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Addressing the Second-Level Donor Pyramid
 

Addressing the Second-Level Donor Pyramid

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bbcon 2013

bbcon 2013

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    Addressing the Second-Level Donor Pyramid Addressing the Second-Level Donor Pyramid Presentation Transcript

    • 10/04/2013 #bbcon 1 Addressing the Second Level Donor Pyramid PRESENTED BY PAGE BULLINGTON, DIRECTOR PROFESSIONAL SERVICES TARGET ANALYTICS
    • 10/04/2013 #bbcon 2 TARGET ANALYTICS Leading Provider of Supporter Insight & Analytics to the Nonprofit Sector Division of Blackbaud, Inc. 7,000+ Customers, Across All Nonprofit Segments Key Assets: Cooperative Database - Industry’s largest donor database; over 2B philanthropic transactions from 80M+ households NOZA Database - Industry’s largest searchable database; over 65M uniquely identified gift records donorCentrics – Nonprofit’s largest & most established performance benchmarking practice, with more than 530 participating organizations Key Product Lines: Direct Marketing Solutions Major Gift Fundraising Solutions Data Enrichment Services Performance Benchmarking & Reporting
    • ά 10/04/2013 #bbcon 3 THE SCREENING PROCESS You Industry/ External Target Analytics We apply the models to pinpoint supporters with the likelihood and capacity to give to your mission We perform detailed screening to uncover actual wealth, career and philanthropic connections on the individuals most likely to be annual, major and planned gift prospects We utilize your organization’s unique giving records, proprietary and external data, and our proven statistical analysis to create custom models Model types MAJOR PRINCIPAL PLANNED $$$ $$ $ $ $$ $$$ $$$ $$ $ $ $$$ $$ $$$ $$$$ $$
    • 10/04/2013 #bbcon 4 WHY A SECOND LEVEL?
    • ] 10/04/2013 #bbcon 5 Major Mid Annual SECOND LEVEL DONOR MOVEMENT Principal Non Donors
    • 10/04/2013 #bbcon 6 • Designed to jump start the campaign • Could equal roughly 80% of the dollars raised • Help demonstrate campaign leadership and capacity • Elevate individuals to (and provide examples of) pace setter status • Ability to influence later giving at all levels • Will provide a vehicle for publicity PRINCIPAL GIFT DONORS
    • 10/04/2013 #bbcon 7 • Designed to jump start capital campaigns • Could equal roughly 80% 90% of the dollars raised • Help demonstrate campaign leadership and capacity • Elevate individuals to (and provide examples of) pace setter status • Ability to influence later giving at all levels • Will provide a vehicle for publicity And “Of the nearly $300 billion donated [in 2011] more than 70 percent was given by individuals, of which roughly half was given by the wealthiest 3 percent of American households.” WHY PRINCIPAL GIFTS?
    • ) 10/04/2013 #bbcon 8 Additional Note: The most common motivations for stopping support are an organization soliciting the donor too frequently or asking for an inappropriate amount. BIGGEST MOTIVATIONS FOR GIVING Bank of America Merrill Lynch/ Center on Philanthropy at Indiana University Center for Philanthropy http://www.philanthropy.iupui.edu/research-by-category/the-2012-study-of-high-net-worth-philanthropy ; accessed on 11/5/12
    • ) 10/04/2013 #bbcon 9 WHO ARE THEY? Inclination Giving history is trending positively Confirmed patterns of philanthropic donations Capacity Well educated and belong to affluent demographic segments Live in areas where a higher quality of life index is present Asset Valuation Purchase expensive homes and vehicles Long-established credit history High real estate valuation Wealth Indicators Benchmarked against peers giving principal & lead gifts Higher incomes and known public assets including stock
    • 10/04/2013 #bbcon 10 HOW DO WE FIND THEM? PRINCIPAL GIFT LIKELIHOOD What is Principal Gift Likelihood? Scores a donor based on their likelihood to give a principal gift, typically $250k or more. What does Principal Gift Likelihood do? The model identifies ultra-high-value prospects who have the means, passion, and commitment to make game-changing principal gifts to a non-profit How does Principal Gift Likelihood work? By utilizing a proprietary archive of principal gift contributions, along with a wide array of financial, demographic, and lifestyle attributes linked to each analyzed constituent.
    • ) 10/04/2013 #bbcon 11 WEALTH DOESN’T TELL ALL The following assets can often be discovered in publically available data sources: The following assets can often be discovered in publically available data sources: Real estate values Public company “insider” stock holdings Some private company affiliations Federal political donations above $250 Charitable donations cataloged from online sites These assets are usually well- hidden and will not be discovered: These assets are usually well- hidden and will not be discovered: Debts and most Mortgages Bank Account Holdings Retirement Assets Non-”insider” stock holdings Business Assets not voluntarily disclosed Detailed wealth screening uncovers roughly 40% of assets. You must do more to uncover these prospects.
    • ) 10/04/2013 #bbcon 12 CASE STUDY – HIGHER EDUCATION
    • 10/04/2013 #bbcon 13 The Challenge • $250 million dollar campaign • Gap analysis reveals campaign pyramid gaps at the highest giving levels CASE STUDY #1 Goals & Objectives • Identify new prospects of Ultra-High Wealth • Increase size of current donor’s gift amounts • Increase response rates across all gift levels
    • ) 10/04/2013 #bbcon 14 CASE STUDY #1 • 600 previously-assigned prospects • Tripled prospects rated at $1M+ for multi-year commitments 1,843 TOTAL IDENTIFIED PRINCIPAL GIFT PROSPECTS Segmentation Capacity to Client Number of Prospects Tier 1 $1M+ 188 Tier 2 $750K - $1M 199 Tier 3 $500K - $750K 416 Tier 4 $250K - $500K 1,040
    • 10/04/2013 #bbcon 15 IMPLEMENTATION STRATEGY Focused on realignment of major gift officer portfolios: Review Of Assigned Prospects Team Pre-Qualifies Unassigned MGO Portfolios Revised Old Prospects Dropped & New Prospects Added Tier 1 Assigned For Exec Cultivation Tier 2 Assigned to MGOs, Personal Solicitation Plan Tier 3 Assigned for 2nd Phase of Personal Cultivation Tier 4 Received Higher-End Mailings & Calls Moved To Primary Cultivation With “Self Selects”
    • ) 10/04/2013 #bbcon 16 CASE STUDY #1 - RESULTS • Major Gift portfolios realigned to represent larger capacity • More value in portfolios, fewer constituents • Streamlined system for managing lower-level prospects; ensures contact is made and initial cultivation begins • Lower potential prospects moved from the assignment pool • Development officers focused on the right individuals Individual accepted; following the event he made a commitment for a $500K gift. Individual accepted; following the event he made a commitment for a $500K gift. Prior to new Tier rating, the individual was in higher-end direct mail pool Prior to new Tier rating, the individual was in higher-end direct mail pool Cumulative lifetime giving prior to the invitation was only $30,000 Cumulative lifetime giving prior to the invitation was only $30,000 Previously underrated prospect received personal invitation to cultivation event Previously underrated prospect received personal invitation to cultivation event
    • ) 10/04/2013 #bbcon 17 CASE STUDY 2 - CULTURAL
    • ) 10/04/2013 #bbcon 18 The Challenge • Large # of low-level donors (< $1K) • Sub-optimal response rates • Upcoming budget cuts & streamlining OVERVIEW OF CHALLENGE Goals & Objectives • Uncover regular monthly donors that should be upgraded • Develop pipeline that will support multi year capital campaign • Discover new previously overlooked principal gift prospects
    • ) 10/04/2013 #bbcon 19 INITIAL RESULTS – 21,220 TOTAL RECORDS $50,000 $100,000 $250,000 $500,000+ P P P P P P P P P P P P P P PP P 74 6,248 5,431 9,467
    • ) 10/04/2013 #bbcon 20 FURTHER PRIORITIZATION OF RESULTS USING ADDITIONAL SCORECARD METRICS FOCUSED ON PHILANTHROPY AND GIVING TO ORGANIZATION PROSPECTS WERE FURTHER SEGMENTED INTO 10 TIERS: Group/Wave Record Count Rationale 1 2044 Tier 1 and Tier 2 2 1859 Tier 2 3 2419 Tier 2 4 1962 Tier 3 5 1760 Tier 3 6 1709 Tier 3 7 2151 Tier 4 8 1959 Tier 4 9 2157 Tier 4 10 3200 Tier 4
    • Ի䞠 10/04/2013 #bbcon 21 INTERESTING OBSERVATIONS Only 961 of these prospects have a Solicitor assignment <1/2 have made a gift to in the past three years Top States: • NY (13,883) • CT (2,301) • NJ (1,436) • CA (1,521) • FL (417) • MA (340) • TX (209) ~2,800 have never made a gift 21,220 Records
    • Զ㖐 10/04/2013 #bbcon 22 PRINCIPAL GIVING SOLUTION: INITIAL NEXT STEPS Wave 1 • Prospects for immediate review • Confirm that all prospects in these groups have assigned solicitors, are disqualified or there is a plan in place for prioritizing qualification • Some qualified prospects should be surfaced to executives for cultivation Waves 2 & 3 • Use these pools for initial portfolio refinement over time • Interim engagement should be assessed using mid-level or leadership level programming opportunities • Begin monitoring activity of un-assigned prospects to help with prioritization Waves 4 – 10 • Further prioritization should occur using special cohorts, geography and other factors • Consider pre-cultivation engagement strategies to help prospects ‘self select’
    • Ձ꾐 10/04/2013 #bbcon 23 CONCLUSION
    • 10/04/2013 #bbcon 24 IN SUMMARY Well Designed & Executed Analytics . • Uncover supporter insights that aren’t easily derived from wealth screening alone • Streamline the process of interacting day-to-day with supporters • Direct our investment towards the constituents & initiatives which yield the highest ROI • Produce results that far surpass past performance, in terms of revenue and efficiency
    • Ժ 10/04/2013 #bbcon 25 TWEET ABOUT YOUR SESSION #SESSION #TRACK #PRESENTER