by Ted Grossnickle

Since 2008 we have all noted quantitative answers to what the impact of the economy has been on gifting.

What is talked about less is what individuals tell us. We know there is more uncertainty and we know that uncertainty, not bad news, is not good for philanthropy.

But what else do we hear from donors and prospective donors? What trends are emerging? Are there lessons to be learned as we navigate these new waters?

Our clients tell us — and we hear for ourselves during feasibility study interviews- the following key themes:

“I’m going to think about a gift more carefully – especially one from assets rather than cash flow.” Donors seem to be taking a longer time to decide and are definitely seeking advice from advisors more frequently.

“I used to support 6 or 8 organizations; I’m cutting that down.” Again, this is anecdotal but it seems donors have decided they wish to continue to be generous but they are giving to fewer organizations. Is this because they have less to give? Perhaps. Is it because some organizations have not done as good a job of staying in touch with donors? Perhaps. Is it because some organizations have not responded well during these times and donors don’t think they are as meritorious a cause? Perhaps. It may be a combination of these factors – or others.

“I’d like to see a clearer, more precise picture of what the organization will be like as a result of my gift. Is there a sound and strategic fiscal model?” We hear this more and more. And believe it ties closely to some of the points mentioned just above.

If one result of the current era is for donors and prospective donors to be savvier and more thoughtful about their philanthropy, then that is good. Everyone wins. Not only those that receive the gifts, but even the organizations that learn the lesson that they must change how they articulate what they do — and be very sure they are effective and efficient in their missions.

As some have called it, this period is the “new normal.” Things will not go back to the way they were and all nonprofits must work harder to help donors see the value they can create with their gifts.

by Angela White

I recently recorded a short video interview on why we advocate feasibility studies at JGA. A feasibility study provides vital answers to help an organization create and run a successful fundraising campaign. By conducting a feasibility study, an organization can receive a third party perspective on the organizations upcoming campaign or project.

Here are some questions a good feasibility study should help you answer.

1. How much money can you expect to raise in a capital campaign?
• What are donors willing to do to aid your organization in achieving its goal?
2. Who are your potential volunteer leaders?
• Who might be able to partner with staff to make the campaign a success?
3. What are the perceptions of your organization among your constituents?
• How do donors connect to the leadership of your organization?
4. Are there underlying issues impacting your organization’s potential for success in a campaign?
• What might be out there that could maximize your giving?
• Are there challenges that could cut back on the amount of gifting you are likely to receive?
• Are there issues impacting your constituency of which you need to be aware?
5. What are the broader questions that need to be asked specific to our organization?
• How can we position this campaign to be successful today and set the stage for long term growth?

A feasibility study can be a valuable tool to help develop a thorough understanding of how successful your campaign may be and where you may encounter problems.

But from my perspective, to get at the broader answers about the campaign you need to tailor the approach specifically to the organization.

Through the years, we have recognized that the feasibility studies that yield the most useful information include the following:

• Detailed, custom plan development specifically to meet your organization’s needs, not a cookie cutter approach
• A tailored selection of questions that allows a feasibility study to take into account your organizations history and current situation
• Face to face interviews with clients which yield more insights and build closer relationship to volunteers and donors
• Enough time for a thorough study of the aspects that could impact your campaign, sometimes up to 90 – 120 days
• Go beyond donors and involve committees, staff, volunteers and other constituents important to your success

Taking this extra step to tailor the questions and the approach to your organizations unique needs allows the feasibility study to answer the bigger question of what do you need to be successful not just today in this campaign but to set the stage for long term philanthropic growth.

by Ted Grossnickle

I am honored to be a campaign co-chairman and trustee for my alma mater. This makes me think about the advice I am asked to give to clients in a new way.

When I talk with clients about what ought to be expected of trustees and other volunteers, I have a perspective as a trustee and volunteer in addition to that of a consultant.

It’s not that the two are mutually exclusive. They’re not. But they are different.

Certainly you want a consultant to be objective- even dispassionately so. You want a trustee and co-chairman to be passionate about the cause.

Both perspectives are required for success in a campaign. It is the blend of those two ways of looking at strategy (and tactics) that help (in this case) a College find its way with philanthropy in challenging economic times.

From these two perspectives, I recently shared in a short video what I believe are key questions a trustee should ask when they hear about a proposed campaign:

1.  Do you understand why a campaign is proposed and will it advance the mission of the organization? Will it help you help people? Will you do better work?

2.  Have the staff and the CEO thought through the campaign… thoroughly? Do they know what will be required of them? Can they support the effort? Are they ready to support volunteers?

3.  Are you prepared to be personally very generous to the campaign and also serve as an ambassador sharing your passion and explaining the mission of the organization to others?

4.  Has an objective set of eyes studied the campaign – and reported authentically on what will make it work— and what might derail it?

I’d be interested in hearing your perspectives about these key questions. Please let me know what you think. We’re all students when it comes to getting it right for our institutions…

By Kris Kindelsperger

August marks the practical beginning of the fundraising year for education institutions and others that are on a fiscal year beginning in June or July.

So what does the coming year look like from a fundraising perspective?

We don’t hear many development staff believing that 2011-2012 is going to be dramatically better. A slower than expected economic recovery, continued high unemployment, and the remaining uncertainty around a whole range of fiscal policy issues don’t do much to suggest that this will be a banner year in fundraising, at least based on donor confidence.

In our observation many annual fund programs have been holding their own and, in some cases, growing modestly.

Donors are not abandoning the organizations that they have funded over time.

Attracting new donors is a challenge, and our research on millennial donors suggests ever more sophisticated strategies will be required to secure them as donors.

Designated giving continues to be popular. Giving online, and the use of social media are all growing though not at the rate some had projected just a few years ago. Most institutions find they need to “do it all” – mail, phonathon, social media, online giving, and personal visitation to get the job done.

Major gifts are a bit trickier. Donor confidence continues to wax and wane, and a gift officers continue to hear some variance of:  “I’m not sure this is the best time; I’m waiting to see if my business recovers; I’m waiting to see what the market will do, My broker is cautioning me to go slow.”

I’m not sure you would define this phenomenon as exactly “stalling techniques” but the decision making that goes into making major gifts -particularly lead and large major gifts – is definitely impacting the timelines of campaigns and other time-sensitive fundraising projects.

Capital fundraising, especially for new buildings, seems to have lost much of its luster with more and more individuals and foundations focusing on programs and endowment.

Planned gifts are an increasing part of the mix of larger commitments.  Extended payment schedules (up to 10 years or more) as well as structured gifts that don’t mature until the donor’s death are frequently negotiated to reach high 6 figure and 7 figure gifts.

These realities do not seem to be dampening the expectations of nonprofit leaders or boards.  The pressure to raise more and more remains strong. 

Our advice is to take a deep breath, plan well, be assertive, try new techniques, and continue to build personal relationships with your organization. 

People and organizations are still giving and still giving generously.  But staff and volunteers alike need to be prepared that minus a “lightening strike,” geometric growth in fundraising results may not be in the cards for 2011-12.

by Dan Schipp

Conventional wisdom tells us there are two ways to raise more money from individual donors:

1. Get the donors you currently have to give more
2. Get more donors to give

But, new research indicates you may need to adjust your messaging based upon which group of donors you are approaching.

A recent study conducted by researchers at the University of Texas, the University of Chicago  and Sungkyunkwan University may provide insights on both counts.

The study evaluated responses to direct mail appeals and found that donors who identified closely with a cause were more motivated by a great need than they were by accomplishments. 

Conversely, they found that less connected donors were more likely to give and give more when they saw an organization had already made progress towards a goal, and were less motivated to give purely by a statement of need.

This research aligns with the standard wisdom in campaign fundraising. We encourage our clients to begin their campaigns with a silent phase during which they share their organizational needs and vision with their closest and most supportive donors. 

Once this early effort has reached a critical mass and a significant portion of their goal has been reached, an organization can use that success to spread the campaign’s message more broadly in the public phase of the campaign.

Beyond this affirmation of conventional campaign wisdom, this study also presents a blueprint for engaging new donors or upgrading your current donors outside of larger campaigns.  

If you are looking to expand your donor base, you should be keenly aware of milestones in your organization’s work, either fundraising or programmatic in nature, which could be used to show potential donors the tangible progress that appears to motivate them. 

Meanwhile, messages of need can be targeted specifically to those donors that you know identify closely with your cause.

by Andy Canada

Does the old adage “you’ve got to spend money to make money” really hold true in fundraising?

The Nonprofit Research Collaborative (NRC) released its 2010 Nonprofit Fundraising Study earlier this year that found that generally speaking organizations that increased their investment in fundraising last year also raised more money. 

While it’s not breaking news to hear that you need to spend money to raise money, the study also concluded that any increased financial investment also increased the likelihood that an organization would meet its fundraising goals – whether those goals increased in proportion to that investment or not.

Does this mean that everyone looking to improve their fundraising should just throw money at the problem?  Definitely not! 

The same study showed 24 percent of organizations that increased their investments in fundraising by 15 percent or more actually saw their giving stay the same or decrease.  Not exactly the bulletproof evidence you want to take to your board if you are looking for a blank check for new fundraising initiatives!

So what should you make of these statistics? 

In our work with clients we regularly see organizations that haven’t invested enough resources in their development programs, but I also see organizations that are over-invested, and others that have allocated the right level of resources but are using them inefficiently. 

The key to improving any of these situations is to be strategic in your future investments.

While mission-related expenses will generally take priority over fundraising investments, nonprofit executives and boards should take note of the stats from the NRC. 

Just like the stock market, there is no risk free investment in fundraising, but if you take the time to analyze your situation and invest confidently in a proven course of action, more likely than not, you’ll reach your fundraising goals. 

As you look at your own operations, where do you fall on the scale?  Are you spending a lot and not seeing a good return? Hoping that a minimal investment will beat the odds? Or have you found a good balance?

by Kris Kindelsperger

In today’s economy, does a major comprehensive campaign make the most sense or is a series of smaller project based campaigns a better approach?

Two commonly used campaign strategies are the comprehensive campaign strategy and the individual project based strategy. Each offers their own advantages and disadvantages.

Comprehensive campaigns offer several advantages:

• One fundraising plan can address a range of important needs
• Their mix of components can better match the varied interests of donors in the campaign
• Their broad scope allows them to address high level strategic initiatives of the institution

While successfully run comprehensive campaigns can be truly transformational for an organization, they also have drawbacks to consider:

• They take longer to plan and complete
• They are more expensive to run
• They can push the limits of donor capacity
• They demand more of staff’s time and endurance

Individual project campaigns, on the other hand, are effective in:

• Achieving goals in a shorter amount of time
• Meeting an obvious and compelling need
• Minimizing the demand on donor capacity
• Lowering the risk of fatiguing staff

But consider where the individual project campaign falls short:

• Its singularity of focus might leave other important needs unmet
• Donors may find the project fails to pique their interest or meet their philanthropic goals

So which is the “better” of the two options? 

In times of transition or uncertainty, a project campaign may represent a good short-term way of staying engaged with your donor population.  Project campaigns can be a good warm up to a larger comprehensive campaign, testing staff and volunteer leadership and building capacity.

If a compelling strategic plan, proven capacity and strong staff and volunteer initiative is in place, a comprehensive campaign is likely the best use of institutional resources and a successful campaign can truly be transformational for the organization.

The best answer for you may not be one or the other, but rather a grouping of components that provide donor choice but at a smaller total goal that better aligns with capacity. 

This approach may offer most of the advantages of a comprehensive campaign while offering the shorter time frame and more focused approach of the project campaign.

by Ted Grossnickle

Sometimes the best conversations in a consulting practice happen when you have a group of colleagues together and a topic arises unexpectedly— and it causes all of us to think about an issue facing a client.

This certainly provides a glimpse into what values drive our practice and it also makes us realize we are often hearing or dealing with the same issues across a wide range of non-profit clients.

Recently at JGA, one of those issues popped up. We have a client near the end of a significant capital campaign. The campaign leadership faces a set of big challenges in terms of building a strong volunteer and staff team and a big goal in terms of dollars to be raised. They also face the challenge of creating a sense of ownership and participation among their constituents and the community.

As they celebrate the success of the campaign and near the dollar goal ahead of schedule, many campaign volunteers have suggested they should immediately “declare victory” and end the campaign early.

After all, they reasoned, “we will have raised the initial dollar goal we set out to achieve, that is what we told everyone for this phase and why should we go on after that?”

There was just one problem. The amount to raise wasn’t the only goal. Another critical goal was to make everyone feel a part of this very public effort — and to help everyone see that they could play a role in making something very important in the region happen. And not everyone had been given a chance to make a gift.

We often make the case to our clients that philanthropy is about more than just raising money – it is an opportunity for us to allow others to become involved and demonstrate support. Donors want to feel that they have a role in accomplishing something for the organization. They want a chance to participate.

Holding true to those values, our counsel to the client was to continue to conduct the campaign and to make clear that everyone should be given an opportunity to make a gift.

Campaigns are about more than a goal; if we believe in the common work we do in philanthropy, we surely believe that gifts at the lower end of the gift table are just as important as those at the top — and that those donors need to express their generosity as well.

I’m proud of my colleagues and proud of our client for upholding those values so well.

by Kris Kindelsperger

In our discussions with donors and clients in recent months, we’ve observed that some donors are, for lack of a better word – paralyzed – by uncertainty. 

Some are looking for more reliability in the markets, some are looking to the November elections for guidance on economic policy, others are looking at January 1, 2011, wondering what the tax structure will be like. 

Adding to this anxious mix is a flood of conflicting advice obtained through personal research or from those that may be advising them about what might happen in the months to come.

The instinctive reaction for some is to preserve personal resources and avoid – or postpone -philanthropy.  For gift officers this often comes with the message “now is not a good time to make a major gift.”

While those who represent our nonprofit organizations are not financial advisors or financial planners, thoughtful discussion with donors can open opportunities to devise strategies that meet donors’ needs and allay concerns.

Philanthropy is frequently a “win-win” financial situation for both the non-profit and the donor if both can have a frank and open discussion about the outcomes. A carefully planned gift can benefit a donor who is worried about their taxes.  Non profits also offer a number of very attractive income producing financial instruments in today’s market.

So, in these uncertain times, now is a perfect time to move beyond the confines of simple gift discussions and to have conversations with donors about how philanthropy might bring a level of certainty to an uncertain world.  Non profits are in a unique position to have these discussions.

Are there ways that your organization is productively engaging donors in an uncertain world?