Have you ever had questions about fundraising planning?
I recently led a webinar for AFP titled “6 Simple Steps to Creating a Written Fundraising Plan.” Hundreds of people attended, and there were so many questions about fundraising planning that didn’t get answered, that I offered to answer them here on my blog.
Even if you didn’t attend the webinar, you will likely glean some great info from my answers.
How do you get your Board members to listen to you?
I know how frustrating it can be to work with a group of well-meaning Board members, especially when they don’t listen to you. I can remember thinking “You pay me to be the resident expert and you pay to send me to training. Why don’t you listen to what I have to say?”
I think it’s a matter of trust and respect. Every time you interact with your Board, you’re either building trust and respect, or tearing it down. Think of an emotional bank account. Are you making deposits or withdrawals? Lots of deposits equals a healthy relationship based on trust. That’s what you need in order for them to listen to you.
One way you can work on building trust is to set fundraising goals and reach them. This shows your Board that you know what you’re doing and that you’re trustworthy.
If this doesn’t work, consider bringing in an outside person like a facilitator or consultant. Many times, I’ve been the outside person to say things that the staff have been saying all along, and where they wouldn’t listen to the staff, they listen to me. I’m not sure exactly why that is, but I’ve seen it happen time and time again.
How do you get other people to buy into your plan?
The best way to get people to buy into a plan is to get them involved in it. You may not want them involved in all the details, but find ways to ask for their opinion,
advice, and feedback. Involvement leads to ownership. Without ownership, people won’t consider it “our” plan, they’ll consider it “your” plan.
If you’re a staff member and you want Board buy-in, start with one Board member, preferably your Fundraising Committee Chair or your Board Chair. Get their buy-in first, then let them lead the charge to get the rest of the Board on board. This peer-to-peer engagement usually works very well. On the Board that I sit on, I serve this role and I find my fellow Board members to pay more attention to me than to our fundraising staff.
How much time should you invest in planning and how much detail should you get into?
You need to spend enough time on planning and get into enough detail that you feel confident in your plan and your ability to accomplish it. If you rush through it and slap it together, it probably won’t have enough detail to be helpful. Remember you’ll get out of it what you put into it. If you can’t dedicate a full day or two to creating a plan, carve out an hour a day for two weeks and see what you can accomplish.
To determine cost per unit of service, do you include all expenses, including salary, operating expenses, and overhead?
Knowing your cost per unit of service can be incredibly helpful to you as you tell your story. Sometimes, this one fact can tell the story better than hundreds of words. First, decide what your unit of service is. It might be an hour of counseling, a single meal for a person, a night’s shelter, or something else depending on the services your organization provides. Once you have this defined, look back at your total expenses from last year and the total number of units of service delivered last year. In your expenses, include everything (salaries, overhead, etc.). Then simply divide the numbers to find your cost per unit of service. For example, let’s say you work for a food bank and your organization handled 6 million pounds of food last year. Your total expenses were $495,678. Your cost per unit of service is 495,678/6,000,000 or $0.08. Imagine the impact that would have on a donor when you tell them for every 8 cents they give, you can get a pound of food to a person in need!
What fundraising software do you recommend?
There are lots of great donor-tracking software programs out there. Go to www.idealware.org to get a good comparison of them. They will all do pretty much the same thing, so it’s about how much you want to spend and which one you like. I suggest you download the free trial versions of several of the top ones and try them out to see what feels right for you.
Should an organization fundraise for a Fundraiser (money to pay for a person to raise money)?
Yes. There comes a point in the growth of every nonprofit where it makes sense to pay someone to join the staff as a professional fundraiser. The important thing here is to get a professional because they will know what works and what doesn’t. Don’t attempt to hire someone to work on commission. It’s considered unethical among professional fundraisers and you won’t get anyone worth their salt.
How do you track renewal rates? Some donors skip a year. Do you analyze annually?
First, you have to define an active donor for your organization. The easiest way to do that is to consider an active donor anyone who has given in the past 12 months. Then, compare last year to the year before to see which donors renewed their support. A good donor-tracking software will help you do that.
If a donor skips a year, then I would question how engaged they are in your organization’s work. Donors who feel connected will give every year and usually multiple times throughout the year. You don’t want donors to skip a year, because that can lead to their lapsing. Do what you need to do to build relationship and engage them.
You need to look at renewal rates each year so that you can keep your finger on the pulse of your donor base. You are likely to lose around 35% of your donors each year and you can’t afford to let this happen! Analyzing your donor renewal rates regularly is a wise thing to do and you can bet the most successful nonprofits out there are doing it.
How do you find new donors?
Before you go out looking for new donors, you need to define your ideal donor prospect. Who is the person who is most likely to want to support your
organization? The place to start is by looking at your current donors. What do they have in common? Be sure to answer this question in terms of both demographics and psychographics. The more clearly you can define your ideal donor prospect, the more easily you can go out and find them. For example, let’s say that through surveying and research, you discover that most of your donors are women, 55+, college graduates, and married. They attend church regularly and are very active in the community. You could then use this information to go find new donors. You could find speaking opportunities at churches and women’s groups to target this particular group.
What formula do you use to decide how many new donors you need to acquire each year?
It’s a good idea to constantly work to grow your donor base. Your base of support is always growing or shrinking. Here’s one way to think about targeting the number of donors you need to fully fund your nonprofit’s budget:
- Start with the total amount of money you raised last year
- Subtract any earned income (interest on investments, thrift store revenue, etc)
- Subtract out grants, corporate income and special events
What you have left is the amount of money you raised from individuals. Divide that number by the total number of individual donors who gave last year to figure out your average gift from individual donors.
Next, think about how much money you’d like to raise this year. Dive that by the average gift size from last year and that will give you a ballpark idea of how many new donors you need to acquire.
Without doing any math, I can promise you that you need more!
What suggestions do you have for approaching lapsed donors?
The best thing to do is to prevent them from lapsing in the first place. But if you have lapsed donors, sometimes you can renew them with a 1-2 punch of a letter followed up by a phone call. The letter must be compelling and inviting in order for the donor to renew. The phone call adds a personal element and often, the human contact is enough to encourage the renewal.
How do you calculate staff time costs for special events?
Ideally, you need to have each staff person who works on the event track the time they spend on the event, but an estimate will work. Simply multiply the number of hours by the staff person’s hourly rate. This will give you an idea of staff expense for your event.
What is the most successful fundraiser you’ve ever worked with? How much did you raise and why do you think it was so successful?
The most successful fundraising event I’ve worked with was a fundraiser/friendraiser based on the Benevon model. I’ve implemented it myself as a Development Director and I’ve helped several clients with it. Results have ranged from $25,000 to $125,000. I think the main reason it was so successful is that it was based on the donor and their interests and not all focused on the organization. It was also well-planned and well-executed, down to the smallest detail.
How can an organization decide which kind of event would be the best fit for the most dollars? Is there a best practice?
When you choose an event, be sure to choose one that fits with your organization’s mission and is scalable to grow each year. It needs to be your organization’s signature event that the community will look forward to each year and associate with your organization. Choose an event that will help you leverage your organization’s assets – things like your compelling mission, any well-known staff or Board members, relationships with the media and so forth. And execute the event as well as you possibly can.
What opinions do you have on rate of return for direct mail? And what tips do you have?
Despite what some are saying, direct mail is NOT dead. If your donors want to communicate and give through the mail, you can raise good money. The rate of return you can expect depends on your organization. I’ve seen everything from 3% to 20% and it all depends on how well you do with all the little details that will make or break a direct mail piece. My best tips are to plan out the entire production schedule well in advance, don’t let too many people in on the planning or the writing/editing of the letter, and make sure you mail to the right list.
What is the best strategy for recruiting volunteers when you are brand new?
To find great volunteers, start with those people who are closest to your organization, like Board members, staff, and current volunteers. Ask them who they know that might be interested in volunteering. And branch out from there. Take advantage of any local resources that connect prospective volunteers with opportunities, and don’t forget internet sites like www.volunteermatch.com. Before you do ANY recruiting, make sure you are crystal clear about the job(s) you have for volunteers, and be prepared for them. Nothing is worse that recruiting a great volunteer, then them getting frustrated with you because you weren’t prepared.
What questions do YOU have about fundraising planning? Drop them in the comments!