Raising funds in a softened economy
Focus on fundraising basics
By Dee Vandeventer
Mathis, Earnest and Vandeventer
Cedar Fall, IA
With a significant rise in unemployment, a drop in the stock market, and consumer confidence at a four-year low, it seems logical that people are more likely to focus on their own economic situation and less likely to focus on yours.
However, this is not necessarily true. While the current economic situation doesn’t paint a pretty picture for hospices trying to raise funds, now is not the time to pull back on your fundraising efforts.
Now is the time to strengthen your efforts. The best way to do that is to get back to the basics: Stay in touch with your donors; maintain your image of honesty and trustworthiness; and develop a planned giving proposal for future economic slowdowns.
Treat your donors well
A study released in March by the Association of Fundraising Professionals (AFP) found that nearly 40% of people who quit giving did so because of what they perceived as poor communication on the part of the charity. Nearly half of those who hadn’t made recent charitable donations cited negative experiences with the charity’s fundraising practices or staff.
In contrast, donors who have given many times to the same charity said receiving follow-up information on how their money was used and the courteousness of the charitable organization’s staff and volunteers were factors in their gift giving.
In short, times may be difficult, but you don’t have to be difficult when it comes to asking your donors for money.
Maintaining a high level of quality will also ensure that people continue to give. Nurture those relationships; be honest about where the money goes. Donors need to feel there is value in what you’re doing. Honesty also means being accountable to those people and organizations you exist to serve, to those who support your work, and to society.
A softening economy makes it all the more important that you persuade donors their dollars are being used to the fullest benefit. Those donors who have the longest relationship with you are the ones who will stick with you when times are tough.
Although very generous donors aren’t typically affected by an economic downturn, those who usually give gifts of stock may now decide on gifts of cash, trusts, real estate, or insurance policies. Don’t take their giving for granted; it’s more important now that you provide them with flexibility and choices to make their commitment. And don’t ignore the less generous donors. Last year, the American Cancer Society received $94.2 million in receipts in the last quarter, a 7.4% increase over the same period in 1999. The average gift was $61.
Always let your donors know how much you appreciate their gifts. A "Thank You" should be timely and appropriate to the gift. A fundraising rule of thumb: Find creative ways to thank your donors — particularly your best donors — seven times.
What influences giving
A recent article in The Chronicle of Philanthropy cited four basic lessons that have more impact on gift giving than the state of the economy:
• People give to organizations whose values mirror their own.
• People give to organizations they trust, and how much they know about them influences how they give.
• Generosity is stimulated by passion about an issue, idea, or movement.
• People are more generous when they’re involved in the issue or idea and they understand the results of their giving. Make your donors feel like venture capitalists.
While conventional fundraising wisdom says the key lies in repeated solicitations, the AFP study found that donors who choose how often and how much to give are more likely to give. Donors said being frequently asked to give and being asked to give large sums of money was a deterrent to giving.
Hospices can benefit from allowing donors to determine how they are approached — whether it’s a monthly newsletter, being approached only during a holiday fundraiser or other event, an e-mail reminder, or being removed entirely from a mailing list.
Many philanthropic organizations now use the Internet to provide donors with another way to give. It allows potential donors to immediately access information about your organization and make a pledge with a simple transaction. This is something to consider if you’re looking to incorporate more flexibility for your donors.
If you don’t already have a program in place for planned giving, you need to establish one. Planned giving, one of the basic supports of fundraising, is beneficial — not only for future economic slowdowns, but also for your long-term success.
Planned giving provides donors with opportunities for deferring their gifts. It falls into three categories:
• bequests or gifts;
• invested funds, with the principal going to the charity and the income going to the donor or to the donor’s family;
• invested funds, with the principal going to the donor and the income going to the charity.
For smaller hospices, this may be too ambitious. Start with something as simple as adding a line to your newsletter or direct mail piece stating you accept bequests. Then establish relationships with attorneys and accountants to provide the technical assistance needed to manage planned gift giving.
Also essential is training your staff and volunteers so they can better inform prospective donors about the benefits of planned giving.
No matter what the economic situation, remember that giving is a personal thing. Ultimately, people give to people. Establishing
a good relationship with current and potential donors will ensure your long-term success.
(Editor’s note: Dee Vandeventer is president and partner of Mathis, Earnest and Vandeventer, a fundraising and integrated marketing communications consultancy.)
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