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How-to Library • Featuring articles from past issues of Contributions

Adopting a Donor-Centered Approach to Fundraising

By Sarah Lange

If you didn’t do as well with your annual appeal this year as you would have liked, perhaps it’s time to look at the degree to which your fundraising efforts have been donor-centric. The concept of donor-centered fundraising is a relatively new one, but integrating these lessons can have a tremendous pay-off. The fundamental step in adopting a donor-centric approach is to first and foremost adopt an attitude of gratitude. This means feeling and expressing gratitude for everygift that walks in our door, even if it’s $10.00.

Key Elements in a Donor-Centered Fundraising Program

Eighty of all philanthropic dollars in the US come from individuals. This means that the key to sustainability lies in having a robust individual donor program. Before you can worry about your donors, however, you must first attract them to your agency and its cause.

At its core, philanthropy is a heart-centered activity. Donors want to make the world a better place, but each has their own vision for doing so. Since most donors can’t achieve this kind of change on their own, your organization could be the perfect vehicle that can help them realize their goal. Before donors will hand over their hard-earned money, however, your organization must:

  1. A compelling case for support to which donors can connect
  2. A relational approach to your donors (it’s about relationships, not numbers or money)
  3. A vigorous relationship-building program (which implies the use of multiple strategies), and
  4. An understanding of the connection between fundraising and every other function of your organization.
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Other elements that contribute to successful fundraising include an agency-wide commitment to continuous learning and growth, good organizational systems, and the use of strategic, efficient and effective management. Organizations that successfully attract -- and retain -- donors keep their mission at the center of their operations, practices, procedures and culture, creating an Axis of Synergy. This means that every aspect of organizational functioning lines up with its mission, vision and values.

Nurture Relationships

Today, there are nearly 1.5 million non-profits in the US. The average donor gives to between 5-11 institutions per year. Approximately seventy percent of Americans donate on a regular basis. This means there is already a trained pool of donors out there, ready to support our cause. Our job is to acquire and retain as many of those donors as possible.

Being donor-centered is about nurturing relationships. Once a donor is in the door, it’s our job to “court” them. How many of you asked your spouse to marry you on the 1st date?! You shouldn’t be doing that with your donors, either! If you want someone to become a donor, convert to a habitual donor and increase their gifts over time, you must get to know them, identify their self-interest and appeal to that over and over again. You must treat your donors like people, not ATM machines!

Information vs. Recognition

One way to do this is to provide information about how their gift has been put to work. Most donors care about this far more than they do about recognition, because recognition without information essentially renders their gift meaningless. People want to know that their gift made a difference, because that’s what compelled them to give in the first place.

To ensure that your donors stay in love with you, you must communicate with them on a regular basis –- at least 7 times per year. This means making phone calls, sending out regular newsletters or e-news updates, emails, and personal notes. It’s a lot of work, but it’s the only way to maintain and nurture the relationship. After all, it’s far easier to retain an existing donor than to go out and find a replacement for the one you lost. Most non-profits can lose up to 1/3 of their donors every year. This is primarily because we treat donations as a transaction, not as the extension of a relationship.

Communication and Cultivation

In order to foster and nurture relationships, we need to communicate with donors in relation to their self-interest. That requires getting to know them on an individual basis and connecting them more deeply to the life of the organization. It means hosting cultivation events where prospective donors and existing donors can enhance their understanding of and connection to the agency and its mission. Developing meaningful relationships takes time. The number of donors that needed to cultivated, over time, to ensure the longevity of an organization requires the efforts of many people in your organization, including your board.

In building a board, it’s important to recruit people who are passionate about our mission and are willing to share that passion with others. Please do not ask your board to trespass on their personal relationship in the process! Find people who are genuinely interested in the cause, bring them together with a passionate, mission-centered board, and watch the magic happen. As donors deepen their relationship with the organization, they are often more than willing to engage in solicitation on the agency’s behalf.

Measuring Success

In a donor-centered organization, the measure of fundraising success is not only the amount of money raised, but the percentage of donors retained. Examining retention rates will reveal a lot about your existing fundraising efforts and where you need to strengthen your program. In order to truly learn why donors are involved with your organization, conduct surveys, interviews or focus groups. It’s particularly important to listen to any complaints that are made and interview former donors, because it is from these people that you can learn the most about how to become more donor-centered. Although donor-centered fundraising requires significant effort on the part of multiple people in your organization, in today’s economy, it is the only way to secure your agency’s future.

Counsel to more than 150 organizations and their leaders, Sarah Lange is the Principal & Founder of New Era for Non-profits, a consulting firm focused on helping non-profits integrate best practices into their daily operations. Sarah has spent more than two decades in the field of non-profit management and is well known and respected for her depth and breadth of expertise in all aspects of fund development, organizational change, leadership and board development, strategic planning, needs assessments and evaluation. http://newera4nonprofits.com/

 

 

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