QualPro Helps University Choose Marketing Mix for Donation Increase
THE CHRONICLE OF PHILANTHROPY
Connecting the nonprofit world with news, jobs, and ideas
July 24, 2011
An Alumnus Teaches a University How to Double Its Donations
Patrick Murphy-Racey, for e Chronicle
Charles W. Holland donated his company’s consulting services to help Lincoln Memorial University,
his alma mater, improve its fund raising, increase enrollment, and attract students with higher test
scores.
By Holly Hall
Charles W. Holland could turn out to be one of the most generous donors to his alma mater—and
to nonprofit organizations everywhere.
Mr. Holland donated his company’s management-consulting skills to Lincoln Memorial University,
a Tennessee institution that in just one year has doubled its contributions to $4-million without
adding a single fund raiser or spending any new money. That achievement comes at a time when the slow economic recovery has meant most colleges barely eke out any increases at all, according to the Council for Aid to Education.
University officials say they’re just getting started on their way to making gifts soar.
Cynthia Whitt, Lincoln Memorial’s vice president for advancement, says Mr. Holland’s ideas
have “brought discipline and energy to fund raising.”
Testing Multiple Ideas
Mr. Holland, who holds a Ph.D. in statistics,
is the founder of QualPro, a Knoxville, Tenn.,
consulting company that has spent nearly 30 years
working with more than 1,000 organizations,
including many Fortune 500 manufacturers.
Over the years, the company has branched out,
working first with service companies, then with
political campaigns, and now even a few nonprofit
organizations, including private schools, hospitals,
and others.
Organizations use Mr. Holland’s process to test
new approaches to save millions of dollars
while greatly increasing revenues. At the core of
his methods are sophisticated statistical analyses
that help groups simultaneously test dozens of
ideas for improvement. In its first year working
with Mr. Holland, Lincoln Memorial used
the process to try out more than two dozen fund-
raising ideas such as taking yearbooks along on
visits to donors, changing the timing of appeals
to the annual fund, and promoting donations
to build new dorms in the university’s alumni
magazine.
Guided by Mr. Holland or another
QualPro consultant, such experiments allow
organizations to quickly sort out which
ideas help, which ones hurt, and which ones
make no difference.
The QualPro approach, while not without critics,
has been endorsed by numerous corporate leaders.
It is somewhat similar to other statistical
improvement methods such as Six Sigma, a
method used by General Electric and other
large companies to improve profits by eliminating
weaknesses and waste. While Six Sigma focuses
on improving existing processes, Mr. Holland’s
approach also seeks to include new, never-before-
tried ideas.
Carson-Newman College, in Jefferson City,
Tenn., recently used QualPro’s methods to test
whether it should open a new campus in
Knoxville. It now plans to open the campus
because QualPro showed that plenty of students
will enroll in the master’s degree program it
will offer there. The tests also determined that
students had a keen interest in one new idea
Testing Lots of Ideas at Once to
Improve Results
Here’s a sampling of the 30 tests conducted simultaneously by
Lincoln Memorial University, which doubled its fund-raising
returns in one year with help from QualPro, a Knoxville, Tenn.,
company.
BIG GIFTS
Demonstrate a fund raiser’s commitment
Fund raisers told donors about their personal philosophy on
charitable giving and about their own donations to the university.
Results: No difference in the number or size of gifts.
Give out promotional brochures
Some fund raisers gave donors brochures that featured students
graduating or reaching career milestones such as practicing medi-
cine.
Results: No difference in the number or size of gifts.
Ask donors about campus memories
Fund raisers urged alumni to flip through a yearbook and remi-
nisce about their favorite faculty members.
Results: Gifts increased in size and number.
SMALL GIFTS
Add a splash of color
A direct-mail appeal was enclosed in a bright red envelope instead
of the university’s standard business envelope.
Results: No difference in number or size of gifts.
Use bigger type
A direct-mail appeal for the annual fund was sent using a bigger
letter font.
Results: No difference in number or size of gifts.
Get ahead of the holidays
Some appeals were mailed two weeks ahead of
anksgiving and some just after.
Results: More people gave to the mailing sent before thanksgiv-
ing.
Spell out needs
An appeal for the university’s museum listed what items it hoped
to buy, such as a letter written by Abraham Lincoln, for whom
the university is named.
Results: Gifts increased in size and number.
Emphasize lifetime membership in the alumni association
The university tested whether people would donate $200 for a
lifetime membership with a direct-mail appeal that emphasized
that offer—but also gave people the option of paying annual
dues.
Results: More people chose the lifetime option
the college hasn’t ever tried, which could provide a
big advantage over competing programs: “academic
success coaches” who would work with students to help
them complete the degree. The college now plans to make such coaches available.
Enrollment Gains
To be sure, Mr. Holland’s services don’t come cheap.
A typical consultation for a nonprofit organization,
which can last from several weeks to a few months,
costs around $150,000, though QualPro’s policy is
to accept only those clients it thinks will earn five times
as much as they paid the company during the first year
of the consultation. However, because Mr. Holland sits
on the board of Lincoln Memorial, where he obtained
an undergraduate degree in mathematics, he decided
to donate virtually all of QualPro’s services to his alma
mater.
He assigned two QualPro consultants to the university.
Dana Thompson has concentrated on improving its
fund raising, while another QualPro expert worked
to increase enrollment and attract more students with
high scores on entrance exams. Enrollment gains
have been impressive, with a nearly 20-percent rise in
new applicants and a more than 80-percent increase in
the number with high test scores.
Statistician Required
To improve the university’s fund-raising returns, Mr.
Thompson guided Lincoln Memorial through a rigorous
process that lasted several months, and he evaluated
more than 25 ideas to increase contributions.
Organizations can learn to use the QualPro approach
themselves, but Mr. Holland says they must enlist a
trained statistician to design and interpret the results of
what are often dozens of simultaneous experiments. At
Lincoln Memorial, Mr. Thompson and his colleagues
undertook the following steps:
Brainstorm ideas to increase contributions.
Mr. Thompson guided Lincoln Memorial fund raisers
through a review of contributions over the past several
years to identify times during which giving peaked or
ebbed and to look for other patterns that might suggest
ideas. But even though tweaking ideas that have worked
before sometimes make a big difference, he told fund
raisers not to obsess over the past, because odds are that
the best ideas are those never previously tried.
He didn’t stop with just the 15-member fund-raising
staff. He also reached out to university officials,
students, parents, and others to come up with new
ideas. The result: more than 200 ideas about how
the university could increase its fund-raising returns.
Decide which ideas to test.
With Mr. Thompson’s help, Lincoln Memorial chose to test seven ideas to increase large gifts and 23 ideas to increase small
ones.
They selected only ideas that would cost nothing
to try and could be tested without hurting fund-raising
efforts already under way. QualPro also looked for ideas
that, if they worked, could be put to use right away on a
broad scale.
To reach major donors, the university tested how well
it worked for fund raisers to talk about their own
personal contributions to Lincoln Memorial or how
the institution uses money. Another idea was for fund
raisers to take a yearbook along to help donors recall
their favorite faculty members.
Ideas for improving small gifts included adding a survey
about the university’s homecoming activities to annual-
fund appeals, asking for annual-fund donations
before Thanksgiving instead of after, shortening
the annual-fund letter, and including a wish list of
items sought by the university’s museum in a mailing
to visitors and other potential donors.
Try out the fund-raising ideas.
Mr. Thompson helped Lincoln Memorial divide 22,000 alumni into 60 groups to test ideas to change mass solicitations. To test
the seven ideas for increasing large gifts, four fund
raisers made visits to a total of 136 donors.
For the trials, Mr. Thompson designed 64 experiments.
But before they began, he met with the fund-raising
staff to make sure each person understood and agreed
on exactly how each experiment would be conducted,
how results would be recorded, and their role in
the tests.
And while each idea was tested with two alumni
groups or with two big donors, Mr. Thompson
also conducted a series of experiments to help verify
results by reversing conditions to see whether that
caused an opposite result. Taken together, the two types
of experiments give a clearer picture of the true effects
of a new idea. Then fund raisers conduced more tests of
the ideas that led to improvements to find further ways
to improve results.
Assess test results.
Of all the fund-raising ideas that Lincoln Memorial tested, only a small percentage increased giving. But that’s to be expected, Mr. Holland says.
After completing some 16,000 tests for more than 1,000
organizations, he says, QualPro has learned that only
25 percent of all the ideas it tests help an organization
improve, while 53 percent make no difference, and 22
percent make things worse.
For example, out of Lincoln Memorial’s seven ideas
to increase large gifts, only two worked: telling donors
that “we need your support” and bringing along a
yearbook to spark a conversation about a donor’s
favorite faculty members. The yearbook idea worked
the best by far, increasing both the number and size of
donations.
And among the ideas for increasing smaller gifts, a wish
list in mailings to seek donations for the university’s
museum increased donations, as did sending
out Lincoln Memorial’s annual-fund solicitation
before Thanksgiving and shortening the pitch letter it
included.
But a photograph of a handsome new residence hall in
a student-housing solicitation, another idea that both
board members and fund raisers thought would work,
backfired with the alumni who received it, says Ms.
Whitt, the vice president for advancement. Ms. Whitt
believes it probably turned off older alumni, whose own
dormitories were far more spartan.
Applying the QualPro approach requires a lot of
extra work for any group that uses it, Ms. Whitt and
others say. But it also offers benefits beyond rapid
improvements. One is improved morale stemming from
the fact that anyone, even the lowest level employees,
are invited to suggest ideas for improvement. Another
is that employees can see the returns of their efforts
relatively quickly.
At Lincoln Memorial, fund raisers “were excited
to be engaged in a process where they could actually
know for sure what works,” says Mr. Thompson. “They
were jazzed because it was an opportunity to really learn.”
They will soon have another chance: Mr. Thompson is
now putting the finishing touches on another round of
experiments that will test ideas for improving donations
and attendance during Lincoln Memorial’s homecoming
weekend in October