Claire Axelrad, J.D., CFRE recently joined us for a webinar in which she showed how to achieve a goal-oriented strategic donor stewardship strategy – one that incorporates tried-and-true relationship-building principles.

In case you missed it, you can watch the replay here:

Full Transcript:

Steven: Thanks for being here for today’s webinar, How to Keep Donors Happier Longer: Using Strategic Stewardship to Get More and Bigger Gifts. We all want to do that, right? Of course. My name is Steven Shattuck, and I’m the VP of marketing here at Bloomerang. I’ll be moderating today’s discussion.

Just before we get started, just a couple of housekeeping items. I want to let everyone know that we are recording this presentation. We’ll be sending out that recording later on this afternoon as well as the slides, just in case you didn’t get the slides earlier today. If you have to leave early or if you perhaps want to review the content or share it with someone on your staff or someone that you know, you’ll be able to do that. Don’t worry. Don’t fret at all. We will get that recording via email later on this afternoon.

As you’re listening today please feel free to send in any questions or comments. Right there on that chat box that a lot of you have already been using, that’s great. We love questions. We’re going to try to save some time for Q and A at the end. If not, we’ll definitely capture all those great questions and comments and try to get back to you as good as we can. Don’t be shy about using that at all.

You can follow along today on Twitter with #Bloomerang. Our username is @BloomerangTech. If you’re listening today via the computer, if you have any issues with audio, it’s usually a little bit better by phone. If you can, call in by phone. If that’s something you can do and you don’t mind doing, the audio quality is usually a little bit better. Just look at that ReadyTalk email from earlier today. There should be a dedicated phone number there for you.

Just in case this is your first webinar with us, I just want to say a special welcome. If you’re new to us and Bloomerang, a little bit about Bloomerang. We are a nonprofit donor database provider. If that’s a piece of software that maybe you’re interested in or just want to learn more about us, you can do that. Check out our website. You can even download a quick video demo. You don’t even have to talk to a salesperson if you don’t want to. We’d love to talk to you later on about that if you’re interested.

I want to go ahead and introduce today’s guest. I’m so excited. I was telling Claire earlier when we were talking that this is Claire’s third webinar. She is the most requested repeat guest. We just had to have her back. Claire Axelrad, how’s it going? Thanks for being here.

Claire: Oh thank you, Steven. Are you ready for me to talk?

Steven: I just want to brag on you really quickly. I want you to get to all the good stuff. Just in case you guys don’t know Claire . . . you maybe know Claire. She’s awesome. She’s got 30 years of front line development experience. She’s helped organizations raise millions of dollars throughout her career. You can see she’s a CFRE. She actually teaches some of the CFRE courses to get that certification.

She is a frequent webinar presenter, a frequent contributor to nonprofit publications, speaks at lots of conferences. If you ever see her on a conference agenda, please do attend her session. You’re really going to enjoy what we has to say today. She’s kind of my go-to person for the donor stewardship piece. Claire, I’m going to pipe down. I’ve talked too much already. I’m going to turn things over to you. Why don’t you get us started, my friend?

Claire: Okay. Well, thank you all for being here today. I want to congratulate you for taking the time to learn how to do a better job of keeping your supporters and turning them not just into habitual givers who are just checking you off their list every year for $15, but having them become thoughtful, even passionate givers who make more and bigger gifts in response to your strategic stewardship. In our hour together I want to cover a lot of material. Type your questions in the chat box. We may get to some. I will take as many as we have time for. I’m also happy to answer any we don’t get to after we conclude our session today. Feel free to email me.

Dr. Adrian Sargeant, who is a donor retention guru, has done the research that shows that nonprofits can increase the lifetime value of their current donor base if they can just increase retention by 10%. It’s not that hard, but it won’t happen without your commitment and a plan to do this. I want to launch the first poll right now just to see where your organization is most committed in your work currently. Steven?

Steven: It’s on the screen. Don’t be afraid to click that bubble. Interesting answers, Claire.

Claire: Just tell me when you got the answers, because I can’t see.

Steven: It looks like a vast majority of people are saying they are equal in priority, which is interesting. Thirty-nine percent equal, about 32% donor retention, 12% acquisition, and about 15% don’t prioritize. Equal in priority is the winner right now, Claire.

Claire: Okay. That’s really good, actually. Since I first started talking on this subject, a lot more people were prioritizing acquisition. You really do want to prioritize the low hanging fruit. Of course, I’m not suggesting that you shouldn’t ever get out the ladder, go up there, and maybe even plant more trees. If you’re new nonprofit, you definitely need to do this. If you’re at all established you could probably survive for years just picking from what you’ve already got easily at hand, in your own backyard, or in your own database.

The reason I’m spending all this time talking to you about retention is that when I used to work in the trenches, I knew that retention was important, but I never fully grasped how important it was. I didn’t really focus on it. We didn’t have the research that’s available to us now that helps us to benchmark how your retention rates compare to others. I want you to be able to look at that and persuade your powers that be to prioritize what I call the easy money.

Let’s take a look at what’s not the easy money. If you just focus on the new money coming in it can really blind you to the bottom line and make you think you’re doing better than you actually are. Here’s Mary, the annual giving director, saying, “We got 100 new donors last year. We’re raising lots more money.” Then Sam the database manager says, “Open your eyes, Mary. One-hundred and three donors lapsed. That’s negative 3% growth. For every $100 we raised, $95 was lost through attrition. That’s hardly lots of money.” Two perspectives, flip sides of the same coin showing you can’t just look at what’s going in because if you do, you’ve got very warped vision.

Sadly, these are actual average donor retention rates from the 2015 Fundraising Effectiveness Project. Pretty dismal, but you can change them. We’re going to look at some ways to do that today. Here are today’s takeaways. I’m not going to read them. I know you can read and you’re going to get all these slides afterwards.

I want to begin with flipping your leadership’s perspective by revealing to them what’s going on, the big picture, not just how much you raise but how much you lose. If you don’t know that you’ve got a problem, you’re unlikely to tackle it. Let’s face the problem head on and figure out the extent of your problem so you can admit to it.

On average, nonprofits today are losing 81% of donors after the first gift. That’s why focusing primarily on acquisition is such a mistake. It means that you’re keeping only 19% of those first-time donors. Your bucket is a fifth full. All the rest have leaked right out. Of your ongoing donors, you’re keeping just 63%. Your bucket is a little more than half full. Overall, all of your donors, you’re just keeping 43%, 4 out of 10. This compares to for-profit businesses who keep 9 out of 10 of their customers.

Why is there this disparity? Businesses know and have known for years that it’s most cost effective to focus on customer service. It costs a lot more to secure a new customer than to retain an old one. Somehow nonprofits haven’t fully grasped the same holds true with donors and that these one-time transactions don’t get you very far. You need to build a business model that moves your organization steadily forward, not two steps forward, three steps back.

Here’s what I mean. Say you brought in a thousand new donors. That sounds good. If you look at the retention rate, 19%, this is going to shrink to 190 donors this year, and to 120 the next because you’re only retaining 63% of those, and then to 75 the next year, and 48 the next year. After just five years, you’ve got only 30 folks left. That’s just 3% of what you began with.

I’m going to ask you if you know your retention rate. You can see more of the national benchmarks if you go to the Fundraising Effectives Project fitness test. I’ve got the URL up on the screen here: They’ve got a fitness test you can download so you can kind of see how your rates stack up. I want to look at the Fundraising Effectiveness Project results another way.

Courtesy of an infographic by Bloomerang, you can look at the lower right and see that organizations who are raising $500,000 or more a year are doing better, showing some decent growth in giving. They could still do better. Many of them still are experiencing the losses depicted in the other three quadrants, the ones we’ve already discussed. You can see that those that raised $100,000 to $500,000 or under $100,000 are not doing so great.

If you see your growth pattern here, I have little doubt that you could still do better. Remember, for-profit business do it all the time. They have 94% median customer retention versus our 43% donor retention. Let’s see why they beat the pants off of us.

They’ve got their head in the right game. They develop and implement focused customer retention plans. Their mantra is the customer is always right. How often do you say the donor is always right? If you do, great. I congratulate. More often I hear people complaining about what their donors should be doing, that they should be giving more, that they should be giving unrestricted gifts, that they should just be giving because it’s the right thing to do. They shouldn’t be making us work so hard.

The reality is there is a ton of competition for donor dollars. If you don’t do the work, something intentional to assure your donor’s loyalty, they’re not going to stick with you. They’re going to go someplace else that is doing the work. That’s why you need to start measuring your retention rates because what gets measured gets improved. The greatest losses in gift dollars are coming from lapsed donors (those are the ones in purples), repeat donors (those are the ones in peach), and downgraded donors (those are the ones in light blue).

I am focusing today on how you can keep your donors happier precisely so they won’t lapse and they won’t downgrade. If you engage in what I’m calling goal-oriented stewardship, not just random stuff that you do every now and then but having a well thought out relationship building plan with specific strategies that are tied to what drives donor loyalty, and channeling more gratitude across the board, organization wide, what’s often called a culture of philanthropy, then you’re actually going to upgrade your supporters and get additional gifts from the same supports and thereby raise more money.

There are lots and lots of things you can do to retain more donors and upgrade more donors. Let’s begin with the big picture. There’s been a lot of research done by Adrian Sargeant and also by Roger Craver, who is another fundraising heavyweight, and also by the United Kingdom Roger Relationship Fundraising Review. I was a panelist for that. I have taken the top 34 drivers that have come out of all of that research and distilled it down to the top seven key drivers of donor commitment. All of these are within your control.

We’re going to cover how to apply them consciously to your stewardship so you can raise more money and keep more donors. In brief, they are trust. This creates a functional, satisfaction based connection to you, which is the heart of all good relationships, trust. Your single biggest tool to engender trust is thank you so they know their gift was received and it’s going to be put to work. It’s really appreciated. We’ll talk about it more.

The rest are all relationship building connection. They’re all part of the wooing strategy that is essential to all relationships. One is a personal link to you. You have to create these, whether it’s a phone call, or an invitation to coffee, or asking for their advice and feedback. Your performance in accomplishing your mission, you need to give the donor a feeling that they’re part of an important cause, having important impact.

Your choice and the quality of your communication, they have to be donor centered, which is a subject into itself. Penelope Burk’s research in donor centered fundraising, it sort of boils down to the donors saying, “Show me that you know me.” If somebody is supporting your children’s services program, don’t send them a menu for the senior nutrition program. Be useful to them. Always be helping them, not always selling them.

Offering a tangible link to your beneficiary, to the people that your donor’s gift is helping. These are strategies like bringing people on a site visit, a tour, a video, a client presentation. Seeing is believing. Multiple engagements, you have to be in touch multiple times with multiple contacts because it’s the only way you’re going to stay top of mind. Shared belief, this is where you’re making a value match. You’re creating this value for value exchange between your donor giving and what you give back to them.

At the end of today I want you to evaluate your fundraising plan and see, do your strategies incorporate these seven drivers? Let’s begin with the first one, trust. It’s the easiest one to accomplish and it kick starts the relationship and sets up your next gift.

Your gratitude has to be meaningful, not perfunctory. You have to think of the first gift as your opportunity to get the next. Most first gifts are impulse, or they’re like first dates. Think about it. If you have a good first date, what’s the first thing that you do? You start thinking about what you’re going to do to get the next one. It turns out for donations that the first 90 days is critical. If the donor doesn’t hear from you a few times in that time period, you might as well forget that you ever met.

The thank-you process, if you do it well, gives you multiple opportunities to deliver on your promises. You promise. You say, “Yeah, we got the gift. We put it to work.” You’re showing that you follow through. You’re showing you’re efficient. You’re showing you have manners. You’re showing that you’re trustworthy. You’re making your donors really happy. Penelope Burk found in her research, donor centered fundraising, that there are three things that donors want above all else. They don’t want a plaque. They don’t want a fancy gala invitation.

They want a prompt thank-you. Donor etiquette is not wedding etiquette. You don’t have a whole year to get your thank-you out. You’ve got 48 hours. Donors repeatedly report they want these timely thank-yous. If you’re really slow acknowledging them, it makes you feel like, is this how you run the rest of your business? Plus, promptness is not just a nicety. The most important predictor of likelihood to give again is recency, when you made your last gift. If it takes you a month to process a gift, you’re missing out on people most likely to give again, period.

They want it to be personal. They want you to show them you know them. Show them that they really matter more than they even thought that they did. They want to see the impact. They want you to paint a picture of how the gift is going to be put to use. They want to know it’s going to be put to use the way they want it to be. The three miracle strategies for thank-you are the donor centered thank-you letter, the donor centered welcome kit, and a phone call. We can’t get into them in great detail, but let’s take a broad brush look at each one.

The donor centered thank-you letter, it’s got to make your donor feel good. If the number one reason that folks don’t give is because they aren’t asked, the number one reason they don’t give again is because you didn’t make nice. What is in it, the content? A catchy opening. You remembered because they couldn’t. Thanks for responding to our request for the Dementia Center. Jimmy will go to sleep with a full tummy tonight because you cared. Not, “On behalf of the board and staff of the blah blah blah organization, we thank you for your $25 gift.” It’s just boring.

Also, when you think content, think stories to show the impact. Stories capture people’s hearts. They’re drawn into them. They can be super brief. Mary will be safe from now on because she’ll have help at home. People can now just picture their gift helping Mary in a specific way. Think of the donor’s perspective. They’re always thinking, “What’s in this for me?” One, they can trust you. That’s good. Let’s say you send in your thank-you letter, then in two weeks you’re going to send a welcome package. Then you follow through with that. Or, in two weeks someone will contact them to see if they’d like to come on a tour. Then you follow through with that.

They’re starting to trust you more and more. You’re delivering. That’s a goal of yours, for donors to know what to expect from you, and then to get it consistently. This makes them happy. Forget about using the thank-you letter to puff yourself up, or to make your ED or board members feel good. Invite their involvement. Would you like to join us next week for a tour? Anytime you need help, call Jeff. Jeff is your person here. Yes, the welcome package is included. Give them a personal connection. It makes them feel special. They don’t have to just call the main receptionist line.

Then some insert that shows them how much they matter. Give them a connection to the people. My favorite insert (I’ve got quotes around that) is not even an insert. It’s just on the flip side of the one-page letter, you’ve got some testimonials from people who were helped. You put a PS on the letter saying, “Please see the words of some of the clients who were helped because of your giving. They express more eloquently than can I how much your support means.”

The donor centered welcome kit. For new donors it’s really good to send a welcome kit. There are two different kinds of welcome kits. The one that too many nonprofits send is the “we’re so great”. It’s just a box was delivered on the donor’s doorstep, no person there. It’s a very generic “dear friend” letter in there. There are some brochures, old newsletters, a glossy annual report, maybe a bumper sticker for the car they don’t own, some invitation to a fundraiser they have to pay for. It’s very impersonal, very boring.

You want your welcome package to be the equivalent of a person hand delivering a basket of muffins. It’s very warm. It’s inviting. It’s tasty. Maybe you put in some useful stuff instead of brochures, like 10 ways to childproof your home, or 7 ways to recycle, or rainy day crafts for kids depending on what your organization’s mission is. It’s a nice surprise. It makes the donor feel good about their new situation as a member of your organization’s family.

You don’t want to spend a lot on this. If you do, they’ll get annoyed that you spent that money. By the way, it doesn’t matter if you got it underwritten. The perception is if it looks expense, you did spend too much money. If you want to look at some token gifts that you can put into welcome packages, go to my board on Pinterest. Just google Clairification Pinterest, and I have a board, Nonprofits Say Thanks. That’s the philosophy of the welcome kit.

Then there’s the donor centered thank-you call. If you can manage to work calls into your plan, do it. Penelope Burk’s research shows that 95% of donors said they would appreciate a thank-you call within a day or two of the gift. Eight-five percent said the call would influence them to give again. Eighty-four percent said they would definitely or probably increase their gift. Those are remarkably high percentages.

If you can’t call everybody, at least try to call a subset. I would always call new $100-plus donors. Anybody that gives $100 for a first time gift I’d consider as gold. What Penelope Burk did in her study is she had board members call donors within 45 hours and found that of the donors that were called, they got 42% larger gifts than from the donors that weren’t called, and 39% more renewed their gifts the following year. If you want to learn how to do this more specifically, you can download a free e-book on my website,, which is a thank-you call e-book and script.

Now you’re set up. You’ve established trust. You’ve set yourself up for the second gift. People are satisfied with you. Let’s get to setting up your third, fourth, fifth, and beyond with the relationship building trigger. You have to switch your mindset from one of doing stewardship, which kind of gets you into a list checking frame of mind. It’s very transactional. There’s not a lot of heart, emotion, love, or empathy involved in that.

Stewardship, the definition of it, means something you do to your donor’s contribution, how you invest their money. The relationship approach to stewardship is different. You’re thinking from your donor’s perspective. You do it with your donor rather than to them. This attitude of how you connect with folks is really important. It’s a lot like dating. It’s how you relate to somebody that you want to see again.

You tell them that you’re happy with them. You compliment them. You recognize them. You talk with them. You write them little notes. You invite them to get together. You take them out once in a while. You think of them fondly and let them know now and again. You don’t wait until the next time you want a gift to tell them how you feel. It’s pretty simple, but for some reason most nonprofits don’t do it that well.

Here’s the first of the relationship building triggers: the personal link to you. One of the ways that nonprofits and for-profits differ is the personal connection, the ongoing connection that they have or don’t have with you. For retail establishments, the customer buys a product and is able to enjoy it over time. They buy a 12 pack of cola. They’re reminded daily of how much they enjoy it. They buy a laptop or an iPod. They use it on a regular basis, and so forth.

When your donor makes a gift, however, they’re done. If you don’t make a personal connection to remind them about the impact of their gift and what a hero they are for having made this possible multiple times in multiple ways, they don’t get the enjoyment out of their gift that they deserve. Here on the screen are examples of low, medium, and high touches. These are like moves. They’re ways that you connect depending on your donor’s involvement with you and your assessment of their potential.

Wherever they are, if you want to get more and you want to get bigger gifts, the connection has to be personal. It’s not like a mass Christmas greeting email. It has to be something that the donor is going to notice and think, “Wow, this is nice.” The next trigger, it’s showing the impact of the donor’s gift through little gifts of content that you sprinkle throughout the year.

I would say if you want gifts, you must give gifts. You make this little gift of donor-centered content that’s relevant to the donor’s life and is very succinct because they’re too busy to read lengthy stuff. It’s very useful. As I was saying before, how to keep seniors safe, a reading list of books that are related to your cause, recipes that maybe your clients or your staff created. It’s not about you. It’s not here’s new board member, or we recently rebranded, or here’s a check we received. Certainly not, “We need your help again.”

There’s a difference between viewing the world through a fundraising lens and a communication lens. The former is too much about monetary transaction. The latter channels philanthropy, which, translated, means love of humankind. It’s really about values, emotions, and wooing. You want to have a content marketing strategy. You want to create a content calendar that has these little gifts. Honestly, you should be scheduling about seven of these content laden gifts for every ask. If you look through a communications lens, your supporters feel a lot better. They feel a lot happier. You need to do this frequently because it’s out of sight, out of mind.

I like to drip stories throughout the year that remind folks of the impact of their giving and creates a collective experience. You’re all a part of this. You can have the people that you helped tell their story. You can have donors tell their story. You can have volunteers. You can have staff. Everybody is giving a personal perspective.

You can deliver these through your e-newsletter, your blog, social media, lots of different ways where you’re basically using language that gives donors ownership of the fact that these stories happened. You’re constantly saying you did this. You’re awesome. Let the donors give you some feedback. Let them express back to you the reason that they support you so that they really feel part of a larger community. Then you turn right around and you can share this feedback sometimes in the form of story, including sharing the feedback of your clients, people who you help, taking excerpts of those thank-you letters you receive.

This speaks to the next trigger, which is the quantity and quality of your communication strategy, all the things that you can do to help people feel connected and closer to you. Remember, 93% according to Penelope Burk, will give again, they said, and 64% will give more if you communicate “more effectively”. What does that mean?

It means a lot of things. Donors expect you to pay attention and take care of their needs, just like you were on a date, or just like you would take care of your spouse’s needs or your child’s needs, people that you’re in a relationship with. A few donor centered biggies that you can do to show them that you know them and answer the “what’s in it for me” question are personalize everything you can with them.

That’s why you track stuff in your database, so you can call up and say, “How are Suzie and Mark?” You ask about their kids by name. You add a personal note to a letter that happens to be going out to see if they’re feeling better, or to ask how their vacation was. Ask them for advice. People love that. Make sure that you’re making feedback to you easy. Ask about their preferences. How often do they want to hear from you?

Here’s a big caveat. This came out of the recent Roger Relationship Fundraising strategy. Some folks don’t want all this stewardship. Being donor centered means no cookie cutter approach. For those who tell you they only want to hear from you once a dear, they don’t want newsletters, they don’t want invitations, honor their request. Still send them a prompt and personal thank-you. Still send them an impact report at the end of the year, but no more. You basically have a transaction track for these people.

The rest are in your transformational track where you’re trying to build the relationship and get bigger gifts. Ask them how they’d like their name to appear in print. Ask them where they’d like to earmark their giving. Ask them what their favorite communication channels are. A recent story by Abula

[SP] said that 52% of donors say you’re not taking their communication preferences into account. Fifty-two percent said you’re not targeting their interest when you send campaign appeals.

You want to offer your donors choices that are based on their interests. You want to track these in your database. You want to follow through so they keep trusting you. Then you want to make the donors the voice of your organization. Who doesn’t like hearing from themselves? Consider having ambassador programs, especially social media ambassadors who share your content on social media. Consider peer to peer campaigns. All of these kinds of things activate your donor’s commitment to you. Finally, endorsements from third parties are a great type of communication to feature because it’s like a Good Housekeeping seal of approval that you’re doing a great job.

For example, I used to get Peet’s Coffee to give us gift certificates and then say: Peet’s thanks you and sends you this coffee coupon as a token of the esteem in which you’re held. Communications are really how you deliver value. Remember, all fundraising is this value for value exchange. You’ve got to understand that donors are you customers. All your interactions have to be customer centered. We’re doing a lousy job of this. They’re telling us this in survey after survey.

That’s why I included this slide. We’re not going to go through it all now. I realize it’s dense. There are a lot of different surveys you can look at if you want to if you need to persuade your powers that be that this is something we need to focus on. It boils down to this as a general rule. Donors give through your acquisition efforts.

Then if you just give back a pro forma receipt, they’re not going to give again. If you give them back something that’s more valuable, they’ll give again. If you give them something that’s more valuable still, you give it to them more often, they might upgrade. In fact, a full 70% said that they would upgrade.

Let’s move on to the next trigger to get people to increasing levels of loyalty. It’s triggering a tangible link to beneficiaries. Fundraising is part of everybody’s job. The more points of contact that a donor has with your nonprofit, the more likely they are to feel a part of your family and stay connected. You don’t want them to just have a connection to the development director.

Lots of different people can send thank-you letters. You can ask kids if you work with kids to write thank-you letters. You can send excerpts of thank-you letters you receive from clients. You can send video reports from the field, easy to make with a smart phone these days. You can send photos. You can send testimonials from family members telling the donor how much they are appreciated.

Psychological research on gratitude by Seligman and Steen indicates that to produce lasting effect, gratitude has to be repeated. That’s why I’m saying multiple thank-yous through multiple channels. The research shows that a one-time act of thoughtful gratitude, and in this case it was a hand delivered thank-you letter, made the recipient feel 10% happier. The effects were cut by 50% in just a week. They disappeared entirely within six months.

If you want your donor to stay continually uplifted by their philanthropy, you have to practice gratitude continually. It has to be a way of life. It really does take a village. Get creative. I’m a tree. Here’s why I want to hug you. Here’s a guide dog. I want to share my story. I’m a parent. I want to tell you. I’m a ballerina. Here’s why I’m dancing for joy. There are all sorts of ways that you can say thank you.

I recommend sending as personal as possible communication every other month or so to remind donors how important they are to you. It’s why you’re hearing so much these days about creating a culture of philanthropy, or you can call it a customer service culture, or a gratitude culture. It’s all the same thing. It’s getting everyone to buy in that donors are important to your entire organization, not just the development staff. If you can do this, you’ll have a competitive edge.

It’s not just about multiple contacts. It’s about repeat contacts. If you think about it, in your life, ongoing communication is the foundation of real friendship. We’ve already discussed the fact that numerous studies are showing that the primary reasons donors leave are related to poor communication both in terms of quality and amount. The reasons are very similar to reason that friendships fizzle and evaporate.

You get busy. You forget to call. You forget to write. You even eventually stop thinking about each other. Donors want to know that you’re thinking about them. They want to know how their money is being applied towards results that are lasting and effective. If you do this multiple times, you’re going to make and keep real friends. Don’t be afraid to reach out to them. Donors do want to hear from you as long as you’re making them feel awesome.

You’re reporting on outcomes that they care about. You’re making them feel like insiders in the know, part of a special community. You’re asking for their feedback, their opinions, their advice. You’re doing this in a monthly e-newsletter, a blog, social media. You’re not just sending them one annual report. No. You’re reporting all through the year. You’re maybe sending an extra report from a program director, which is where they earmark their gift.

Finally, you want to trigger shared value. If you provide your donors with the feeling that they’re part of an important cause, this is a definite driver of donor commitment, and you do this by reminding them of the values that you share, and you really get out there with them. Here I’m showing you a picture on the lower left of the Jewish community center where I work where they posted the values on walls in the main lobby. They happen to say welcoming strangers, spirit, justice, friendship, repairing the world. You need to get your organization together to come up with a statement of values if you don’t already have one. Bring everybody into this discussion, all the key stakeholders.

Here is an organization that sent holiday cards that emphasized shared traditions and teachings. Planned Parenthood posted this on Pinterest. Equality Delaware sent this on Twitter talking about the values that they and their donors share together. Ask donors to share stories of why they got involved with you. I did this at the Jewish community center. We got all these value-laden stories. We then had a whole bunch of inspiring quotes that we could sprinkle in our communications throughout the year. We had stories we could tell. We put them on posters.

Ask them to share their inspiring quotes with you. Ask them to tell you their favorite books that are related to your cause. Ask them to send you photos of them volunteering. You can then comment on these. You can pin them to a Pinterest board. You can share them on Instagram. You can use them in your publication.

Let’s move on to some specifics about getting additional or upgraded gifts. The first contribution is almost never the largest one. That’s why your current donors are the low hanging fruit for larger gifts. To get an upgrade, you first want to be able to identify and target the people who are most likely to upgrade. It’s not usually the first time donors but the ongoing donors, especially at the middle level, or people who’ve made multiple gifts in the course of a year, or your major donors, or those people who have been identified as major gift likelihood through purchased donor analytics, or your own database predictive modeling, or from screening sessions with volunteers.

A 2014 study by US Trust of High Net Worth Philanthropy revealed that 35% of these folks say they plan to give more. If you’re not getting more from them, it’s because you’re not stewarding them effectively. You’re not using the seven drivers of donor commitment. Let’s assume that you have identified the right people. You are stewarding them using the seven drivers.

There are still two more things you have to do to get an upgrade. Explain the need for the increased gift. Don’t just say give more. Has something changed? Has your vision gotten bigger? Are you really close to your goal, so you’re asking current donors for a little more to close your campaign? Are you launching a new project? Are you trying to serve more clients? Don’t just say, “Another year has rolled around. Would you be willing to give more this year?” Explain why.

Then you have to ask for the increased gift. You should be asking for a specific amount for a specific project or campaign, an actual question, not a statement like we could really use more support. Don’t ask for a wishy washy amount like as much more as you can give. That’s not an effective way to upgrade. Instead, you want to ask for something like, would you be able to move from the leadership circle at $1000 to the visionary circle at $2500?

The other way to upgrade is through monthly giving, which we’ll talk about in a minute. That’s a way that you incentivize people to upgrade. Monthly giving clubs is one way. Recognition societies that have benefits at different levels. Challenge grants is a great incentive to upgrade gifts. People respond really positively to those. Peer to peer fundraising contests where you have prizes for those who raise the most money. I find often folks will increase their own gift because they want to win.

On to a little more on monthly giving. I could do an entire webinar on this subject, but let’s cover the basics of why this is such an effective upgrade strategy as well as a real donor loyalty tool. First, it’s a club. People like to be in clubs. It creates a real sense of belonging. If you don’t have a club, if you don’t have a name for your monthly donor program, do that. It’s very donor-centered strategy. Essentially, the donors are pre-authorizing you to ask them for a gift every month.

Monthly donors give more, often as much of one-third of what they gave annually and then multiplied by 12. Monthly donors stick with you longer. Research, different studies show that they take 5 years, 7 years, even 10 years longer versus 19% of first time donors, or 57% of multi-year donors. In fact, in a short period you can move the needle on monthly givers to 85% retention. Monthly donors build stronger relationships with you because you have built in opportunities to communicate with them and steward them. They provide a stable foundation for you because it’s a predictable monthly cash flow.

They also can lower your costs because you don’t need to mail them repeat direct mail packages to renew their gifts or make additional gifts. They’re already doing that. And, they become candidates for major and legacy gifts because loyalty is a sticky proposition. You stay top of mind and they’ll stick with you. Let’s talk more about getting your upgraded and monthly donor to give you additional gifts. I mean legacy gifts.

There are two different categories of donors who generally make good candidates for legacy gifts. The first are frequent donors. The quintessential case study is a loyal librarian who gives monthly to you, has no heirs, lives frugally, and then surprises you with a million dollar bequest. The other group are major donors because you know they have the capacity to leave you a nice bequest. In both cases you have a much better chance of getting this legacy gift if you don’t just sit there waiting for the phone to ring after they die.

If you identify them now, steward them now, and ask them now, you don’t have to have a fancy legacy program. The lion’s share of planned gifts are bequests. You don’t have to offer charitable remainder trusts. You don’t have to offer charitable gift annuities. You just need to make it clear that you accept legacy gifts. Honestly, I have talked to donors who say, “Oh, I didn’t know that you did that.”

Have a website page that explains how legacy gifts are put to work. Have a contact person people can call to discuss leaving a legacy. Have some testimonials that are on your website and in your publication if you can from people who have left a legacy. Even people who were helped by that legacy if you don’t have a living person that you can showcase. Put everywhere you can something about your legacy program, like: “your lasting legacy carries on the tradition.” Put that on your envelope. Put that in your email signature. Where there’s a will there’s a way. Put that on your remit pieces.

If you’ve been around for 20 years or more, consider starting a formal legacy giving program or club. Ask your board to take the lead on this. Ask them to remember you in their will. Ask them to make you a beneficiary of their IRA or their life insurance, which they can do with a simple beneficiary change form. They don’t have to visit an attorney.

Kick start your program, and then maybe once a year send a special mailing talking about the benefits of the legacy club, the benefits to your organization, the benefits to the community, and of course the benefits to the donor of which there are many, including some tax benefits. Then recognize your legacy donor. Again, they want to belong. Invite them to a special event. Send them an exclusive newsletter or a letter from your ED.

Let me just tie all this strategic stewardship together with a metaphor. Don’t be a bridesmaid. You want to get your donor engaged to you. You want to get them to marry you. You don’t want to make them want to divorce you. You want to be in this until death do you part and you get that legacy gift. If you don’t steward your donors, others will. Your bottom of the pyramid donors, your mid-level donors, those that you’re not paying that much attention to, are going to go become top of the pyramid donors elsewhere.

The trend is for donors to give fewer gifts but larger ones. They’re picking fewer charities but making impact gifts. That means that all the bridesmaids, all the charities with which your donor is engaged, the ones that don’t make your donor’s top 5 charities list or top 10 charities list are going to be left high and dry. The fact that your competition is doing a super duper job with stewardship is going to hurt you more than it did in the past when almost no one bothered with stewardship. Donors would give to multiple charities small gifts.

The fact that the lightbulbs are starting to go off for nonprofits and many are really paying a lot of conscious attention to retention could result in more attrition for you, their competitor. Resolve to go after what I call the easy money: the renewals, the upgrades, and the additional gifts from your current donor. What do you do next when you get back to life?

Here’s a look, courtesy of Giving USA, at the average rate of growth you need per year to double your annual giving. The average annual growth rate for all nonprofits since 1970 was 7.6%. If you can keep up that rate of growth, you can double your annual giving in 10 years. You need a higher growth rate if you goal is to double it sooner than that. If you get the full report, you can see the average performance in your peer group organization.

Don’t just benchmark against your peer groups. Don’t just benchmark certainly against overall fundraising. Measure performance against your results last year. That way you’ll know that you’re doing better. What you want to do is establish your priority areas for improvement. If you had a lot of lapsed donors, one of your priority areas is to get them back. If you had a lot of people downgrade, one of your priority areas is to not allow that to happen more, and so forth. You want to make incremental increases then in your fundraising budget by these priority categories.

You want to develop a real written plan with goals, with measurable objectives, strategies, and tactics for each category, which means assigning responsibility for getting this done to somebody on the staff and establishing deadlines. Then you want to measure the incremental return on investment by category. Are you gaining or are you losing? Once you know this, you can make new increases in your fundraising budget based on the performance of your previous activity.

Before we get to questions if we have a minute, I want to take one final look at the importance of creating a gratitude culture because you can’t do it alone sitting in your development corner. You need all hands on deck. One way to do this is to have everybody take a donor-centered pledge. Tom Ahern and Simone Joyaux in their book “Keep Your Donors” came up with 23 donor-centered principles. You can borrow from those to create your own donor-centric pledge. I have some favorites of mine on the screen. This is a really great way to get everybody on board with this culture of gratitude towards your donors. You create a gratitude regimen.

I really like the 5 to 15 rule. I used to keep five notecards on my desk. By the end of the week I had to have sent one to a donor. My desk needed to be clear by the end of the week. The other is to set aside 15 minutes a day for thank-you calls. Make it a regimen. Ask everybody on your staff, not just development staff, to do this. The other thing I’d like is to emulate Jimmy Fallon who, if you watch him, on Fridays he does his thank-you notes. You could gather together your whole staff on Fridays for a little bit of wine or some other beverage. Maybe break some bread together. Have some notecards there. Have everybody write thank-yous.

You really want to embrace this karma that includes the psychological research on gratitude that I referred to earlier, which also shows that giving thanks is as good for the giver as it is for the recipient. His research revealed that when you write down what you’re grateful for, like writing a thank-you note, that you also feel less depressed, less stressed, more energetic. When you thank your donor, two people get rewarded. You are one of them.

I want to thank you for doing this important work and making our world a better, more caring place. If you happen to be one of my blog subscribers, I want to thank you for that too. If you’re not, please subscribe and get your free copy of the “Donor Thank You” book. I’m also doing a power of thank you course with Pamela Grow in May. You can go on my website and check that out. I think we’re done. I didn’t leave any room for questions.

Steven: It’s 2 o’clock on the dot. That was pretty good, Claire. That was a lot of great information. Really awesome. I think we’re kindred spirits with all this stuff. I love hearing your ideas for doing things. I know we don’t really have time for questions. It’s about 2 o’clock and I don’t want to keep people from the rest of their day.

Please do email Claire. Send her a tweet. Download all that good stuff on her website. I know she’s willing to answer questions offline via email. Don’t be shy about that. We’ll keep her information there on the screen for you to jot down. Claire, thanks for taking an hour out of your day. This was really fun. Thanks for always coming back and doing webinars with us.

Claire: It’s my pleasure. I think if you just remember that retention boils down to delivering happiness, and you are consciously thinking about all the happiness that you have to give, you’ll do a really great job.

Steven: That’s it. I couldn’t have said it better myself. This is fun. We’ve got a really fun webinar coming up over the next few months or so. You can check out our webinar page. We’ve got lots of other resources on our website. The next webinar is really special. It’s a rare opportunity to hear from Daryl Upsall who is a very well-known European fundraiser. He’s out of Spain. We’re going to try to get him connected. Hopefully that all works.

We’re on Wednesday. Six days from now we’re going to mess up the schedule a little bit. We’re going to have a Wednesday webinar. Daryl is going to talk about face to face fundraising, street fundraising, getting in front of people in person, people you don’t know. It’s not just about the face to face ask. It’s really just face to face fundraising, which is sort of a popular model in Europe, but not something that’s done a lot here in the States. I really think you’ll enjoy the presentation. Please register for this one. It’s a super rare opportunity. It’s going to be a lot of fun.

We’ve got other webinars on our page as well. You may see some other topics that you’re interested in. We’d love to see you again next week. If not, hopefully sometime in the future. Thanks for attending. Claire, thanks so much again. This was a lot of fun. Look for an email from me with the slides and the recording a little later on this afternoon. Have a great rest of your day. Have a great weekend. We’ll talk to you again soon, hopefully. Bye now.

Major gift fundraising

Kristen Hay

Kristen Hay

Marketing Manager at Bloomerang
Kristen Hay is the Marketing Manager at Bloomerang. From 2018 - 2020, she served as the Director of Communications for the Public Relations Society of America's local Hoosier chapter. Prior to that she served on several different committees and in committee chair roles.