They call her Ugly Betty. And, while she may be lacking in fashion sense, she knows a thing or two about renewing gifts from prior donors. Who is she? She’s a no-frills direct mail package that’s gaining popularity among annual giving programs. She doesn’t contain a wordy case for support or compelling pictures. In fact, she looks more like an invoice than a traditional fundraising appeal.
There’s a lot of noise out there” says one annual fund manager referring to mailboxes cluttered with charity appeals and consumer offers, “and Ugly Betty helps convey our most important message in a succinct way. In addition to our more traditional letters, we send as many as four Ugly Betties to our recently lapsed donors each year.”
Megan Doud, Director of Annual Giving at The University of Michigan, describes Ugly Betty as one of their most successful appeals (see sample below.) “On average, we see a 14% response rate for prior year donors and 3.5% response rate for 1-2 year lapsed donors. Some schools and colleges see response rates from priors of around 20-25%!” See an example below.
Today’s donors are busy. Even those who are committed to supporting your organization can use a little reminder now and then. Ugly Betty may not be the best approach when it comes to acquiring new donors, but she may be able to help you convey an important message to your most loyal supports – it’s time to renew your support!
Retention rates are calculated by taking the number of donors who have made gifts in both the current year and the prior year and then dividing it by the number of donors who made a gift in the prior year. This is important because last year’s donors are more likely to renew than any other segment. The median retention rate for colleges and universities is 62% according to Target Analytics Index of Higher Education.
The likelihood that a donor will renew decreases with every year that the donor lapses. In other words, each year that s/he doesn’t make a gift. “The Cliff” is the point at which the odds of getting a lapsed donor back are less than the non-donor (i.e., someone who has never given) will make a gift. For most institutions, this is usually at 4-5 years.
Another reason why it’s important to pay attention to your lapsed donors is that they are more likely to upgrade (i.e., increase the amount of their gift) than any other segment. This is particularly true for donors who have made:
- multiple gifts in a single year before lapsing
- a gift of $1,000 or more in a year before lapsing
- gifts in 5 or more consecutive years before lapsing
Thanks to our good friend Meredith Blair for reminding us about the importance of donor retention and reactivation, and for keeping us away from The Cliff!
Heidelberg University was searching for a way to increase philanthropy awareness on campus and introduce their own Student Philanthropy Day. So the Heidelberg Fund team and the Student Alumni Association put their heads together and came up with an innovative idea. They called it TAG Day.
“We considered the idea of a Tuition Freedom Day – a popular idea on other campuses as a way to point out when (in the academic year) tuition dollars would theoretically run-out and private support would take over,” says Ashley Helmstetter, Executive Director at Heidelberg. “But that model didn’t resonate for us. Since 99% of our students receive scholarship and financial aid, we were mostly interested in highlighting the specific impact gifts that we have on our campus.”
The word “TAG” is an acronym (Thank-A-Giver) as well as a call to action. Students use the day as an opportunity to reach out and thank donors for support – many write handwritten notes. In addition, they spend the day “tagging” stickers onto items around campus that exist as the result of donor support. This includes material objects items like buildings, books, and art work as well as human objects including faculty, staff and students.
Now in its third year, TAG Day continues to gain momentum. “We add a new (fun) element every year,” says Helmstetter, “but our fundamental focus remains on stewardship, engagement, and education.”
Click here to watch this great TAG Day video. Go Student Princes!
What does it take to have a successful career in annual giving?
For starters, you need to be goal driven, creative, personable, analytical, flexible, and committed. You need to be open to new ideas and willing to take risks. You also have to make decisions (lots of them) such as who to visit, when to send appeals, how to segment audiences, and which messages to communicate. In other words, you have to do a lot. With so much going on, it’s easy to slip-up, get distracted, and misstep.
Here are 5 common mistakes made by annual giving professionals that can get in between you and a long and successful career.
- They try to go it alone. It’s a team sport. Your colleagues, your bosses, and your volunteers will likely have as much (if not more) to do with your programs success than you will. Know when to step up, when to delegate, and when to stay out of the way.
- They don’t use enough data. “That’s the way we’ve always done it” and “That’s what I assume” won’t get you very far in this business. Conduct surveys and focus groups. Study what other programs are doing. Test, don’t guess. If you can’t find any data to support an assumption, then that’s all it is – an assumption.
- They use too much data. If you’re spending more than 10% of your day staring at reports, then you need to find a better use of your time. Avoid analysis paralysis. Get out there and do something.
- They don’t focus on their current donors. Your best donor is the one you already have, so make sure that’s where your spending your time and resources. If less than 60% of last year’s donors don’t give again this year, then you have a problem.
- They get distracted by “shinny new objects.” It’s important to keep up with the latest trends and try new things, but don’t forget about the fundamentals. Crowdfunding, Giving Days, and Text to Pledge may be important, but they’re not silver bullets. Remember where the majority of your gifts and donors still come from.
Don’t be afraid to make mistakes. It means your trying. One of the benefits of working in annual giving is that you get to make mistakes, learn from them, and start over fresh every 12 months.
The 11th Hour – Year End Strategy for Annual Giving
April 14, 2015 at 1pm EDT (60 min)
Presented by Martha Krohn – Assistant VP for Annual Giving at The University of Rochester
Click here to learn more or REGISTER TODAY!
The fiscal year will be ending soon for many annual giving programs. Fortunately, there is still a lot that can be done in the coming weeks to acquire more donors and raise more money for your Annual Fund. If your anxiety is as high as your goals, then this webinar is for you!
Register online for your entire team to learn how to close out your fiscal year on a high note and leave no stone unturned.
WHAT YOU WILL DISCOVER
• Strategies to reach your prospects using your resources
• Tactics that can be implemented quickly and don’t cost a lot of money
• Methods for motivating staff and volunteers
• Examples that have worked at other institutions
• And more
WHAT YOU GET
• Access to the LIVE webinar; invite your entire team (limit 1 login per registration)
• Guarantee to have your questions answered by an expert
• Copies of the presentation materials and resources
• Link to watch a recording of the webinar for 60 days following the live event
ABOUT THE PRESENTER
Martha Krohn is the Assistant Vice President for Advancement & Annual Giving at The University of Rochester where she oversees a comprehensive program including leadership and regional annual giving, direct marketing, reunion giving, and special constituency fundraising.
Her 15-year career in annual giving and advancement also includes leadership roles at Carnegie Mellon University, The University of Connecticut, and Emerson College.
Martha is a foundation board member at the Young Women’s College Prep School and an active volunteer for numerous nonprofit organizations in the Rochester region. She holds a Bachelors Degree from Susquehanna University and remains involved as a volunteer for their Advancement efforts.
Click here to learn more or REGISTER TODAY!
The word “stewardship” gets used a lot in the world of annual giving. But ask a group of people to explain its meaning and you’re likely to get a lot of different responses. That’s because stewardship isn’t just one thing. It’s many things. And it’s not something you do just once. It’s constant and fluid. In many ways, it’s like a river.
A RIVER is also an acronym to help you think about and remember the many ways stewardship should flow through your fundraising operation:
Acknowledgement – Let donors know that their gifts have been received as soon as possible. This might include something as standard as a receipt or as personal as a handwritten note. The best acknowledgements arrive quickly.
Recognition – Nothing stands out like the letters in one’s own name. Identifying donors in print or online not only let’s them know that their support is recognized, but it can also incentivize others to donate. It can be just as motivating to notice that your name is missing from a list, as it is to see that your name on it.
Impact – It’s not about the money. It’s about what the money does. Show donors the impact of their gifts. Provide examples. Tell stories.
Value – Most donors aren’t looking for something in return, but offering them small tokens of appreciation (e.g., invitations, keepsakes, discounts) can go a long way. Give and you shall receive.
Experience – Starbucks doesn’t sell coffee, they sell an experience. What kinds of experience are you giving to your donors?
Reminders – Chances are that your donors have as much (if not more) going on than you do. Reminding them when their pledge payments are due or that a year has elapsed since their last annual fund gift isn’t nagging. It’s good stewardship.
There’s a lot that can influence someone’s decision to respond to an appeal. When does it occur? Who’s asking? How compelling is the case? How much is asked for? How long has it been since any previous gifts and what have you done for them since?
Personalization also plays a big role. Suffice it to say, the more personal that an appeal feels, the higher the likelihood that the prospect will respond positively to it. That’s one reason why conversion rates for email and direct mail appeals are generally lower than conversion rates for phone calls or face-to-face asks.
The Phonathon Program at The University of California, San Diego has found a great way to connect with their prospects in a personal way. After each pledge, they use an iPad camera to film the student caller saying saying a personal thanks to the person with whom they spoke. Then they email it to the prospect with the subject line: “A Quick Thank You” They record using QuickTime movie and send it in an email as an attachment. Because they’re short and quick, they’re actually really small file size (2MB) and easy to email.
Click here to watch a sample of this video from one of their callers.
“Right now, we send thank you videos to anyone who makes a pledge or gift”, says Meredith Blair, Executive Director of Annual Giving & Regional Advancement. “When our supervisors were short-staffed, we had to cut back to first time and newly reacquired donors, but we’re back to all donors again!”
The videos are unscripted and usually shot in one take—and as a result, they’re often admittedly unpolished; even intentionally unpolished. Blair said that they really set out to make them quick and timely, so they arrive within a few minutes of getting off the phone. They also felt strongly that they needed to be real, organic, and “charmingly authentic.” She feels like the fact that they are clearly not slick, pre-shot videos fosters a stronger feeling of connection between donors and students.
And the 60 seconds or so that it takes to make and send this video is quickly proving to be a worthwhile investment. “It is strengthening retention and fulfillment rates already,” says Blair “and we’re getting a lot of really touching feedback. People really love them—we’re building stronger relationships, creating positive giving experiences in our phonathon, and increasing results…all for the low, low price of two cheap iPads.”
State of the Art – Annual Giving in 2015
March 17, 2015 at 1:00 PM EDT (60 minutes)
Presented by Dan Allenby – Founder, The Annual Giving Nework & AVP at Boston University
Click here to learn more or register today!
What does the field of Annual Giving look like today? Which trends are most relevant? How does your program compare with others? Find out as Dan Allenby reviews The Annual Giving Network’s recent survey and explains how to use it to improve your own strategy. All registrants will receive a copy of the detailed survey data.
Register online for your entire team and prepare your program for success in 2015 and beyond!
WHAT YOU WILL DISCOVER
- Who is leading annual giving programs today (and how much they earn!)
- Where you should invest your budget to get the highest return
- What impact you can expect from social media, mobile phones, and front-line officers
- How to use the survey data to improve your results
- And more
WHAT YOU GET
- Access to the LIVE webinar: invite your entire team
- A guarantee to have your questions answered by an expert
- Copies of the presentation materials and resources
- Link to watch a recording of the webinar for 60 days following the live event
Gift pyramids can help us visualize the distribution of our donations and identify where the majority of the money we raise is coming from. They can be useful for assessing all types of fundraising efforts including complex multi-year comprehensive campaigns, recurring annual fund drives, or stand alone direct mail appeals.
An important question to ask when analyzing your gift pyramid is whether it’s Egyptian or Mayan. Egyptian pyramids have pointed tops. They reflect campaigns in which a very large majority of the revenue comes from one or very few gifts. On the other hand, Mayan pyramids have flat tops. They reflect campaigns in which small and midsize gifts make up a more substantial portion of total revenue.
Here’s an example of a gift pyramid from a campaign that raised $50,000.
- $10,000+ (1 gift totaling $25,000)
- $5,000-$9,999 (2 gifts totaling $10,000)
- $2,500-$4,999 (5 gifts totaling $7,000)
- $1,000-$2,499 (4 gifts totaling $5,000)
- Less than $1,000 (25 gifts totaling $3,000)
As you can see, 50% of the total money raised came from a single gift. In the short term, this can be an efficient and effective fundraising strategy. You’ll have a much better chance of success raising $1,000 by trying to find one donor who’s capable and willing to give you $1,000 than by trying to find 100 donors to each give you $10. Over time, however, organizations that rely on Egyptian pyramids run the risk of becoming top heavy and weakening their base of support. And you know what ultimately happens to organizations that are too top heavy, don’t you?
They tip over.
If mortgage and car payments were due only once a year, a lot of us would have a hard time coming up with the full amount. If we paid our cable bills only once a year, there would probably be a lot fewer of us watching HBO. Banks and media companies understand that customers are more inclined to make big purchases when the payments are easy to swallow.
The same can be said in fundraising, which is why monthly giving can be so appealing. On one hand, it offers convenience for the donor. On the other hand, it can help charities increase retention rates and encourage upgrades. For example, rather than soliciting a $1,000 gift all at once, ask for $83.33 each month. Or, see if a current $1,000 donor will upgrade to $1,500 with monthly gifts of $125.
Franklin & Marshall College does a great job with monthly giving. They even have a dedicated page on their website explaining the set-up process and benefits. On it, they have a chart that explains the monthly contribution for membership in their leadership gift society. It even breaks down the monthly payment for each of the last ten graduating classes since they can join at discounted rates. Click here to learn more. Go Diplomats!