Posts tagged ‘donor-centered’

August 7, 2018

Mega-Philanthropist with Profound Legacy:H.F. “Gerry” Lenfest (1930 -2018)

H.F. “Gerry” Lenfest, cable-television pioneer, mega-philanthropist, and civic leader, has died at the age of 88. His extraordinary generosity and wisdom will have a lasting impact.

I had the privilege of knowing Gerry. I was especially honored that he provided the Foreword to my book, Donor-Centered Planned Gift Marketing. I want to share some of his astute words with you. However, I first want to tell you a bit about this great man and his exceptional life.

Gerry Lenfest (left) with Michael Rosen.

Gerry was not born into great wealth. He was born in Jacksonville, FL, and raised in Scarsdale, NY and later on the family farm in Hunterdon County, NJ. After his mother died when he was 13-years-old, his father sent him to the George School, a private boarding academy. A troubled student, he was invited not to return after just one year.

At his new school, young Gerry continued to be something of a juvenile delinquent, his own description. Finally, his father enrolled him at Mercersburg Academy where teenage Gerry began to excel.

Following high school, Gerry was directionless. He worked as a roughneck in North Dakota, a farm hand, and as a crew member on an oil tanker. Eventually, he attended Washington and Lee University where he received an undergraduate economics degree. He served in the U.S. Navy, rising to the rank of captain. In 1955, he married Marguerite Brooks, an elementary school teacher. Gerry went on to receive his law degree from Columbia University and, then, served with a prestigious New York law firm.

Walter Annenberg hired Gerry in 1965 to work at Triangle Publications, Inc., owner of Seventeen and TV Guide magazines, the Philadelphia Inquirer and Daily News newspapers, television and radio stations, and several cable television properties. With the help of loans and two investors, he bought two tiny cable systems from Annenberg in 1974 to start Lenfest Communications. In 2000, Gerry’s company had grown from 7,600 subscribers to over 1 million to become the 11th largest cable company in the nation. That same year, he sold the company to Comcast, netting $1.2 billion in the deal.

Gerry always attributed his great success to the skill and dedication of his various teams and good fortune, whether in business or with the nonprofit organizations he worked with. Knowing he owed much of his success in life to others motivated him, in turn, to help others.

The Lenfests signed on to The Giving Pledge, a movement of wealthy individuals who commit to donating the majority of their fortunes. Over more than two decades, the Lenfests have donated more than $1.3 billion to over 1,200 nonprofit organizations. The top 10 recipients of support from the Lenfests are (source: Philly.com):

ORGANIZATION DOLLARS IN MILLIONS
Columbia University 155.0
Lenfest Institute for Journalism 129.5
Mercersburg Academy 109.0
Philadelphia Museum of Art 107.3
Washington and Lee University  81.0
Museum of the American Revolution  63.0
Curtis Institute of Music  60.0
Lenfest (Pew) Ocean Program  53.3
Wilson College  40.0
Lenfest Scholars Program  32.0

In addition to his enormous philanthropy, Gerry served on a number of nonprofit boards including Columbia University, the Philadelphia Museum of Art, and the Museum of the American Revolution, which he helped create. In 2005, Gerry and Marguerite were awarded the Association of Fundraising Professionals Award for Outstanding Philanthropists.

You can read more about Gerry Lenfest’s extraordinary story by clicking here.

While I could say much, much more about Gerry and his tremendous, positive impact, I’d rather share some of Gerry’s own words with you. Gerry provides some sage advice for fundraising professionals about what they must do to secure significant contributions:

Knowing your prospects and understanding what motivates them are two critical steps in the [philanthropic] process. Quite simply, you cannot skip cultivation and relationship building and expect a successful outcome.”

Lenfest was also keenly aware that the fundraising process should not end when an organization receives a donation. He advises:

Do not make the mistake of forgetting about us once you receive our gift commitment. We may truly appreciate how efficiently and effectively you handle contributed funds so much that we entrust you with another [donation]. We are also in a position to influence others to do the same.”

As a strong advocate for planned giving, Gerry observes:

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August 3, 2018

Fantastic News and Opportunity for the Nonprofit Sector!

The nonprofit sector received a major piece of good news at the end of July. American Gross Domestic Product in the second quarter of 2018 grew at the annualized rate of 4.1 percent. This represents the economy’s fastest growth rate since 2014. GDP growth in the first-quarter was a healthy, though unremarkable, 2.2 percent.

I don’t really care if you love or hate President Donald Trump. I’m not making a political statement. I’m simply reporting on an economic fact that has profound implications for nonprofit organizations.

The news is fantastic for charities because overall-philanthropy correlates with GDP. For more than four decades, philanthropy has been between 1.6 and 2.2 percent of GDP. In 2017, philanthropy was once again at 2.1 percent (Giving USA). This means that when the economy grows, we can expect growth in charitable giving.

Think of it this way: For more than 40 years, the nonprofit sector has received about a two percent slice of the economic pie. It’s safe to say that that approximate proportion will continue. So, if the economic pie becomes larger, that two percent slice becomes larger as well.

While I’m oversimplifying, my fundamental point is sound: When the economy grows, so does philanthropy.

Some economists and commentators believe the robust GDP growth rate is not sustainable. However, if the impressive economic growth continues, or even if growth continues at a more moderate pace, we can still expect 2018 to be a good year for charitable fundraising.

Given the positive economic environment, you have an opportunity to successfully raise money for your organization. But, it’s up to you to seize that opportunity while the positive economic environment lasts.

Here are 10 things you can do to raise more money while the economy is good:

1. Hug your donors. Ok, maybe not literally. However, you do need to let your donors know you love and appreciate them. Do you quickly acknowledge gifts? You should do so within 48 hours. Do you effectively thank donors? You should do so in at least seven different ways. You should review your thank-you letters to ensure they are heartfelt, meaningful, and effective. Have board members call donors to thank them in addition to your standard thank-you letter.

2. Tell donors about the impact of their gifts. Donors want to know that their giving is making a difference. If their giving isn’t making a difference or they aren’t sure, they’re more likely to give elsewhere. So, report to your donors. Tell them what their giving is achieving and that their support is being used efficiently.

3. Start a new recognition program. One small nonprofit organization I know started a new, special corporate giving club. CEOs of the corporate members are placed on an advisory board, receive special recognition, and are provided with networking opportunities. This new recognition program generated over $50,000 in just a few months. While enhancing existing recognition efforts is beneficial, starting a new recognition program can yield significant results.

4. Ask. Your organization is providing important services. It needs money. Give people the opportunity to support your worthy mission. When you ask for support, just be certain not to limit the ask to cash gifts. Research shows that organizations that receive non-monetary donations (e.g., stocks, bonds, personal property, real estate, etc.) grow significantly more than organizations that receive only cash contributions. Partly as a result of the new income tax code, the number of Donor-Advised Funds has grown significantly. So, make it easy for your supporters to give from their DAFs.

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July 27, 2018

How to NOT Make a Mistake Worse

There is an adage, first published in The Bankers Magazine (1964) that advises wisely:

If you find yourself in a hole, stop digging.”

The Law of Holes suggests we should strive to not make bad situations worse through further unhelpful, counter-productive behavior.

Sadly, many people, including nonprofit managers and fundraising professionals, fail to heed that fine advice. Instead, when in a bad situation or when confronted by criticism, many folks make matters worse by reacting defensively, acting helplessly, remaining in denial, criticizing the critic, or ignoring the situation altogether.

Fortunately, many people handle criticism gracefully and, in the process, set a fine example for the rest of us.

Recently, I wrote about my wife’s failed attempt to donate to a local charity. While my wife and I have never supported the organization, we do agree with its mission. Therefore, it was with great interest that I noticed that the charity was hosting a fundraising event with a speaker I wanted to hear. My wife went to the organization’s website to buy tickets. However, due to a website glitch, she was unable to complete the transaction. So, she then called the organization during office hours. Not being able to reach a live person, she left a voice-mail message. No one from the organization returned her call. We ended up not attending the event.

After I posted about my wife’s experience and what fundraisers can learn from it, I sent the organization’s Executive Director an email and a link to my article. I sent the email on Tuesday evening at 7:01 PM. I expected one of two things to happen: 1) I thought I might receive a defensive response the following business day, or 2) I might not receive any reply, ever.

Instead, my guess was happily wrong. That very evening at 7:21 PM, I received a message from the Executive Director. We can learn much from the tone and content of his response:

Dear Michael,

Your email was both upsetting and instructive. I appreciated the spirit of the message and have already begun to think about how to use it to create change and improve. Also I read your blog. I’m curious if you are a professional fundraiser? Either way you and your wife have my apologies for this unfortunate experience. It is clearly our loss when customers and potential friends are turned off. It’s contrary to the purpose of running these events and clearly counter productive.

In addition to my apologies you have my gratitude for bringing this to my attention.

Sincerely,

(name withheld here)”

Here is what we can learn from the email response:

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July 20, 2018

Make It Easy for People to Give You Money

Two different stories this week have inspired me to write this blog post, and provide two pieces of simple, essential advice.

My first tale involves a local charity. While my wife and I have never supported the organization, we do agree with its mission. Earlier this week, the charity hosted a fundraising event with a speaker I wanted to hear. My wife went to the organization’s website to buy tickets. She saw there were two options: 1) general admission tickets, and 2) tickets to both the talk and a pre-talk meet-and-greet reception with the speaker. We opted for the pricier tickets.

That’s when the trouble started.

As my wife began entering her contact information, the website would not allow her to change the town name in the address section. This was a big problem because our hometown is different from the nearby town where the charity is located. Compounding the problem, this was a required field although it did not have to be so.

Unable to buy the event tickets online, my wife called the charity to try to purchase the tickets by phone. No one answered. She left a voice-mail message. No one returned her call.

That was the end of it. My wife could not complete the transaction. We were both annoyed. While our intended contribution would not have been huge, it would have been a significant first-time gift. Unfortunately, for the charity, it lost its chance to engage us. Instead, the charity alienated us. Sadly, we likely weren’t the only people who experienced this problem.

So, what can we learn from this story? The lesson is as simple as it is significant:

Make it easy for people to give you money!

Here are some tips:

  • If you’re having a fundraising event, create a landing page on your website to make registration easy.
  • Make it easy to find the event landing page.
  • Make registering easy by ensuring the registration or donation page is functional.
  • Make it easy for people to donate money online, even when there is no special event, by having a donate button at the top, right corner of every web page on your site.
  • In addition to a donate button, have a donate tab on your website’s menu bar to make giving easy.
  • When seeking donations online or by mail, keep it simple and easy. Ask only for the information you need. The more information you seek (particularly the information you require), the greater the risk that the donor will not complete the contribution.
  • When sending direct-mail appeals, enclose a Business Reply Envelope to make responding easy.
  • Provide your full contact information (name, title, mailing address, phone number, fax number, email address) for donors to reach out to you easily with any questions or issues. Your organization’s general contact information should be on every website page.
  • When a donor or prospective donor calls, answer your phone. If you’re not going to answer your phone, be sure to respond to messages as quickly as possible. This is especially true leading up to an event or at year-end.
  • Accept gifts of cash or donations made through credit card and PayPal. In other words, make giving easy by accepting the donor’s preferred payment method.

The bottom line here is that your organization needs to make it easy for people to give it money. Donors have choices. Your charity is not unique. There are other charities with a similar mission. If you mistreat prospects or donors, or make giving a challenge, they’ll simply support another organization with a similar mission that more effectively engages them.

While making it easy for people to give is important, it’s not enough as the following story from the for-profit sector demonstrates:

read more »

June 15, 2018

Raise More Money by Understanding Generational Differences

When you understand the behaviors and motivations of different generations, you’ll be in a better position to build stronger relationships and, ultimately, raise more money. That’s the belief behind the Blackbaud Institute’s new report, The Next Generation of American Giving. Catherine LaCour, Chief Marketing Officer at Blackbaud and Senior Advisor to the Blackbaud Institute, writes:

[T]hese insights serve the core purpose of helping you—the social changemakers—build bridges to those who care most about your causes. Use this information to inform your outreach, but know that the relationships you cultivate are still the key. With this deeper understanding of your supporters and the tools they use, there is no limit to the positive change you can achieve.”

The report identifies eight key findings:

  1. Fewer Americans are Giving. Blackbaud is not alone in uncovering this disturbing trend. Among every generational cohort, with the exception of Baby Boomers, there is a decline since 2013 in the percentage of cohort members who say they give to charity. During the same period, total giving has nevertheless increased because those contributing are donating more.

 

  1. The Greatest Generation is in Its Sunset Years. Those born prior to 1946 are declining in number. That’s why they are no longer the dominate philanthropic group that they were in 2010. However, they remain a vitally important philanthropic cohort. These individuals give to more charities and give more money than any other generational group.

 

  1. Baby Boomers Remains the Most Generous Generation. Boomers donated 41 percent of all money contributed last year. By contrast, Gen X accounted for 23 percent, Matures 20 percent, Millennials 14 percent, and Gen Z 2 percent.

 

  1. Generation X is On Deck (and there are way more Gen-Xers than you think). While there are far fewer Gen-Xers than Boomers (65.6 million v. 74.1 million), their population is almost as large as the Millennial generation (67 million). Furthermore, Gen-Xers are approaching the life stage known to be the prime giving years. Given the population size of this cohort and their approaching life stage, they will likely continue to be a growing philanthropic force.

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May 22, 2018

New Research Proves Cash Is Not King in Fundraising

If you want to raise significantly more money for your nonprofit organization, you need to diversify the types of gifts you seek from individuals. That’s what successful charities do to raise significantly more money each passing year. Conversely, relying solely on cash contributions will likely stunt your organization’s growth.

Those are the key conclusions of a newly released study by Prof. Russell James III, JD, PhD, CFP®, philanthropy researcher at Texas Tech University. The study examined more than one million filings with the Internal Revenue Service by nonprofit organizations.

The following chart reveals that, from 2010 to 2015, nonprofits that consistently received gifts of stocks or bonds grew their contributions six times faster than those receiving only cash:

James’ study found the results are not limited to just those years. When looking at three-year rolling averages, organizations consistently receiving non-cash gifts grew much more quickly than those receiving only cash contributions. The study identified the same general growth pattern regardless of the starting size of the charity or the type of charitable organization.

James observes:

Beyond simple opinions or war stories, the previous results conclusively demonstrate that organizations raising non-cash gifts experience dramatically greater growth in total contributions, both contemporaneously and over the long term. Why? This is likely due in part to the effects of mental framing.

First, it is important to understand that wealth is not held in cash. Census bureau estimates suggest that only about 3% of household wealth is held in cash and checking accounts. When fundraisers ask for cash, they are asking from the ‘small bucket.’ This makes a psychological difference because it changes the reference point for the gift. The same gift may seem ridiculously large when compared to other checkbook purchases (elective expenditures from spendable income), but quite small when compared with total wealth (other non-cash assets). Donors who have never made a gift from assets may simply never have considered giving from wealth rather than giving from spare income. This is particularly important considering findings from experimental research demonstrating that people are much more willing to make charitable donations from irregular, unearned rewards (such as might occur with an appreciated asset) than from regular work earnings.

[Second,] gifts of appreciated assets are also cheaper than gifts of cash because the donor avoids capital gains taxes. This special benefit is particularly important under the new tax law, because it applies to all donors, even non-itemizers who can’t use charitable deductions.”

Intuitively, most fundraising professionals have already known what the James study now proves. So, if fundraisers know they should be seeking cash AND non-cash gifts, why do so many ask for only cash or merely make a feeble attempt to get non-cash donations?

James answers:

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May 9, 2018

Setting the Record Straight about Jimmy LaRose

Jimmy LaRose, founder of the Inside Charity website and co-founder of the National Association of Nonprofit Organizations & Executives, continues to be a controversial figure in the nonprofit sector. However, I have refrained from addressing his statements that trouble me.

Until now.

LaRose recently copied portions of one of my recent blog posts, altered their intention, and purposely misattributed them to someone else in an article he wrote attacking the Association of Fundraising Professionals.

When I confronted him with what he had done, he admitted to and defended his actions. Furthermore, he refused to apologize or delete the article at issue. In his last email to me, despite the fact that I never mentioned NANOE in my communications to him, he wrote, “NANOE’s Board of Directors has directed our staff to forward all your communications to counsel.” Do you think he might have sent me that message in an attempt to intimidate and silence me?

Well, you deserve the truth. Therefore, I will not be silent.

I published my blog post “Are Donors the Hidden Enemies of Charities?” on April 16, 2018. On May 6, 2018, the LaRose article “Is There a Secret Reason AFP (Association of Fundraising Professionals) Is Hating On Donors?” appeared at Inside Charity.

In my post, I reported on the findings of The Harris Poll survey report conducted for AFP and The Chronicle of Philanthropy. While I recognized that most donors are good people, I did point out that some donors do bad things. The Harris survey found that 25 percent of women and 7 percent of men, who are members of AFP and who were surveyed, report having been the victim of sexual harassment. In the cases cited, 65 percent of the perpetrators were donors.

In his article, LaRose attempted to discredit the survey report though he offered no evidence of his own.

Neither AFP nor I are demonizing all donors. We are simply giving voice to the survey respondents who have said that donors sexually harassed them. This is a real problem that some of our fellow fundraising professionals have faced. It’s something that we should not ignore.

Toward that end, I suggested some actions that individual nonprofit organizations should take:

1.  Have the organization’s board adopt a sexual harassment policy. If a policy already exists, it should be reviewed with an eye toward improving it. The policy should define sexual harassment (regardless of the source), map the reporting process, and explain the consequences of harassment. The policy should also make it clear that no donation is worth mental or physical harm to staff or volunteers; people should be clearly valued more than money.

2.  The senior management team or board of the organizations should set policies regarding meetings with prospects and donors. The policy should include answers to several questions including:

  • Where is it appropriate to meet with a prospect or donor?
  • When should more than one person from the organization meet with a prospect or donor at the same time?
  • When dining out with a prospect or donor, who should pick-up the check?
  • What prospect or donor behaviors should not be tolerated?
  • How should misbehavior be treated in the moment and following an incident?

3.  Procedures should be adopted for providing feedback to prospects or donors who misbehave so that they understand that their missteps are inappropriate and unacceptable.

4.  Staff and volunteers (including board members) should be provided with the policies and trained to ensure they understand all of the provisions of the policies

5.  As part of training, make all staff and volunteers aware of the problem. For example, share the Harris Polling report with them along with a printed copy of the organization’s sexual harassment policies.

6.  Re-assure staff and volunteers that they will be fully supported, and that they will not be penalized or lose their jobs for filing a legitimate complaint.

In LaRose’s article, he lifted the questions I asked in item two above. He then mislead his readers when he introduced the questions by writing, “In response to The Chronicle of Philanthropy’s ‘poll’ AFP’s IDEA Committee (Inclusion, Diversity, Equity and Access) has just announced another set of provisions they’re going to burden you with after they determine the proper answers to the following questions.”

To the best of my knowledge, the AFP IDEA Committee has not adopted my questions to guide its discussions. The questions I posed were clearly mine and mine alone. As I stated in my post, the questions are just some that should be addressed as nonprofit organizations discuss their own policies and procedures. I did not ask AFP to impose such a requirement on nonprofit organizations. It would have been foolish to do so because AFP has no mechanism for such an imposition even if it wanted to issue such a mandate.

By twisting the intent of my words and by providing incorrect attribution, LaRose has erected a straw-man.

LaRose writes:

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February 14, 2018

How to Get Last Year’s Donors to Give More this Year

Showing donor love and asking for more money should not be mutually exclusive activities. Inspiring upgraded support requires both to work hand-in-hand.

Unfortunately, for many nonprofit organizations, stewardship is the poor stepchild of the fundraising process. It is often ignored or poorly implemented. It is usually an underfunded activity. As a result, donor-retention rates for the nonprofit sector are pathetic.

Development professionals who think about stewardship usually believe that it is something sandwiched between when a gift is received and the next appeal. In other words, stewardship and fundraising are separate functions. However, Joe Garecht, President of Garecht Fundraising Associates and Editor of The Nonprofit Fundraising Digest, believes that the next appeal is actually an integral part of a robust stewardship process. An upgrade appeal will not achieve maximum success without sound stewardship. Done well, an ask is an extension of the stewardship process.

Joe’s thinking makes sense. If we love our donors, why would we want to deny them the satisfaction of continuing to support a cause they care about? Why would we want to deny them the opportunity to make a larger commitment? Helping donors to continue feeling good about continuing to do good is part of good stewardship.

We want our donors to feel important, feel needed. One way to do that, is to ask and to ask for more than they gave last year. However, we shouldn’t make an upgrade appeal in a vacuum.

It’s not just about asking. As Joe explains in his guest post below, it’s about incorporating the ask into a sound stewardship system so that the upgrade appeal is a natural evolution of our relationship with the donor. Stewardship and asking are not separate activities; they part of a cohesive system.

I thank Joe for sharing his stewardship insights and his four-step strategy for asking for donation upgrades:

 

One of the most important fundraising systems you can build at your nonprofit is an effective donor stewardship strategy. Donor stewardship starts with thanking your donors for their gifts… but is much more than that.

There are three main goals for your donor stewardship system:

  1. Donor Retention: You want to make sure that your donors keep giving year after year.
  2. Referrals: You want your donors to introduce you to their friends and colleagues who also might want to get involved with your organization.
  3. Donor Upgrades: You want your donors to give more this year than last year, and to move to major gifts and planned giving, if they have the capacity to do so.

In this article, we’re going to take a look at that third goal. We’re going to answer the question, “How can you get your current donors to give more this year than they did last year?” To understand how to best upgrade your donors, we’re going to first explore why donors make the decision to upgrade, and then review a simple, four-step strategy for getting your donors to upgrade this year.

Understanding Why Donors Upgrade

If you want to successfully solicit your donors to give more this year than they have in the past, it is important to understand why donors decide to upgrade their gifts:

Donors upgrade because they have been stewarded effectively.

The most important reason why donors upgrade is because they have been properly stewarded. This means that your nonprofit has appropriately thanked and recognized them for their past gifts, and has continued to build a relationship with them. Your donors want to feel like they are an integral part of your team. They want to feel appreciated, valued, and heard.

If you are treating your donors well, keeping them updated on your work, seeking their advice and input, and reporting on outcomes in between asks, your donors will be far more likely to upgrade their gifts. If your donors are investing their emotional energy, knowledge, and time in your work, then upgrading their financial investment will be the next logical step.

Donors upgrade because you are casting a big vision.

One of my favorite maxims in fundraising is this: Donors don’t make big gifts to small visions. Your donors want to change the world. They want to make a difference. If you are not casting a big enough vision, your donors will make their big gifts elsewhere, investing in organizations and companies that are.

Every nonprofit can cast a big vision…even small, local organizations working in one small corner of the world. Start by asking yourself, “How are we changing the world? How are we changing lives? How are we saving lives?” Your answers to these questions will help you think through the real impact of your work. If you want your donors to give more this year than they ever have before, you need to cast a bigger vision this year than you ever have before.

Donors upgrade because they are asked to upgrade.

Donors only upgrade when you ask them to do so. Very few donors will upgrade their gifts without being asked.  Thus, if you want your donors to give more this year than they did last year, you need to go out and ask them to do so. While the majority of your stewardship system should be focused on cultivation, asking for donations from current donors (including renewals and upgrades) is an essential part of the fundraising cycle.

In order to be successful, the upgrade process should be systematic. This means that you shouldn’t ask for upgrades here and there, whenever the whim strikes you. Instead, you should have a defined plan in place to review your donors’ capacity and ask them for upgrades as often as appropriate.

How to Ask Your Donors to Upgrade

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January 26, 2018

Are You Making the Same Mistake as Whole Foods Market?

Whole Foods, a supermarket-industry leader recently acquired by on-line retailer Amazon, has received some bad publicity this month. Consider the following headline appearing in The Boston Globe:

Empty Shelves at Whole Foods Have Customers Going Elsewhere”

The Globe reports that many customers are beginning to shop elsewhere because of empty shelves and declining quality:

Whole Foods customers in Bellingham have been struggling to find English cucumbers and sweet onions. In Newton, shoppers have been disgusted to realize that the organic celery they purchased was mostly rotten. Shoppers in Hingham have complained about half-rotten bags of clementines, while those in Newtonville say they were unable to purchase tofu all last week.”

My wife and I shop at a Whole Foods Market just a few blocks from our home in Philadelphia. We’ve experienced similar problems with out-of-stock or poor quality items. Now, we shop far less often at Whole Foods, despite its convenient location. Instead, we increasingly shop elsewhere. For example, MOM’s Organic always has a great selection of high-quality items. In addition, we’ve found that our local Acme Market, a traditional supermarket, has a better selection of high-quality organic items than our Whole Foods.

Whole Foods is making a number of serious mistakes:

  1. assuming it can rely on brand loyalty and its now outdated reputation.
  2. being unresponsive to customer needs.
  3. ignoring the fact that customers have options of where to shop.

Sadly, those are three mistakes that many nonprofit organizations also make. As a result, donor-retention rates are pathetically low. The average overall donor retention rate is approximately 45 percent, according to the 2017 Fundraising Effectiveness Survey Report. The Fundraising Effectiveness Project is a partnership between the Association of Fundraising Professionals and The Urban Institute. The FEP website provides a variety of reports and helpful tools for enhancing donor retention.

Many charities think they can rely on their reputations to achieve strong donor retention rates. Unfortunately, while that might have been the case with brand-loyal Baby Boomers, it’s no longer the norm. Donors want to know that their gifts are making a difference. Moreover, they’re not willing to assume you’re using their money wisely. They want evidence of your effectiveness.

Nonprofit organizations need to be responsive to donor needs. Every member of your organization’s staff, not just fundraising professionals, should be trained to meet the needs of donors. You can read more about this in my post: “The Most Important Part of Any Grateful Whatever Campaign is…

If you don’t provide a meaningful experience for donors by providing them the information they demand and by meeting their varied needs, they will stop giving to your organization. However, that does not mean they will stop giving. They will simply give elsewhere.

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December 15, 2017

Avoid a Big Misstep Now to Raise More Money in 2018

Fundraising can be complex and challenging. We need to consider strategies, tactics, technology, staffing, budget, and so much more.

What if I could help you cut through all of the clutter, so you can avoid a big misstep now and raise more money in 2018?

Well, here you go:

If you want to raise more money, do not fail to send a proper thank-you letter.

It’s pretty simple, right? I think it is. Unfortunately, so many nonprofit organizations mess up this important step in the development process either by not sending a thank-you letter at all or by simply dashing off a letter with little thought. While professional fundraisers expend considerable effort to master the complexities of the fundraising process, many stumble when it comes to something as simple as the thank-you. Don’t be one of those fundraisers.

The thank-you letter is an essential part of a sound stewardship program. Every donor should receive a thank-you communication. It amazes me that some organizations still refuse to send thank-you letters to lower-level donors. Sending a simple receipt is not the same as a thank you.

A wise person once observed that the most important communication a donor will receive from you is the first thank you after the first gift. At that point, many donors will decide whether to ever make another gift to your organization.

So, what are the three essential principles of a great thank-you letter?

1. Immediacy.

The first rule of effective thank-you letters is: Be sure to send them. The corollary is: Be sure to send them immediately, within three to seven days of the gift coming in. If you delay, donors will likely think that you do not need their money or that you do not truly appreciate them. Wise organizations that don’t have the infrastructure to do this will outsource the gift acknowledgment process recognizing that it’s a worthwhile investment.

2. Caring.

Let your donors know you care. You can do this by sending a thank-you letter out on a timely basis. In addition, make sure you spell the donor’s name correctly, acknowledge the amount received, encourage the donor to contact you with any comments or questions, include an appropriate gift receipt and tax information. If your organization hosts events or programs for the public (i.e., a theater company that has a new stage show about to open), take the opportunity to share this information with your donor. These are just some of the things you can do to show you care.

You should also remember that a thank-you letter is not another solicitation piece. So, don’t appear ungrateful by asking for more money or enclosing a gift envelope. I know this is a controversial issue so, for more about this, read “Can a Thank-You Letter Contain an Ask?”

3. Meaningfulness.

Don’t just send a simple thank-you letter that shows you didn’t spend much time thinking about it or drafting it. One way to force yourself to be a bit creative when writing a thank-you letter is to not use the words “thank you” in the first sentence. This prohibition will slow you down and force you to be more thoughtful when writing the letter.

Another tip is to remind donors of the impact their gifts will have. Better yet, tell them how their gift is already being put to good use.

Whenever possible, hand sign the thank-you letters. Even better, hand sign the letters and write a short P.S. This will go a surprisingly long way in building a meaningful relationship with the donor.

For her book Donor Centered Fundraising, Penelope Burk reviewed hundreds of thank-you letters. Based on her analysis, she outlined 20 attributes of great thank-you letters. I felt so strongly about her list that I cited it in my own book, Donor-Centered Planned Gift Marketing:

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