digital donors but that we could implement it differently:
- Telling slower, more immersive stories
- Using more visual formats
- Creating a higher perceived mail experience
- Boosting the number of monthly giving asks
Essentially, the mail stopped being transactional and became all about the relationship.
The results were difficult to ignore:
- 14% lift in multi-year retention
- 16% lift in second-year retention
- 15% increase in average gift
- 13% lift in monthly donor commitments
None of that likely would have emerged from simply optimizing the old format. The breakthrough came from challenging the assumption itself.
The Next Era of Fundraising Will Require More Courage
Innovation threatens comfort. It challenges some important things:
- Historical assumptions
- Familiar reporting structures
- Legacy KPIs
- Internal expertise
- Budgeting models
- Established habits
And in mission-driven organizations, failure can feel morally expensive. That often pushes teams toward safer, incremental decisions.
But the organizations that thrive over the next decade will likely not be the ones that merely optimize yesterday’s fundraising model. They will be the ones willing to rethink how donor relationships are formed, deepened, and sustained in an entirely different donor economy.
Optimization still matters. But optimization rarely creates breakthrough growth.
Measurement Still Matters. We Need to Be Open to Different Measurements.
This does not mean organizations should abandon measurement. Measurement builds trust; it creates accountability. It gives leadership confidence to invest in new ideas. And when innovation works, measurement is what provides it.
But if we only measure the immediate and direct responses to an impact, then we only fund the immediate and direct response tactics.
We need to be willing to evaluate new ideas through tracking donor-level behaviors, like how they improve retention, second gift, and conversion to recurring giving.
Because many of the strategies that build stronger donor relationships do not reveal their value in a single transaction, but rather improve overall donor value over time.
