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  • SWOT ANALYSIS
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  • Building a Gift Chart
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  • Advocacy or Lobbying 101
  • Sad Day for Virginia…
  • Fear of the Ask
  • Kaiser on Marketing Arts Organizations
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How to build a donor stewardship plan

Create a stewardship development committee whose primary responsibility is to create a stewardship plan that will be presented to the board of directors for approval.

• Conduct a donor analysis at least twice a year
• Track current donors
• Track giving levels and frequency

Board buy in; keep the board current on all fundraising initiatives.

• Keep the Board aware of the entire stewardship process
• Have Board members suggest who, within the organization, should be on the stewardship development committee
• Once the committee is in place, it will meet and develop an appropriate stewardship plan
• Develop a comprehensive database
• Monitor and adjust the stewardship program as the donor base grows
• Record benchmarks
  • Number of repeat donors
  • Number and value of increased gifts
  • Event attendance
  • Newly engaged donors (and how they were acquired)

Engage the donor from their first gift

• Create a budget for stewardship; include taking a donor to lunch, postage, printing of thank-you notes and donor-focused events.
• Ensure stewardship activities are in line with the budget, amount of the gift and image of the agency.
• Determine what kind of involvement your top donors want outside of making the donation.
• Use current donors to convey the agency’s message to potential donors.
• Determine how to tie the stewardship program to the mission.
• Focus on the intangible benefits rather than the tangible. Turn donors into investors of the agency.
• Continue to maintain stewardship with long-term and major donors even when they decrease their gift or stop giving
• completely.
• Establish relationships between donors and the stewardship program staff.
• Keep all donors on the database unless they ask to be removed.
• Create Giving Levels

Use the following mediums for effective outreach

• Marketing and print materials
• Mailings (annual fund letter, newsletter)
• Phone calls
• Personal letters
• Social media (twitter, blog, FaceBook, Youtube, Wikipedia)

Many people believe that the recent economy has forever changed giving.  This might be true, but according to the conference board corporations are ‘moving out of crisis mode and into a recovery mindset’.  This is good new for non-profits who have missed their sponsors.  Hopefully development professionals have kept contact with previous sponsors.

While giving budgets are not where they once were, corporations are no longer making giving decisions based on the recession.  Priorities are again aligning with corporate strategy; only 11% of survey respondents said that their grant making would be reduced in 2010.  Still, there will continue to be decreases in event sponsorship.  Arts are still low on the list, and will be one of the last to recover.

http://www.conference-board.org/utilities/pressDetail.cfm?press_ID=3884

Donor Stewardship is Vital in this Economy

In today’s philanthropic world, donor recognition must be so much more than a response to, or motivator of the gift. It simply must be a part of a comprehensive and strategic communication plan to enhance and broaden continued giving.

Although charitable giving during the 2009 holiday season generated some optimism among fundraisers about the year ahead, donors, especially to the arts, are still only cautiously optimistic at best.  An article in the New York Times http://www.nytimes.com/2009/06/10/us/10charity.html states that giving fell to its lowest point in fifty years in 2008-2009.  Giving was still impressive considering the 40% drop in the value of some foundation’s funds.

A December 2009 survey by the AFP found that 34 percent of the charities that responded to the survey raised more money during the last three months of 2009 than during the same three-month period in 2008. Things are looking up.

However, the recent economic turmoil has made many people hesitant to give. Development professionals are focusing on establishing long-term, lasting relationships with potential donors. “Since lots of people are cutting back on giving, charities with the proper stewardship that plan to keep donors close and involve them emotionally are those that are going to survive.” said Debra Ashton, author of the “The Blue Bible.”

The Foundation Center suggests that now is the time to meet and get to know the staff at foundations that are good matches with your organization.  Once they renew giving to new organizations, you will have a foot in the door because you already introduced yourself.

Work with your current donors, who are your best prospects, to forge bonds and understand their motivations.  How can you help them meet their giving needs?

http://www.utsystem.edu/cdl/files/Observations2010ProposedBudgetImpactCharitableGiving.pdf

http://www.post-gazette.com/pg/10077/1043676-28.stm

http://www.nonprofitfinancefund.org/docs/2010/2010SurveyBrochure.pdf

Once key issues have been identified with your SWOT analysis, they feed into marketing objectives. SWOT is a very popular tool with marketing students because it is quick and easy to learn. During the SWOT exercise, list factors in the relevant boxes. It’s that simple.

Strengths and weaknesses are internal factors

Strengths

Your staff

Your marketing expertise or strong brand

Great reputation

Location Quality processes and procedures

Any aspect of your organization or mission that adds value

Unique niche

Weaknesses

Lack of marketing expertise

Weak brand

Lack of funding or staff

Undifferentiated products or services

Location

Damaged reputation

Opportunities and threats are external factors

Opportunities

A developing market such as the Internet

Mergers, collaborative efforts, strategic alliances

A niche vacated by an ineffective competitor

Unfulfilled need in your area

Threats

A new competitor in your area

A competitor has a new, innovative product or service

Competitors have superior access to channels of distribution

Simple rules for successful SWOT analysis.

• Be realistic about the strengths and weaknesses of your organization when conducting SWOT analysis.
• SWOT analysis should distinguish between where your organization is today, and where it could be in the future
• SWOT should always be specific
• Always apply SWOT in relation to your competition: better than or worse than your competition
• Keep your SWOT short and simple
• Avoid complexity and over analysis

Today I am posting a chain of emails that I recently exchanged with someone starting a non profit art organization. Where does the money to start come from?

Is it as simple as starting with nothing and having someone come in and write grants based on commission?

It sounds like a wonderful center. However,you might want to think a bit more on the pay and the way you are advertising it. I imagine most people on here don’t offer commission to fundraisers- but I’m curious now.

The practice of hiring fundraisers on commission has been roundly criticized by several fundraising trade associations, including the Association of Fundraising Professionals, the National Association of Hospital Developers, and the Council for the Advancement and Support of Education.

Paying fundraisers on commission is considered by most to be not only unethical, but also potentially harmful for a nonprofit organization and its future fundraising efforts.

Katherine,

I had not heard that before, regarding the criticism and ethical concerns of commission-based fundraising (mostly, in this regard I’m referring to grant writing rather than say a fundraising event like a raffle). I’m out for the rest of the day, but would like to hear more from you on this.

It’s common for start up non profits, without money to pay well, to think commission makes sense. But if I were you, I’d drop that off your post even if you decide to go that route. I am not sure if you are close to a college/university but interns can make great grant writers, for free.

The Foundation Center Online is an excellent resource you might check out.

Here’s a good article http://www.charityvillage.com/cv/research/rfrm24.html
for further info on the ethics of commission based fundraising- you can always check AFP too- http://www.afpnet.org/ethics

It’s an industry wide thing, although there are people who feel a great fundraiser/grantwriter is worth whatever you pay them. You just want to avoid a situation where your grant writer seems over paid to your donors who will then leave your organization.

Best to you! k

Katherine,

One point of clarification, and this is my fault for not being clear in my post, is by “fundraiser” I mean primarily, “grant writer”. I don’t know if the same issue applies to grant writers versus fundraisers (now understanding the difference in the use of the terminology). This after reading part of the references you sent me. I understand the issues with a fundraiser making commission, that makes perfect sense. But, does that apply to grant writers as well? My understanding is a commission-based payment for grant writers is generally acceptable.

Where did you hear it is generally acceptable? I am curious. Fundraiser, development person, grantwriter are all so closely related- Much the same thing.

How do you plan to pay the commission? It cannot be through the grant money; most grantors will not allow the money to be used in that manner. Many will reject an application that includes this.

Do what you think works where you are, but I’d seriously consider before going that route- I’ve simply given you my two cents! When working with Donors- TRUST is critical. If you lose this trust before establishing yourself or your organization you’ll have no donors to ask- Once the trust and reputation is damaged it will take years of intensive labor to regain.

If a commission based salesman/grant writer, with no passion for your organization or mission, alienates your donor base you are in a mess.

http://thegrantplant.blogspot.com/2007/02/grant-writers-on-commission.html

Some grant writers are paid based on a certain percentage of funding requested. In this arrangement, the grant writer’s compensation is tied to their success in securing the grant, and will be paid anywhere from 1% to 5% of the total grant awarded.

Often used by cash-strapped non-profit organizations with little operational funds, this practice raises a number of ethical questions in the industry. First, grant seekers will have to creatively reflect the grant acquisition services provided by the grant writer in the grant application. Including grant-writing fee in the proposed budget of the grant application presents the risk of jeopardizing the client’s chances of securing the grant. Grant funders almost always stipulate that every dollar to be raised for and spend on project be accounted for on a line-item basis. .

The grantwriter will also be taking a lot of risks if they tie compensation to the success of the grant application. If the grant application is rejected, they have basically given their services for free.

The success or failure of a grant application is not always contingent on the quality of writing of the grant proposal. Sometimes, grant applications are rejected because of poor timing, poor presentation by the applicant, or for some other reason beyond your control.

It is not  fair to grant writers who should be given fair payment for work done on a grant application, whether the grant funding is secured or not.

Here are some very simple guidelines for building a gift chart:

The lead gift is at least 15% and maybe up to 25% or more of the goal.

Build the chart downwards by cutting the gift size in half and increasing the number of donors at each level.

Round the donation levels up or down to keep it simple.

Roughly 80% of your goal will come from 20% of your donors.

For each gift you need three or four qualified prospects.

As you go down the list, you need fewer prospects because people who said no at higher levels often give smaller gifts.

SAMPLE GIFT CHART FOR A $10,000 GOAL
GIFT AMOUNT		# GIFTS		# PROSPECTS		CUMULATIVE TOTAL
$1500		1		4		$1500
$750		2		8		$3000
$400		4		16		$4600
$200		8		24		$6200
$100		16		32		$780O
$50		24		48		$9,00O
$25		40		80		$10,000

Now it’s time to replace the prospect column with lists of prospect names and then move on to deciding how you’ll approach each prospect.

Video Description: Carnegie Mellon University Professor, Jesse Schell, dives into a world of game development which will emerge from the popular “Facebook Games” era.

One of the most important relationships you should work on is one with your local politicians. Our local politicians carry a lot of power and can be a true friend in time of need:

Most politicians have some discretionary funds and can sometimes help out with funding for special events that you might hold.

Some politicians are able to provide you with information about the types of grants you might be eligible for.

Local politicians can provide support for your initiative inside government, which can open doors for you.

Politicians like to be associated with successful programs & events. They appreciate invitations to special events and love to speak at them. Often this can bring more attention to the work of your not-for-profit.

Introduction to Congress

The legislative branch

How it works

Where to I find a legislator’s contact information  Congress State/local

Two Reasons for Contacting a Legislator

For a policy vote

To create or build upon a relationship

Preparing for Your Visit

Know your legislator; read their biography

Be informed of the issues and your legislator’s views on them

Be prepared: know what you want to accomplish

Rules of Engagement

All politics is local; your legislator wants to please you

Make your voice heard; be an advocate for your mission

Invite your legislator to your events or arrange a meeting

Follow up with a thank you note

Average meeting 7 minutes long know what points you want to make

Laws to be Aware of

Election involvement in your official capacity as an employee of a 501(c) (3) is not permissible

A 510(c) (3) should not spend more than 5% of its budget on advocacy

A 501(c)(3) employee or institution should not take a public stand for or against a candidate

Summary

• • Develop a plan:  What would you like to show the elected officials or staff people?  Who should attend?  What or who will be compelling?  What can you show that connects to policy issues?
  • Issue the invitation:  Once you’ve come up with an exciting plan, contact the legislator’s local staff people and see what can be arranged.  Whatever you do, DON’T ignore the staff.  In fact, you might want to have an initial visit with the staff as a “test run.”  They can be some of your biggest allies in getting the members themselves engaged.
  • Secure the appointment:  This is a step all by itself because it generally takes several communications via e-mail, fax and phone to get a meeting time set, especially when seeking a member-level meeting.  Only the persistent survive this process.
  • Conduct the visit:  This is, in fact, one of easiest steps.  Be sure you have all the logistics in place for planned (and unplanned) aspects of the event.  In addition to all the logistics of the visit itself, you’ll want to have a photographer, someone taking notes and a plan in place for scheduling, transportation or weather problems (or be prepared to control the weather – your choice).
  • Follow-up:  Did the visit happen if you don’t follow-up?  No, it sure didn’t.  Be sure you know what the official or staff person was most interested in and whether you need to answer any questions.  And send those pictures to the legislator’s office!  They serve as photographic evidence of their interest in your issues.

I am posting a copy of an email I received today…

On February 21 the Appropriations Committee of the House of Delegates voted, 15-7, to cut state funding for the Virginia Commission for the Arts by 50 percent in 2010-11 and to eliminate the agency completely as of July 1, 2011.  The Senate Finance Committee has adopted the proposal in the budget bill submitted by Governor Kaine not to make further cuts in state funding for the Commission for the Arts. There will be votes on the House and Senate floors later this week on the proposals from the two committees.  The different versions of the 2010-12 budget bill approved by the two house of the General Assembly then go to a Budget Conference Committee to resolve the differences. Virginians for the Arts is encouraging all of its members to do two things:

1.  Contact your representatives in the General Assembly, both Delegates and Senators (fax and phone calls best), protesting the recommendation of the House Appropriations Committee.  Legislator contact information can be found on the web.

2.  Write a letter to the editor of your local newspapers with the same message. These actions must be taken in as soon as possible (at least by end of the week) in order to have any impact on the final decisions on the state budget. Please take action and help us spread the word with other arts advocates in every way (website, email, social networking, etc.)

Talking Points for These Contacts with Legislators and Letters to the Editor

• The House Appropriations Committee, on a divided vote, has made a short-sighted decision about state funding of the arts, proposing a 50 percent reduction in state funding for the Virginia Commission for the Arts in the first year of the new biennium, and eliminating the agency completely in the second year.
• The arts community recognizes the severity of the budget problems facing state government and expects to share in the budget cuts and has already been cut by 30 percent over the last two years.
• However, every dollar that the state invests in the arts through the Commission returns $7 in investment by private citizens, businesses, and local governments.
• The Commission made matching grants to Virginia local governments of half a million in FY 2009-2010 to support festivals and programs generating tourism and attracting business and cultural activity throughout the state.
• The Commission is funded at the lowest per capita level among state agencies of surrounding states.
• Elimination of the Commission would also mean the loss of Federal funds for arts in Virginia ($1 million in FY 2009-2010).
• The arts contribute to the economic vitality of Virginia communities. Localities such as South Boston, Richmond, Lynchburg, Blacksburg, Alexandria, and Petersburg are using the arts as a lynchpin for attracting business and economic development.
• Artists and arts organizations work in Virginia schools to expand educational opportunities for children so important to developing a creative workforce.  The arts have stepped in to meet cultural education needs of our children where these programs are being cut in the schools.  Funds provided by the Virginia Commission for the arts often represent the only opportunity for children in rural areas to be exposed to arts and culture.
• The arts provide jobs, and cultural tourism as an important part of Virginia tourism promotion efforts.
• Over the past two years the arts have faced large spending cuts, cancellations of performances, staff layoffs, and galleries closing.  Minimizing further cuts in state arts funding is essential to the survival of Virginia’s cultural infrastructure. CUTS OF THE MAGNITUDE BEING PROPOSED WOULD CAUSE ARTS ORGANIZATIONS, BOTH LARGE AND SMALL, TO CLOSE THEIR DOORS throughout the Virginia.
• We urge you to vote against the proposal of the House Appropriations Committee. The small investment the state makes in the arts has a major impact on local economic development, tourism, and education.

Thank you for your essential support!  Action by our advocates will make all the difference! Trish PouporeVirginians for the Arts(804)644-2787

This post was inspired by a recent discussion on LinkedIn.  The topic was fear of the ask; why are fundraisers afraid to make the ask and what can be done about it?

It is only by connecting at an emotional level with the intentions of the donor that we can acheive the highest and best of what or donors, and our organizations, have to offer.

Part of the problem is that people fear rejection, the cultural taboo against asking for money, and the lack of training or practice.  Asking others for money is uncomfortable for many people. Number one is a belief in the cause; when fundraisers have a passion for the mission of their organization the ask becomes easier to make.  Embarrassment, caused by troubles within the organization, can prevent fundraisers from asking, too. In Kaiser’s Art of the Turnaround, he writes about this particular issue in connection with the Royal Opera.  When the organization is troubled, board members don’t have any friends to ask or recommend.  Once things turn around, the board regains its pride and suddenly they all have friends again and they are ready to ask.

In Good to Great, Collins discusses the importance of having the right people in the right ‘seat on the bus’.  Are the right people in the right positions in your fundraising department?

Try role playing and practice the ask.  It is a great idea to make the ask as part of a team- bring the director and someone from the development to the lunch or meeting when you are making the ask.  You’ll have ‘back up’ to answer questions and explain the details.  Sit down with your team before the meeting and do a role play so everyone feels ready to make the ask.

• Delete words like solicit, ask, beg from your vocabulary; replace them with invite, nurture and listen.
• Do your research.  Know as much as you can about the program you are requesting money for and as much as you can about the prospective donor.
• Be realistic about how much you request (yes, do ask for a specific dollar amount)
• Address the fear of rejection by planning a contingency plan for a no.  Try a lower amount or ask what amount they would feel comfortable with at this time.  You might suggest a multi year pledge. Be creative and prepared with alternatives.
• Speak to the interests and goals of the donor.  Frame the conversation from the donor’s point of view.
• Listen and take cues from the donor through out the conversation.
• Donors want to do something good or be part of the organization so give them the opportunity to do so.
• Remember it is about giving the donor the opportunity to do something of value.  In the end you want the donor to feel great about making the gift.
• Thank donors immediately and frequently; let them know they are a vital contributor to the mission.

We may be negotiators, but our job is not to sell our organization–particularly when we are seeking a major gift. If we’re talking to the right prospect at the right time, prepared with a proposal for a gift in support of the right program, then our prospect is already sold.

We should train our novice fundraisers to see themselves as relationship builders and negotiators. We can only bring a prospective donor to their highest philanthropic potential by bringing them closer to us. We do this by 1) reinforcing the fact that they have shown good judgement in supporting us (showing gratitude, demonstrating results); 2) making it about them–helping them see themselves as an important part of our organization and mission (YOU made this possible; without your support this would not have happened); 3) creating consistent contact with the same professionals year after year–which takes continuity in staffing. It is discouraging for donors to find themselves talking with someone new every year.

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