Editors’ note: This article, first published in print during Mar/Apr 2003, has been republished for Nonprofit Quarterly with minor updates.
As you add up all the money you raised in 2002, and evaluate how your fundraising program worked and what you should do differently, I hope one of the items you will add to your plans is to be in contact with donors in a more systematic way.
Saint Katharine of Sienna is reported to have lost her temper at God (with whom she was in frequent contact) when the carriage she was riding in while on an errand of mercy tipped over and she was thrown into the cold mud. As she stood in the freezing rain while the carriage was righted and the horses calmed down, she is said to have lifted her fist into the air and yelled at the heavens, “The way You treat Your friends, it’s a wonder You have any.” I was reminded of this story when I began thinking about writing this article. I believe many donors share Saint Katharine’s feelings toward the nonprofits they support.
Probably the majority of donors feel fine about their relationship with organizations they donate to. They send in their $35, and they get a form thank-you letter and an occasional newsletter. Two or three times a year they may be asked for an additional gift. If they give, they are thanked again. They don’t expect more than that.
THERE IS ALWAYS THE NAGGING QUESTION, “IF THEY TREAT ME THIS WAY, HOW DO THEY RELATE TO THEIR CLIENTS OR THEIR STUDENTS OR THE PEOPLE THEY ORGANIZE?”
It is only when someone starts giving bigger gifts that they begin to notice how they are treated.
Let’s look at a few situations I’ve recently encountered.
- A couple has given an organization $250 each year for many years. They have occasionally given $500 in response to a big fundraising drive, such as a major anniversary for the organization. The executive director is in touch with them a few times a year, as she is a friend of theirs. The couple received an e-mail from a board member expressing a desire to meet with them to discuss their annual gift and asking that they please write back with some good times to meet. A couple of weeks later, when the couple had failed to respond to the e-mail (they kept meaning to look for a mutually possible date), they received a letter from the same board member saying he would like to talk to them about increasing their gift to $750 and could they please call and let him know when they could meet. In talking to their friend the executive director, the couple learned that this board member reported that she made “repeated attempts” to get in touch with them and finally stopped because she didn’t want to be seen as a pest.
- For 30 years, a woman and her husband gave $10,000 a year to a scholarship fund. When the husband died, the woman kept up the gift because of his previous involvement with the program. The school thanks her promptly every year and she receives mailings from them. Since her husband died, no one from the program has called or visited her. Finally, someone from the development office called and asked if he could come to see her. She was quite delighted and welcomed him into her home. He said, “You have been such a faithful and generous supporter of our scholarship efforts for all these years, I just thought I had to meet you.” They chatted for a while and then he said, “Because of your long-term support, I was hoping you would help with an endowment gift of $250,000.” She laughed in his face and the conversation ended soon after.
- A founding member of a five-year-old nonprofit has given $1,000 a year to the group. This is her biggest gift, and also one of the top five gifts the organization receives from individuals. The donor gets a thank-you note, and at the end of each year she has received a form letter that begins, “We know you are familiar with the work of XYZ group. Please consider making an additional donation.” This is the only communication she receives during the whole year.
All three of these organizations do fine work. They are understaffed and the staff are not well paid, so no one is getting rich or sitting around playing computer games. The quality of the work is probably what keeps these donors giving every year, plus the knowledge that the staff and board of these organizations mean well and work hard for the group. Nonetheless, each of these donors felt poorly treated by an organization to which they had been quite loyal, which caused them to re-think their giving to the group.
One question these stories raise is, What is a gift? If you give a nonprofit a donation and they use the money to provide quality programs or services, shouldn’t the knowledge of the good use of your gift be enough? Possibly, but few of us are so enlightened that we can be content with that. Moreover, there is always the nagging question, “If they treat me this way, how do they relate to their clients or their students or the people they organize?”
Let’s quickly review what the organizations in these examples should have done differently.
In the first example, the board member needed to phone the couple. Writing and e-mailing are fine, but in this case the effort to set up the meeting became the responsibility of the donors when it is, in fact, the responsibility of the board member. One e-mail and one note is hardly “pestering” — in fact it does not even register as persistent. Moreover, the executive director should have contacted the couple and explained that they would be hearing from a board member, in effect handing off these donors to a new contact in the organization.
A FOUNDER (OF YOUR ORGANIZATION) WHO MAKES A MAJOR GIFT NEEDS TO GET AT LEAST A PERSONAL LETTER, AND PREFERABLY A PHONE CALL AND AN OFFER TO VISIT FROM THE EXECUTIVE DIRECTOR OR A BOARD MEMBER.
In the second example, the development director should have visited this donor at least once and possibly two or three times before asking her for a large endowment gift. In those meetings, he should talk to her about the need for the endowment and its financial goals and assess whether this was something she was interested in. He moved way too fast and burned a big bridge.
In the third example, a founder who makes a major gift needs to get at least a personal letter, and preferably a phone call and an offer to visit from the executive director or a board member. Standard annual appeals are hardly commensurate with the donor’s generosity
So why didn’t these organizations do a better job with their major donors?
There are four main reasons:
- The organization is unclear about what it means to build relationships with donors.
- The group’s systems are not set up to help them do their job.
- Contact with donors, while on the to-do list, keeps getting put off until after… (proposal is done, newsletter is out, hiring is complete, board meeting is over).
- People do not think enough about how the donor feels.
Each of the reasons that organizations do not do a better job with major donors can be addressed with some practical steps. Making these steps priorities for the organization’s fundraising function will immediately improve your fundraising.
As anyone who has ever attended any fundraising workshop or read almost any fundraising book can tell you, the purpose of fundraising is to build relationships. As donors feel closer to the group through having a relationship with it, they give more, they talk about the organization to friends and colleagues who may themselves then give, and some of the donors will become volunteers. This is all well and good in theory, but what does it mean “on the ground” — in terms of day-to-day work?
First, we must be clear about what we mean by “relationship.” I’ve heard consultants say, “You should know all your donors’ kids’ names and birthdays,” or, “You should know whether your donors prefer flowers or candy so you can bring the appropriate item on a visit.” I don’t think either bit of information is necessary, and it is disingenuous. Many of us hardly know our close friends’ kids’ birthdays. I think I am doing well to remember approximately how old they are.
The relationship the donor has to the group is best described as collegial. It is the kind of relationship you might have in a big office with co-workers whom you like and respect, but do not socialize with, or the kind of relationship you have with people you do business with. Words that characterize the relationships you have with donors are cordial, warm, neighborly, friendly, respectful, thoughtful, and so on. If you develop a personal friendship with one of your donors, that’s fine. But that friendship is something you want to have because you like this person and want to be their friend. It is beyond what is required by the relationship a group needs to have with its donors, and your friendship presumably will continue when you are no longer working at this organization.
In the case of a donor relationship, you begin by realizing that the donor genuinely likes the organization and you respond by genuinely appreciating that the donor gives your organization money. In building a relationship, you do what you can to show that appreciation and to share with the donor what the organization is doing so that the donor will continue to like you and feel connected to your work, increasing their loyalty and affection for the group.
With that in mind, here are the most important things to know about a donor: the dates and amounts of the donor’s gifts, why they gave, who knows this donor, how the donor got involved in the first place, and the most recent contact anyone has had with them. If that is all you ever record, you will be way ahead of all the groups in our examples.
Of course, the first order of business is to get a good database. See Grassroots Fundraising Journal Vol. 21, No. 3, May/June 2002, for a special issue on what databases should do for you, including reviews of databases; more reviews of databases are in the Journal’s January/February, 2003 issue.
However, like buying exercise equipment, the problem won’t be solved simply by installing a great software program or even by entering all the names and addresses of your donors into the program.
Where systems break down is that people don’t keep up with them. You need to devote some part of every day (even if it is only 20 minutes) to entering data about donors. When board members or non-development staff are part of fundraising efforts, they need to be helped to understand what kind of information you want them to bring back to the office. I have had board members turn in reports that rival FBI dossiers in depth and War and Peace in length, yet contained little that would actually help the next person with this donor. At the same time, shorthand notes such as “used to work with JA. Came to BEC mtg.” are less than worthless. Simple criteria for notes: Suppose you get amnesia. Could someone familiar with your organization but not with these donors figure out what he or she needed to know from the information in the database and in your files? Go through each donor record and see what the answer is. Where the answer is no, fix it.
WHERE SYSTEMS BREAK DOWN IS THAT PEOPLE DON’T KEEP UP WITH THEM. YOU NEED TO DEVOTE SOME PART OF EVERY DAY TO ENTERING DATA
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Use your system to segment your donors. Segmenting is a key tool in facilitating your efforts to build appropriate relationships. There are three broad segments in which to divide donors:
Size of gift: All donors who give more than $100 are one segment. Inside this segment will be categories of size— $100–249, $250– 999, $1,000 –2,499, $2,500 –up.
Longevity of giving: People who have given for three years or more (regardless of size of gift) are another segment. Inside this segment are categories of length of giving, depending on how far back your records go: 3– 5 years, 6 – 9, 10 –up.
Frequency of giving: People who give two or more times a year are the third segment. Again, there will be categories inside this segment: 2 times, 3–5 times, 6–8 times, more than 8 times. Use these categories in working with donors. For example, donors who give frequently should be asked to join a pledge program; you may want to consider creating a special category for people who pledge. People who give only once a year no matter how often they are asked do not need to be sent more than one extra appeal annually.
Your best donors are those who cross two or three categories. Someone who gives $100 two or three times a year and has done so for five years is actually as high a priority as a donor who has given $2,500 once.
Using your segmenting, decide which donors you need to be in touch with occasionally without asking for money. Generally these are your major donors — those who give more than $100 or $250 and do that every year. You may also want to be in touch with someone who gives $35 several times each year and you may want to call or meet with someone who has given for ten years in a row.
Generally you need to contact your major donors at least twice a year in addition to the time/s you ask them for money. For some donors, this will be easy. Major donors who also serve on a committee have a lot of contact with the organization. Those who send in their money but don’t have any other relationship with the organization are the ones who tend to get shortchanged.
In your database, set dates for when you are going to be in touch with your donors. These dates can be arbitrary and reflect slower periods in your work. Many people create a field in their database for dates to contact
I recently participated in an evening of phone-banking with an organization I volunteer for. The problems the team of callers encountered during the course of the evening gave me renewed insight into some simple but critical elements to building relationships with donors.
Five people were recruited to participate in the phone bank: two board members, two other volunteers, and one staff person. The staff person prepared the list of names we were to call that night, comprised of people who had made at least one contribution to the organization within the past three years. In other words, all of the people we were calling knew the organization, even if some of them hadn’t given in a while. The team of callers received some talking points and a sample script. Before making the calls, the team met and divided up the list of prospects. Each person took the names of prospects they knew, then we randomly distributed the rest.
I found about twenty-five names I recognized and took those to call first. Upon reviewing their records, I was surprised by how little information was there, even though more was certainly known about them. For example, several of the donors had first contributed to the organization when they attended a house party that a friend of mine had hosted for the group the previous year. On the form I received, the “source” field for that contribution said “house party,” but not my friend’s name as the host. If I hadn’t been at the phone bank, the person calling would have no idea how this donor was connected to the group. You might imagine how much more powerful it would be to call a donor and say, “We want to thank you again for attending Ruby’s house party last Spring and supporting our important work,” than to say “Thank you for attending a house party someone gave for us last year.” Imagine which of those openings will incline the listener to a positive reaction when you then say, “We’re calling you to tell you about some exciting new projects we’re doing and to ask for your support once again.” (In fact, if the records had shown that several people gave at Ruby’s house party you might even recruit Ruby to make calls to ask her friends to give again.)
One of the donors I recognized was listed as having given between $250 and $350 a year for the past several years. However, like the house party donor, there was no indication in his record as to his relationship with the organization. Because I knew this donor, I knew that he had been involved as a volunteer many years ago and cared a lot about the group’s work. Since the current staff had all joined the organization after he stopped volunteering, none knew this history. Furthermore, even though he gave what to this organization is a significant gift, no one had taken the time to be in touch with him in the course of the year between the last annual solicitation and this one.
For your board members and volunteers to do a good job in their fundraising tasks they need to have the following kinds of information on each prospect:
- Who the donor knows personally in the organization
- How they first came to know and support the organization
- What kind of contact the organization has had with the donor during the past year and, if appropriate, previous years
- What the donor is particularly interested in with regard to your organization’s work
With this information in hand, anyone who calls these donors will be able to have a personal and more meaningful conversation with them, acknowledging their ties to the organization in order to strengthen them.
On my phone banking evening, the donors were called by people who not only did not know them personally, but didn’t know enough about their history with the organization to be able to acknowledge that relationship. No wonder I often hear complaints from board members who feel the task of talking to donors is unpleasant and one they try to avoid.
When I reached a few of the donors I knew over the course of the phone-banking evening, I had some very positive conversations with them about the work of the organization. They were happy to talk with me (if briefly), because I was someone they knew who was giving time to support this particular cause. I knew that even if they didn’t agree to give a gift at this time, they would not hang up in anger at getting yet another unsolicited fundraising phone call.
donors: for example, October 15. Then they sort in that field for that date, providing an instant list of people to be in touch with. Don’t fall for the idea that you are going to be in touch with all your donors on a certain date. Do them in batches of five or ten, spread it over the year, and make it manageable.
What kind of contact do you want to have? The simplest thing is to develop a few types of contact, and as you get to know your donors, decide which donors are going to get what. For example, one small group with two staff people might organize their contact with major donors like this:
For local people:
- Holiday letter
- Personal phone follow-up to invitation to special event
- Personal note on Annual Report or personal note with newspaper clipping
For non-locals, either:
- Holiday letter
- Personal phone call to ask for their feedback on something or to update them on an exciting development
- Personal note on Annual Report
- E-mail to ask for their feedback on something or to update them on an exciting development
- Personal note with newspaper clipping
People can be contacted with different combinations of these options. For some people, for example, the Annual Report is the letter that precedes a request for money.
This system is based on some generalizations: Some people like and read e-mail, others do not. Some people like phone calls, others do not. Some people like to get personal mail, others find it burdensome. Many people like a little of each.
having a simple system with a few choices is the beginning to making the time to do this. The other is simply scheduling. Twenty minutes each day to update the database, with a full half–day once a month to make contacts will make all the difference in the world. Make it like brushing your teeth — you are going to do that regardless of what else is pressing on you. Take out your calendar or palm pilot right now and write in your appointments with your database.
This is possibly the most important element of fundraising. When you work in an organization, you think about the organization a lot. You think about the group when you are not at work. You talk about it with friends and family. Your donors, by and large, don’t do that. They think about their work, and they think about their concerns. So, in our example at the beginning of this article with the board member who sent an e-mail and a letter, I am sure she is thinking this is easier for the donors — she is not bothering them with a phone call. However, asking them to call back to set up a meeting is just one more arrangement for them to make. Had she called and gotten one of them, her visit would have been more of a priority for them.
Similarly, it is easier for an organization to send out the same letter to everyone, but it does not make a donor want to give. Major donors deserve letters that are personalized to their giving — what their particular interest is in the group and how their gifts have furthered the group’s work in that area.
Ultimately, an organization has to decide how important its donors are. To organizations that have a lot of foundation funding or other income streams, donors may not be that important right now. However, if those streams start to dry up — and many are — you will wish you had better relationships with donors to draw on in hard times. If you already consider your donors innately important, keep in mind that they have to be important all year long, not just when you want money. Donors are people, after all, not ATM machines. They want and deserve recognition and appreciation for supporting the good work you do. Acknowledge their loyalty and you will be rewarded with their continued support into the future.