Moving Donors Up the Giving Pyramid

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Presented by Jann Schultz, AVP Donor Services, Operation Smile and Angel Aloma, Executive Director, Food for the Poor, July 2013. Learn proven strategies from our experts to optimize long term value …

Presented by Jann Schultz, AVP Donor Services, Operation Smile and Angel Aloma, Executive Director, Food for the Poor, July 2013. Learn proven strategies from our experts to optimize long term value of your direct response donors by moving them up the giving pyramid. Utilizing case studies, this presentation will offer proven concepts regarding development of donor pathways, messaging and offer development and highly personalized contact strategies to optimize donor value.

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  • Moving Your Donors UP the Giving Pyramidv. July 2013Presented by Angel Aloma, Food for the Poor and Jann Schultz, Operation SmileOverview: This session will outline proven strategies to optimize long term value (LTV) of your direct response donors by moving them up the giving pyramid. Utilizing case studies, this presentation will offer proven solutions regarding development of donor pathways, messaging and offer development and contact strategies to optimize of donor value. Intended Audience: Anyone with responsibility for relationships with, or revenue from donors.Learning Outcomes:Know which combination of media channels will optimize donor value over time.Understand the strategic role giving clubs can play in major donor marketingUnderstand how to optimize a contact calendar for middle donor and major donor file segments.
  • Hello, I’m honored to be here and sharing some insights and lessons learned from the integrated fundraising team at Operation Smile.You may be familiar with our organization, we are the largest volunteer-based medical charity in the world, providing free cleft lip and cleft palate surgery for children in need.
  • As Direct Response fundraisers, we are diligent in analyzing and benchmarking our fundraising programs. However, that gives us just a narrow look at our overall fundraising efforts. Usually, we are only looking at our direct response program – the area that we are directly responsible for. However, you may have corporate giving, foundations and grants, government funding, gifts in kind and individual major gifts. Many other funding sources.Do you analyze your giving and benchmark your fundraising at ALL levels?ASK: <<Raise your hand if you analyze fundraising performance at all levels in your organization>>KUDO’s to YOU! Those of you with your hands down…welcome to the club. We conducted our first comprehensive fundraising review at Operation Smile – from bottom to top, last year…and did I mention that we are celebrating our 30th anniversary! Better late than never!The Organization and Fundraising Assessment we completed was part of a broader Strategic Planning project launch, Operation Smile worked with our partner Pursuant Ketchum to complete the comprehensive organizational and fundraising review.The results have helped to shape our strategic planning process.It has also informed Operation Smile where there are significant opportunities to do things differently within our fundraising team. I’m going to share what we learned with you here today. Including all the issues and challenges that we are addressing.
  • What does your organizations fundraising pyramid look like? <graphic of a perfect pyramid>Is it a perfectly built design, a donor-centric edifice, a thing of beauty?<<CLICK>>Or is it a pyramid in ruins? Poorly constructed - reflecting the needs of the organization vs. the needs of your donors?<<CLICK>>Here is what our “pyramid” looked like from the assessment conducted by Pursuant. Heavily weighted at the bottom because of the strength of our direct response program. At Operation Smile, Direct Response is responsible for gifts up to $10,000.We have been successful in some mid-level efforts at the top range of our direct response program – an area where we have seen success in upgrading our donor’s giving. (I’ll tell you a bit more about that in a moment.)But very little activity at the top of the pyramid. And a huge gap in properly transitioning donors from giving annual fund gifts to multi-year pledge programs.Our Major Gift program has been a special event team – raising funds utilizing sponsorship of tables at gala events.Fabulous events! But no growth in giving. The same sponsorship levels year over year. 80-90% of attendees are NEW to Operation Smile each year. So these are NOT major gift recognition events, these have been socialite party activities. If you have read “The Seven Faces of Philanthropy” you’ll know the type of donor that I’m speaking of.Planned giving marketing has only been utilized at the direct response level – it should be a comprehensive program across all levels of giving.<<ASK>> Does this sound familiar? Does anyone else have similar challenges at their organization? <<Raise your hands?>> Thank you…it’s always good to know we are not alone!!
  • A question you may be asking yourself, is “why is she speaking about moving donors up the pyramid, if they are having the same challenges we are?”A very valid question.The good news is that we have been making strides for the past few years in upgrading donors within our direct response program. And I have some great program information to share with you. And over the past year, we have been making enhancements to our Integrated Fundraising Program - specifically the Major Gift Team and building out a more robust mid-level program with the help of our Major Gift Counsel, Pursuant and all of our wonderful vendor partners.And I think the lessons we have learned and the steps we have taken to become more donor-centric in our fundraising efforts have value in sharing. Our goal is to do a much better job of engaging our donors so that they come alongside and give at significantly higher levels. (Moving up the pyramid!)
  • THIS SLIDE IS CORRECT – DO NOT CHANGE!! Per Jann (two sets of text are overlaid in animation.)Donor Care is our specialized direct response strategy targeting mid-level giving donors. The goals of the program are:Donor EngagementDonor RetentionAnd Donor Upgrade and Long Term ValueWe consider this a “Hybrid Program” – combining the best of our multi-channel Direct Response program and layering in personal touches from a Donor Care Associate on the phone.<<CLICK>>Our communication strategy to this audience includes 12 touches annually:3x Multi-channel campaigns, 2x newsletters, 3x reporting back on campaigns (mail and phone), annual tax receipt, 3x special Direct mail appeals (12 touches)
  • THIS SLIDE IS CORRECT – DO NOT CHANGE!! Per Jann (two sets of text are overlaid in animation.)Donor Care is our specialized direct response strategy targeting mid-level giving donors. The goals of the program are:Donor EngagementDonor RetentionAnd Donor Upgrade and Long Term ValueWe consider this a “Hybrid Program” – combining the best of our multi-channel Direct Response program and layering in personal touches from a Donor Care Associate on the phone.<<CLICK>>Our communication strategy to this audience includes 12 touches annually:3x Multi-channel campaigns, 2x newsletters, 3x reporting back on campaigns (mail and phone), annual tax receipt, 3x special Direct mail appeals (12 touches)
  • To move donors up the pyramid…and give more to Operation Smile required crafting new offers and defining new products.We needed to engage donors who had given a donation of a single surgery and find new products that upgraded the value of their giving.<CLICK>So we developed asks tied to the emotional ask that engaged them in the first place, if they gave a single surgery – they could sponsor multiple surgeries or an entire operating table for a single day at $2400.
  • In addition, we have leveraged special offer strategies – such matching gift challenges or gift multipliers, tied to the value of shipping vital medical equipment and supplies required to…<CLICK>…STOCK AN OPERATING ROOM– and showed the donors, through images, the difference their donations could make.
  • So have we been successful in upgrading our donors? YES!During our initial test phase of the program, we ran a control panel and a test panel.We were successful in upgrading our single surgery prospects, and saw an 84% lift between the test and control panels.We increased giving to break the $1000 mark by upgrading donors who had given “multi-surgeries” in the past. We saw a 91% lift between the test and control panel.And another group where we saw significant improvement in performance were donors who had been screened and identified by Target Analytics as having the capacity to give at higher levels, but had given gifts of under our single surgery benchmark. We had a 103% lift between our test and control panels to upgrade these donors to giving over $500.
  • What happens to a donor who gives a “trigger” gift of $10,000?Historically, this was The Donor Cliff!We have not had a comprehensive cultivation and solicitation program to move our high value donors in to.Does this sound familiar?The donors are “moved” into a black hole. As they are not event donors – they have not fit the model for existing solicitation strategies. So they were abandoned. Marked “Do Not Solicit by Direct Response” and left to wonder why Operation Smile didn’t care about them anymore. Or another problem we had – we took the time to do a proper wealth screening on our direct response file, but then the MG team did not having strategies in place for properly transitioning these donors into Major Gifts. The MGO’s “ran through” the list of prospects in short order, then complained because none of the donors they called would take a meeting with them.
  • Sincethe fall, we have been focused on repairing those gaps and filling the holes. <CLICK>In January, we layered in the Charitable Partners Program to develop mid-level donors who give annually - into multi-year pledge donors giving from $1000 - $10,000 per year – committing to a 3 year pledge.This Face to Face solicitation program eases donors who give at the mid-level from a direct response program into a more traditional development program. Paving the way for increased prospects for our Major Gift team.<CLICK>Last fall, a new SVP Development and Leadership Gifts joined the organization, bringing 25+ years of experience in traditional development shops to Operation Smile. Since that time, there have been significant enhancements to our Major Gift Program:Re-purposing members of our Major Gift team from Special Event organizers into Gift Officers.Development of guidelines for MG portfolio managementPlus the creation of a Stewardship and Communication program
  • THIS SLIDE IS CORRECT – DO NOT CHANGE!! Per Jann (text and graphics are overlaid in animation.)Since the fall, we have been focused on repairing those gaps and filling the holes. <CLICK>In January, we layered in the Charitable Partners Program to develop mid-level donors who give annually - into multi-year pledge donors giving from $1000 - $10,000 per year – committing to a 3 year pledge.This Face to Face solicitation program eases donors who give at the mid-level from a direct response program into a more traditional development program. Paving the way for increased prospects for our Major Gift team.<CLICK>Last fall, a new SVP Development and Leadership Gifts joined the organization, bringing 25+ years of experience in traditional development shops to Operation Smile. Since that time, there have been significant enhancements to our Major Gift Program:Re-purposing members of our Major Gift team from Special Event organizers into Gift Officers.Development of guidelines for MG portfolio managementPlus the creation of a Stewardship and Communication program
  • So we filled the gaps, that’s easy to say, but what does that really mean?We had a vision, but we didn’t have the framework or the business rules to make it happen. The challenge is that we have been continuing to work in our old silos as these new programs were put in place.With my key vendor partners, I recognized this was going to be a challenge if we didn’t make significant changes to our framework.So we brought together all the players for an Integrated Strategy Planning Session - the key fundraising leadership team members and our vendor partners - together to review and define what our comprehensive fundraising program will look like.<Pursuant Framework> This framework was crafted by Pursuant Ketchum through detailed analysis. It defines audiences that are Donor Centric, not channel specific.
  • We all agreed – across our partners, across channels - to this framework.Most importantly, we crafted all the business rules for moves management into and out of programs.And we set timelines for implementation.The concept here is that there are pathways for donors to move up – from direct response, into Donor Care.Hot prospects in Donor Care can be moved up to the Charitable Partners program – you get the idea.And we set business rules for those donors who need to “jump” a stage, based on a variety of criteria.
  • So with all this change, have we been successful? We have continue to meet cross-functionally internally and with our vendor partners to refine the business rules and continue our donor centric approach.Full roll out of the Charitable Partners ProgramWe had some territorial issues that we had to deal with - but once we got the Gift Officers in the field and meeting donors face to face - the feedback from our donors has been very positive. To date, we have seen promising results. The close rate on multi-year pledges is at 50%, with an upgrade factor of 578%. We have several exceptional success stories. One is Mr. C. His lifetime giving to Operation Smile was $1,930 with this highest previous contribution of $1,200 occurring in 2011. Through a donor visit with one of our gift officers, Mr. Caruthers agreed to a $60,000 pledge, payable over three years, and he made an initial installment of $20,000 during the visit. Now while this is an exceptional success story, we have seen annual increases in giving in the 250-300% range on a regular basis.The Major Gift Team had their first full review of portfolios in March and April with lots of clean-up work and movement out of portfolios for “stagnant” donors. Our next quarterly review will be later this month. Implementation of a multi-channel Stewardship and Communication program for Major Gift Portfolio donors with regular cultivation and solicitation touches
  • This communication stream is a program that I’m facilitating, leveraging our strong direct response program – with specific adaptations for the major gift audience.It includes regular donor-centric reporting strategies as well as three solicitations for “extra” annual gifts. The additional asks are “special” appeals for unrestricted funds – such as an extra year end gift, or a request to help with our fiscal year end goal or the opportunity to participate in a special matching gift challenge.The first solicitation was sent at the end of the calendar year and raised an additional $100,000 dollars for the organization.This program is in addition to the strategies the team is using to prepare and solicit their donors for significant, transformational gifts through traditional presentation of a case.
  • So I hope from this information, you takeaway these key learnings:Assess and analyze all your fundraising programs – to identify gaps up and down the pyramidReview your product offers and begin an upgrade program within your existing direct response. Increase the value of the asks - higher value gifts – by looking at ways to re-package your existing offer into new, larger asks.Identify “bridging” or “transition” strategies to move donors out of direct response – to include more personal engagement and relationship building such as our Donor Care Associates who are on the phone or our Charitable Partners Gift Officers who meet with donors face to faceCraft donor-centric pathways that allow movement and build business rules for moving donors in and out of programsWork with your Major Gift team to create a comprehensive communication program utilizing direct response elements to make it cost effective and consistent across all teams. Offer to help assist with the creation and management of the program.

Transcript

  • 1. Moving Donors UP The Giving Pyramid JANN SCHULTZ, Operation Smile ANGEL A. ALOMA, Food For The Poor MARK RHODE, Russ Reid
  • 2. The problem we’re here to solve How to optimize relationship and revenue from our donors products, integrated channels, strategies tactics Questions are good, but hold till Q&A
  • 3. JANN SCHULTZ Operation Smile Twitter: @jannschultz @operationsmile #NYNP2013
  • 4. Operation Smile Envisions a world in which no child suffers or dies because of a repairable facial deformity.
  • 5. Fundraising Analysis
  • 6. Collapsed Giving Pyramid © Pursuant Ketchum
  • 7. Donor Care (Mid-Level Giving) Program Goals Donor Engagement Donor Retention Upgrade and Long Term Value Donor Care Associates (portfolio of 650 donors)
  • 8. Donor Care Communication Strategy 12 Touches  3x Multi-channel campaigns  2x Newsletters  3x Reporting Back (mail and phone)  Annual tax receipt (online & offline)  3x special DM appeals
  • 9. New Products Single Surgery Ask $240 Sponsor an Operating Table $2400
  • 10. 84% 91% 103% Mid-Level Prospects HPC $240-$479 84% Lift – the difference in performance between Test Panel and Control Panel Upgrading to $480+ Mid-Level Prospects HPC $480-$999 91% Lift – the difference in performance between Test Panel and Control Panel Upgrading to $1000+ Wealth Screen Prospects HPC <$240 103% lift – the difference in performance between Test Panel and Control Panel Upgrading to $500+
  • 11. The Donor Cliff
  • 12. Repairing the Gaps
  • 13. Repairing the Gaps Charitable Partners Program  Face to Face solicitation  Multi-year pledges New Major Gift Team Leadership  From event organizers to Gift Officers  Portfolios, moves management framework, weekly reports  Communication and solicitation program
  • 14. Donor Paths, Programs & Goals • Includes: • DR Acquired • Single Gift & Recurring • Multichannel Cultivation • Donor Relations Support • Goals: • Second Gift • Donor Retention • Includes: • DR & Other Channel Acquired Donors • Single Gift Donors • Hybrid Cultivation w/Versioned Messaging • Donor Care Associate Portfolio and Support • Goals: • Donor Upgrade & LTV • Donor Engagement • Donor Retention • Includes: • DR & Other Channel Acquired • Face to Face Solicitation • Hybrid Cultivation & Communication • Associate Development Officer Portfolio • Donor Care Associate Support • Goals: • Donor Upgrade & Multi-Year Pledges • Donor Engagement • Life Time Value • Major Gift Prospecting • Goals: • Major Gift Donors & Prospects • Face to Face Major Gift Solicitation • Goals: • Donor Upgrade • Annual gifts • Multi-Year Pledges • Donor Engagement • Life Time Value © Pursuant Ketchum
  • 15. Donor Paths & Programs Upgrade and downgrade paths developed for each type of donor in each program… © Pursuant Ketchum
  • 16. What does success look like to date? Continued collaboration across programs – focusing on the donor Full roll out of the Charitable Partners Program First full review of MGO Portfolios Implementation of a multi-channel Stewardship and Communication program for MG Donors
  • 17. Major Gifts Stewardship Program Communication and Solicitation Plan 12 Touches • 3x Solicitations (leveraging direct response content) • 3x Newsletters (version of direct response) • Annual tax receipt • Annual Report • Quarterly Donor Impact Reports (campaign updates) + Thanksgiving Card, Birthday Card
  • 18. Takeaways from Jann Assess all your fundraising programs – find the gaps Review your product offers and begin an upgrade program within your existing direct response Identify “bridging” or “transition” strategies to move donors out of direct response Craft donor-centric pathways that allow movement and build business rules for moving donors in and out of upgrade programs. Create a comprehensive communication program
  • 19. Thank You! Jann Schultz +1.757.321.7645 +1 757.593.6560 jschultz@operationsmile.org Facebook: Operation Smile Twitter: @jannschultz @operationsmile LinkedIn: Jann (Erickson) Schultz Associate Vice President, Donor Services Operation Smile Moving Donors UP The Giving Pyramid
  • 20. Food For The Poor, Inc. ANGEL ALOMA
  • 21. ACROSS CHANNELS Phone Direct Mail Face to Face
  • 22. DYNAMIC ASKS Realistically and gently stretching the donors to increase their giving with dynamic asks and ask tables based on their last largest gifts
  • 23. DIRECT MAIL & PHONE Upgraded ask tables $ $to
  • 24. FACE-TO-FACE Present higher priced projects, always with options
  • 25. DONOR CENTRIC COPY Let your copy and conversation be truly donor centric. Compare: “Food For The Poor feeds hundreds of hungry, at-risk children.” Vs. “Your caring generosity has saved the lives of hundreds of hungry children by providing them with much needed food.”
  • 26. WHAT’SYOURUSP? -YOURSTORIES!!! Tell them well Don’t be afraid to elicit an emotional response; emotions are a strong catalyst for generosity
  • 27. BREAK DOWN SILOS No one owns a donor Your best donors are those that give to multiple channels
  • 28. TELEPHONE - THE BEST CULTIVATIONAL TOOL
  • 29. In tests with first time donors, a thank you call increased renewal rate by 40% RIGHT FROM THE START
  • 30. THIS IS HOW FOOD FOR THE POOR USES IT
  • 31. FOUR GROUPS Campaign Advisors 2 (CA2) Campaign Advisors 1 (CA1) Senior Campaign Advisors (SCA) Development Advisors (DA)
  • 32. They call active donors (0-12) with single gifts of $50 - $99 in last 24 months Pool of 60,000 donors 13 callers on predictive dialer CAMPAIGN ADVISORS 2
  • 33. CAMPAIGN ADVISORS 1 They call active donors (0-12) with single gift of $100 - $599 in last 24 months Pool of 60,000 donors 10 callers on predictive dialer
  • 34. SENIOR CAMPAIGN ADVISORS They call active donors (0-12) with single gift of $600 - $3,600 in last 24 months or cumulative gifts of more than $3,600 two years in a row Pool of 9,700 donors 11 callers, each with own portfolio of donors for continuous contact
  • 35. DEVELOPMENT ADVISORS They call active donors (0-12) with single gift of $3,600+ to $20,000 single or cumulative Pool of 7,000 donors 17 callers, each with own portfolio of donors for continuous contact
  • 36. THREE CAMPAIGNS PER YEAR (12-16 WEEKS) Water - Food – Housing Calls follow-up creative direct mail pieces promoting above with ask tables designed to upgrade donors.
  • 37. INCENTIVES Callers are incentivized… to surpass goals to upgrade donors to higher level
  • 38. GRADUATION In January each year… All CA2 donors with single gifts of $100+ will upgrade to CA1 group All CA1 donors with single gifts of $600+ will upgrade to SCA group All SCA donors with single or cumulative gifts of $3,600+ - two years in a row – will upgrade to DA group All DA donors with single gift of $10,000 and cumulative of $20,000 will upgrade to Major Donor Department.
  • 39. MAJOR GIFTS DEPARTMENT 650 donors Director with portfolio of 20 donors Five major gifts advisors with approx. 125 donors in each portfolio $20,000+ per year donors
  • 40. MOVING THEM TOWARDS THE PEAK OF THE PYRAMID Develop meaningful, personal relationships well beyond donor/fundraiser Calls, cards, notes, prayers Awards Special Events Parties with a Purpose
  • 41. MOVING THEM TOWARDS THE PEAK OF THE PYRAMID (Continued) Proper fulfillment for projects undertaken by donor Access to Executive Director Personal visits Mission trip to see need and organization’s response to that need
  • 42. THE SUMMIT – LEGACY GIFTS Relationship between Major Gifts and Planned Giving Departments
  • 43. THERE IS GOLD IN GOLDEN YEARS OF YOUR DATA BASE Example of successful approach by FFP: Phone calls to select of donors 65+ years old Thank them for past support – some may be lapsed Offer prayer for special intentions/petitions Offer free course in planned giving
  • 44. HOT PROSPECTS Those who request/accept free course are hot prospects for a planned gift These should be followed up by phone call from Planned Giving Advisor This call could lead to setting up a personal visit with planned giving prospect
  • 45. Thank You! Angel Aloma 954-954-2222 aaloma@foodforthepoor.com Executive Director Food For The Poor, Inc. Moving Donors UP The Giving Pyramid
  • 46. Thank You! Jann Schultz, Associate Vice President, Donor Services Operation Smile 757.321.7645, jschultz@operationsmile.org Angel Aloma, Executive Director Food For The Poor 954.427.2222, aaloma@foodforthepoor.com Mark Rhode, Vice President Russ Reid 626-298-4166, mrhode@russreid.com