My neighbour Jimmy has lived in his house for 60 years. The suburb at that time was full of recent migrants and tradies and people scorned the old Victorian weatherboard houses. Now it’s full of investment bankers driving Teslas. Real estate agents will always tell you that the best time to buy was last year. When Jimmy tells me how he bought his house for the equivalent price of a designer handbag, then they may have a point.
Many non-profits are tempted by the thought of corporate partnerships but haven’t yet made the commitment. Others have dipped a toe in the water but aren’t pursuing them seriously. If you’re a non-profit, then you’re very conscious of your cashflow. You’re all trying to do the most with limited resources and be good stewards of donor funds. But you need to invest to grow. The research from JB Were and the Giving Large report shows corporate giving estimated at $5billion per year and growing despite economic challenges. There has never been a better time to pursue corporate partnerships.
Here’s what the cost of inaction looks like.
Wasting your investment in people
The average salary for an experienced partnership manager is around $100-120k plus benefits. When you invest in their ongoing learning and skills development you can expect them to bring in 10x the cost of their salary on average. So why are learning and development budgets so tiny? I know that non-profits are acutely focused on their cost-income ratio and ensuring that you meet the needs of as many beneficiaries as possible. But lack of investment in your people leads to stress, frustration and burnout. You’ve made the investment in hiring and you want to set up your team for success. The market for real talent is fierce right now and especially for experienced corporate partnership people, who often jump across the fence and back into corporate roles. Don’t forget that a partnership executive needs the right kind of support to stay motivated and successful. Hiring partnership staff and failing to give them support from across the organisation is like buying a Ferrari and driving it in second gear.
Missing out on partner value
Every business knows that it’s better to retain existing customers than find new ones. It’s 6-7 times more expensive to acquire a new customer than retain an existing one and a 5% increase in retention can increase revenue by at least 25%.The extraordinary response of corporates during COVID show that retention matters. The non-profits that had invested in nurturing their corporate partners saw extraordinary results. The Smith Family benefitted from a $1mln donation from Suncorp, who had been a program partner for many years. Lack of investment in your partnership program leads to rapid staff turnover and a break in relationship continuity. It’s harder to build a strong and meaningful corporate partnership when your people change so often.
The landscape has changed dramatically in the last two years. As corporates look for fewer, more strategically aligned community partners, you have to make the most of every opportunity. Don’t miss the shot because you didn’t get the right help or didn’t build the right skills.
Missing out on fundraising value
Corporate partnerships provide an opening to new channels, audiences and donors. When Target Australia partnered with Australian Childhood Foundation, they had more than $250,000 on the table. Target also have 13,000 staff, over 250 stores and a loyal following of millions of customers through their online and store channels. It’s a fantastic opportunity to leverage Target’s footprint and marketing assets to expand community awareness and fundraising.
Compare this to the cost of donor acquisition through more traditional means. Face to face fundraising costs an average of $500 per acquisition and the rate of attrition in year one can be higher than 30%. You’re unlikely to break even until at least year two. Direct mail costs upwards of $50,000 to buy new email lists and you’re lucky to get a return of 1-1.5% on a standard mailout.
Investing in finding the right corporate partner can dramatically expand your donor base. Plus you’re getting a warm introduction through the partner relationship. Tesco in the UK has 80 million customer visits per week and a loyalty database of millions. How much would it cost you to acquire a mailing list like that? In difficult times we can all revert to some defensive behaviour. We save our pennies, buy less and hoard toilet paper. But shrinking to greatness is not a viable strategy. If you want to grow meaningful corporate partnerships, then you need to invest. Don’t be the one who didn’t invest in real estate years ago and is living in a tent whilst others are adding a swimming pool. Get serious about partnerships, make the investment and ensure your organisation isn’t left behind.