The NonProfit Times - January 15, 2008 - (Page 8)

DONORS DON AUSTIN High Gift Versus Recent Gift Is your ‘ask’ an appropriate amount for the donor? H ave you ever had this experience? A friend asks you why a charity he donates to always asks him for a much larger contribution than he has been giving.He says that he gives about $25 annually to the organization, but he is asked to donate more than $200 in every appeal that he receives. When you ask him if he had ever contributed a gift of that size, he says that his first contribution had been $250. He elaborates, saying,“My sister had just been diagnosed with an illness and the gift was in her honor. donor asking for the same amount or more. But when the donor made a second gift of $25, following appeals would ask for amounts based on this contribution level. The rationale for using the high gift on record (HGR) is that it is a good indicator of the potential amount a donor could contribute. On the other hand, using the most recent gift (MRG) might reflect the amount the donor is most likely to want to contribute. The downside of using the HGR would be that some donors, like the friend, might resent being asked A significant proportion of the donors failed to meet or exceed their first donation amounts. Since then I have been contributing $25 a year to the charity.” Of course, the reason behind your friend’s question is that some organizations base the suggested gift array in their appeals on the maximum amount a donor has ever contributed. So, if a donor makes a first contribution of $250 and subsequently gives $25 a year, the donor will perpetually be asked to contribute gifts of around $250. Other organizations use the most recent gift from a donor as the basis for the next suggested gift. In this case, a first gift of $250 would result in the next appeal to the to give contribution amounts they are not prepared to sustain over a long period of time. Therefore, the response rates of these donors could suffer. In using the MRG to determine the gift array, the negative effect would be that donors might give less than they could be giving. You should begin thinking about the appropriateness of your giving array if you observe that your donors who make first contributions of more than $100 often have second or third contributions of much lower amounts. The reason for this is that large first contributions can be the re- sult of something happening in the life of a donor that elicits that large contribution to a charity. This could be the death or illness of a family member or friend, for example.A person in this situation might continue to support the charity for some time, but not at the same giving level. A research study was performed using nonprofits with average first contributions of more than $200 and, therefore, the following observations might not apply to all nonprofit organizations. Selected donors were those whose first contribution was $100 or $250 because some donors might have given an amount that they were not likely to sustain. In addition, the selected donors were those who made at least three contributions. For donors whose first contribution was $100, some 21 percent had a second contribution of less than $100 and 26 percent had a third contribution of less than $100. For these donors, a gift array starting with $100 would be inappropriate if they followed up with a contribution of $50 or less. Among the donors with a first gift of $250,some 25 percent had second contributions of less than this amount and 38 percent had third contributions of less than $250.Again, a significant proportion of the donors failed to meet or exceed their first donation amounts. For contributions of $50 or less, it might not matter very much whether the HGR or the MRG is used for the suggested gift array. Should your organization base its suggested gift array on a donor’s highest contribution or the most recent contribution? If you receive complaints from donors who are receiving asks for large contributions, based on their highest gift amount, you should definitely consider basing your gift array on the most recent contribution. You should also determine the percent of donors who make large first contributions and do not follow-up with similar second and third contributions. If the percentage is 30 percent or more you should consider switching to the most recent gift to determine the gift array. Of course, testing could provide the answer to this question. NPT Don Austin, Ph.D., is vice president for client strategy at May Development Services, a division of Direct Media in Greenwich, Conn. His email is daustin@directmedia.com BURNT OFFERINGS HERSCHELL GORDON LEWIS Thank You, Please Familiarity doesn’t breed contempt in this case Twelve days after a substantial check was sent to the local headquarters of The Salvation Army, in came a letter from that worthy organization. What was expected was a “Thank you, please” communication.The Salvation Army is one of our more sophisticated nonprofits, and it knows the value of an immediate “Thank you” coupled with “Can you give more?” Uh-oh. One look at the stamp and it was clear that this wasn’t a “Thank you, please.” The window envelope with a nonprofit stamp was all too clear: bulk mail. THE CURSE OF AUTOMATION INTRODUCING Intelligent Mail Monitor C a l l u s t o l l f r e e a t 1.8 0 0.767.79 67 or visit us online at www.usmonitor.com. What happened here is an all too common problem. No, make that an all too common dereliction. Some 20 years ago, a human hand would have suppressed a bulk mailing going out to a donor who had just shown, in the most tangible way, respect.That hand would have reached into a different stack and sent out a “Thank you” notice … or, if the nonprofit were reasonably astute, a “Thank you, please” response. But we’re automated today … in this instance, blindly automated. Once mailed, the bulk letter cemented an arm’s-length, non-relationship. Had coincidentally a classic “Thank you” message also been in the mail, the result would have looked even more uneven:“We love you, whoever you are.” The bulk letter was well-written. It was computer-personalized.The type-font wasn’t the too-standard Times Roman. If a contribution hadn’t been sent, you might have admired it for its apparently personal touch. But the very nature of the apparently personal touch spawned a mild irritation.The letter began: Dear Mr. and Mrs. Lewis, How are you doing during these busy holiday weeks? And, expectedly, the letter builds to: I hope you will once again open your heart to those in need. Burnt Offerings, page 9 8 JANUARY 15, 2008 THE NONPROFIT TIMES www.nptimes.com http://www.usmonitor.com http://www.usmonitor.com http://www.nptimes.com

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The NonProfit Times - January 15, 2008 The World's Best Fundraisers On the Road Contents Lists: Election Cycles Donors: High Gift Versus Recent Gift Burnt Offerings: Thank You, Please Fundraising: One Big Family Travel Guide NPT Jobs Resource Directory

The NonProfit Times - January 15, 2008

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