GUEST EDITORIAL: A LETTER FROM THE CEO
To all Auctionpay clients:As you know, over the last few months the U.S. and world economies have been extremely unsettled and volatile. These are some of the most unpredictable macro-economic conditions that we have faced in our generation. Given the state of the economy, I wanted to reach out to reinforce our commitment to you.
As an Auctionpay client, rest assured that your investment in your Auctionpay fundraising solution is secure and will continue to gain value.
We have established a solid reputation with schools and nonprofits for delivering reliable fundraising technology solutions and world-class client service. In 2007 Auctionpay was recognized by Inc. Magazine as one of the 500 fastest growing companies in the U.S. We recently passed $1B in cumulative credit card processing for our clients, with $2B in overall fundraising.
Auctionpay is a venture-backed company supported by Maveron and Appian Ventures. Our capital structure allows us to continually invest in products that integrate and compliment our current products, including exciting new products related to online fundraising. In addition, our commitment to fund and expand our client service organization remains unyielding.
Auctionpay is a level one PCI-compliant company, the highest standard in the industry. This level of compliancy requires regularly scheduled independent audits to maintain the standard as it evolves. Our technology infrastructure is built from the ground up to address all the security, data integrity and privacy concerns associated with processing electronic payment data. We process credit card payments using the Elavon (formerly Nova) payment platform, one of the largest payment processors in the world.
The Auctionpay management team and Board of directors have many years of collective experience in the technology marketplace, non-profit operations, banking and credit card processing. This experience will enable us to continue to make wise, informed decisions in order to provide you with products and client services that are second to none.
In these times we recognize the challenges you face in raising money for your cause and supporting your mission. Our company is very well-positioned to continue to provide you with effective solutions for years to come. We will be there for you.
Thank you for your investment in Auctionpay. We appreciate your business and we are honored to have you as a customer.
Steve Sterba
President and CEO
Auctionpay, Inc.
PRODUCT SPOTLIGHT-ONLINE SOLUTIONS
Over the last 2 years, Auctionpay has placed more development emphasis on its online fundraising solutions. Why? Online solutions, or Web-based applications, are extremely cost-effective in several ways: - They provide easy access for staff and volunteers from anywhere at anytime, so you can better leverage your human resources;
- They enable low-cost fundraising opportunities year-round;
- They extend your fundraising reach outside of your immediate area by leveraging the reach of the Internet;
- They allow supporters to get more involved with your efforts.
Out-of-the-box, Online Payments gives you 10 published web pages, so you can have an online donation page posted for year-round fundraising within a day. The other major use of Online Payments is for ticket sales and event registration ranging from formal galas to seminars or volunteer gatherings. But, beyond these immediate uses, Online Payments can build complete nonprofit Web sites, and Auctionpay will continue to expand its online fundraising features.
Auctionpay Event Software online edition 4.0 was released in 2007 and enabled teams to cooperatively manage events by allowing access from anywhere at any time. Users can log into Event Software online edition from any Web browser and work on an event or multiple events in a shared environment. Event supporters (i.e. sponsors, donors, bidders, volunteers, and staff) can be managed across multiple events, reducing data management issues and enabling you to get new historical insights in your events over time.
Event Software online edition releases 4.1, 4.2, and 4.3 have added considerable functionality. Now, with the push of a few buttons, you can create Web pages to support your event that introduce visitors to the event and your cause, let them browse through your auction catalog, make cash donations or in-kind item donations, and even buy tickets or event merchandise. And you can thank your sponsors on these pages as well-even provide a link to a sponsor's Web site.
These online-based products will allow you to cost-effectively promote your cause and your event to make your fundraising efforts more effective. We will continue to build more functionality into both products through 2009.
Guido Persch is Vice President of Product and Technology at Auctionpay, Inc.
FOCUS ON YOUR MISSION
What's Your Mission?Your mission is central to your organization-your "reason for being."
Your mission describes the purpose for which your organization exists. It reflects your core ideals, your values, and your goals. Without a clear mission, a nonprofit can lose focus and become ineffective. Understanding your mission, and being able to describe it clearly and succinctly, is essential in both good times and bad. Why?
If everyone in your organization understands the mission, their activities will be focused on that mission. You'll waste less time and resources and won't take on more activities than your team can handle. A well-defined mission will guide and motivate not only your staff, but Board members, volunteers, donors, and potential donors.
Everyone you meet is a potential donor or volunteer. If you can't describe your organization's mission quickly and clearly, whether in person, in print, or online, you miss opportunities to gain new benefactors. In sales, such a description is called an "elevator statement"-meaning that you should be able to get another individual to understand your organizational mission in the time it takes an elevator to go up four or five floors-about 30 seconds or less.
Writing a Mission Statement
A mission statement should be brief, thorough, and simple. It should inspire action and respect-not boredom. It should identify the name of the nonprofit, what it does for whom, and where those activities take place. Here are some examples of real-life mission statements:
- American Red Cross - "Our mission is to build healthier lives, free of cardiovascular diseases and stroke."
- Humane Society of the United States-"To create a humane and sustainable world for all animals, including people, through education, advocacy, and the promotion of respect and compassion."
- "PONCHO is dedicated to enriching the quality of life in the Northwest through increasing resources and community support for the arts."
Let Your Mission Help Shape Your Live Event
Your mission should be the central element of your live benefit event, too. For more detail on how to ensure that your event is mission-centric, we talked to Kimberly Proffitt at Fladeboe Auctions for her insights. Here's what she told us."Many of our clients do a double take when I tell them the core philosophy of our benefit auction company is to promote the mission first and the money second. After all, we've been hired to help them raise money, right? Yes…but the success of the evening depends in great part upon being able to inspire people to part with their hard-earned cash. Our experience shows us this is best done by remembering the big picture and concentrating on mission.
At any special event, make sure your mission is front and center. Every guest should leave the event with an understanding of what you do and how you benefit the lives of others. Knowing their contributions really make a difference and feeling good about it makes guests want to give (as opposed to feeling pressured to give) - whether they buy a ticket, bid on an auction item or participate in a direct giving moment.
How do you stay focused on the mission? It doesn't just happen; it must be planned as part of your evening. Here are just a few examples of what you can do to help guests understand your mission:
- As part of the program, make sure someone from the organization (such as the executive director or Board president) spends a few minutes talking to the audience about what you do and how it is positively impacting others.
- Have someone who has benefitted from your efforts give a testimonial about your services. A few minutes of authentic "passion" can have an incredible impact.
- Offer a live auction item that incorporates or reflects your mission - is there an unusual experience or opportunity only your organization could offer?
- Add a pledge section (direct giving moment) which raises funds for a need at the core of what you do.
And don't forget…promoting your mission doesn't end when the lights are turned out after the event. You've got an incredible opportunity to continue to engage those who attended your event. Make sure guests are sent thank-you notes that remind them of the cause on which you'll be spending their donation. Add guests to your general mailing list so you can continue to engage and remind them throughout the year. Invite them to participate in other activities of your organization. And, whatever you do, show them you are using their money responsibly, for what you said you would.
In the end, it's all about building a positive relationship - whether it's for one evening or many years to come. Stick to the big picture, and the dollars will follow."
Kimberly Proffitt is Director of Operations at Fladeboe Auctions, a Minneapolis-based fund-raising auction company. She can be reached at kimberly@fladeboeauctions.com.
FOUR COMPASS POINTS FOR BENEFIT AUCTION SUCCESS IN ANY ECONOMY
"We can't direct the wind, but we can adjust the sails." This mariner's maxim reminds us to continually adapt in the face of unpredictable conditions.In this challenging economy, now more than ever, it's vital to utilize proven best practices, new technology and fresh ideas to maximize fundraising auction efforts.
Here's the good news. Non-profit organizations are achieving auction success today by charting their course on things that they CAN control to reverse the trends that many benefit auctions are experiencing due to this tough economy.
These predictable yet controllable factors include: lower attendance; auction items not achieving full or over value; use of volunteer auctioneers; cautious spending by guests; inadequate planning, lower sponsor participation, reticent bidding and sluggish events that do not maximize each and every revenue stream.
How's it done? Luckily, most fundraising auctions have many, many areas that are not yet optimized for maximum results. In other words, by working smarter, you can keep your auction proceeds strong.
Set your course now in each of these four critical directions for success.
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Focus on your Mission
The most important aspect of a fundraising auction is to make sure that all of your guests understand exactly where the money is going and how much their efforts in bidding will go to support your wonderful cause. "People do not give to needy organizations, they give to lofty causes that can make a difference," said Sharon Danosky, Fundraising Consultant, Danosky & Associates.
First and foremost: brand your mission. You have a captive audience for the entire evening of your auction. Ensure that everyone understands exactly how their donation will benefit your clients and your community. Be explicit about your cause in every auction communication and promotion: mailings, newsletters, save the date card, invitation, communication, catalog and even auction forms.
On auction night, place banners and photos that showcase your programs and services all around the auction venue and stage. Place informative table tents on the dinner tables and in between each silent auction item. Showcase how you are making a difference and how your supporters are part of the solution.
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Cultivate and Deepen Your Relationships
In addition to raising money, benefit auctions provide an extraordinary platform for friend raising. Remember, people give to people for causes they care about. Your non profit auction provides a momentous opportunity to deepen relationships with guests, sponsors, members, Board of directors, trustees, prospective donors and volunteers.
Make it easy for all your supporters to bid higher at your auction with these cultivation ideas. Several weeks prior to your auction, hold a pre-auction reception where you and your Board can personally meet major donors, sponsors and prospective VIP guests to highlight your cause and preview key auction items. At your event, ask your Board and auction committee members to personally welcome five guests they do not know during the silent auction. During the event, empower your supporters with a personal connection; reach out to as many as you can during the evening to make sure they understand how their contribution will benefit your clients and your community.
Approach your benefit auction as a cultivation event and you will ensure that your auction will be a catalyst for future giving opportunities, such as annual appeal, major gifts and planned giving and capital campaigns. By deepening relationships with auction supporters, you invite investment and involvement far beyond auction night.
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ASK!
And do not stop asking; be unabashedly explicit about raising money and in what area you need funds. For most of you the economy has had an incredibly challenging effect on your clients. Now is the time to communicate how much your donor's investment will positively impact your cause.
It's because of this tough economy that it's crucial to tell donors that you need their support now more than ever. Be specific. Explain how your organization is making a difference and that donors are a critical part of the solution. Make sure every single donor in your database knows what you are doing and why their involvement is so critical to your continued success.
As a very wise person once said: If you don't ask, the answer is always the same!"
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Embrace Best Practices
This is no time for your auction to be an amateur event. By bringing in best benefit auction practices like focusing on audience development to increase the level of guests who have the means and influence to bid higher to support your cause; soliciting premium items that your guests really want; designing your auction with momentum and exciting timing; and using the latest in on-line auctions and benefit auction technology you stack the deck in your favor. Now, more than ever, a professional auctioneer who specializes in benefit auctions will maximize your fundraising efforts and create an entertaining, successful evening that takes the risk out of fundraising.
A presidential campaign not too many years ago used the phrase "It's the economy, stupid," to keep their staff focused on one issue that really mattered to voters. However for benefit auctions, it's all about your great cause.
So chart your course and really explore each of these four strategic directions. By branding your mission, deepening personal connections with your auction guests, explicitly asking for investment in your cause, and using auction best practices, you can have a record breaking fundraising auction in any economy.
MANAGING YOUR NONPROFIT THROUGH AN ECONOMIC DOWNTURN
It is difficult to open a newspaper or turn on the television these days without seeing a story on economic doom and gloom. The housing and credit markets are in disarray, oil prices continue to rise and the dollar is weak. But what does this current economic climate mean for the charity auction fundraiser?Given the steady drumbeat of poor economic news, it is easy to be pessimistic about the current state of the economy. However, experienced professional fundraisers and marketing gurus are not buying into all of the negative economic hype.
We all know that there will be hurdles to overcome, but there also will be a certain amount of stability for focused well-positioned charity auction fundraisers.
So what can charity auction fundraisers do to better their efforts during the bad - and good - times?
- Get Back to Basics
Stay Positive. Lead charity auction fundraisers need to encourage their co-workers to keep morale high. Donors and volunteers will pick up on your demeanor, so stay positive and optimistic and they will follow your lead. Keep the glass half full.
Work Smarter and More Efficiently. Information technology is one tool that can help fundraisers to work smarter and more efficiently providing more time to promote the charity auction event. Consider using auction management software, which can allow you to spend more time generating attendance and funds versus administrative busy work.
Revisit Fundraising Goals. Is your organization too reliant on one or more grants or top donors? What new sources of revenue is the organization pursuing? Now is the time to focus on increasing the diversity of your funding sources and strengthening every fundraising effort. Your specific financial goal must be written down and communicated to your donors. If your goal is understood you will have a better chance to meet it.
Learn From the Past. Be ready and flexible for when times are down - remember you are always building for the future!
Get Ready for the Good Times. When the economy recovers, make sure you have planned for the increased activity. Remember if you keep in constant contact with your donors during the bad times, you will reap even more benefits during the good times.
- Reach Out to Donors
Keep Donors Focused on Your Mission. Continue to remind donors why they became involved with your organization in the first place, and put the focus on working with them to achieve the goals of your charity. Hold regular short meetings with your team to keep the focus and be sure to regularly communicate results to donors.
Maintain a Steady Course of Stewardship for Donors at All Levels. Don't fall into the trap of over-soliciting your donors during a down economy to make up for lost gifts. By continuing to talk with donors at all levels, you keep your charity event in the forefront for when times improve. And now more than ever is the time to expand your donor network. Increase your new donor contacts by at least 20% each year to keep the event fresh with new funds. If donors cannot commit to a gift, ask them to volunteer.
SPECIAL FEATURE: PLANNING CHARITABLE DONATIONS WITH A DONOR-ADVISED FUND
The majority of your donors have a plan for retirement, for education funding, for estate planning, but how many of them have a charitable giving plan? Having an effective charitable giving plan is one of the best ways to ensure that your donor's contributions are being used according to their wishes and applied as effectively as possible. A donor-advised fund is a simple way to enable donors to incorporate charitable giving into their overall financial plan-and it may provide them with personal and financial benefits. A donor-advised fund is a charitable giving vehicle administered by a third party and created for the purpose of managing charitable donations on behalf of an organization, family, or individual. Donor-advised funds are generally funded with cash, publicly traded stocks, mutual funds shares and bonds. Many will also accept other gifts, such as restricted stock, illiquid securities and real estate. Your donors are not required to select a specific charity or cause at time they open a donor-advised fund, and grant recommendations can be made throughout the life of their account, allowing them more time to select the organizations that meet their philanthropic goals.
Your donor's contributions are tax deductible and may benefit from tax-free growth, enabling them to simultaneously give while reducing their tax liability. Because their gift to your cause has the potential to grow over time, they may end up being able to recommend more charitable gifts from their account. And, if taxes rise, the tax deduction for the donor will be even greater than today.
There are additional advantages for donors when they establish a donor-advised fund. They can create a "giving legacy" by designating an individual to succeed them to recommend charitable grants from the account. This step will enable their philanthropy to continue beyond their lifetime. Donors can also make grants anonymously or with recognition. And donor-advised funds generally have lower fees and start-up expenses than other related structures such as private foundations.
Here are some important questions for you to consider when soliciting and administering donor-advised funds.
- Can your donors recommend grants and verify account activity through secure online access?
- How are their investments structured within the program?
- How frequently can you provide accounts statements and notification of gifts made from their account to your donors?
George M. Noceti is a Financial Advisor with a major Wall Street firm and a professional benefit fund raising auctioneer for the SF Bay Area. He can be reached at george@yourcharityauctioneer.com.
