The Annual Giving Exchange

There is a certain level of formality that is necessary in direct mail.  If I don’t know you, you should address me as “Mr. Allenby.”  If you don’t know me, but know that I know your organization, you should address me as “Daniel.”  If we know each other, it’s okay to call me “Dan.”  Regardless of the scenario, you’ve done 50% of your job if your prospect has opened the letter and is even reading the salutation.

A salutation in e-mail, however, is more important.

If I receive an e-mail that begins “Dear Daniel,” it’s likely that it will be deleted before I even have a chance to see who sent it to me.  “Dear Daniel” lets me know that you don’t know me.  It’s a signal to me that you’re a spammer.

Building a good e-mail list of constituents and prospective donors is one of the most important things that a nonprofit organization can do.  While you’re building your list, don’t underestimate the importance of collecting good “preferred names” on your constituents.

That’s no easy task.  It might even require that you get out and talk them once in a while.

When my neighbor told me that he and his wife were expecting their fourth daughter, I jokingly asked him if he’d been hoping for a boy.  He just smiled and said, “No, it’s good to specialize.”

Annual Giving was once considered a good way to get your start in development.  But, if you were good, you moved on to major gifts within a few years.  If you were still good, you were on your way to being a VP.  That, however, is no longer the case.

Annual Giving isn’t a stepping stone.  It’s a destination.  Six figure salaries and a seat at the management table await outstanding annual giving professionals.

Annual Giving is a complex business and a valuable specialty.

After all, it’s good to specialize.

A recent survey of top tier university advancement programs revealed an average e-mail newsletter open rate of nearly 25%.  Imagine if all of your constituents:

• Opened your direct mail 1 out of 4 times you sent it.
• Answered the phone 1 out of 4 times you called.
• Read your magazine 1 out of 4 times they received it.

Many organizations underestimate the value of a strong e-mail relationship with constituents.  Moreover, many organizations who do recognize the value of e-mail, don’t always know if their program is working.  While there are many ways to measure the strengths of your e-mail program (i.e., bouncebacks, click throughs, opt-outs), one metric that should certainly be considered is “open rate.”

If you’re looking for substantive goals for the next fiscal year, make one of them a 25% open rate for your e-mail newsletters.

Exciting things are happening at Vanderbilt University, including two outstanding career opportunities within the University’s Central and Medical Center advancement programs.  Both positions will require a proven leader in the field of development and will provide unique opportunities to build best-in-class annual giving programs that include leadership annual gifts, progressive media marketing, and volunteer management.

• Click here to read the Executive Director of Annual Giving position description.
• Click here to read the Senior Director for Medical Center Annual Giving position description.

Feel free to contact me directly with any questions: dallenby@grenzglier.com

Permission is often overlooked as an important aspect of relationships, especially relationships with donors.  It’s not always clear if, when, and how someone wants to have a relationship with your organization.  It can be even less clear if, when, and how someone wants to support your organization financially.

Consider the role of permission in your annual giving strategy.  Start by asking yourself a few simple questions:

• If someone attends your event, is it okay to solicit him/her?
• Would someone provide their contact information if they didn’t want to hear from your organization?
• Should asking to be removed from a mailing list automatically exclude someone as a prospect?
• When someone becomes a fan of your organization’s Facebook page, are they giving you permission?

Permission is important, but it isn’t always clear.

This may come as a surprise to those you with an expensive habit of buying a $4 caffeinated beverage on your way to the office every morning, but Starbucks doesn’t sell coffee.  They sell an experience.

It’s not the cup of coffee that brings customers back into Starbucks every morning, it’s the idea of that cup of coffee.  It’s not the kind of beverages Starbucks offers, it’s the ability to customize those beverages exactly how you like it.  It’s that, while every Starbucks store looks and feels familiar no matter where you are, no two floor plans are the exactly same.

Fundraisers take note!

Help your donors imagine the impact of their gift.  Describe the building they will help to build, the student they will help to educate, the research they will sponsor.  Allow them to customize their gift as much as possible (and within reason).  Make them feel part of a familiar community, but show them what is unique and special about your community.

Donors are looking for an experience, too.  Are you giving it to them?

This past weekend, I participated in an NPR Marketplace story on young alumni fundraising entitled, “Colleges Hitting Up Alums Early.”  It featured Holy Cross’ strategy to engage recent graduates through a series of breakfast gatherings with the College’s President.  Click here to listen to it.

Institutions that are able to sustain high levels of alumni participation understand that building a culture of philanthropy doesn’t happen over night. Educating alumni about the importance of giving back often starts when students first step foot on campus as freshman, and strong senior class gift programs are often indicators of strong annual giving programs.

While there are exceptions, it’s probably a safe assumption that recent graduates are less likely to make large gifts.  And while young alumni are not often today’s major donors, they will be tomorrow’s.

So, spend time with young alumni.  Talk with them.  Listen to them.  Provide them with opportunities to volunteer.  Challenge them to solicit their peers.  Make sure they understand the impact of their support.  Thank them twice as often as you ask them for money.

Help young alumni develop a habit of giving now and you’ll begin to build a lasting culture of philanthropy for years to come.

Picture this.  You’re in a meeting with a prospect.  She is a recent graduate of your university, young, ambitious, and well regarded by her classmates.  She isn’t in a position to make a large gift at this time, but this is certainly someone you want to engage as a donor now in hopes that she develops a long lasting habit of giving.

She apologizes that she can’t make a larger gift now and suggests that she hold off on making a donation until she can contribute something more significant.  You respond by saying that alumni participation is very important to which she asks, “Why is alumni participation so important?”

Don’t let yourself get caught in this situation without a good answer.  Here are just a few.

• Broad alumni participation helps establish a culture of philanthropy that is vital to the success and sustainability of the institution.
• There is strength in numbers and a community is only as strong as the people who support it.
• Alumni participation is often viewed as a barometer of alumni satisfaction.
• Corporations and foundations consider alumni participation when making funding decisions.
• Alumni participation is a key factor in college and university rankings, including U.S. News and World Report.
• Parents and students compare rankings when making enrollment decisions.

The saying goes, “A bird in hand is worth two in the bush.”  It means that it’s better to have a small advantage now than to have the possibility of a greater one in the future.

Estimated to have its origins in the 13th century, this adage not only helps us maintain an appreciation for what we have today, but it’s a fundamental principle for building strategy regardless of our business, our place in life, or our objective. Don’t let it be lost on your annual giving program.

• It is better to have a sound direct mail appeal go out on time than it is to delay it in hopes of making a more compelling case later.
• It is better to personally thank a donor for their support today than it is to have a chance to ask them for another gift tomorrow.
• It is better to have one Board member who understands the importance of annual giving than it is to have 100 highly-rated prospects who might someday appreciate the needs of your organization.
• It is better to have a donor in the habit of giving to your annual fund every year than it is to expect that they will make a major gift five years from now.

Count your birds.  Especially the ones that have already hatched.

One of the great concepts that came out of the recent CASE Conference for Senior Annual Giving Professionals is that simple and inexpensive ideas can also be effective.  Here are a few tactics that phonathon managers can implement, even when budgets and time are scarce.

1. Divide your phonathon goal by the number of minutes in a year.  Ask your donors to sponsor a minute.
2. Have a supervisor “confirm” all pledges over the phone.
3. Send a handwritten letter to any past donors who declined to make a pledge over the phone.  Include a reply card and thank them for their past support.
4. Have callers send an e-mail to donors the day after a pledge is made that includes a link to the online giving form and your organization’s Facebook page.
5. Create a special segment for phonathon caller alumni.  Launch a 100% participation campaign for this group.

Simplicity can often be the best path to sustainable growth in all of your annual giving programs.