Definition : Annual Giving is the primary fundraising method used to broaden support, upgrade levels and provide operating support for ongoing programs. Annual giving is the 365-day development program that is the central point for most first-time donor gifts.
Within the integrated development process, annual giving is an essential first stage and precedes all other stages
The process of annual fund development includes:
Developing the case for support
Acknowledgment and Recognition
What are the key components of the written, operational development plan?
Statement of fundraising purpose
Strategic and financial goals
Budgeting – how are you going to pay for the process
Solicitation strategies for targeted constituencies
Time frames and responsibilities
Indicators of success
Processes to monitor progress and evaluate performance
Provide income for unrestricted and restricted programs
Renew donor support
Cultivate donors to increase giving levels
Solicit new donors to broaden the base of support
Identify major gift prospects
Build donor loyalty
What are the components of an annual fund strategy:
Individuals – first-time and renewal
Corporations – can be philanthropic support or marketing funds
Government – proposals for specific established program
Foundations – proposals for new or existing programs, capacity building
Special Events – raises funds and brings new friends
Major Gifts – program support, building, special projects,
. Important principles when soliciting individuals
An individual is unlikely to make a significant gift to an organization that is new to him or her
The demographic profile of your current donors is a good indicator of the profile you will find successful in a prospect list for your campaign
Time (generally three to five years at a minimum), energy, work and budgets are all required to build a broad base of support
How does an Individual decide whether or not to contribute
To diminish negative feelings (guilt, fear, anger)
To gain immortality
To express deep emotion (grief – memorial or joy – commemorative)
To give something back
To help or care for others
To respond to the person asking
To gain tax and/or financial planning benefits
Selecting the best strategies for soliciting individuals
According to author James Greenfield, personal solicitation is 16 times more effective than mail solicitation
Using more than one method of solicitation is desirable for individuals
Each method has a greater potential when it is well coordinated with other methods
Individuals have different motivations for giving and different patterns of giving. The more you know about a donor’s motivations and giving patterns, the more effective your solicitation activities will be
With which audiences would personal solicitation be best?
The Board – peer-to-peer solicitation is best accomplished by a small committee of board members and aids board members in soliciting others
Major annual donors – prospects at higher annual giving levels have the greatest interest and potential; personal solicitation can maximize their giving potential
What role does the professional play in personal solicitation
Mail solicitation is the most impersonal and least efficient form of solicitation
Requests for a first-ever (from a nonaffiliated prospect list) gift will yield a return rate of between 0.5% and 1.0%. If early returns are promising, it is advisable to send more than one appeal to the same prospects – to maximize the opportunity and chance of someone making a gift
Direct mail is not simple to perform nor easy to operate at a profit; it requires years of experience to master.
Every aspect of the direct mail campaign - from segmentation of the list to design of the letter, envelope, response device and recognition or thank you gift, can affect the outcome of the campaign. It is strongly recommended that each of these elements be tested for their response rate before any large, direct mail campaign is undertaken
“ ePhilanthropy” is the commonly used term for online donations to nonprofit causes. It can take the form of direct contributions from donors via your website, or indirect contributions via cause-related marketing agreements with businesses.
The growth of the use of the Internet for philanthropic purposes will be met with success when integrated with traditional methods of direct mail, telemarketing, and personal solicitation
Most proposals are developed by staff as a team – the development staff pulls all the information together and puts it in the correct format as requested by the funding source
No matter who is working on the proposal, the developers should act as facilitators bringing together the needs of beneficiaries, applicant organization and funding source on some coherent and logical plan.
One of the first considerations is timing. Then comes implementation – major efforts are required for organizing an administrative group: lining up and training volunteers; locating site, talent, equipment, supplies; printing brochures; publicity and so on. Weeks and months can be consumed even for a relatively small happening.
Competition – Other events can siphon off attendance and we should consider any events which hit our target audiences. Check with the Red Book to see what might already be scheduled on a proposed date (not all events are listed in the Red Book so additional research will have to be done)
Population – there must be enough interested people who will support the event
Attitudes – how do those targeted to attend or participate in the event feel about it?
How much money can, should, and will be raised from this event?
In a major, highly-populated market like the Phoenix metropolitan area, events should be carefully considered as to the return on the investment.
Develop a realistic budget of all costs and set a attainable goal for a net return
The enormous time and effort to produce a successful event constitutes a large investment of time and talent, both staff and volunteer. Why spend all that effort to produce an extremely low return on your investment when it could in reality be much more financially successful.
Do a basic calendar of organizing – work backwards from the date of the event to ensure you have enough lead time for each activity. Allow time for mistakes, delays and a little procrastination from individuals
Recognize the recruitment of volunteers – send each volunteer that is selected a letter confirming his/her appointment – include current plans for the event – any minutes of organizing committee
To be effective, volunteers must have information and perspective – keep in contact with volunteers, be sure they are fulfilling their responsibilities – catch any problems early – encourage their creativity and commitment – keep them apprised of the overall picture.
Confirm everyone’s involvement before the event – have a pre-event meeting the day before with key volunteers to be sure all will go smoothly
Recognize hardworking volunteers – at the event and afterwards. Recognition consists of both saying “thank” you and being open to constructive criticism. Collecting their comments soon after an event improves the event next time.
Everyone has a different perspective on how much money it takes to raise a dollar. In special events – the guide is to invest 50 cents for every one dollar raised. While this may sound reasonable, many times the cost of staff time and overhead expenses are not included – the costs are real and should be included.
One person can sell 10 tickets on the average - many groups overestimate how easy it is to sell tickets – this rule appears to be consistent whether the tickets are for an event or a raffle. It is often the case that 20% of the volunteers sell 80% of the tickets – unfortunately it is hard to predict who will be the star salespeople.
Rule #4 – utilize in-kind donations to maximize the return on the investment
Look at all the materials it will take to run the event and select the ones which have the best opportunity to be donated: food, printing, decorations, flowers, talent, etc. Plan in-kind contributions into your budget so you can be sure they are being pursued
There is only one way to solicit a major gift – in person! Describe your project and the way it helps to solve a community problem, match the prospect’s needs to those of your cause and ask for the prospect’s support
Asking for a specific amount – and securing a promise
It is crucial to ask for a specific amount – people are more comfortable when you give them a sense of what is expected – they can better make a decision
Get a commitment of a specific amount before you end the solicitation. If the prospect needs time to think about the amount, tell him or her you will call back on a specific day to get the pledge – and follow through
Do not accept a gift that is too small – if you think the prospect is going to offer a smaller gift – try to negotiate up first
Don’t just accept a “no”. Keep selling – however if you feel the prospect is going to turn you down, withdraw saying that perhaps this is not a good time to consider such a gift. Ask for a future meeting