Far too often I see organizations using a blanket approach with their donor base. With a few minor tweaks in their strategy, they can increase their revenues by a third, sometimes even double.
What strategies do I recommend?
Well, what I often see is that one of the most overlooked areas of planning in small to mid-sized nonprofits is segmentation and personalization of their campaigns.
What do I mean, don’t send everyone the same letter for starters.
Let me share with you steps on how to segment and then personalize your year-end fundraising efforts.
1 – Start by determining all of your different donor segments and audiences. For instance, you may have Board members, Honorary Trustees, major donors, planned giving donors, monthly donors, lapsed donors, LYBUNTS, loyal and consistent donors, staff, volunteers, etc.
2 – Once you have your “buckets” of possible segmented donors, then begin to think about your various approaches to them. For instance, with major donors “hold” their letters, and instead engage the Board of Directors in making personal visits and calls. Also, have designated staff members conduct an in-house campaign.
3 – Once you have determined your specific strategies for segments, you will move to creating your actual solicitation approaches. For personal and telephone solicitations, you may need a “pre-call” letter and a packet of collateral materials with the letter prepared.
4 – For the bulk of your segments, you will probably be utilizing some form of direct mail appeal. Do NOT use a “Dear Friend” letter. In today’s age, mail merging even in office is easy and simple to do.
5. I do NOT recommend using a generic, blanket letter approach. Instead, you want to custom tailor a letter for each segment identified. What do I mean? Well, in most cases, you are not going to create an entirely new letter for each segment. What I recommend you do is creating a paragraph or two of custom-tailored text that you will insert into a “base” letter. You may have loyal and consistent donors who have been giving to you for multiple years. In this case, you may have a paragraph front and center that thanks them for all their past support of the organization. For a sample of segments and custom tailored text, email me!
6 – You may also personalize gift strings. Personalizing gift stings helps to upgrade donors to a higher giving level. There are many formulas to use, but pick one and be consistent.
7 – Once you custom tailor the letter and the gift strings, then you need to determine if you will use a “lift” note or write personal notes right on the letters themselves and to what segments of donors are you using this technique.
8 – Determine how you are going to mail these letters. Major donors you may want to consider sending a personalized letter with a first-class stamp. Other donors you may want to use a non-profit pre-cancelled stamp or bulk mail indicia.
9. All of these techniques can be done for your online audiences as well. You can custom tailor segments in your email marketing provider program, create separate emails, and email out to them. Don’t forget when doing second or third emails to filter out all those who have given by using a dynamic filter.
So there you have the simple steps that you can immediately take to enhance your year-end fundraising campaign to inspire your donor’s sights to support your charitable mission.
These are the same steps that I use when designing and implementing my client’s year-end fundraising campaign. And, they work!
An important part of any fundraising campaign is how you plan on recognizing your donors at different giving levels. While donor recognition opportunities do not motivate all donors, the fact is that some are. And, you need to be prepared to offer this valuable tool to inspire the sights of your donors who are motivated by public forms of recognition. Different things motivate different donors. So, always begin by knowing your donor.
Below I share with you a step-by-step method to creating Donor Recognition Opportunities that will inspire your donors to set their sights higher. And, public recognition inspires all donors from big to small and for all kinds of fundraising campaigns, not just capital ones.
There are several important guidelines that one should consider first before actually coming up with the recognition opportunities.
First, it is important that you have several recognition opportunities available for your donors to select.
Second, the top-level gift should be larger than the largest gift projected during the fundraising campaign.
Third, the cumulative values of the donor recognition opportunities should add up to significantly greater than the overall fundraising goal.
And, lastly, the donor recognition opportunity should be two to three times the costs of construction, furnishings, or overall costs of the opportunity.
Once you have given these guidelines consideration, here is how you can establish your donor recognition opportunities step-by-step.
Step #1 – Invite key staff and volunteers to a Donor Recognition Planning Meeting and review your building plans or fundraising campaign outline.
Step #2 – Brainstorm all of the possible named gift opportunity “places” or “things” i.e. main lobby, flag pole, endowed department, scholarships, staff positions, etc. Think expansively and creatively remembering that nothing is off limits.
Step #3 – Write each possible brainstormed building place on a sticky note and put them on the wall in random order.
Step #4 – Look at your campaign gift range chart and determine how many gifts are needed at each level to reach your goal.
Step #5 – Determine the “Curb Appeal” gifts. These gifts are those that provide value for the opportunity and are not necessarily just based on gift size. For instance, a lobby will hold more “curb appeal” than say a large industrial kitchen located in the back of a facility hardly ever seen by the general public.
Step #6 – Match the top “Curb Appeal” gift with naming opportunity that is the largest on the list, etc.
Step #7 – Be sure to present this Donor Recognition Plan to the Board to ensure that they approve of your plans. Ensure that the Board votes to approve this plan. Don’t skip over this step! You need the Board’s support.
There are also other ways that you can recognize your donors. For instance, you can recognize mid-level to lower-level givers with a group plaque, listing in the print donor honor roll, or on the organization’s website. You may also choose to run brick and pavers or wall tile program. And, inevitably, you will recognize all of your donors at a post-campaign celebratory event.
One thing that you do need to ensure is that you are consistent with how you recognize your donors. Everyone needs to be treated equally regarding what his or her gift will afford in a named gift opportunity.
And, now the organization is ready to begin asking for gifts from donors using these different named gift opportunities as a way to motivate donors to step up their giving to the campaign.
Now that it is development planning season for many with the start of a new fiscal year looming, I am often asked, where do you start first when putting together your development plan and calendar.
Well, for me, I start at the beginning. I tend to look at the key metrics and how past Return on Investment (ROI) has been for each fundraising activity including events, appeals, major gifts, etc., etc., etc. By looking at ROI, you will determine whether or not a particular activity is effective or not. It prevents that “well we have always done it this way” or “we hold this event every year, so we can’t stop it now.” It allows you to keep the proverbial “winners” while deciding to eliminate those activities that are not as effective or are not meeting best practices.
I should add a disclaimer before I go on that – not all activities have a sole purpose of raising money! So, specific metrics would need to be developed for those particular activities.
So what are some of those key metrics and how do you calculate them?
I start by gathering:
# of pieces – # of pieces mailed to select group of the database or number of direct requests
# of gifts – # of gifts received by mailing or number of donors responding with gifts
Gross income – Income without expenses calculated or values of gifts and contributions received
Expenses – expenses of mailing including copywriting, design, mailing services and postage or amount of fundraising budget spent
Then I calculate:
Net income – Expenses minus gross income
Participation rate – # of participants divided by total solicitations
Average gift – Divide revenue received by participants
Average cost per gift – Divide expenses by participants
Cost of fundraising – Expenses divided by revenue
Net ROI – Net income divided by expenses; multiplied by 100 for percentage rate of return
I put this all in a spreadsheet document with like appeals spanning a number of years together i.e. Spring Appeal 2012, 2013, 2014, 2105, etc. So that ROI comparisons can be easily made. If you would like a sample copy of this Appeal Comparison spreadsheet to use for your purposes, email me here!
Then from there, I evaluate all of this data against Industry Best Practices in terms of Solicitation Activity Reasonable Cost Guidelines as found below.
Solicitation Activity Reasonable Cost Guidelines
Direct mail (acquisition) $1.00 to $1.25 per $1.00 raised
Direct mail (renewal) $0.20 to $0.25 per $1.00 raised
Special events $0.50 per $1.00 raised
Volunteer-led personal solicitation $0.10 to $0.20 per $1.00 raised
Corporation and Foundation Grants $0.20 per $1.00 raised
Capital campaigns/ Major Gifts $0.05 to $0.10 per $1.00 raised
Planned Giving $0.20 to $0.30 per $1.00 raised
If an activity meets the Reasonable Cost Guidelines then it is a keeper, if not, then it is time to evaluate why. Don’t throw an activity out solely on not meeting these guidelines, especially if you have other “goals” in mind for the particular strategy, but do be conscious of this in your planning process.
Just this week, I was working with a client, and we were discussing Board member engagement in fund development. The assumption was, ho hum, “they just won’t participate.” It was then that I came across a blog article outlining all of the wonderful ways that you can engage your Board in fundraising. You know things like, make thank you calls, write notecards, etc., etc., etc.
To be honest, we have heard these over and over again. The reality is that even though you can talk about all the different ways that Board members can participate in the process of raising philanthropic dollars, it still doesn’t cause engagement.
So, my client and I stepped back and bit and talked about how some successful organizations ARE engaging their Boards in fundraising. And, what we noticed is that with very successful organizations, it all begins with how you recruit, screen, and bring on new Board members to your organization. And, here based on that evaluation are some simple steps that you can take to revolutionize your Board engagement.
Here is what I recommend:
As a fundraiser, become a member of the Board nominating or preferably governance committee, if not already a member. And, as an executive, advocate for your fundraiser’s participation on this important committee. It all starts here.
Develop a formally written and adopted Board recruitment process and procedure.
One you have identified an appropriate Board member candidate, schedule a screening interview. (Yes, a screening interview! Why would you not screen for one of the most important jobs in your organization?)
Send the prospective candidate information in advance i.e. things like your brochure, a list of volunteer opportunities, committee listings, relevant Board policies, etc., etc.
At the interview, first, review the process and purpose of the meeting i.e. “getting-to-know” each other interview.
Then review with the candidate the organization’s values, mission, and services seeking alignment. If the candidate does not align with those core elements of your organization’s identity that is a “red flag.”
Share with the candidate the major issues facing the organization both opportunities and challenges.
Share with the candidate the different ways that the organization uses volunteers i.e. committees, policies, meeting schedule, etc., etc.
Review skills, experiences, diversity, and network needs that the organization has identified. Discuss with the candidate which of these they desire using on behalf of the organization. Seek alignment.
Review Board member responsibilities and expectation, particularly around fund development seeking commitment to them
Close the meeting but don’t make any decisions yet.
Bring all of this information back to the nominating/governance committee to discuss and make recommendations. Remember the fundraiser must sit on this committee.
Once the candidate is voted on and accepted, bring them on and into an orientation process reviewing the organization’s values, mission, services, and goals. At this time, provide training on a “Culture of Philanthropy” and further reiterate the Board expectations around engagement in development.
Have all Board members sign a Board Member Contract agreeing to uphold this commitment regarding responsibilities and expectation and develop a Board Fund Development Expectation Form that the Board member must sign and date indicating how exactly what they explicitly commit to upholding. Email me for a sample Board Fund Development Expectation Form.
Board Chair reviews Board member’s performance throughout the year to ensure performance meets expectations and outlined contract. If the Board member’s performance does not meet expectations, the Board Chair MUST “thank and release” the Board member. Yes, this MUST happen for the whole process to maintain its credence. You must “thank and attrition” poor performers.
The key to Board engagement is truly about setting and managing Board member’s expectations BEFORE they even join your Board of Directors. This way, they know right up front what is expected of them as they perform their role. What I often hear from client’s Board members, is that “I had no idea that was what I was supposed to be doing.” So, out of fear of the unknown, Board members are hesitant about ever committing to fund development because the importance has never been relayed to them, training never provided, and the expectations never set.
So, while all these great articles can espouse how to engage your Board members in making telephone calls and writing note cards, you can’t even hope for them to begin to participate in your fundraising efforts if they are unsure of what you expect from them. This engagement all starts before they officially come onboard.
Follow the above recommended “How To’s” and watch your Board member engagement in fundraising and your organization soar!
As a nonprofit organization, you are here to meet a mission to your stakeholders. Maybe long ago, or not so long ago, you were founded to assist a particular group or meet a critical need. And, months go by, years go by, and you are still in existence. But, is the need still there? Are you still relevant towards meeting that need?
Sometimes, we just don’t want to answer this question. Because in answering it, you may find, that yes, indeed, you have met your mission or, in fact, are no longer relevant, or facing a crisis, or maybe even just plain exhausted and lack energy as an organization.
Is it time to dissolve perhaps? Maybe merge with a similar group? Shutting down is not the only option, but it is one.
Let’s face it, was it ever our intent to be here forever?
In admitting that you have met your mission, you have done exactly what you have set out to do. And, more and more nonprofits are choosing this route, admirably I may add.
Ultimately, though, this is a larger Board discussion.
Because the Board of Directors is directly responsible for the organization’s future: whether to grow, change, downsize, merge, evolve, or close. This is governance at its most important and highest level.
Here are some important questions to explore as a Board before you do:
Are we meeting our stated mission?
Are we helping our intended audience?
Are we still relevant to our community?
What is the situation that is precipitating this discussion? Are we tired, lack energy? Financial constraints? No longer needed?
What would be the implications if we did no longer exist?
Do we want to continue? Can the organization be saved?
Have we simply run out of steam and need to close down?
Is it time to let us fail instead of always trying to “right” the ship?
Do we have adequate human resources to keep things going and are they the right people?
After seriously reflecting on these questions, a nonprofit Board can choose to take several routes.
You can choose to change your mission statement to reflect who you are and what need you are truly meeting.
You can choose to restructure your operations, programs, and activities to lead to a better functioning organization.
You can find a similar nonprofit organization in mission and merge.
If under undue financial stress, you may consider filing for bankruptcy
Or, if you are just tired or having met your mission, you can cease to operate and dissolve.
Ultimately, the Board must recognize that a crisis situation exists, focus efforts on addressing this issue, and come to a consensus-based conclusion on which path is most appropriate to your mission, to the community you serve, and to yourselves as individual Board members.
I often get asked from my clients, how many touchpoints do you need to give to a donor at a certain level?
And, my answer – it varies.
There is some science to the whole matter. In fact, after I conduct a rating and ranking session, I will combine all of the numbers and come up with a formulaic cultivation quotient. The number of touches estimated for a particular donor’s rating score and ranking.
To me, that is a guide. What we must remember is that each donor is an individual. They have different motivations for giving, different ways that they would like to be recognized, and different things that they are interested in giving to support. And, that means that they all have different cultivation and stewardship needs as well. So, while I could say that the cultivation quotient for Mrs. Smith came out to 20 touches per year, she may not want to be contacted or that involved with the organization.
I advocate that each necessitates a thorough review and a particular strategy custom and unique for them. And, often, it takes a wise fundraiser who has been in conversation with the donor to recognize what is or is not important to them.
Now, I am not advocating that we throw the “moves management” system of relationship-building out. However, what I am recommending instead is that we seriously advocate instead for a very donor-centered process that takes in the uniqueness of each donor into the “moves management” equation when developing strategies for cultivation and stewardship. Let’s not reduce our donors down to formulas, quotients, or tactics. They are people – unique and compassionate!
Technical skill or personality, which is most important when hiring a new director of development?
That is a great question.
And, while ideally, both would be great, that is not always a guarantee.
So what do you look for in this case?
While just about anyone can have the skill set of a fundraiser, not everyone can have the temperament to be a superior director of development. It takes personality to make a professional difference. And, let’s be honest, not everyone has personality.
What kind of personality?
Well, development professionals must have a temperament suited to serving people’s needs. They must be attentive, persistent, and flexible. They need to have a thick skin and be willing to give others credit. A huge piece of the job is making others look good while taking the back seat to their ego. When they do their job well, no one knows it. They make an indirect not a direct contribution to accomplishments and very rarely if ever take the credit.
The best development professionals are servant leaders, putting the needs of the organization and those that they serve ahead of their very own. They are the voice of the donor within the organization and as a profession as a whole.
Since they are that voice for the donor, I then ask, what is it that donors expect in that person?
A recent article published on Guidestar stated that donors want someone who is passionate and enthusiastic about the mission, has high standards of integrity, authenticity, self-confidence, and most importantly someone who loves their work and shows it by their willingness to pay the price to get the job done with joy.
So don’t hire based just upon skill sets or certifications alone. You might not be satisfied with what you get. Delve deeper to determine if this person has the right attitude, temperament, and belief that will take your organization to the next level and meet the needs of your donors.
Shall I dare say, good development directors are not as easy to find? But bad ones are!
There are quite a number of groups seeking to test the feasibility of a possible capital campaign.
And, so naturally being a consulting firm catering to small fundraising shops, I tend to get asked to talk about these, and I am currently in the midst of one now.
What I find is that groups think that feasibility studies only test for one thing and that one thing is a financial goal.
I assert that there are many different types of things that a feasibility study tests for as a result. Financial goals being just one. In fact, more importantly, feasibility studies look at both internal and external perceptions and find areas of opportunities and challenges for an upcoming campaign. Things such as “what about that large endowment the organization has?” or “it doesn’t have strong fundraising leadership?” or “you need to ensure that so and so is on board and committed to launching a full-scale effort.”
Through a feasibility study, a group also finds out about potential campaign leadership, which by the way, can make or break a proposed capital campaign, other competing campaigns currently or just recently completed within the same community, and potential prospective donors to a capital campaign. Also, a capital campaign feasibility study will unearth the general economic outlook both nationally and locally and how will that impact the success of a capital campaign.
So, as you can see, a feasibility study done correctly will provide lots of data that can then be used to refine the case for support, determine if it is time for the organization to mount a significant campaign, and what is the recommend campaign plan based upon findings as part of the study. Oh, yes, and what fundraising goal will be feasible.
If you or your group is considering an upcoming capital campaign, I urge you NOT to skimp on the process of conducting a feasibility study. You will learn more than just – can this campaign make a go of it. You will find out exactly how much and how it can or cannot!
For the past year, I have watched development jobs come and go on the job boards.
I lamented that folks like myself with over 20 years of experience, certifications, and education were getting passed up for the lower paid, less experienced, “greener” young ones. And, there might be some thread of truth to that. I can’t be all wet behind the ears.
But, the funny thing is lately, after a year of scanning job postings, I started to notice something very, very interesting. The same postings were coming up. A place down in Newport, a place in Dorchester, the same job, needing the same person.
It is so costly to keep having staff turnover. Expensive in many ways. Not just because of having to fill a vacancy, but costly to the organization as its donor base is disturbed. Development is all about relationships, and if high staff turnover continues, those relationships are never truly built.
Another thing that I have noticed is that some organizations are being a bit more proactive. Seeking out referrals for qualified candidates and then actively recruiting instead of waiting for candidates to apply and come to them.
The smarter move, I might add.
I guess I pen this manifesto for all those development professionals who have spent years in the field honing best practices and in some cases even developing them. It is time that organizations stop looking for the cheapest, youngest, idealistic help. It doesn’t serve the organization to cut the budget by hiring inexperienced newbies for its top position, particularly when it comes to fund development. Can you afford to take a chance on someone who is “green” behind the ears to figure it out as they go along?
I think naught! If you think differently, leave me a comment below.
I have worked in the nonprofit world far longer than I can remember. My job began in the sector back in 1992 or so, when I became a grant writing intern for a local non-profit organization as part of my undergraduate work.
Little did I realize that some twenty plus years later, I would still be working in the sector. First as a professional at local non-profit organizations and now as an industry consultant. This week, I had cause to pause. I received a telephone call last Friday evening that a former client of mine had passed away due to cancer. I cried. And, I cried. And, I even cried some more.
Then, after a long season of constant deadline oriented projects, finally feeling a bit of downtime between clients, I became sick with the flu and was laid up in bed for several days, still weak as I write this article. While sick in bed, I received another telephone call, someone else in my personal life had passed on, again due to cancer.
One thing I do know is that our work is long and hard. And, we are often fighting for the lives of others in our sector. But, does that mean that we don’t take care of ourselves? Do we even stop a moment to breathe, to reflect, to take in the season that we are in, to spend time with our loved ones?
I am guilty of this. I admit it. I work tirelessly so that my clients can be the best that they can be.
If you can do one thing right now, stop, get up, walk around – thank your employees, take in the sights and sounds of the season, perhaps take the afternoon off, hug a loved one, give someone close to you a call just to say “hi!” There is more beyond our work than our nonprofit. Yes, I said it. And, if you don’t rest and recharge, there will be little else for you to give to others.
This week, I pause and remember my former client, Fr. Stan Kolasa of the Sacred Hearts Retreat Center in Wareham, MA, I take the time to honor his life and his legacy.
And, I take the time just to be – in the season and the moment. And, I urge each of you to do the very same.
Reflect on your life, and take good care. The fight always goes on, but it only goes forward when you are stronger.
Best practices. We hear that phrase often. This week, I even read a question asking if “best practices were misleading?”
Are we throwing that phrase around to legitimize our field? Our do we have best practices and what are they?
Well, I contend that the only true best practice is one that is grounded in research. Those are harder to find that than the other so-called “best practices.”
While studying for my Masters Degree in Philanthropy and Fund Development, I learned that philanthropic research has many gaps. However, there are people now making a study of philanthropy and conducting research. Folks like Adrian Sargeant and Jen Shang. More research is needed in our field to support our work.
I can tell you that when research is grounded in actual studies, it works. Eye motion studies, philanthropic psychology, etc., etc.
Recently, I have been working on many appeal letters. And, each time I craft one for the client, I get pushback. Why do you indent paragraphs? Why do you repeat yourself often? Why is there bold and underline? Do we need to include a P.S.? And, can’t the letter just fit on one page? Must we send more than one appeal?
Pushback that is unfounded. And, I push back with research. When the client allows me to use those best practices, the results speak for themselves.
When those results speak for themselves, it is magic. Campaigns get funded, new projects begin, and donors have the opportunity to make a greater impact.
We forget that the fact (and it is a fact) that we are not beggars. Donors want to give. And, to give, they must be asked. Asked in a way that moves them to feel connected to their core beliefs through your organization’s mission.
Know the difference between unfounded best practices and best practices backed by scientific research. Read blogs, stay current with trends, and keep furthering your informal and formal education. When you do, and you practice it, your results will show all the difference.
Fund development does have a researched body of knowledge. Don’t allow anyone to convince you that it does not.
What, wait, we hired that Capital Campaign Consultant to run the campaign, and now you are telling me that I have to do something. No, this can’t be possible.
Yep! It would be unrealistic to think that a capital campaign is left up to the staff to manage. How could they? The staff doesn’t have access to donors and to peer networks? A campaign is not a one, or two, or even three person job. It is even more unrealistic to think that now the capital campaign consultant is in town, no one
needs to do anything period.
So, I know you’re shaking in fear that you might have to ask for money. Well, yes, you may. But, that is not your only role in a capital campaign.
When running a capital campaign, I meet with each of my campaign’s Board of Directors and review the Campaign Plan, goal, schedule, gift chart, and Case for Support. I insist that they vote to approve these primary campaign documents.
And, I also share with them a Board commitment form that I have each and every one of them sign and date.
Board members have many responsibilities to a campaign. Below is my top ten list of capital campaign responsibilities and what I expect them to commit to:
Not taking on any major new volunteer roles for other organizations and consider how to pare down current obligations and be accessible to the campaign.
Review their philanthropic planning for the next year and perhaps beyond, as well as their calendars for those years.
Consider what role they could and would like to play in the campaign. Every board member will be responsible for some part of the campaign and will be engaged in identifying and enlisting campaign committee members.
Review their list of contacts – friends, neighbors, business associates – and carefully consider which of them may be interested in learning more about the organization.
Review and approve the capital campaign plan as recommended by the capital campaign planning committee.
Make a “stretch” gift to the campaign. Board members will all support the Annual Fund campaign each year in addition to supporting the capital campaign. All board members will participate financially in the campaign – to the best of their ability. The board will be the first to give. It is essential that other donors see 100% percent participation of the board. It shows them that the board has the utmost faith, confidence, and enthusiasm for the organization.
Ensure that contribution are used well and according to donor intent.
Read all materials given to them by the organization and the campaign. Members of the community – donors, clients, friends, neighbors, etc. – will turn to the members of the board for guidance and information.
Be an advocate for the organization, to the best of their ability, in the local and the wider community. Help expand the organization’s influence and exposure throughout the community by:
o Securing the sponsorship of a community group to support the campaign.
o Recruiting a speaker, host, or sponsor for a special event.
o Arranging tours of the organization for interested individuals, corporations, foundations or others.
o Hosting an event at their home, place of business or community organization.
o Endorsing a solicitation made by the campaign leaders, either by phone or by letter.
o Setting aside at least 20-30 minutes weekly to plan how to help the organization’s campaign.
o Thanking donors and staying in touch keeping them informed of the project plans.
o Evaluating the success of the campaign to determine strengths, areas of improvement and effectiveness of board policies and decisions.