Utilizing Transitional Giving to Increase your Annual Fund | npENGAGE

Utilizing Transitional Giving to Increase your Annual Fund

By on Oct 22, 2010


Are you experiencing Annual Giving fatigue at your organization?  Have many individuals “plateaued” at the same level of giving year after year?  Are you having difficulty transitioning donors from annual giving to major giving?  If so, consider implementing a leadership or transitional giving program dedicated to proactively increasing gift levels among individuals capable of making larger contributions.

What is transitional giving?  While definitions vary, essentially it is the progression of donors through the donor pyramid, culminating in each donor’s greatest, or ultimate gift to your organization.  In a nutshell, it is the “space” between annual and major giving:  those sparsely populated mid-tier levels on your giving pyramid.  With attention typically focused on more exciting “mega” gifts, it is easy to forget that many donors could increase their giving, but will most likely do so gradually, not move from $250 to $10,000 in one step.  Effectively moving these individuals up the pyramid requires that you first identify the best prospects, then create an effective strategy to encourage larger gifts.

STEP 1:  PROSPECTS!  For many organizations, an important first step in building an effective transitional giving program is increasing the number of $1000 donors.  This elusive giving level is often the psychological “bridge” between annual and major giving:  not only is it the point at which donors start thinking about being a major gift donor, it is also quite likely the level at which your organization starts treating individuals like major donor prospects.  Therefore, it is critical to build this prospect pool to a robust level.

To find the best $1000 prospects, identify the “sweet spot” within your annual giving pool.  Take a look at individuals currently giving $250+ who have “plateaued” at that level for three or more years.   Then do some simple data mining:   add additional information that will tell you how many years they have been giving, total number of gifts, and specific gifts in the last three years.  

The results of this exercise may be mind blowing:  you may be surprised at how many prospects are lurking in donor limbo, giving the same amount year in and year out.  Ask yourself if this isn’t due, at least in part, because you have been asking in the same way, year after year.  So, how do you change your behavior in a manner that will affect donor behavior?  Remember my earlier comment– if you want a donor to act like a major gift donor, make sure you are treating him or her like one.  So, rather than the same, tired annual fund appeal you may be sending to all of your constituents, let’s do something different this time.

STEP 2:  MESSAGE!  This may be the most important aspect of this effort.  To create an effective message, first stop thinking of this as an annual fund effort.  Instead, think of this as a mini campaign.  Develop a strong case statement with clearly articulated funding priorities.  This should be meaningful and tangible.  Make sure the prospect can answer the question, “What will a gift of $1000 fund if I give it to you?”  Consider the specificity of a request from organizations such as Heifer International:  If a donor contributes $1000, it will fund a “milk menagerie”, which represents “a quality-breed heifer, two goats and a water buffalo – four milk-producing animals for hardworking families hoping to provide a better life for their children.”  Pretty powerful stuff.    Does your request sound as compelling?

Another message strategy is to quantify the collective benefit:  What will be accomplished is 1000 people accept this challenge?”  This can have a powerful effect on donors when they see the role their gift can play in the big picture.  Finally, pay attention to the tone—urgent is fine, desperate is not.  Ensure that donors don’t feel they are being asked to rescue a sinking ship!

STEP 3:  FOLLOW UP!  As important as the message is, effective follow up is perhaps even more critical to the success of your effort.  Remember, this isn’t just the same old annual fund.  Your letter is simply the first step in a well-planned process.  You should have a comprehensive follow up process that includes a phone call by the “right” person.  Again, keep in mind you are creating a mini campaign.  You need to know who would be the best person to make that call:  who can “make a difference” with the prospect? 

This implies in important corollary:  the size of your appeal group must be manageable for your organization.  Again, this isn’t a mass effort, this is a mini campaign.  That may mean 100, or maybe only 25 prospects should be solicited at a time.  Follow up should take place within two weeks of the arrival of the letter.  Gauge your group size based upon how comprehensive of a follow up network you have in place.

STEP 4:  TRACKING AND COMMUNICATION!  Not only do you need to track the success of your efforts, you also need to communicate it back to your constituents.  Shout it from the mountain top!  Let everyone know how many new $1000 donors you have—and what has been accomplished as a result of this.  Not only do you want to personally thank those who stepped up and respond affirmatively to your request, you should also use this as a focal point of your annual fund success.  Let the masses see what individuals can achieve.  Newsletters, emails and websites can all be venues for your good news.

So, get to work!  If you make transitional giving a priority at your organization, you can implement a strategy to make it happen.  Once it does, you will have nurtured a new group of individuals along the major donor path, culminating in a larger “ultimate gift” than you ever thought possible.  Good luck!  We would love to hear about your successes!


Laura Worcester, senior consultant at Target Analytics, joined Blackbaud in 2001.In her current role she advises nonprofits on utilizing screening results in identifying and evaluating best donor prospects. In 25+ years of fundraising experience, Laura has served as the chief advancement officer for numerous organizations and managed her own consulting business, providing grant writing services to arts, educational and health care organizations. She’s presented at development conferences and has been a regular contributor to Blackbaud’s blogs with selected posts being reprinted in journals such the NonProfit Times. A traveler since her study abroad days in Denmark, Laura’s committed to passing this enthusiasm on to her teenage daughters. Her family’s travel adventures were just featured in a neighborhood magazine in her suburban Milwaukee community. Contact Laura by email.

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