The following is an excerpt taken from The Supporter Journey which will be available in October at www.blackbaud.com/DesktopReference
In the early days of building predictive modeling services for nonprofits, I was hoping to prove that there are two separate concepts — likelihood to give and capacity to give — that we could statistically combine in different ways to rank our prospects and understand the giving choices they were most likely to make. I believed that likelihood, also known as affinity, inclination, or propensity to give offered us more insight to future behavior than capacity.
Fortunately for me, two of my colleagues, Jennifer Key and Hans Engebretson, applied a variety of statistical methodologies that did not reflect my biases but served to prove the original hypothesis. Of course, the critical component of likelihood to give is loyalty, which may be demonstrated in a variety of forms. It is disappointing to me and often surprising to others that in spite of the critical connection loyalty has with giving, we often treat loyalty as the stepchild who receives little thanks or positive recognition. Consider these three examples.
1. Electronic media has changed the ways in which we publicly recognize gifts. Websites and emails have now been added to donor honor rolls and annual reports. Whatever the medium, the message focuses on the individuals, couples, families, foundations, and corporations making gifts at the top of the donor pyramid. The power of change inherent in a mega-gift is awe inspiring and the potential for inspiration in their recognition is limitless. The mega-gifts of loyal donors, those who are low-to-mid level habitual contributors and form the backbone of your organization are often planned gifts. It is a fact beyond refutation; loyalty is directly linked to ultimate planned giving behavior. But, do we tell the story of these loyal donors and their planned giving commitments? Sometimes we do, but not nearly as much as we should. The more frequently we share these great stories of selflessness, the more we encourage other similarly situated individuals to do the same.
2. You might assume that loyalty encourages lots of thanking from nonprofits, yet what is the one thing that we do most consistently with our loyal donors? We solicit them much more often than we thank them. That’s a mistake; it’s not that hard to say thank you. Anyone in your organization — service provider, administrator, board member or volunteer — can do it. A well-timed phone call or a hand-written note, are simple strategies to build relationships that last and grow.
3. There is a disturbing trend in the industry, one that eliminates personalized thank yous for donors below a certain dollar level. Many of your best ultimate donor prospects give less than $100 annually. Do you really want to thank them with a receipt?
As you can see by these examples, I am a big fan of loyal donor recognition and a firm believer in the power of donor loyalty to predict future giving. But keep in mind, there are many other forms of loyalty beyond just giving that indicate engagement with your organization. Loyalty may include: membership, event attendance, subscriptions, ticket buying, volunteerism, and advocacy.
My colleague, Chuck Longfield, has observed that even very simple behaviors may be strong indicators of loyalty or passion. The example he often cites is the donor/prospect who reaches out to your organization to provide you with a new address upon relocation. This simple act of courtesy is also a not-so-subtle statement of caring for your cause.
I would be remiss if I did not offer a thought about the concept of “years of consecutive giving.” Of course we want our donors to give at least once annually, but we know that if they miss a year or two here and there (particularly if it is sporadic), it does not adversely affect ultimate giving behavior. If you track consecutive years of giving and publicly recognize it, practice forgiveness for a year missed. And also remember that donors think and act on a calendar year schedule: a gift in January 2010 and another in July 2011 happen in consecutive calendar years but miss FY2010-2011. Would you agree that they remain loyal to your mission?
Data Modeling Delivers
Mining your prospect data is a key to success. Modeling factors in the strength of each individual’s relationship with your organization, such as whether they volunteer regularly, purchase season tickets every year, or sit on your board of directors. It will identify and rank the best prospects in your database, whether or not they have already given to your organization. This will enable you to better understand your donors’ and non-donors’ relationships with your organization. Once you have the information, you can target your efforts accordingly by turning that knowledge and your creativity into fundraising results.
Find out how your unique organization could benefit from predictive modeling by completing the Modeling Explorer online needs assessment at www.blackbaud.com/ModelingExplorer.
Lawrence Henze, J.D. Managing Director, Target Analytics