Major gift fundraising should be an integral part of any nonprofit’s fundraising strategy as approximately 88% of nonprofit funds come from just the top 12% of donors. Another reason to focus on major gift fundraising is because the nonprofit sector trends show that the number of small and medium gifts is dropping.
That’s why we’ve put together this guide to help you kickstart your major gift fundraising strategy. Here at Bloomerang, we’ve helped thousands of nonprofits implement the technology they need to identify, cultivate, and steward major supporters. This article will cover several key aspects of effective major gift programs:
- What are major gifts?
- Why are major gifts important?
- How to find major donors
- Major gift cultivation
- Creating a major gift solicitation strategy
- Thanking major donors
- Accessing major gift results
- Next steps to get started
You’ve probably gathered that your major donations are the largest gifts made to your organization, but let’s dive into a more specific definition to make sure we’re on the same page about these key donations.
What are major gifts?
In short, major gifts are your most significant donations. The exact donation amount that you consider to be a major gift will depend on the average donation amount your organization receives.
For example, while some larger organizations may consider major donations to be donations of $100,000 or more, smaller nonprofits might consider $2,000 donations to be major gifts.
Consider the largest donations your organization receives. These donations are considered major gifts and may make up the majority of your funding.
Why are major gifts important?
In 2017, people gave $410 billion to philanthropic organizations. Almost half of those donations (49%) came from the top one percent of donors. More recently, according to the Fundraising Effectiveness Project’s 2020 Q3 report, we’ve seen the COVID-19 pandemic’s impact on individual donations, with the number of major donors (measured by those giving over $1,000) increasing by 6.9%. As you can see, this means your major gift program has a lot of potential.
When it comes to capturing major gifts, your organization should develop a major gift program that will help you build relationships with your supporters and prospects. To start that process, you’ll need to find major donor prospects.
How to find major gift prospects
A donor will rarely make a major donation out of the blue. Therefore, one of the best ways to encourage donors to make major gifts is by building relationships with supporters and focusing on donor retention and stewardship strategies.
When you retain your donors, you’re securing future donations. Over time, you should build deeper relationships with those supporters so that they become more invested in your mission and consider increasing their contributions and becoming major donors.
The first place you should look for prospective major donors is your donor database because your database can provide data points that allow you to identify major prospects.
Generally, donors with a history of giving, high engagement with your organization, and a high generosity score (capacity for donating) will be the best major gift candidates.
We’ve heard fundraisers say, “Our organization can’t do major gift fundraising. We’ve tried in the past, and it’s never worked.”
Usually, the problem is that these organizations have been trying to engage with lukewarm or cold prospects. That’s why it’s important to approach the right donors at the right time. Here’s how to identify the best major gift prospects.
When you start searching your donor database for potential major donors, you’ll want to look at the three C’s of major prospects: the depth of their connection to your nonprofit, the concern they have demonstrated for your mission, and anything you know about their capacity to give.
Let’s review some specific identification factors to look for in a compelling prospect. In order of importance, these include:
- Donors who gave 90% of your funds over the last 12-24 months
- Donors who rank highly on “major gift likelihood” or “planned gift likelihood” in donor prospecting software
- Donors who’ve made multiple gifts over the course of a year
- Donors who’ve already demonstrated loyalty by giving each year
- Prospects rated highly (based on connection, concern, and capacity) by volunteer-conducted peer screenings
- Current and former board members
- Current and former staff members
- Committee members
- Beneficiaries (i.e., clients, members, subscribers, students, patients, program attendees, ticket purchasers)
- Families of beneficiaries
Once you’ve identified these prospects in your donor database, move them through your major gifts pipeline. If you find yourself with too many prospects for limited staff members to build relationships with them all, you could organize prospects into tiers based on each prospect’s overall likelihood to become a major donor to make prioritizing donors easier.
On the other hand, if you don’t have a lot of prospects, figure out how to find more options both within and outside your existing records. As you expand your major prospect list, ask your current major donors if they have any referrals. This not only helps grow your list of prospective donors but also shows the strength of your relationship with the referring donor.
Prioritize potential prospects
While you care about each and every one of your donors, you probably don’t have the resources to reach out to all of them individually in the hopes of earning a major gift. That’s why it’s important to use a strategy like the Pareto Rule, which advises putting 80% of your resources into cultivating the top 20% of prospective donors who are likely to give you 80% of your funding.
When you first reach out to supporters and donors, ask them if they want to build a deeper relationship with your organization. Donors who say they do want a deeper relationship will be possible prospects. Then, consider other qualifications such as if they’ve made past donations that are larger than your average gift amount, if a major donor or board member referred them to your organization, or if they’ve otherwise demonstrated a passion for your mission.
If you’re looking inside your donor database for major donor prospects, take the following steps to understand which supporters to prioritize in your outreach efforts:
- Do a wealth screening to determine which prospects you might want to conduct more research about. Prospect research software like DonorSearch or WealthEngine provides tools that will automate analyzing wealth information for each prospect. You can also take the DIY approach and analyze Zillow, real estate records, Google searches, and other public records to get an idea of your donors’ wealth capacity.
- Look at each supporter’s giving history and identify trends. Who is giving year after year or multiple times per year? The longer and richer the history of giving with your organization, the higher on your prioritization list these supporters will likely fall.
- Consider your mid-level donors who haven’t changed their giving level in some time. Many of these supporters could quickly become your next major donors.
- Review your planned giving donors to see if you should ask them for a major gift right now in addition to the one they’re planning to give.
While you’re most likely to find your major prospects within your database, don’t discount new supporters’ potential to become major donors. If you need to acquire new supporters and prospects, sit down with board members and stakeholders to see if they have any new donor referrals.
Qualify your prospects
The qualification process is all about getting to know your prospects and building a deeper relationship with them.
In the for-profit world, it takes an average of eight touchpoints with a person in order to make a sale. In the nonprofit world, we can expect something similar, which is why we recommend trying to reach out to a potential donor eight times to get a conversation. If you make an effort, reach out eight times, and your prospect doesn’t respond, move on to other donors who might.
These seven steps will likely look something like this:
- Start by sending an introductory letter.
- Follow up with a phone call, thanking them for past engagement and discussing what they love about your mission.
- Leave a message if you don’t reach them.
- Send a follow-up email.
- Write them a letter to show further appreciation for their support and invite them to have another conversation.
- Send a survey if you don’t hear back.
- Follow up on a different marketing channel.
- Make one last phone call.
You likely don’t have time or energy to chase every one of your major prospects. Qualifying them is a great way to make sure they’re interested in maintaining a relationship with you and your organization before you launch into the rest of the gift cultivation process.
Major gift cultivation
Start the cultivation process by developing a concrete case for support that you can share with donors. Donors don’t give to your organization; they give to support your mission. In fact, 42% of donors said that hearing personal stories from a nonprofit’s beneficiaries impacted their decision to give. Explaining why you need their support and how they’ll make an impact is key for obtaining gifts.
Start by creating opportunities that allow you to get to know your supporters on an intimate level. For instance, you might decide to create opportunities such as:
- Hosting intimate and exclusive events, allowing your major gift officer and support staff to mingle and interact with several supporters personally.
- Communicating regularly through email and social media. Ensuring a constant presence on these platforms will help you establish your brand, provide mission updates, and show prospects that you’re actively engaging with your community.
- Asking for help and opinions about various strategies at your organization. By showing your prospects and stakeholders that you care about their opinions, you’ll be able to establish a trusting relationship with them.
- Setting up face-to-face meetings during which your supporters can get to know your team members and ask questions about your mission.
- Inviting prospects to volunteer so that they can see your mission in action and know exactly how your organization operates and creates the most significant impact possible.
As you use these opportunities to build your relationships with your major donors, you’ll want to gather some specific information about them, including:
- Why they gave to your organization rather than to a different nonprofit
- What their connection is to your cause. For example, they may have had a family member impacted by an issue that your mission addresses or perhaps they themselves benefitted from your programs
- What their favorite projects and programs are
- How they feel about your organization and their impressions of your cause
Track each interaction you have with your supporters and prospects in your CRM to understand how far along in the cultivation process each prospect is and how the relationship is evolving.
Create a Major Gift Solicitation Strategy
So, you’ve started building relationships and cultivating prospects. Cultivate by definition means that you’re leading up to something—and that something is a solicitation. In this case, you’re leading up to making the ask for a major contribution.
There are two primary parts of a solicitation to keep in mind: the meeting setting and the language you use to ask for a donation.
The meeting setting
When scheduling a meeting with donors, ask if they have a preference as to whether they’d like to meet virtually or in person.
Virtual meetings are convenient for many individuals with tight schedules and allow organizations to reach donors who don’t live nearby. However, they leave something to be desired as they don’t allow for the same level of personal interaction as the in-person alternative.
When you schedule meetings with prospective major donors, make sure to choose an environment ready for intimate conversation. It’s ideal for these meetings to occur in quiet spaces such as a home or office rather than a public setting, allowing for additional privacy and fewer distractions for both parties.
Generally, it’s best to keep the number of attendees for these meetings small. You don’t want your prospect to feel as though they’re being ganged up on by your team. Your executive director, major gift officer, or another team member with whom they’ve developed a relationship are the best choices for the meeting’s importance and personal nature.
Language to ask for a major gift
If you feel uncomfortable asking prospects for major donations, you’re not alone. We often hear from fundraisers that they feel awkward making such an ask. The good news is that you’re reaching out to people you’ve researched and who you’ve found are likely interested in helping your mission in such a way. We hope you take some comfort in the fact that you’re making an informed ask.
When it comes to making your ask, the first step is to show appreciation for the prospect’s past contributions. As we said before, it’s unlikely that this person is brand new to your organization and your mission. They’ve gotten involved in several other ways, whether through donations, volunteer work, or event attendance. Tell them about the impact they’ve made and how much you appreciate their support.
Then, when you make the ask, you should frame it as something for them to consider and provide a specific amount. You should also include the specific program that would benefit from the gift. For instance, you might say something like:
“Would you consider contributing a gift of $5,000 for the Save-the-Farm program?”
In the best-case scenario, they agree right away. However, you should go into the meeting prepared for them to say no—whether that’s because they don’t have those funds on hand or because they’re not interested in contributing more at this time. If your prospect says no, decide—based on how they respond—if it’s appropriate to ask for a smaller gift at that time or if you should just resolve to make another ask in the future.
Remember two hidden major gift opportunities.
When creating your major gift strategy, keep in mind these two opportunities and present them as options for your prospects. These opportunities are:
- Naming the nonprofit as the beneficiary of their IRA or other retirement or financial plan
- Naming the nonprofit in their will
Here’s how you can go about starting the process of preparing your team to seek out these types of gifts:
- Inviting an estate planning attorney or financial planning professional to join your board or committee so they can assist in advising your nonprofit on how to make these asks
- Working with them to prepare your team to make the asks and to answer a prospect’s questions
- Asking your board members to make one of these gifts in order to gain experience with these giving methods and allowing you to use them as a reference for donor solicitations
- Creating downloadable PDFs or other assets explaining both types of gifts to show donors how the process works and how the gifts would help you carry out your mission
- Introducing both options to donors—those who gift smaller, mid-tier, and major gifts—who have given three or more years consecutively and to those who have given five or more times to your organization
- Creating a stewardship plan to recognize those who participate for either option
Thanking your major donors
After you solicit and secure a major gift, you need to follow up and thank your donor for their generosity. Stewardship starts with two simple words: thank you. Show your appreciation for everything your major donors do for your organization and give concrete examples of how you used their donations to help you achieve your mission. This helps cement the relationship you’ve built with them and encourages future involvement with your organization.
Here are a few things you can do to thank your major donors:
- Creating a donor recognition wall. Donor recognition walls provide a visual sign of appreciation for your major supporters. With their permission, you can add their name to a physical or virtual board that highlights their support for your organization.
- Making phone calls. We recommend calling all of your donors, not just your major donors. It’s a great stewardship opportunity to build relationships with all supporters.
- Hosting appreciation events. Invite your major donors to an appreciation event where they can mingle with one another and with your team members. This allows you to say a collective “thank you” to your supporters while also developing relationships with them.
- Sending handwritten letters. Sending handwritten letters is a thoughtful way to show your appreciation. Ask someone on your team like your major gift officer or executive director to write and sign these letters so the donors know that you took the time to thank them personally.
Ideally, you will use several of these strategies to show appreciation. If you successfully steward your donors, you’ll likely receive additional financial support from them in the future.
Assessing major gift results
Once you’ve set up a major gift program, you should assess the results to determine how well the program works and identify opportunities for improvement. When you set up the program, use your CRM to develop a report template to measure your program’s impact.
This report should list out metrics such as:
- Program ROI
- Retention rate
- Number of gifts secured
- Average donation size
- Average giving capacity
- Number of asks
By reviewing these metrics, you can identify opportunities to continue improving your major gift program. For example, if your retention rate for your major gift program is low, you might consider revamping your major donor stewardship and appreciation program.
You should also see specific trends in these numbers over time. For instance, your average donation size and giving capacity will likely increase as your nonprofit grows. If it doesn’t, then consider conducting additional prospect research or increasing your ask amounts.
Next steps to get started soliciting major gifts
Soliciting major gifts should be a part of your nonprofit’s fundraising strategy. If you’re ready to start making these asks, here are some next steps to take:
- Discuss creating a major gifts program with your nonprofit’s leadership team. Make a case for starting the program and make sure everyone is on the same page about its importance.
- Determine which team member will lead the program.
- Define what major gifts look like for your organization.
- Determine major prospects with the capacity to give in the range identified. Look first at your donor database, then start doing prospect research in the community.
- Create a cultivation strategy to start building relationships with your prospects.
- Build a solicitation strategy to guide the conversation for each of your prospects. Then, schedule meetings with them to make the asks.
- Steward your donors after they’ve contributed to your organization to continue building relationships with them and to set yourself up for future donations.
- Assess the results of your major gift program and look for opportunities to improve and build even stronger relationships.
If you’re looking for additional resources about soliciting major gifts, check out the articles below.
- The Ultimate Guide to Nonprofit Strategic Planning. Learn more about how major gifts will fit into your nonprofit’s large-scale strategic and development plans.
- Nonprofit CRM: The Buyer’s Guide + Solutions for Success. Major donor relationships are built on data and your CRM is where you store this information. Check out this buyer’s guide.
- Buying Fundraising Software: 6 Important Factors to Consider. Software will help you raise funds at all levels. Make sure you have the best solutions to back up your strategy.
- 30 Easy ‘Get the Visit’ Major Gift Strategies. Check out our free eBook for more information about how your organization can build relationships with major prospects.