Episode 212: Comparing Philanthropy to Sales – Similarities, Difference and Learned Lessons
Welcome to another edition of Around with Randall, your weekly podcast for making your nonprofit more effective for your community. And here is your host, the CEO and founder of Hallett Philanthropy, Randall Hallett. I'm honored that you take a few minutes of your day to join me, Randall, on this edition of Around with Randall.
I want to do the unthinkable in the world of philanthropy: go into the deep despair of how we always think the world views us. Can we compare what we do to being a salesperson? That forbidden topic that many in our industry don't want to have. Where does this conversation topic come from? I did something recently that, for those who know me, will say, "Wow." I bought a car. Now, I'm not known for spending a lot of money in large chunks, particularly on cars, which to me depreciate so quickly once you drive them off the lot. But for my wife, who I think of as the greatest person I've ever met, it was time. We wanted a car that would last us for multiple years, looking at the needs we have in that process, just because of a lot of other factors. We did also something I'm not accustomed to. We bought a new car.
I have to say that the process we went through in the decision and getting that particular car was spectacular. My wife has commented on many different occasions as we have gone through this and worked with the salesperson, who we first met when we walked in the door, to the team of people that have helped us learn how to use the car, considering my wife was driving a car from not only potentially, it feels like, another decade but another century. There's a lot of differences in the car’s technology. In fact, my comparison to my wife was, since I tend to rent cars when I travel and I see more modern things, I said, "Sweetheart, you're going from writing a horse to being the captain of the space shuttle."
There have been countless calls that have come as a part of this process post-purchase. There is a weekly email about getting to know your car. There have been incredible outreach from the sales team, just, "Hey, how’s everything going? Is there anything you need?" I've been floored. It wasn't a hard sell. We felt good about it, and we love the car that we purchased, and I'm not mentioning here because I'm not here to endorse. But it was a good decision for us. The thing that got me was when my wife said to me about a week ago that she felt like the car company was more engaged with us than some of the nonprofits that we give to, i.e., making us feel good about the decision. And I had to think about that, which leads me to today.
The real question is, how are we similar? How are we different? And what can we learn when we look at what we do and how we do it? So if you're the gift officer and you're giving special events, principal gifts, planned giving, this is direct. If it's prospect management and you're listening, this is connected. If you're a leader, how do you get your team to think about this? If you're a board member, how do you think about how you engage in the community? Today we want to take these things apart in our 20-minute, 21st-century classroom conversation and figure out how we can make what we do better.
So let's start at a very high level. What are the similarities? I had to think about this when it comes to cars, not cars per se, but salespeople, and the issues or thought process behind working with donors. Well, the first thing is obviously relationships are key. And we'll get into some of the tactics here in a few minutes. We also have to figure out the difference between persuasion and influence. But sometimes, do we have enough? Do we have too much in the nonprofit sector versus what's going on in the for-profit world with salespeople? Certainly, researching and prospecting is very similar, as you're always trying to figure out how to get into more conversations. How you get there changes, which we'll talk about in a few minutes.
Both industries are based on goal-setting in some way or goal-driven. In fact, so much so that you know that most salespeople are really driven toward the idea of commissions because that's how they get paid. The final piece of this puzzle is that communication becomes really important. But what we communicate and how we communicate may be totally different.
The major key differences. I'm going to just say this, and I'm going to come back to it in a few minutes because I think it's the most important: the motivation between a buyer and a donor are completely different. Number two is how we ask. Maybe a third one is, if we're doing it correctly on the nonprofit side, the length of the cultivation cycle to get to larger gifts. Another difference could be — and we'll talk more specifically about this in a moment — around the motivation: what is the actual appeal? Emotional versus rational — big difference. The accountability is different. Much of the time with salespeople, if they're commission-based, if they don't sell, certainly the company is affected, but the people who are affected most often are the salespeople. In our industry, we have ethical standards, and I think appropriately so, that we don't compensate people by how much they raise. So failure actually hurts more on the accountability side on the organization. Finally, the values that we have and what they're actually getting. A salesperson is selling an object, a good or possibly service. What we're selling, to use a lack of a better term, is intangible. It's love, it's hope, it's changing the world.
So, at a broad sense, there are some similarities. There are also some differences. Inside of that though, and now we start moving into the tactical: what is it that salespeople do that is similar to us that we actually could learn from? What are some of the lessons? Well, we have to start with what are the exact similarities. The first is that there is a relationship process, if done correctly. We mentioned this at the outset, but maybe some of the details are really important here. One of the first things is the idea of trust.
I think about our car buying experience and how, as I watched, and Frank, they let my wife take the lead on most of the conversations to her car. She knows what she wants, plus she’s 10 times more knowledgeable than I am. But I was watching and listening, not realizing I was putting in the framework of philanthropy, at least from my professional experiences. What I learned from this was that this idea — he was building rapport and trust. He was asking lots of questions. He was trying to get the first names. What is it you're trying to accomplish? What are your goals? What do you need the car for?
And then he did something that was incredibly powerful, which is something we should parallel: his ability in active listening was spectacular. What are your unique needs? In our case, to give you an example, we have a beautiful home. The one thing we just kind of all shake our heads about is that it's a raised ranch, and the garage is under part of the house. Well, in 1954, when they built the house, they didn’t have tall cars. So we have an upper inch limit as to what cars we can buy. And to a lesser degree, a width — not much of an issue, but the height is a big one. Well, as soon as we said that, he says, “Well, you don’t want that car, that car, that car.” His active listening skills about what was important to us were pretty impressive.
We also said no to something, so his ability from that active listening perspective about what our goals were and how he created some resiliency — which is something I talk about a lot, and we don't have enough of — was also valuable. We tend to internalize when someone possibly says no, and it shouldn't be meaning "no," and that it should support that project or whatever it is. It really has nothing to do with us. In our experience from sales, if you're really good at it, you're trying to figure out how to overcome these objections to hone in on what they need. How do you solve their problem?
In my case, a car with height limitations, we need enough space for kids, and my wife tends to haul stuff around. How do we do all of that? Emotional intelligence — how ready were we to buy? What were the big issues? My wife’s big issue wasn’t finance. I'm the one who asked to overcome the issues, for the most part, of dealing with depreciation and how quickly cars depreciate. And depreciation, she can certainly spell it, but I don’t think she can do it in a business perspective. Financially, it’s not her thing.
But I'm watching this going, he's good. He's figured out what values my wife has. Now it still solved the logical issue. We got to buy a car because of these reasons. We should be always highlighting this philosophical lesson about what value the gift might have from the donor's perspective. And we might also overlay then what it might do for us to make their dreams, their hopes come true. What our organization does to fill that need.
I thought it was fascinating how focus on value was played up reliability. We take care of the maintenance, all these things. You look great in it. It's a little more sporty. He figured out value in my wife's world. What makes it better for her? We need to do more of that, but through the eyes of the donor.
Number two is sales people are always prospecting. And frankly, we need to do this better. They're dependent on it. Now there's prospecting goes into major marketing efforts, billboards things of that nature. I'm not talking about that. What I'm talking about prospecting is how do you make sure that you have a constant flow of new conversations with different people?
So two episodes for the details to go listen to episode 205, which obviously I just recorded because it's one's fairly close about how do you get a small kitchen cabinet group of people to help inform you, particularly if you're maybe a senior leader around an area or the organization, informally about what's going on in the community, how you connect to it. 190 gets into the conversations around the details of the referral process, education, healthcare, so service wherever. So two episodes, two or five and 190 about always prospecting.
But the key is if we leave too many people in our portfolio for too long, they stagnate. Now those are people who aren't making regular gifts who can't be elevated, but too often I see portfolios of 150 people and I'm like, how many people did you not see in the last year and the answers? 40, 50%. I'm like, what kind of prospects are these? The answers they're not. So how do you bring down the number of people and then on top of that, always having new people coming in?
There's also some tactical things that I think we can learn. Number one is sales people when they're at their best tell stories, usually of other customers and satisfaction. This is kind of why we read the reviews like on Amazon or Walmart or Target or wherever you buy stuff because they tell a story. Was it a good product? Those are good service.
Why do we ask for references when we purchase bigger things like, you know, it's only putting on a roof or somebody's doing construction work? I would like three references. I would like to talk to formal clients. Why do people ask me for references? Because they tell a story. We need to be better at telling stories about, not about donor satisfaction, but about impact about people, what the organization does. If you're looking for some more help in the detail of that, that's episode 104 on storytelling. And I couch it around Billy Joel, who I think should been the poet laureate of the United States is a storyteller and his music. You can listen to more about that and how to do that.
I think the second thing is handling objections. There were some things that came up in the conversations and buying the car. Well, these same things objections, generically come up all the time in our work. They have when they give, how they give what the organization does. You were in the paper. You did this. I didn't hear this. It's too much. It's too little. I don't know how to do this. All kinds of things. Incredible detail in episode 147 on handling objections.
What I appreciated in the car buying process is we did have some objections. One of which is the car can't be too tall or too wide. Do you know what the guy did? He said, I'll be right back. He went and got a tape measure because how wide do you have it and how tall can it be? And he measured it on the spot. We could look at that tape measure and go, this will fit. Wow. Challenge. Objection. What are we doing to overcome those obstacles?
The last thing that I want to spend just a moment talking about, or I'm running just a minute long, is about stewardship. I mentioned this at the top, that this car manufacturer, this salesperson representing them. A couple of other people who are part of the process have been unbelievable at stording our purchase. I did not buy a Porsche. I did not buy a Cadillac. It's a pretty standard brand, but not a traditional brand. And the customer service that has occurred has led me to believe if I have to buy another car, maybe the next one for me, not anytime soon. They got my business, not just because of the sales process, but stewardship process, because for service process.
How in the world do we not spend more emotional, psychological, organizational, whatever effort to steward those people who have made a difference for us? Why isn't that the first thing that we're thinking about? We are going through or have gone through the process of making some of your end gifts. And people get eliminated each year because I don't ever hear from them, other than they just want to ask me for more money.
And I'm not talking about, like, they got to come and like bring us gifts. And I'm talking about like, hey, could somebody just pick up a phone and thank me for the gift? And those that haven't, my wife's figured out as well, they don't get a gift next year. Or it's just something very small. How in the world do we not prioritize the stewardship? A car is a purchase, taking a figure, $50,000. It's a major investment for myself, for anybody. And they know that. How in the world aren't we doing that kind of stewardship with people who are making a thousand, twenty five hundred five thousand dollar gifts that eventually may get larger?
A simple phone call. Thank you for what you've done for making a difference. Higher level gifts, spending some additional time, explaining what their gifts did. I have been blown away by the customer service and it's been the connection back to stewardship that I most marvel at. My car buying process in a lot of ways mirrored when done well and it was the trust that's built over time in the relationship business.
We're in the relationship business. While we're different and we highlighted some of those differences, there are things we can learn when it's done well. When I give credit to the company we purchased the car from and from the service we've received. And I want to take some of those lessons and push them into conversations I'm having with gift officers because I want you to raise more money because your organization needs it.
I want your organization to be more viable, stronger and more effective for what you do in the community. And there are some things that we can do in this process to get better, to understand, and to increase our philanthropy efforts. Don't forget to check out the blogs at how it philanthropy, two week, interesting things I read about from articles and to publications to legislation and changes which are obviously going to happen when we look at some of the changes politically in the United States.
Also, if you'd like to reach out to me it's podcastedhowletflanthropy.com. Remember what you do is important. You serve a really critical role somewhere between government which is inefficient at times and for profit enterprise commercial practice. They don't see a profit motive, there's a whole philanthropy fills that whole. What you do changes lives.
Don't forget my favorite saying some people make things happen, some people watch things happen to those who wondered what happened. What we do every day is a difference maker. What you do every day is a difference maker being someone who makes things happen. What a great way to spend every working day of your life knowing you're changing the world. One little piece at a time. And I thank you for that. Even if it's not my community, you're doing it for somebody in a community that you love.
I look forward to seeing you the next time right back here on the next edition of Around With Rambles. Don't forget, make it a great day.