The experience attendees have at your event is based upon each and every interaction they have.  From the moment they arrive until the moment they checkout, every volunteer and staff member at your fundraising event is helping set the tone for the evening and shaping your guests’ perceptions of how things went.

And while it is nearly impossible to make everyone in a 300-person crowd happy, it is possible to set an event-wide tone of customer service and success. Good customer service can make people forget the most egregious of errors, while bad customer service can turn the most innocuous of molehills into mountains.

Take, for example, the experience my wife, Michele, and I had on our honeymoon at an eco-resort on the Riviera Maya in Mexico. We knew in advance that our villa came with a CD player and surround-sound system, so we brought a sleeve of CDs to listen to on the trip. One night, well into our trip, we were blasting music and dancing around the main room of our villa.

There was a knock at the door, and when we opened it we found one of the resort staff members flanked by security personnel. He cocked his ear to one side, and then said to one of his compatriots, “Really? This is the right room? Well, I can hardly believe it myself, but one of your neighbors has complained about your music being too loud. I hate to trouble you, but would you mind turning it down a bit?”

Brilliant! I’d never felt so good about being asked to turn my stereo down, and I’d never heard anyone else make such an ask so artfully. I only wish I’d had his example to draw upon back when I was an R.A. in the dorms at U.C. Berkeley.

Contrast that with the sound guy I saw at a recent event. He hadn’t brought adequate equipment to cover the needs of the event, and was forced to crank up the volume on the only two speakers he had. Furthermore, he’d set up his speakers so they were aiming right at the tables in front of them. At head level. And these were potential big bidders.

As soon as one table realized that the speakers were going to be aimed at their heads all night long, they got up and redirected the speaker so that it no longer aimed at them - or anyone else in the audience, for that matter. When the sound guy realized this, he went over and turned the speaker back towards the table without saying a word.

As he was passing their table, someone at the table asked the sound guy if he could turn it down a bit. Without breaking stride, he turned his head and sneered, “No!” and went back to his mixing board. Everyone at the table was shocked. I was shocked. It was a level of rude that no one expected, especially in an event setting like that.

I tried to smooth things over with the table by offering a solution of moving their table away from the speaker and closer to the dance floor. It helped, but it didn’t fix things one-hundred percent. It certainly didn’t change the tone the sound guy had set when he snapped at them.

The screaming sound guy may be an extreme example, but it doesn’t take much to impact a guest’s mood at an event. All it takes is one rude waiter, a volunteer who is too focused on their assigned task to answer a quick question, or bartenders who spend more time chatting with themselves than interacting with attendees to turn one person off. And at an auction, the way people vote is with their paddle - or by withholding use of it.

Empower you staff, volunteers and vendors to create an atmosphere of positive customer service at your event. Each of them has the potential to make your event great for each and every attendee; especially if something goes wrong. The customer service they provide will define attendees’ experience. It will also impact the amount of money you raise, either the night-of, or at future events.

At more than one recent event, I have been handed a catalog with inflated values on the live auction packages. There is an inherent danger in this, as it stretches the boundaries of trust with bidders. The desire to establish a high value for the auction packages one works incredibly hard to obtain is understandable, but extremely high lot values can have a chilling effect on an auction. Especially in this economic climate.

A fundraising auction is in many ways an exercise in building and maintaining trust. Attendees come because they trust they will have a good time. They give you money because they trust you honestly need it and that you’ll do good work with it. You have to trust that your crowd will show up and support you at the level you need.

The latter is probably harder to do, but it is also the most important. It takes a big leap of faith to put yourself out there, to put all of the effort into making the event happen, and to trust that your crowd is going to come support you at the level you need. The moment you start inflating the values of your live auction lots, however, you violate that trust. It seldom pays off.

When the values of a live auction are inflated, a couple of things can happen. At best, people feel priced-out of the auction, and start paying less attention. This is bad because we need everyone to feel like the auction is somewhat inclusive, at least until we do the fund a need.

The worst thing that can happen if you inflate the values is that the audience turns on you, because they think you are being greedy. A few summers back I did an event that was lucky enough to have one of San Francisco’s most wealthy and highly-regarded philanthropists in the crowd. The people putting the event on wanted everyone in the room to rise up to said philanthropist’s level, and insisted on inflating all of my opening bids.

Our opening lot was a winemaker’s dinner for 12 people at a then soon-to-open Winery. At the client’s insistence, we changed the opening bid from $2,000 to $4,000 - thereby also changing the implied value of the lot from $4,000 to $8,000. Ridiculous. And I wasn’t the only person who thought as much.

One of the tables was filled with a bunch of bidders I see at many wine auctions in California and beyond. This crowd comes to spend money at an auction. I could see the looks on their faces immediately change when I announced the opening bid, as they all got pissed off and put their paddles down. That same table of people had spent over $30,000 at an event only two weeks before. That day, they didn’t bid once, not once. They turned on the event and sat on their paddles from the opening bid.

It affects my credibility as your auctioneer, as well. If I’m telling a crowd that the lots are worth X and everyone knows they’re worth less than that, people start to doubt what I say. And when people start to doubt what I say, they start to spend less, ultimately having the exact opposite effect of the original intent. There are many keys to getting people to spend more at a fundraising auction. Simply saying the stuff is worth more than it is isn’t one of them.

At the end of Clint Eastwood’s Oscar-award winning western, Unforgiven, Little Bill Dagget (Gene Hackman’s character) finds himself about to die at the hand of Edward Munny (Eastwood), one of the very criminals he’s spent his entire life protecting his little town from. “I don’t deserve this… to die like this,” Dagget says.

Munny pauses just long enough before pulling the trigger to reply, “Deserve’s got nothing to do with it.”

Audiences at fundraising events these days are completely unforgiving, leaving little room for error before they turn on or tune out an event. And like Munny said, “deserve” has nothing to do with it.

It used to be that if a sound system was sub-optimal, a crowd would work to hear the auction and pay attention. I did a school event this year that had an unfortunately horriffic sound system, and the crowd took that as their cue to save some money. “What’s that? You want me to bid on what? I’m sorry, I can’t hear you, my 401k is down 37% this year!”

The event finished down 40% from last year’s totals. We’ll never know for sure how much the sound system cost them, but I’d estimate that half of that is attributable to how poor the sound was.

Start the auction too late? Unforgiven. Have too many speakers or too large a program? Unforgiven. Put on a poorly structured fund a need that doesn’t spell out what you need the audience to help you accomplish? No matter how badly you need the money, this year “deserve” alone has got nothing to do with it.

We have always advocated thinking of your event as theater, and planning your event so everything that happens does so for a reason.  This year, that reason has to be focused more tightly than ever before. We’ve seen plenty of evidence to back up our theory that people are attending less events than ever before. And if they are given the slightest hint that something is amiss, they are ruthlessly tuning out and saving their money for an event that deserves it more.

Reynolds & Buckley will be conducting a workshop entitled Fundraising Auctions in Hard Times on Tuesday, February 24th at the Volunteer Center of Sonoma County. Company founder and nationally recognized fundraising expert David Reynolds will be on hand to discuss the challenges facing anyone conducting a fundraising auction today, along with associates Greg Quiroga and Ed Gold.

This is the third year we’ve partnered with the Sonoma Volunteer Center to offer a workshop, and this workshop couldn’t come at a more relevant and important time. We will discuss emerging trends in fundraising auctions, share insights from the 50+ events we’ve done since the recession “officially” began last fall, and touch on the ever-important fundamentals:

• Laser beaming your message
• Donor development
• Bidder recruitment
• Audience empowerment

Then we’ll break up into roundtable discussion groups led by David, Greg and Ed to address the specific concerns of each organization’s event. Whether you are considering starting an auction or have a well-established event, you are certain to gain a wealth of tips and ideas.

Date: Tuesday, February 24
Time: 9:30 am – 12:00 pm
Place: Volunteer Center of Sonoma County, 153 Stony Circle, Suite 100, Santa Rosa, CA
Fee: $45 for members of the Volunteer Center of Sonoma; $65 for non-members
For: Executive directors, board members, development staff and other volunteers involved with fundraising auctions

Click here to register online for this Reynolds & Buckley workshop at the Sonoma Volunteer Center.

I feel compelled to note that all of the fees associated with this workshop cover costs for the Sonoma Volunteer Center and its programs.

The question always comes up as we start working with a new client;

“In the catalogue should we list value or opening bid?”

In fact the choice is broader than that.  I have used the following options over the years, each has it’s own advantages and disadvantages.

1. Value.  The advantage is that it is straight forward.  We are not trying to trick the bidders into over bidding through ignorance.  The main disadvantage is that it acts as a barrier telling the bidder to bid this high and no higher.  There is a minor secondary problem.  Sometimes the donor includes a totally unrealistic valuation.  In that case what value do you list?
2. Opening Bid.  The advantage is that there is one less decision for auctioneer, making his or her life easier. The disadvantage is that it removes one of the best tools in the auctioneers toolbox.
3. Estimate .  I use a simple formula to determine an estimate based on the value.  I list a estimate of 10% down and 50% up.  For example, if a lot is valued at $1000, I would put the estimate at $900 - $1,500.  The advantage of this method is that does set the relative value of all the lots and it also starts the bidders thinking about the higher price.  The disadvantage is that the upper price level sets an impenetrable barrier.
4. Priceless or equivalent. I understand having to list the occasional  lot as priceless.  Literally no one knows the price.  The advantage is that while the term priceless just means no known price, big or small, the tendency is to assume a high price If you list  more than a few lots this way it becomes precious.
5. Leave it blank.  The advantage is that it is really easy.  In many ways the whole purpose of auctions is to determine a price and whatever a lot sells for is the true value of the item on that day.  The disadvantage is that it can be confusing for the bidders.  The Central Coast Wine Auction has never list any prices or values and it has worked well for years. The reason is that Archie McLaren, the founder and executive director, writes the most complete, detailed and best promoting catalogue in the business.

Unfortunately there is no one correct answer to this except to stay with whatever system you are currently using, as any change may confuse your audience.  If you are hosting a first year event I would recommend choosing from options one, two or three.  If you are as lucky as a couple of our events you would label the value as “Opening Bid” and just go from there.

Colleen and I have spent the last few days in the wine country.  We have had meetings in Napa, Mendocino and Sonoma.  It has given us a chance to talk to several vintners.  They are all complaining about wine sales generally but the bright spot is that direct sales and their wine club sales are as strong as ever. In fact several wineries reported that wine club members actually increased the size of their orders.

My interpretation of this is that in hard times, people value the relationships they have more than ever and are prepared to spend money to protect those they care about. If they are prepared to do that for wineries, how much greater is their commitment to a charity?

This should give non-profits a psychic boost.  All the time and effort you have invested into building relationships with your supporters will be returned, and then some.  Do not underestimate your supporters.

Disappointing News.

I just saw a depressing report from the Spectrem Group of Chicago. They spend their time tracking trends among the wealthy. This is the first feed-back that I have seen on the effects of the economy specifically on the wealthy. The first question answered is whether the rich have, through access to some secret club, remained unscathed by the current downturn. The Spectrem Group reports that households with assets over $1 million have lost an average of 30% of their assets and nearly 20% have lost over 40%.

Most of the wealthy (90%), expect a prolonged economic downturn. There is no reason to expect the wealthy to be any better interpreting the tea leaves than anyone else (if they were, they would not have lost 30% of their investments), but it will affect their behavior.

The statistic that I find most threatening for fundraising is that a majority of the wealthy (55%), are worried that they may not have sufficient assets to maintain their lifestyles. It is tough enough to raise money from individuals who have lost a significant part of their wealth, it’s really tough if that donation requires the donor to give up something significant.

One of the events I had the privlege of working with last year was Web 2.0 Summit, put on by O’Reilly Media and techweb in the first week of November.  2008 marked the fifth Web 2.0 Summit, and the first time that they opted to do any sort of fundraising in conjunction with the conference.

The decision to hold an auction benefiting technology-related charities was made just a few months before the event. And while the connection between the conference and philanthropy seemed straight forward, no one was sure how it would fly with attendees–especially given the economic turmoil at that time.

We held an auction on the first night of the conference, at the end of a dinner which followed the keynote address. There were a number of logistical challenges: we had to move the entire crowd from one room to another between the entree and the dessert course; we started the auction immediately after a 45-minute onstage interview of Lance Armstrong; the number of lots was limited; and the fund a need was being split amongst all three charities.

When the dust settled, we’d raised over $75,000 on just eight lots and a fund a need. Not a record-setting auction but definitely life changing for any of the individuals served by those charities. And definitely a success given the lead-time we had to plan and implement the auction.

I was surprised in our follow-up meeting when I found out that they were debating whether or not to hold the auction again. Some said that the amount of time it took to plan and implement was simply too great. Others felt like it had been a success worth doing better. I had one simple question: other than staff time, what did the auction cost the conference? In other words, did attendees spend less money elsewhere at the conference because of their involvement in the auction?

Answer: no. Other than the planning and implementation, the auction cost the conference nothing. It cost Tim O’Reilly some money because of his personal support of the fund a need, but beyond that it didn’t affect the conference.

To which my response was hold that auction! Do it! Not because I want the work, but because it is incumbent upon them to continue to make the world a better place, now that they know they can.

There are many ways that Web 2.0 Summit, O’Reilly and techweb could get better mileage out of the auction and, in turn, make the staff time expenditure on their end more worth it. They could have had Al Gore present the check from the auction to the CEO of one of the charities at his speech on Friday. They could use video-blog updates to show how Web 2.0 Summit’s auction continues to impact people’s lives throughout the year. And while all of that is important, it’s not the point.

The potential of any given crowd of people has a finite lifespan: If you do not capitalize upon it at that very moment, it dissipates. Completely. The Web 2.0 Summit auction proved that they have a roomful of attendees who are capable of changing many lives, and readily willing to do so. If they forgo their auction in 2009, they effectively send all of that philanthropic potential away with no guarantee that anyone else will ever be able to make good use of it.

If the question you are wrestling with in 2009 is whether or not to hold your auction, answer me this: what lives does your event change, and who will change them if you don’t?

Who would have ever thought that I would start to think of 2007 as the good old days.

In the last year the combined loss in property values and the stock market amounts to over $9 trillion, or approximately $90,000 for every household in America.

I suspect that it is the secret hope of every director of development that their wealthy benefactors have somehow come through this unscathed and will continue to support their charity with the same vigor as they have in the past.

Unfortunately for donations, the rich have taken a double whammy. Not only have their investments taken a hit, but the percentage return they can expect over the next few years will also decrease. They may still have more money than they can spend in a lifetime, but the wealthy will feel poorer. If you once had $300 million and you now only have $200 million, I suspect that it is human nature to focus more on the missing hundred million than to celebrate the amazing quantity of money you still have left.

The pool of donations to be divided amongst all charities will shrink for the foreseeable future. This will be going on at exactly the same time as most charities face increased pressure to provide more services.

Sadly, for your charity to survive, others will be forced under. The next couple of years will be tough, and, as shocking as it may seem, we may all start looking upon 2007 as the good old days.

This is from today’s Wall St. Journal:

“According to a new survey from American Express Publishing and the Harrison Group, nearly half of respondents with incomes of $250,000 or more agreed with the statement that “I worry that at some point I could run out of money.” That’s up from about a third in April.

Fully 69% agreed with the statement that “The recent real estate and banking crisis has affected my sense of financial security.”

Of course, $250,000 is only “Obama wealthy.” And running out of money “at some point” is a long time horizon. Yet the survey suggests that even high-income earners are cutting back their spending for fear of what the financial future might bring. Fully two-thirds say that they are “looking closely at every spending category to see where I can save.””

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This is the group that I mentioned that used to be a reliable participant at auctions but is now far more cautious. We need to re-engage. It all goes back to “Laser-beaming the message”.