When will things start looking up? How will you know?

So there's lots of chatter about hints of recovery in many economic indicators. Maybe we've reached a turning point?

Let's look at some of the data.

• New home sales up 9.6% between June and July. (Sales of existing homes also up, 7.2%)
  
• Consumer confidence, especially expectation of where we'll be in six months, rose in August to the highest level since December 2007.
  
• Orders of durable goods rose for third time in four months in July (up 4.9%), beating consensus estimates
  
• Last week, Federal Reserve Chairman Bernanke told a financial conference that the economy is on the verge of growing again.
  
• Second quarter Gross Domestic Product declined "only" one percent, much less than expected
  
• First-time filings for state unemployment benefits fell by 10,000 to a seasonally adjusted 570,000 last week, marking the first drop in initial claims in awhile

Many scoff at this optimism, and for every positive data point it's easy to produce one to show the glass is half-empty. Caution is completely understandable and warranted.

But what does this mean for philanthropy? For your organization, in particular: How will you know when it's over? What indicators are you looking for? Average gift creeping back up? Direct response rates returning to "normal"? Corporate contacts no longer ducking your calls and interested in talking to you about sponsorships? Top investors willing to visit? To stay ahead of the curve, what signs are you monitoring to know when recovery is at hand? Or will you miss those signals?

To challenge you, I ask: What will you do first when you see those early indicators? What new practices will you roll out? What new initiatives will you pursue?

And then I will pose the most challenging question: What are you waiting for?

If you have a plan in mind for when things get better, what really is preventing you from going ahead and making those intentions a reality now? If that idea or strategy or tactic will be a good idea at some future "better time," I can almost guarantee you that it's a great idea now.

If there's any way to do so, get ahead of the curve. Implement those plans now.

As we head out of the dark toward better times

So, there's some indication that better times are ahead. The prognosticators are seeing light at the end of the tunnel; the news isn't as bleak as we've grown accustomed to.

If you've read my previous blog postings on doom-and-gloom, then you know I've never advocated pulling back. But, people being human, many have been startled by the last six months, frozen into lethargic inaction or an unfocused milling around, wandering and waiting.

If that's you, latch onto the hope-filled indicators and use them to declare an end to your organizational funk. It's over. Finished. As of this moment. Make a note of the date and time. This is when the recovery begins. Let's move on.

So what shall we do now?

Job one: Strengthen your existing donor relationships to enhance loyalty, foster strong relationships and encourage word-of-mouth referrals.

Regardless of the state of the economy, Pareto's principle dictates that 80 percent of your revenue will come from 20 percent of your donors. In fact the updated take on this rule is that the ratio is more like 90/10 or even 97/3.

Thus, it is more important than ever to know who that 20% (10%? 3%?) of top donors are, and shower them with love and attention.

Use this time to re-connect (or connect for the first time?) with your best donors. Not by direct mail. Not with an email. Not with an event invitation. Not by phone. Go see them! Conduct visits, in person, elbow-to-elbow, eye-to-eye. Work even harder, listening to and understanding their needs while presenting opportunities to be involved that address the pressing interests they have in your cause.

At the end of the day, make a concerted effort to stay upbeat, optimistic and positive. Celebrate wins (even the small ones).

It could be easy -- forgivable, actually, given the battering many of us have endured -- to be somewhat skeptical, even pessimistic, about the future. But pessimism never attracted a new donor (or renewed an existing one, for that matter). Commend yourself and your staff for successfully enduring - and thriving - through some of the most challenging times in history. And then go out and TELL YOUR STORY!

Doom-Gloom Away! Let's not become beggars.

Today I attended the Development Executives Roundtable session in San Francisco. While the networking was good and the program quite interesting, there was an overall pall in the room. It seemed every other minute, someone was bemoaning the state of the economy, the crisis we are facing, how our donors are feeling the pinch. There was talk of cancelling events, lowering ticket prices, re-focusing strategies for entire campaigns. Yikes!

Now don't get me wrong. I've personally felt the impact of our recession or depression or whatever it is. I'm not one to hide his head in the sand. We ought not pretend it's all well-and-good. But panic is not an appropriate response. The doom-and-gloom mentality was highly contagious in the room. Yes, things are tough. And non-profits are being called on to serve greater numbers while they feel their revenues at risk.

Before we reduce ticket prices, let's be certain that the market won't bear last year's price, rather than reflexively jerk our knees and discount the tickets. Has one person's worried comment been whipped up into a communal decision to slash what we ask for? Sure, people know things are tight -- and many are unemployed or underemployed. But the vast majority of people still have their jobs. While their net worth might have declined, their take-home pay almost certainly has not. And if we're not going to do our gala event this year, let's be honest enough to admit that we probably should have stopped doing that event long ago.

And as we modify campaigns to incorporate the current "realities," let's make sure we don't go overboard. It's too easy to have our "we-know-times-are-tough" direct mail copy become tantamount to saying: "We still need your support, but you probably don't want to give right now, do you?" Worst of all is the very real risk of simply not asking at all. No. Now is the time to get out there, build relationship with our donors. Remind them of the experiences they've had with us in the past. Sit beside them, elbow-to-elbow, and share our story with them in as compelling a way as we can find. Spark in them the same passion for our work that we feel. And then ASK them to invest in our cause.