Dollars from Donors: Strategies for Turning up the Heat on your Individual Donor Program

1. Dollars from Donors: Strategies for Turning up the Heat on your Individual Donor Program April 2015

2. Today’s Learning Objectives • Today, we’ll explore: • Donor-centered philanthropy • Strategies for “extracting” money from donors: appeals, major donor work (including planned giving), & events • Prospect research & planning • The Art of the Ask • Stewardship

3. The Top 3 Reasons Nonprofits Struggle to Make Ends Meet

4. 1) Failure to invest in fundraising I have yet to encounter a nonprofit that has a large enough development staff to adequately perform all the functions that are necessary to maximize the organization’s fundraising potential. Many of these organizations need to raise more money, yet they are reluctant to spend any money to do so. Somehow, they expect their existing staff – who are already overwhelmed – to “magic” more money out of the air. Hmmm….

5. 2) Failure to Engage the Board I’ve only met a handful of executive directors who are happy with the role their board of directors plays in fundraising. Boards are comprised of volunteers, who may or may not work in the nonprofit sector, and often do not have experience, skills or expertise in fundraising. Would we ask our board to go out and be volunteer dentists? Yet we ask our board to engage in fundraising without proper education, training and support.

6. 3) Failure to Engage our Community Your donors, volunteers, and other members of your community have a bevvy of gifts they bring to the table, yet we often fail to identify and leverage them. The work we do does not always need to be done by the staff – often, we can expand our scope and reach by tapping the skills of people who care about our organization. All we need to do is ask!

7. Individual Giving: Donor-centered philanthropy, donor motivations and the Giving Ladder… and more!

8. Individual Giving • 80% of the philanthropic dollars given away come from INDIVIDUALS. 85% earn $50,000 or less/year! • Unrestricted dollars give you the freedom you need to fill the gap in your program funding. • Individual donor work is akin to dating – it requires time, energy & commitment.

9. Donor-centered Philanthropy • In order to maximize the number of dollars you raise from donors, you need to create a culture of philanthropy. • This means providing your donors with information on a regular basis & in a timely manner & with multiple opportunities to deepen their relationship with the organization.

10. Donor Motivations • What motivates a donor to give? • Passion about a cause or issue • They want to “do good” in their community • A sense of obligation • They were taught to

11. Donor Motivations (2) • The top 2 reasons donors give? 1. They were asked! 2. Your mission is in alignment with their vision of how they want the world to be. Ergo, you have something they want!

12. The Truth: People Act out of Self-Interest AGENCIES DO NOT HAVE NEEDS. Your clients have needs. Your donors have needs. Your agency is simply the vehicle through which donors are able to contribute to a cause they care about. Your job is to continually connect the dots for them!

13. Strategies for Getting Dollars from Donors • Appeals • Solicitation • Major or Capital donor work • Planned giving – also called estate planning because 95% of all planned gifts are bequests • Events

14. The Giving Cycle RENEWAL IDENTIFICATION STEWARDSHIP RESEARCH SOLICITATION PLANNING CULTIVATION

15. The Giving Ladder Estate Planning Cultivation & Stewardship Capital Gift Major Gift Significant Gift Habitual Donor Donor

16. Appeals • An appeal is a device that solicits a gift from an individual, business or group. It can take the form of a letter, video, email, card...the format’s only limited by your imagination! • Send more than one/year • Donor segmentation & the ask • Hard vs. soft asks

17. Solicitation • Asking your high-end donors face-to-face for a major or capital or planned gift • These need to be made by the board, not the staff. The staff person might be in attendance at the meeting, but it’s the board member’s job to ask for the money. • Staff does the prep, board makes the ask.

18. Major or Capital Gifts • A major gift is sometimes a capital gift and vice-versa. • Unless you work @ a university, these gifts need to be solicited by a board member or other donor for a specific project or initiative (building reno, scholarship fund, endowment, etc.)

19. Planned Giving • Just like it sounds, it’s a gift that’s planned in advance. It’s usually a sizable chunk of change; it can be property, a % of an annuity, life insurance policy, stock, cash, etc. However, ANYONE can leave a gift of ANY size to a charity in their will. • There are a ton of planning vehicles, but since 95% of these gifts are bequests, the only thing you have to figure out is how to talk to your donors about death & money!

20. Events • We’ve all been to our share of special events. Some of them are great. Others, not so much… • Events are the lowest ROI because of the enormous amount of time they take to plan & the up-front costs required. It’s best to use them primarily as “friend-raisers” that bring in some $$.

21. Successful Solicitation • Giving begins at home. Is your 100% of your board supporting your organization? Your agency should be among their top 3 philanthropic causes. If not, the it’s time to rethink their tenure! • State your case. Tell the donor why you’re there, the purpose of the project, what impact it will have, how you intend to finance it, and what you’re hoping they will contribute.

22. Successful Solicitation (2) • Listen – to both their words & the “music.” Body language & facial expressions often tell you more than words. • Ask for the gift. Yes, name a specific amount! Then sit back & wait for their response. • Say (and mean!) thank you. Even if they give you less than you’d hoped or turn you down, they still gave you some of their valuable time & their consideration.

23. The Art of the Ask I’m going to let you in on a HUGE secret: PHILANTHROPY IS A HEART-CENTERED ACTIVITY!

24. The Art of the Ask (2) No matter which strategy you pick, you’re going to have to ask people for money. How does one do that?! Start by touching your own heart. Why did you get into this business? Why do you put in long hours for far less than you’d make at a for-profit?

25. The Art of the Ask (3) Do this with your board.Have them close their eyes. Ask them: Why do you give up your precious time to be on the board? Why this agency vs. another? What do they hope to contribute by volunteering? Have them write down their answers.

26. The Art of the Ask (4) Then do this with your donors. Ask them to get in touch with their hearts; to share their deepest hopes with you. Then connect the dots between their hopes & the people you serve, focusing on the difference you’re making in your clients’ lives. Remember – donors have needs. You are not ASKING people to support your mission, you are LETTING them.

27. Donor Loyalty & Retention • You can lose as much as 30% of your donor base each year. Why? Because we are not very good @ stewardship. • We need to treat every $$ like it’s precious – because it is! • It’s far easier to keep a donor than to find a new one. Effective stewardship & cultivation techniques prevent your donors from drifting off.

28. Stewardship • Donors prefer information to recognition. However, you can still deliver information with a person touch – use hand-written notes, photos, etc. to stay in touch. • Provide them with extraordinary experiences! If their gift is helping support your after school program, invite them in for a visit. If their donation is supporting your orchestra, invite them to a rehearsal. Get creative & get them in the door!

29. Stewardship (2) • Donor are not ATM machines! Do not just move on to the next gift. Be sure to provide them with a timely – and heart-felt! – thank you, preferably written by hand. For larger gifts, someone in your organization should be picking up the phone! • Word-of-mouth is a potent marketing technique. The last thing you want your donors telling their family, friends & co-workers is how badly they’ve been treated by a charity they’ve supported! Today’s donors are feeling used & “handled.” How are YOUR donors feeling?

30. Stewardship (3) • Transparency is important to donors, as are ethics. • Boost donor confidence by sharing your financials openly. They don’t need to know every last detail, but it helps when they know that their donation’s being spent wisely. • If you’re not already publishing an annual report, now’s the time to start!

31. Vehicles Through Which to Promote Stewardship • Communication: newsletters, e-newsletters, email blasts, Facebook posts, Twitter feed, special donor communiques • Annual reports • Videos, photos • Letters, case studies or testimonials from your clients, or other donors • Special, intimate, exclusive events • Anything else you can dream up!

32. What We Covered • The real reasons nonprofits struggle to make ends meet • Donor-centered philanthropy • Various strategies for getting dollars from donors • Prospect research & planning • The Art of the Ask • Stewardship

33. Closing Thoughts Remember that growth is uneven. Take it one step at a time. Pick one strategy you want to implement & play with it. See how it goes. Then try another. If you have questions, get in touch -- I’m here to support you & help you succeed!

34. Contact Information Sarah Lange Principal & Founder 5 Edgewood Street Worcester, MA 01602 Phone : 508.733.5114 sarah@newera4nonprofits.com www.newera4nonprofits.com The material contained within these pages is propriety. While I am happy to have you share this with people at your organization, I ask that you not reproduce or disseminate it to others without my express written permission. Thanks for respecting my intellectual property!