Year-end gift acknowledgments and tax receipts are going in the mail. For many development professionals, January is the time of year for shifting gears, perhaps from a winter appeal to an upcoming signature event, or from fundraising for operations to planning for a special purpose campaign. And while you know that major gifts fundraising is an ongoing, season-less process, this time on the calendar often challenges staff and volunteers to stay motivated and inspired.

Whether you just finished your fiscal year or are in the middle of one, here are six steps your organization can take to move your values-based relationships forward and further your mission in the coming months:

1. Acknowledge hard work. After summer planning, the fall frequently is the busiest time for staff and volunteers engaged in your development efforts. Now that it’s winter, take time to thank those stakeholders who have been cultivating, soliciting and stewarding relationships with donors and prospects. Recognize these efforts at your board and staff meetings and with a personal call or note before planning begins again this spring.
2. Engage your full board in thanking supporters. In a “perfect” fundraising world, all board members are involved throughout the major gifts donor cycle. Between now and perfection, ask board members to personally sign gift and tax letters during your next board meeting.
3. Devote time to data in order to evaluate progress and opportunities. Budgeting for philanthropic income often is based less on strategy and more on “the gap” between fees, membership, tuition, and other sources of earned revenue. Whether you met, exceeded, or fell short of your year-end target, analyze the donors who you acquired, who upgraded, who renewed, and who lapsed. What do the numbers tell you about where your development team should be spending their time this winter and spring?
4. Reach out to those donors who made a first-time major gift, and to those regular donors who didn’t. Use year-end results to “tweak” your prospect list. Sit with those prospects that made a new or upgraded major gift, and ask about their motivations. What other information would they like to learn about your organization? Who would they like to hear from, and how frequently? Would they like to get more involved, and if so, where might they fit in? For those supporters who did not give in 2010, invite further conversation about changes in their personal priorities or circumstances.
5. Refresh your case for support. The “new normal” means fundamental shifts in revenue sources for nonprofits in every sector. Make sure the story you are sharing reflects current realities, but always lead with the relevance, urgency and community benefit of your mission.
6. Remember why major gifts are a priority for your development program:
   • According to GivingUSA, almost 85 percent of charitable gifts come from individuals.
   • Research indicates that prospects are more likely to give, give again and give more when asked by a peer.
   • Donor-centered, face-to-face relationships will foster a deeper, mutual understanding and investment in your mission and vision than the most exciting event.
   • Retaining and upgrading current donors, vs. acquiring new ones, is good business. According to best practices, it costs $1.50 to raise a new $1.00. Investing in meaningful relationships takes time, but the ROI is well worth it.

After you have celebrated, acknowledged, and analyzed your year-end fundraising results, use the coming weeks to validate or shift your development priorities. Understanding your successes, challenges, and opportunities will reengage loyal volunteers and reinvigorate dedicated staff!

Looking for more ways to prepare for 2012? Join our webinar on January 24th for an interactive discussion on getting your shop in order: click here to register for this free webinar!

Fundraising is a team sport: In each case, staff and volunteers are working together for the first time to further develop relationships with prospective donors. This did not come naturally or easily to most of the players and, as with any team sport, clarity around roles and expectations has been an essential ingredient for their success. While many of us struggle over who should take the lead in developing cultivation strategies and initiating contact with major donor prospects, these groups have been successful because key staff members have stepped up to lead the way. By scheduling meetings and then inviting one board member or another to join them, staff members have created specific opportunities for volunteers to try out their ambassadorial roles, get familiar with the cultivation process, and develop more confidence in their ability to influence potential donors.

Challenge and matching gifts can motivate volunteers too: In one case, a major donor offered to match the first year amount of five new five-year pledges in the mid five-figures (this is otherwise known as “the rule of fives!”). The not-so-surprising effect of this matching gift, however, was that it provided a spark to the board to get out and visit with top prospects. Several board members themselves participated in the matching gift opportunity and, in turn, asked others to join them. Without the motivation of the match, it would have been much more challenging for board and staff members to get out the door, give generously, and ask others to invest.

People want to know what you hope they will give: There is a perennial discussion in our field about the pros and cons of asking someone for a specific amount. Yes, I know of examples where a donor was never asked for a gift but unexpectedly committed a gift that was beyond a nonprofit’s wildest dreams. For sophisticated and experienced philanthropists, being asked for an amount can be off-putting. They often convey, “Let me know what your needs are and I’ll let you know what I can do.” However, most of us don’t think of ourselves as “major donors” and appreciate having a sense of what level of gift will really make a difference. Often, we want to know what others are doing and how we’ll be recognized. Of course, this all assumes that you are asking for gifts in person and tailoring your request to what you’ve learned of the prospect’s interests!

If you want to inspire your donors, motivate your volunteers (and staff), and realize greater fundraising results, revisit and dust off these and other best practices in major gifts fundraising. If these two groups are any example, you’ll be pleasantly surprised by donors at all levels stepping up to new levels of support and engagement with your organization.

How much should I budget to give per year? A ten percent tithe is common for religious denominations. I grew up Catholic and it was my job every week to drop our family donation envelope in the basket. We donated because we were a member of that community and it was our duty and our privilege to support it. But now, I consider myself to be a member of multiple communities now and it is my duty and privilege to support all of them.

According to the 2010 Giving USA annual report, in 2009, individuals gave 2.1 percent of their disposable income to charitable causes. My personal giving last year was about 2.3 percent, so I’m right with the pack. Ten percent of my net income to philanthropic causes is too much of a stretch for my single-earner/parent household, but could I do five percent?

What I can do for sure is be more organized and thoughtful about my giving. Instead of adding all my receipts up after the fact and being surprised at what I gave (or didn’t), I’m going to decide what percentage of my income can be set aside for charitable giving and plan out my 2011 gifts.

To help in this task, I’ve created a very simple Personal Annual Giving Plan tool in Excel. I’ve filled in some organization examples and amounts. You can delete and fill in your own. The base net salary I’ve used as an example is $50,000. Five percent dedicated to annual giving would be gifts totaling $2,500. What would it look like if you gave five percent of your disposable income to charitable organizations? Is it possible? If not, what’s reasonable for you?

• The number of grants made to charities through their donor advised funds grew by 50 percent
• The average grant award increased by 35 percent
• The fund saw a 77 percent increase in the number of new DAF accounts created
• Thirty percent of the fund’s existing DAF account holders made additional gifts to their accounts
• The fund reports a 75 percent increase in gifts of appreciated stock and a 46% increase in gifts of appreciated mutual funds

The number of donor advised funds has been growing over the past several years, and if Vanguard’s results are typical, this news indicates a continued interest in using these vehicles to support charities.  Our clients should be paying more attention to identifying donors and prospects with DAF accounts and cultivating them accordingly.

You can get the full report here

Last week Guidestar shared encouraging results from its November 2010 Fundraising Survey.  The survey shows more organizations are reporting increased contributions for the first three quarters of 2010 compared with the same time period in 2009. However, as the graph below shows, nearly the same percentage of organizations reported that giving was up as those that reported giving was down. Larger organizations (those with annual expenses of $1 million or greater) were more likely to report increased contributions.

The study also shares that organizations are feeling cautiously optimistic about giving for the end of 2010 and starting into 2011. Of the organizations who receive the bulk of contributions in the last quarter of the year, 36 percent predict that contributions received during the fourth quarter of 2010 will exceed those from the last quarter of 2009 and 43 percent expect end-of-year contributions to be about the same as last year. Only 22 percent anticipate that end-of-year contributions will be lower. Additionally, most organizations were hopeful about 2011. About 47 percent planned budget increases and only 20 percent anticipated a lower budget for 2011.

At The Collins Group, we know that overall charitable giving is influenced by major campaigns – whether for capital, program expansion, or endowment fundraising. In 2009, few major campaigns were launched and there was a significant decrease in the number of campaign feasibility studies being conducted in our region and around the country.

Our firm’s experience this year also holds promise for increased giving in our region for 2011. We have conducted more feasibility studies in the fall of 2010 than in all of 2009, and many have come back with positive results. Several of our clients will launch campaigns next year – donors are ready and invested in their visions and strategic initiatives.

It may be slow-going, but I am hopeful that philanthropy will help signal confidence that economic recovery is underway. The results of these investments will undoubtedly help our communities bounce back.

What has your organization experienced this year? Are you hopeful about this giving season, or 2011? We’d love to hear from you.

Despite what our on-the-ground experience and common sense as fundraisers may tell us, to-date there has been little if any published research documenting gender differences in philanthropy.  A new report published by the Women’s Philanthropy Institute at the Center on Philanthropy at Indiana University last month confirms that, once factors such as income and education are controlled for, women are not only more likely to give to charity than men, they’re likely to give more when they do.  This holds true across all income levels but one.

As fundraisers, we are well aware that women live longer than men, and I would wager that every one of us has worked not only with women philanthropists, but couples for whom the woman’s perspective drives charitable decisions. In all-female colleges, of which I am a graduate, there is a keen sensibility that women will likely outlive their male partners by years if not decades, inheriting—and likely controlling—all of the assets accrued during their marriage(s).  By virtue of their longer life spans and growing earning power, women also accumulate their own assets as well as inheriting and controlling wealth from extended family members (grandparents, aunts and uncles, parents, cousins, siblings, and sometimes daughters and sons).

Think about it.  A constituency that makes up at least half the population in younger cohorts—and increases to well over half in older cohorts.  A constituency more inclined to give, and to give more at virtually every income level.  A constituency whose educational level and earning power increases each decade.  Sounds like a fundraiser’s dream to me.

One of the interview questions we always ask donors is whether they feel satisfied with the way in which our client organization solicits, acknowledges, and recognizes their gifts. Responses vary – from people who feel well connected and appreciated to those who only hear from the organization when they are asked for money once a year.

The Montana donors we interviewed each answered the question the same way, and it was an answer we don’t expect these days. The collective response went like this: “We don’t wait to be asked. The need is so great and the organization is so important, we just give as much as we can, as often as we can.”

Back to Anne Frank’s tree. This past week, wind, rain and disease felled this venerable tree that comforted a young girl hiding from the Nazis. Eleven prized cuttings from its branches were sent around the world. The news reminded me of a quote from young Anne that has captured pure generosity for generations: “How wonderful it is that nobody need wait a single moment before starting to improve the world.”

Today more than ever, nonprofit organizations need to build relationships through which they communicate with their donors frequently and meaningfully. What a wonderful thing when those dialogues inspire giving that doesn’t “wait a single moment,” and is offered with the joy Anne Frank felt when she looked out her window.

As you begin a new season of fundraising, what inspiring donor stories do you have to share? Let us know. We’d love to be able to share your stories with a wider audience.

On the surface, the project appears seamless – a plan that promises to change the face of philanthropy in the coming decades. No one can argue with the fact that a handful of mega-gifts can significantly impact overall giving. Giving USA 2010 showed that individual giving held steady in 2009, but only as a result of five gifts from high-net-worth donors totaling nearly $1.6 billion.  Without those gifts, overall giving by individuals in 2009 would have declined by 1.1 percent.  The problem with the Giving Pledge’s promise to change philanthropy, however, is that much of the money will not be transferred for years, and even then may be dispersed at a very slow rate.

Many of the families that have signed on so far have pledged to transfer their wealth after their death. Ron Rosenbaum of Slate magazine criticizes this practice.  “Show us the money if you want the credit,” he writes. “And show it to us now, before you die, not in some distant future where a lot of poor and diseased people will themselves have died for lack of timely aid.” While the pledging parties certainly have the option to transfer their wealth during their lifetime, it’s likely that in those cases the money will be funneled into charitable family foundations – and many of those foundations are only required to make grants totaling five percent of their assets each year. The argument is that it could take decades before the money finally trickles out to the organizations that need it now.

While I certainly agree with the above criticisms, the problem I see with the pledge is the spotlight it shines on the rare mega-gift, and the attention that it takes away from the everyday donor. While the donations made by the über-wealthy are certainly generous, in many cases they are not stretch gifts. Personally, I am far more moved by middle class families that have remained committed to supporting the organizations in their communities even in the face of their own pay-cuts and job losses.

Don’t get me wrong – overall, I think the Giving Pledge is a great project. But it would be sad to see organizations become fixated on claiming their piece of the mega-gift pie when there are so many mid-level donors that have continued to give, even when it hasn’t been easy.

It’s tempting to add a couple of zeros to your next major solicitation and see what happens, isn’t it?  While we all wish we had prospects with that kind of capacity, it does seem to be a positive indication for overall giving in 2010.

Focus groups and an online survey (Hope Consulting conducted the research) tapped the opinions of more than 4,000 individuals, half of whom were from high net worth households. Their methodology, in Hope Consulting’s words, “investigated behaviors, not simply stated preferences” and “forced individuals to make trade-offs to mirror real life decisions and minimize pro-social responses.”  Based on this research, the report develops six different donor segments and provides advice for reaching each one.

The survey’s key findings overturn some conventional wisdom in fundraising:

• Donor demographics, in particular, age and gender, are not reliable predictors of high net worth donors’ actions
• While donors care about the quality and performance of nonprofits, few take the time to research them
• High net worth donors are not behaving differently from other donors

And some less surprising findings:

• Donors, once connected to a nonprofit, are very loyal to it
• Donors feel they are being asked for support too often

The Money for Good project is funded by the Rockefeller Foundation, the Aspen Institute of Development Entrepreneurs, the Metanoia Fund, and the William and Flora Hewlett Foundation. Click here to download the full report.