Launching a Women’s Giving Circle

Posted on 07/15/2018- by Dan Allenby
Sarah Rubin

Women are earning more than ever - and taking a larger role in charitable giving. Research shows that a $10,000 rise in a woman’s income is associated with a more than 5% increase in total household giving. According to the Women’s Philanthropy Institute at the Indiana University Lilly School of Philanthropy, women with the top 25% of income gave 156% more than men in the same category. Even in households where the husband is the major breadwinner, women have the stronger say as to how charitable funds should be allocated. But cultivating the next generation of female philanthropists requires a strategic approach, one that appeals to their desire for personal connection with both fellow donors and with the causes that they support. In an effort to engage more female alumni in philanthropy, Oregon State University (OSU) established its Women’s Giving Circle in 2003. Since that time, the Giving Circle has expanded its capacity and focus, raising a total of over $920,000 to fund university grants that are relevant to women. Projects include a STEM academy that recruits undergraduate women and minority students to work with underrepresented youth, and a series of financial literacy sessions for freshmen with minimal money management experience. Their flagship effort has been a multi-year pledge to support the recently-opened Beth Ray Center for Academic Support, which provides programs and services to benefit all students and aligns with the Giving Circle’s emphasis on helping others get a leg up. Kellie Parker, OSU’s Senior Associate Director of Annual Giving, attributes much of the Giving Circle’s success to careful listening and an open-minded approach to donor ideas and interests. The OSU Foundation initially structured the group based on research studies and focus groups, but feedback from alumni and other stakeholders - including the group’s steering committee - helped refine the Group’s priorities and direction. One major challenge was ...

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Creating RFM Scores for Donors

Posted on 07/08/2018- by Dan Allenby
Sarah Rubin

It’s one of the most important and fundamental principles of annual giving: last year’s donors are the most likely prospects to give this year. That’s why maintaining a strong donor retention rate is so critical and should be a focus area of any annual giving program. And while it can be appealing to base your strategies on these prior-year donors, lapsed donors also have a strong likelihood of renewing their support - with the right approach. One way to evaluate your past donor population is to employ a marketing technique called an RFM score, which stands for Recency, Frequency, and Monetary value. RFM analysis assesses how recently a donor made a gift, the frequency of their giving over a period of time, and the amount of money they have given in that period. Each variable can be an indicator of a donor’s propensity to give in the future. For example, a donor whose last gift was two years ago is more likely to give than one who most recently gave five years ago. A donor who gave four out of the past five years is more likely to give than one who gave two out of the past five years. And a donor who gave $500 in the past is more likely to give again than one who gave $100. Applying this kind of analysis to your alumni provides additional perspective on donor tendencies for segmentation purposes. The Westminster Schools in Atlanta recently used this approach to refresh their segmentation strategy and help refocus their volunteers. While the school saw a higher than average donor retention rate year after year, the annual giving team felt that their appeal strategies and volunteers were too heavily focused on LYBUNTs (i.e., prior-year donors). They wanted a tool that would help add insight to alumni propensity beyond just last year’s gift and the most recent gift amount, with the goal of converting more of their lapsed donors.   To tackle this, they conducted a simple RFM analysis and created a score for all of their past donors. This score ...

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7 Tips for Beginning a New Fiscal Year

Posted on 07/01/2018- by Dan Allenby
Sarah Rubin

For those who work in annual giving, things are always moving. There’s always an upcoming appeal to produce, another phone call to make, or a thank you note to write. There’s always a prospect who has yet to connect (or reconnect) with your institution. There are always reports to run, pledgers to remind, and volunteers to support. Even though the annual fund doesn’t stop, it’s important to pause now and then in order to hit the reset button. And there’s no better time to do that than at the beginning of a new fiscal year. With each cycle comes the opportunity to make a fresh start. And while there will likely be big things you’ll want to accomplish in the months ahead, it’s often the little things you do in the first week or two of a new fiscal year that can really set the tone for a successful campaign. So, before you close the books and head out for that well-deserved summer vacation, here are 7 small - but significant - things you can do to get the new year started on the right note. Take a moment to let your colleagues in advancement services know how much you appreciate their help and support throughout the year. Bring them bagels and coffee one morning. They entered a lot of data and processed a lot of gifts to complete the cycle of your appeal efforts. Reach out to a few peer institutions to find out how they did in donors and dollars compared to the year before. Ask each to share a success and a failure from the past 12 months. Offer the same in return. Call at least five of your most committed volunteers. Let them be the first to hear the year’s final results. They’ll appreciate the inside scoop. Send handwritten thank you notes to your top ten leadership donors. Make sure they know that they are among the relative few who provide a large portion of the annual fund's total support. Calculate the ROI (total revenue - expenses / expenses) for your phonathon and direct mail program. Think of ways you can improve ...

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Coordinating Annual Giving in Complex Organizations

Posted on 06/24/2018- by Dan Allenby
Sarah Rubin

Coordinating annual giving efforts in complex organizations, especially those that are large and decentralized, can be a challenge. In such environments, different units often operate as completely separate entities with their own constituents, goals, and cultures even though they’re all part of one umbrella institution. For those who work in the central annual giving department, the day-to-day tasks of getting appeals out the door while offering valuable support to the various units might feel a bit like herding cats. A quintessential example of a successful central effort within a complex and decentralized organization can be found at Cambridge in America. Known as CAm, this US-based nonprofit is responsible for coordinating fundraising and alumni relations in the US for the 800-year-old University of Cambridge and its thirty-one member Colleges “across the pond” in England. Each College is an autonomous entity across which more than 18,000 students live, work, and study, all spidered throughout the ancient city of Cambridge, England. Each one has its own development office and director, with staffs ranging from 2–12 dedicated full-time employees. Along with their own histories and ways of doing things, these Colleges have their own fundraising needs and goals and have established their own internal procedures to meet them. But even the most prestigious institutions must deal with time and change. In recent years, the need for fundraising has increased in order to support research, posts, and facilities and to help meet the increased shift of tuition and other costs to students. Until the late 1990s, tuition and fees had primarily been the purview of the government; since then, however, they have been steadily rising to a current price of £9,250 per year per undergraduate student. To help generate private support and offset these increasing expenses, the University undertook a £2 billion Dear World, Yours Cambridge capital campaign. In ...

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Using Teasers to Increase Appeal Response Rates

Posted on 06/17/2018- by Dan Allenby
Dan Allenby

There’s an old saying in direct mail: “An envelope has two jobs. The first is to get delivered to the right mailbox. The second is to get opened.” Getting prospects to open the envelope is a key step in having them read what’s inside and, ultimately, make a contribution. The best way to get your alumni to notice (and want to open) the envelope is to capture their attention and make them curious. One way to do this is to use envelopes that stand out because they are unusual in size, shape or color or because they are creative or eye-catching in some other way. Using standard #10 envelopes for mailings may be easy and cost-efficient, but doing so also increases the risk that your appeal will be overlooked. Another way to increase the chances that your envelope gets noticed is to use teasers (i.e., short eye-catching messages or images) that lure alumni to look inside. A good place for teasers is between the recipient’s name and address (usually in the middle of the envelope) and the return address (usually in the top left corner of the envelope). These are the first two places people’s eyes go when they look at an envelope, and your message will stand out when their eyes move from one to the other. A teaser should try to tap into the prospect’s emotions, regardless of its placement. For example, “Find out why your gift could help our rankings!” might evoke a sense of pride or connection. “Is your name on this list?” could make recipients curious (and possibly concerned) that they might be left out of something if they don’t act. Don’t be afraid to try humor now and then. The University of California, San Diego used a teaser that read, “OPEN ME. Seriously, I can’t open myself. I don’t have hands because I’m an envelope." No matter how compelling your enclosed appeal is, if it goes straight from the mailbox to the recycling bin, the envelope has not performed its job - and you've missed the opportunity to engage the ...

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5 Elements of an Effective Annual Fund Plan

Posted on 06/10/2018- by Dan Allenby
Sarah Rubin

Earth is approximately 93 million miles from the Sun. It’s in constant motion, traveling 67,000 miles per hour along a 584-million-mile path known as its orbit. As it moves through space, the planet also spins around a tilted axis. Because of this tilt, different parts of Earth point toward the Sun at different times, changing the amount of light and warmth it receives and causing seasons to change every few months in some areas. It completes its orbit every 365 days—one full year. An annual giving program is also in constant motion. There’s always an upcoming mailing to produce, another phone call to make, or a new thank you note to write. There’s always a prospect that has yet to connect with your institution. There’s always a series of reports to run, donors to remind about pledges, and volunteers to support. As soon as one fiscal year ends, the next one begins. The cyclical nature of annual giving is often an attractive characteristic to those who work in the field. Unlike major gift fundraising, which tends to operate over a longer, less-defined period of time, the annual giving cycle resets every 365 days. There are clear starting points and clear ending points—and a lot of work to do in between. For that reason, developing a plan for each fiscal year becomes a necessity. When structuring your plan, be sure to include these 5 elements: Executive Summary. This should be a brief narrative (no more than one page) that includes bullets to call out the most relevant points. Make it the first thing people see when they open the document. It should explain the current situation and address important challenges and key strategic questions. How has the program performed over the past few years? What trends stand out within your own program or across the industry in general? Are you in a campaign? What are your biggest strengths, weaknesses, opportunities, and threats? How are the institutional environment and the economy? Have there been any ...

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Asking Lapsed Donors “Why”?

Posted on 06/03/2018- by Dan Allenby
Dan Allenby

Find out how The University of Houston uses surveys to engage former donors.

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Soliciting Blended Gifts: The Dual Ask

Posted on 05/27/2018- by Dan Allenby
Sarah Rubin

Many people think that soliciting a donor for a major gift is bad news for the annual fund. But nothing could be further from the truth. In fact, when properly planned and coordinated, major gift solicitations can be very beneficial for an annual fund. At the University of Pennsylvania Law School, the dual ask or blended gift (i.e., including both a major gift and annual gift) has long been a regular part of their strategy. Laura Tepper, Director of Development, notes that there are several things that help to make their approach successful. The first is to communicate often and openly. At Penn Law, the development staff is relatively small, so there is a great deal of regular contact among the annual giving staff and the major gift staff. But even in larger offices, regularly touching base with team members is crucial for succeeding with blended gifts. Not only should annual gift and major gift staff talk to each other and share information about prospects and conversations, but they should also regularly update call reports in their digital systems so that anyone in the office can keep track of donor progress. Penn Law’s development staff holds joint meetings with representatives from both major gifts and annual giving to make sure everyone is on the same page and discuss why a particular donor should give to both the annual fund and the major gift fund. Tepper says it’s also important to frame the “proper pitch.” When Penn Law’s development staff has agreed that a certain donor would be a good prospect for a dual ask, the team works together to determine the best way to approach that donor. For instance, in some cases, an annual gift staffer may have a long relationship with this person, so the annual gift staffer may be the best one to make the ask, even though it includes a request for a major gift. Sometimes, Penn Law development professionals hold joint meetings with a donor, in which both annual and major gift staff are present. ...

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Donor Coverage Ratios

Posted on 05/20/2018- by Dan Allenby
Dan Allenby

There's an ever-present grind to annual giving. Each year, programs are expected to generate as many - if not more - donors than they did the year before. This is an especially big challenge for educational institutions who are faced with increasing competition from other non-profits and changing attitudes among alumni regarding giving back to their alma mater. One of the things that can help annual giving programs face this challenge is having a goal and breaking it down into a few smaller parts. In the case of donor counts, this can be accomplished by analyzing what's known as the donor coverage ratio. Simply put, this is the number of new and reactivated donors you secured compared to those lost through attrition. Here's an example: Assume that two years ago your program generated a total of 1,000 donors. Then assume that 600 of those donors renewed last year. In other words, you lost 400 donors. At the same time, you had to replace those lost donors. There are only two ways to do this. The first is to acquire new donors. The second is to reactivate lapsed donors. Figure that last year you acquired 200 new donors and reactivated 200 lapsed donors. In this case, the donor coverage ratio for last year is 100%, meaning that your program secured exactly the right amount of new and reactivated donors to cover what you lost in attrition. It also means that there was no change in overall donor counts from one year to the next. Had the ratio been less than 100%, it would have meant that the year resulted in an overall decrease in donors. Had it been higher than 100%, it would have meant that there was growth in donors counts from the previous year. The donor coverage ratio can also help you assess the efficiency of your efforts. Typically, acquiring new donors and reactivating lapsed donors is less efficient and requires more resources than retaining current or recent donors. By increasing your retention rates through targeted outreach and ...

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Selecting a Date for Your Giving Day

Posted on 05/13/2018- by Dan Allenby
Dan Allenby

Several years ago, many in the world of annual giving were asking themselves whether or not their institution should try out a “Giving Day.” Fast forward to the present time and we see that 3 out of 4 colleges, universities and independent schools have held (or are planning to hold) one. So, the new question that many organizations are now asking themselves isn’t if, but when, they should hold the big day. Back in 2012 when Columbia University celebrated the industry’s first major day of giving, one of their motives was to encourage donors who might typically give in the spring to make their gifts earlier in the fiscal year. For this reason, they decided to hold their giving day in October, and they have continued that tradition every year since. By any standard, Rice University has made the most of the giving days that they’ve conducted each year since 2013. However, unlike Columbia and many other institutions that hold their event on or around the same date each year, Rice has experimented with different times in order to piggyback on various campus activities and keep donors on their toes. Here’s the approach Rice has taken over the past five years, with results for each year listed in the chart below: First year (2013) — May 10th: Coincided with the celebration of the conclusion of their comprehensive Centennial Campaign, as well as with commencement. Second year (2014) — May 1st: Coincided with “decision day” — when prospective students decide if they will attend Rice. Third year (2015) — June 16th: A little later in the fiscal year, to motivate donors to give during the fiscal year-end push. Fourth year (2016) — February 29th (Leap Day): To have some fun with marketing around the unique date. Fifth year (2017) — June 1st: Based on their success two years before, once again hoping it would give a boost to their fiscal year-end fundraising efforts. Emily Kernan, Executive Director of the Rice Annual Fund, ...

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Special Report: 10 Drivers of Annual Giving Success

Posted on 05/06/2018- by Dan Allenby
Dan Allenby

The modern annual giving program faces many challenges. A twenty-year decline in alumni participation rates has been fueled by rising tuition and student debt, changing attitudes by a new generation of alumni, and increased competition from a growing number of nonprofits. Limited resources and high rates of staff turnover make the job of running a productive annual giving program even more difficult. At the same time, new opportunities are presenting themselves every day – through technology, digital media, and data analytics – that can help staff and volunteers achieve their goals. Today, annual giving is more complex, more sophisticated, and more important than ever. AGN's Spring 2018 Special Report has been developed as part of our ongoing best practices research. It contains a summary of key findings from our recent survey of more than 300 educational institutions and reveals 10 Drivers of Success as observed from the nation's highest performing annual giving programs. Use it as a roadmap to improve the quality and productivity of your fundraising efforts and better understand what’s happening in the industry. As the world’s leading resource and consulting firm for annual giving programs, AGN is dedicated to helping educational and nonprofit organizations improve their annual giving efforts. Through our membership program and specialized annual giving consulting services, we help advancement professionals stay on top of industry best practices, discover new ideas, and implement winning strategies for their annual funds.

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The Alumni Population Explosion

Posted on 04/29/2018- by Dan Allenby
Dan Allenby

According to the Council for Aid to Education, the number of alumni of record from U.S. colleges and universities has increased dramatically over the past several decades. In fact, the average number of alumni per institution has nearly quadrupled, from around 15,000 in 1972 to 60,000 today. At the same time, the average number of alumni donors has remained relatively flat. Although one may think that this suggests a certain level of stability, it actually has a negative effect on alumni participation rates. As the number of alumni grows, an institution needs to increase the number of alumni donors just to maintain its current alumni-to-donor ratio. Imagine that last year a college had 50,000 living alumni and that 5,000 of them made a contribution; its alumni participation rate would be 10 percent. Then imagine that the number of living alumni increased by 2 percent this year, to 51,000, perhaps due to an increase in enrollment or because fewer alumni died (not implausible as life expectancies are going up). If the college maintained its current alumni donor count of 5,000, its alumni participation rate would decline to 9.8 percent. This scenario has become an all too familiar reality for many educational institutions and their annual giving programs—so much so that many programs have adopted the slogan “flat is the new up” when it comes to alumni participation rates. Does this mean that declining alumni participation rates should be accepted as a harsh but unavoidable reality, since the increasing size of alumni populations is beyond the direct control of annual giving programs? Before you answer, ask yourself if you would accept population growth as a good excuse for declining employment rates. Probably not. Instead, you’d think something was broken within the economy. The way you think about alumni participation rates should be no different. The fact that rates have been declining steadily for so long is an indication that something is fundam...

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Thinking Outside of Your Donor Database

Posted on 04/22/2018- by Dan Allenby
Dan Allenby

Don’t be limited by the data that your institution is actively maintaining on constituents. These days you need to think outside of your donor database. Social media is full of information and clues about your alumni and donors—and chances are, it’s more accurate and current than what is in your own database. Take LinkedIn, for example, where an individual’s public profile can provide three data points that can help you determine their potential capacity to make a gift: geographic location, employer and job title. Your alumni are far more likely to update their LinkedIn profile when they change jobs than they are to reach out to your alumni relations department with the news. Engagement is no longer limited to physical presence, and watching how your alumni behave on social media can also tell you a lot about them. The posts they like and share can point to their interests and affinities. The people they’re connected to can tell you who influences them. Their comments can reveal opinions and tell you how they might feel about the things going on around your campus. Hamline University asked alumni on its Facebook page to comment with the name of a faculty member who made a difference in their lives. Alumni responded in droves. It not only turned out to be one of their most engaging posts ever, but it also revealed which professors were most popular with alumni—data that they could use later to determine future news stories in the alumni magazine or newsletters, or even to determine which influential faculty should be asked to sign annual fund appeals. Online engagement can also help to identify new donors. For example, if you’re able to identify a group of alumni who like or share a particular post about the school’s pep band, then it stands to reason that those individuals would have a higher likelihood of responding to an appeal to support the pep band than would a randomly selected group of non-donors. And while mining social media data ...

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No Gift Is Too Small… Or Is It?

Posted on 04/15/2018- by Dan Allenby
Dan Allenby

If you own a home (and you're not the Home Depot type), you may at times find yourself looking for a handyman. When you do, keep in mind that their slogan can say a lot about them. Some slogans are assertive: We’ll fix it even if it’s not broken. Others are sincere: A helper with a heart. There are even a few that are humorous: I can repair what your husband fixed. And then, of course, there’s the old handyman classic: No job is too small. One could argue that this translates easily to annual giving. In a world where donor participation is a high priority, it's no surprise that encouraging gifts of all sizes has become commonplace in fundraising scripts and appeals. But is it really true to suggest that no gift is too small? It’s easy to understand why annual giving programs might want to pursue small donations. Soliciting nominal gifts ($1, for example) is a common way to include or "count" those who want to support the institution but simply don't have much money. Many students and young alumni fall into this category. A dollar is better than nothing, right? Maybe not. There are, in fact, downsides to small gifts. Consider the expense of processing a donation. When you factor in the staff time and budget required to record a gift in the database, produce an acknowledgment and mail the receipt, each gift usually costs an organization more than a few dollars. Think about the future too - specifically donor retention rates. You may be counting the individual as a donor now, but what's the likelihood that a $1 dollar donor will give again in the future? The following chart shows that there is a correlation between gift size and retention rates. The larger the gift amount, the higher the retention rate. This means, of course, that a smaller gift amount corresponds to a lower retention rate. So while a $1 gift might help boost your participation rate in the short-term, it likely won’t do much to help you build a sustainable base ...

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5 Tips For Making The Ask

Posted on 04/08/2018- by Dan Allenby
Dan Allenby

People make charitable donations for many different reasons. Some give out of a sense of loyalty and appreciation for an experience they had, because they want to make a difference in the life of another, or because they believe that the institution has a positive impact through its teaching, research or other programs. Others give because they receive something of value in exchange for their support—special access, tax breaks, parking or other privileges. But the number one reason people give is quite simple: because they are asked. There are several things that need to be aligned to ensure that everyone is “prepared” for a gift solicitation to take place. First, you need to find the right prospect. This is someone who has a relationship with or an interest in your institution as well as the inclination and capacity to make a gift. You also need to determine the right time. Maybe it’s been a year since the prospect’s last gift, it's a reunion year for the prospect’s class, or maybe your institution is marking a special occasion like the anniversary of its founding. And then, you need to figure out the right amount to ask for. If you’ve done your homework, you should have a good sense of this number. As a general rule, it’s important to aim high while considering the individual prospect’s past giving and capacity. Whether you’re a professional gift officer, a phonathon caller or a volunteer, keep in mind the following five guidelines the next time you solicit a prospect for money: Little yeses can lead to big yeses. Warm up your prospective donors by asking them simple questions about themselves framed in a positive way. Be specific, confident, and precise. Always ask for a specific amount. Avoid casual second attempts that start out like, “Well, then, how about…” Set the bar high. If at first, you don’t succeed, you can always try again with a smaller amount. But once they say yes, you can’t ask for more. Be ready ...

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