In 5 Indicators for Identifying the Best Potential Donors, a guest post on the Bloomerang blog from Ryan Woroniecki of Donor Search, the key indicators someone might be inclined to support you with a major philanthropic gift are laid out. These indicators are, in order:
- Previous giving to your nonprofit
- Giving to other nonprofits
- Participation as a foundation trustee
- Giving to federal election campaigns
- Real estate ownership
One thing is indubitably true: the more you know about people the better you’ll be able to assess, and work with, their likelihood to invest with you philanthropically.
Another thing is also true: not all these indicators are created equal. They’re listed in order of importance above but, for my money, numero uno is far and away the most significant.
We hold these truths to be self-evident
The people most likely to become major donors to your organization are already known to you. You don’t have to do research to find them, or find friends to introduce you or gate-keepers to let you in. You only have to do one simple thing.
Look in your own database
You’re going to find them here – buried in plain sight. All you have to do is unearth them. You don’t have to find the field, till the soil, plant the seeds or water the plant. The plant is already growing – especially if you’ve been doing a good job building relationships and nourishing your current donors with fundraising and marketing fundamentals.
You’re not likely to find them here: (1) by listening to your board member say “someone really should call (fill in name of local rich person) for a gift,” or (2) by reading Chronicle of Philanthropy to see who the biggest donors to other charities are, or (3) creating a list of local celebrities, tech bigwigs or venture capitalists. I say this repeatedly, but can’t say it enough:
They’re already linked to you by virtue of having made a previous donation, been a loyal volunteer, served on your staff or board, or been a repeat purchaser of services or products.
They’re already interested in what you do, by virtue of the same.
Now all you need to do is assess their ability to make a larger gift than they’ve already made.
This methodology has stood the test of time; you can take it to the bank. It’s worth noting that as long as I’ve been in the business (since we had computers to crunch this info), these have been the same key indicators used to provide donors with “scores” when you purchase any wealth screening or predictive donor analytics product. It’s great to know Donor Search draws these conclusions from their own recent research — from over 400 non-profits covering 2 million individuals who gave over $5 billion.
How do you want to invest in finding the best donors?
You can either purchase information on key indicators or use some of the tips in the aforementioned article to do this research yourself. There are pros and cons to both, and your choice will depend on your size, budget, and the number of staff you have to dedicate to this work. Most important, however, your choice should depend on how you plan to use this data.
There’s seldom one right way to do anything. You always have a choice; I’m trying to help you make an informed one.
Once research is collected, how will you use it?
Don’t jump to a solution until you’ve identified the real problem. Alas, it’s human nature to want to run headlong into implementation mode without first undertaking a thoughtful assessment of whether the tool you’re choosing is the right one to fix your most pressing problem. A board member may say “we purchased donor analytics at XYZ organization where I also sit on the board, and we should do that too.” Maybe; maybe not. It depends on the donor problem facing your nonprofit.
Let’s think of all the donors in your database as a haystack. How might you identify the best potential donors within this pile? Here are three “problem” possibilities:
PROBLEM 1: You don’t have a haystack.
You have very few donors, so probably not enough to justify making an investment in purchased analytics. To find your highest likelihood major donors you can do two things. FIRST, look in your database for donors who’ve given more than once. When a prospect has a giving history with your organization, half the battle has been won. SECOND, add some names from your non-donor house mailing list of people who’ve had repeated and/or multiple affiliations or engagements with you. THIRD, begin with those closest to you, and ask them to surface names of friends, family, colleagues and personal and professional networks who may have an interest in what you do. Start with your board, staff, volunteers, event attendees and clients. These people may not yet be donors, but they are linked to you in some way. FOURTH, (1) do your own research using the internet, and (2) by convening a group of peers (e.g., board, committee advisory group members, vendors, and other donors) to conduct a confidential peer review.
PROBLEM: You need to find the needle in your haystack.
You have a good supply of donors, but a small budget and not enough staff to delve deep into analytics right now. Your goal is to quickly (let’s say before the end of the year) identify the most likely major donors by starting with metrics you can easily assess. FIRST, look at recency and frequency of giving (the more recent and/or frequent, the more likely they are to respond to your outreach). SECOND, look at size of last gift (this serves as a potential indicator of capacity). THIRD, review other engagement and affiliation with your nonprofit (this serves as an indicator of interest). FOURTH, conduct research to ascertain affiliation with nonprofits engaged in similar causes (this also serves as an indicator of interest). Using the internet is handy. I’ve also been known to peruse annual reports and arts organization programs, and visit local donor walls, taking notes of major donors; then returning to my database to see if any of these folks are current donors to our organization. If so, I know I may have a bigger foot in the door than I’d previously understood. They have more than a passing interest in this cause, and they have the ability to be more generous should they be given proper treatment and incentive.
PROBLEM: You have a lot of needles and just need to separate them from the hay.
You have thousands of donors at various giving levels and need to find out if some of the folks at the lower and middle levels could be encouraged to become major donors. You don’t have time to screen and rate every name individually, nor do you have resources to reach out personally to everyone to ascertain their level of interest and willingness to become further engaged. You need a tool to help you do your digging! FIRST, you can purchase predictive modelling to score your current donors as to major gift, capital campaign and/or planned giving likelihood. SECOND, you can purchase wealth screening enabling you to conduct more in-depth research on the “needles” that rise to the top when you get the results of your modelling. THIRD, you can also throw non-donors into the mix for assessment, such as event attendees, alumni, client families, vendors, and any others with whom you believe you already have good linkage and interest.
What else should you do?
It’s always a good idea to use some common sense. As a general rule, knowledge of a donor’s profession, career track and stage of life offers good clues as to their capacity to give. So, if you have data in your database on profession or business affiliation, you could run reports to unearth all the doctors, lawyers, financial advisors, real estate developers, technology employees and so forth. If you find a few major law firm partners currently making $250 annual gifts, you might want to look further. At one legal services organization I worked with, I found hundreds of gifts at this level from lawyers who clearly had capacity to do more. This gave us a great list to work with – and we didn’t even need to purchase analytics.
Sometimes the problem is not linkage, interest or capacity. It’s simply habits that have become entrenched due to lack of strategic planning and outreach on the nonprofit’s part.
It’s never been more important to get serious about major gifts.
Forget the 80/20 rule. The latest research from The Fundraising Report Card shows 76% of revenue comes from .74% of your donors. These folks truly are needles in a haystack. Your job is to set about finding them, and plucking them forth!
It’s not hard. It simply requires a plan, commitment and perseverence.
Quick! Want more strategies to jumpstart or boost your major gift fundraising?
Whether you’re new to major gifts or a seasoned pro, I invite you to join the Certification Course for Major Gift Fundraisers. Sign up by July 29 to save $200! (You’ll find a discount code you can automatically apply).
If you’re serious about fundraising, you’ve got to get serious about investing in major gifts. This is true no matter your size. A combo of know-how and commitment will get you where you need to go. So, seize the day! There’s no more cost-effective fundraising strategy. It’s a struggle to figure out how to do it on your own, so leave it to experienced experts to help you with the know-how over the next 13 weeks. This fall I’m again partnering up with The Veritus Group to offer you their amazing course which begins next month. You’ll have access to all their support, but don’t hesitate to reach out to me as well if you have any questions. I really want you to learn these skills so you develop a well-oiled major gift fundraising machine!
TAKE THE LEAP: Don’t hesitate; you get a lot for your money. The skills you learn will always be in high demand — whatever your role with your nonprofit. It may seem like a big investment, but you’ll more than make it back with just one major gift… plus you’ll add valuable skills to your toolkit. You won’t find such high-quality, life-changing, career-enhancing online major gift training any place else. It’s worth it — and you’re worth it.
Photo by Aziz Acharki on Unsplash
Pingback: [ASK AN EXPERT] Who Are The Best Endowment Campaign Prospects For A Local Historic Charity? - Washington DC News Station