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Waking Up Your Annual Fund 2009


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This was presented at the 2009 National Philanthropy Day Educational Workshops for AFP Northeast Indiana. Topic is how to improve your annual fundraising results by focusing on some basic keys to success, evaluating results and focusing on donor retention.

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Waking Up Your Annual Fund 2009

  1. 1. Waking Up Your Annual Fund Consultants of Philanthropy ● Fund Raising ● Training Robert Croft, CFRE November 12, 2009 AFP Northeast Indiana
  2. 2. It’s Been the Best Year Ever!
  3. 3. <ul><li>“The 30 Best Careers for 2009” </li></ul><ul><li>(November 2008) </li></ul><ul><li>“Top 15 Jobs with Stress that Pay Badly” </li></ul><ul><li>(November 2009) </li></ul>What a Profession!
  4. 4. Today’s Objectives <ul><li>Move you from CNN to US News & World Report …from Death Valley to Hangin’ 10 on a Ginormous Wave of Annual Fund Success! </li></ul><ul><li>Learn 7 “Keys” to annual fund success </li></ul><ul><li>See your job as Chief Bucket Manager ! </li></ul><ul><li>Learn how to Analyze your program </li></ul><ul><li>Discuss Top Strategies for growing annual support (in the current economic climate) </li></ul>
  5. 5. Definitions <ul><li>Annual Giving: </li></ul><ul><ul><li>An amount given annually. </li></ul></ul><ul><ul><li>A fund-raising program that generates gift support on an annual basis. </li></ul></ul><ul><li>Annual Fund: The total gifts made on a yearly basis to support yearly budgets or general operations. (Sustaining Fund) </li></ul>
  6. 6. Two Common Ways of Annual Giving <ul><li>Once a year campaign: “Annual Fund Drive” - same time, same request, same amount, same donors, same method </li></ul><ul><li>A year-round series of targeted fundraising efforts </li></ul><ul><li>What’s Your Approach? </li></ul>
  7. 7. How are You Doing?
  8. 8. How are You Doing? Tough, But Making It It’s Bad, Very Bad! Breaking Even! Raising More!!!
  9. 9. Just How Bad is It? <ul><li>Giving USA 2008 : </li></ul><ul><ul><li>40% decline in market, 2% drop in overall charitable giving from 2007 </li></ul></ul><ul><ul><li>First decline in giving since 1987, only second decline in giving since 1956 </li></ul></ul><ul><ul><li>However, giving remained steady as a percentage of GDP at 2.2% for 2008 vs 2.3% for 2007 </li></ul></ul><ul><ul><li>Human Services declined 12.7% (15.9% when adjusted for inflation) YIKES! </li></ul></ul>
  10. 10. Just How Bad Is It? <ul><li>AFP State of Fundraising </li></ul><ul><ul><li>Less than half (46%) of charities raised more dollars in 2008 than in 2007 </li></ul></ul><ul><ul><ul><li>Typically about 60% see an annual increase </li></ul></ul></ul><ul><ul><li>14% raised the same amount in 2008 </li></ul></ul><ul><ul><li>40% raised Less in 2008 than 2007 – An all time high! </li></ul></ul>
  11. 11. Martz & Lundy Study – Oct. 2009 <ul><li>Capital and Endowment Giving declined most </li></ul><ul><li>Average change in annual fund was 2% decrease </li></ul><ul><li>The number of donors on average decreased by 1% </li></ul>
  12. 12. Just How Bad is It? <ul><li>Unemployment - 10.2% (highest since 1983) </li></ul><ul><li>Rasmussen Consumer Index (Nov 9, 09) </li></ul><ul><ul><li>Just 21% of adults say personal finances are getting better </li></ul></ul><ul><ul><li>50% say they are getting worse! </li></ul></ul><ul><ul><ul><li>Figures have changed little since beginning of 09 </li></ul></ul></ul><ul><ul><li>25% say economy is getting better </li></ul></ul><ul><ul><li>49% say economy is getting worse </li></ul></ul><ul><li>Stock Market has rallied since Spring </li></ul>
  13. 13. Just How Bad Is It? <ul><li>AFP State of Fundraising – Optimism </li></ul><ul><li>Lowest level of optimism in history of survey: </li></ul><ul><ul><li>28% expected to raise more in 2009 </li></ul></ul><ul><ul><li>36% expected to raise less in 2009 </li></ul></ul><ul><ul><li>36% expected to raise same in 2009 </li></ul></ul>
  14. 14. Waking Up Your Annual Fund Key #1 <ul><li>RIGHT ATTITUDE </li></ul>
  15. 15. Right Attitude
  16. 16. Do you want to stay in the stinky pool?
  17. 17. Bad News, Good News or Who Cares? <ul><li>Chronicle of Philanthropy – Oct. 29, 2009 “America’s Top Charities Face Tough Fund-Raising Year” </li></ul><ul><ul><li>Top 400 charities’ are anticipating a median decline for 2009 of 9% </li></ul></ul><ul><ul><li>These charities are anticipating a 1-2% INCREASE in giving for 2010. </li></ul></ul>
  18. 18. Mal Warwick - “Is it Time to Panic Yet?” <ul><li>Can you find the Great Depression on this chart? </li></ul>
  19. 19. Mal Warwick - “Is it Time to Panic Yet?” <ul><li>Nonprofit Revenue during the decade of the Great Depression </li></ul>
  20. 20. Fight or Flight? <ul><li>“ The strategic and tactical decisions made by charities will have more influence on their fortunes than will the recession itself. Charities have more control than they think they do, as long as they FOCUS on the fundamentals of their programs, do not panic and FOCUS on the long term.” - Advancing Philanthropy, Jan/Feb 2009 </li></ul><ul><li>AFP Toolkit (member benefit at </li></ul>
  21. 21. Waking Up Your Annual Fund Key #2 <ul><li>FOCUS </li></ul>
  22. 22. Waking Up Your Annual Fund Key #3 <ul><li>A GOOD FOUNDATION </li></ul>
  23. 23. Foundations of Strong Annual Funds <ul><li>Annual Fundraising Plan </li></ul><ul><ul><li>Set attainable goals </li></ul></ul><ul><li>Case for Support </li></ul><ul><ul><li>Clear purpose for fundraising </li></ul></ul><ul><li>Regular Donor Communications </li></ul><ul><ul><li>Must clearly show how support truly makes a difference </li></ul></ul><ul><li>Volunteer Fundraisers </li></ul><ul><ul><li>Volunteers make the best fundraisers! </li></ul></ul>
  24. 24. Keys to Success <ul><li>Strong Board Support </li></ul><ul><ul><li>Including financial </li></ul></ul><ul><li>Keeping Records </li></ul><ul><ul><li>Donor software program </li></ul></ul>
  25. 25. Why is Annual Support Flat? <ul><li>In non-recessionary environment, flat or declining annual fundraising is often due to: </li></ul><ul><ul><li>Too much emphasis on inefficient methods </li></ul></ul><ul><ul><li>Poor donor acquisition, or lack of planning or budget for acquisition </li></ul></ul><ul><ul><li>Poor donor retention </li></ul></ul><ul><ul><li>Neglecting to analyze results and adjusting (usually from “tyranny of the urgent” and being understaffed) </li></ul></ul>
  26. 26. The Development Challenge <ul><li>The Fundraising “Bucket” </li></ul><ul><ul><li>Acquisition </li></ul></ul><ul><ul><li>Retention </li></ul></ul><ul><ul><ul><li>Nonprofits lose 5 donors for every 6 they obtain - Fundraising Effectiveness Project </li></ul></ul></ul><ul><ul><li>Identification </li></ul></ul><ul><ul><ul><li>Major Gifts </li></ul></ul></ul><ul><ul><ul><li>Monthly Donors </li></ul></ul></ul><ul><ul><ul><li>Planned Gifts </li></ul></ul></ul>
  27. 27. Waking Up Your Annual Fund Key #4 <ul><li>Tending the </li></ul><ul><li>Bucket </li></ul>
  28. 28. Tending the Bucket <ul><li>Analyze Your Organization’s Giving Trends </li></ul><ul><li>Must have donor software program and USE IT to have meaningful data </li></ul><ul><li>Keeping Records a Must </li></ul>
  29. 29. Giving Dynamics Report <ul><ul><li>GROUP EXERCISE: 3-4 to a group </li></ul></ul><ul><ul><li>What areas are strong? </li></ul></ul><ul><ul><li>What can be improved? </li></ul></ul><ul><ul><li>Remember the bucket? </li></ul></ul>
  30. 30. Approach Report
  31. 31. Waking Up Your Annual Fund Key #5 <ul><li>Know Your Donors </li></ul>
  32. 32. Campaign Analysis Report
  33. 33. Waking Up Your Annual Fund Key #6 <ul><li>Strengthen Weak </li></ul><ul><li>Areas </li></ul>
  34. 34. Strengthen Weak Areas <ul><li>No New Donors? Why? </li></ul><ul><li>New Donors but high attrition rate? Why? </li></ul><ul><li>Donors Not Upgrading Support? Why? </li></ul><ul><li>What can you do in each of these scenarios? </li></ul>
  35. 35. Waking Up Your Annual Fund Key #7 <ul><li>Focus on Effective Strategies </li></ul>
  36. 36. Focus on Effective Strategies
  37. 37. Acquisition vs. Retention (In this economy) <ul><li>Which do you choose? </li></ul><ul><li>Which costs more? </li></ul><ul><li>Martz & Lundy Study: New commitments for all purposes saw an average decrease of 33%. </li></ul><ul><li>Retention is King for Growing your annual fund. </li></ul>
  38. 38. Top Strategy #1 – Donor Retention <ul><li>Renewals, Renewals, Renewals… </li></ul><ul><ul><li>Retention (keeping donors in the bucket) should be your HIGHEST priority! </li></ul></ul><ul><ul><li>Retention has larger impact than acquisition </li></ul></ul><ul><ul><ul><li>A 10% increase in donor retention can increase the lifetime value of the donor database by up to 200 percent. - IU Center on Philanthropy </li></ul></ul></ul>
  39. 39. Top Strategy #1 – Donor Retention <ul><li>How do you Keep Donors? </li></ul><ul><li>Key Drivers to Building Donor Loyalty: </li></ul><ul><ul><li>Satisfaction </li></ul></ul><ul><ul><li>Trust </li></ul></ul><ul><ul><li>Commitment </li></ul></ul>
  40. 40. Top Strategy #1 – Donor Retention <ul><li>Retention Starts with the First Gift </li></ul><ul><li>Don’t Over-Solicit </li></ul><ul><ul><li>Penelope Burke – “Donors will give again when they are satisfied their last gift was used the way they intended.” </li></ul></ul><ul><li>Communicate regularly and clearly </li></ul><ul><li>Secure a Renewal </li></ul>
  41. 41. Top Strategy #1 – Donor Retention <ul><li>Create a New Donor Process </li></ul><ul><ul><li>Welcome Letter or Packet </li></ul></ul><ul><ul><li>“ Credibility” Letter (within 2 months) </li></ul></ul><ul><ul><li>Newsletter or email </li></ul></ul><ul><ul><li>“ Best ever” renewal package (within 3 months) </li></ul></ul><ul><li>Implement a phone “Thank You” program </li></ul>
  42. 42. Top Strategies 2-5 <ul><li>Raise Major Gifts for Annual Support </li></ul><ul><li>Upgrade Current, Regular Donors </li></ul><ul><li>Create a Monthly Giving Program </li></ul><ul><li>Engage Donors in Volunteer Activities </li></ul>
  43. 43. Conclusion – 7 Keys to Waking UP <ul><li>Right Attitude </li></ul><ul><li>Focus </li></ul><ul><li>A Good Foundation </li></ul><ul><li>Tending the Bucket </li></ul><ul><li>Know Your Donors </li></ul><ul><li>Strengthen Weak Areas </li></ul><ul><li>Focus on Effective Strategies </li></ul>
  44. 44. Wake Up Your Annual Fund, Surf’s Up