THE END OF THE YEAR IS NIGH
November. Your end of year appeal planning should already be done. But if you are using Giving Tuesday—December 1st this year—as your EOY kickoff, you still have time. Even if you aren’t, in this crazy year, most “best practices” have been turned on their head, and so start your planning now. Or look at what you planned and ask if you can make it matter.
Most years, about 30% of all charitable gifts occur in December. There are a lot of reasons for that: The season which makes people think more of others, the fact that at the end of year many feel they have a better handle about what they can afford, and the real impetus for giving—the fact that most nonprofits use this time to actually ask their donors for support.
This makes the end of the year a very noisy time. Lots and lots of pushing for attention—give to me, to me, to ME. This year, that noise is going to be louder. I don’t think I have to remind anyone about COVID, social unrest, an election that promises to be contentious even after November. Add to that the panic mode that many nonprofits are in.
Unless you are an organization that provides basic services—food, shelter, medical care—you may be suffering from lower than usual revenues. Many organizations may be doing fine comparing total dollars across years, but much of what has been received this year has been limited to specific COVID related activities. And while some organization have had to slim down to keep their doors open, others have added many services and serve many more people, often without commensurate resources.
Add to that the fact that fundraising, for some, is down. In fact, a recent survey by CCS reports that over 70% of all nonprofits expect a significant or modest decline in fundraising for 2020. But at a recent training I did on End of Year Appeals, more than 50% of the participants thought that 2020 would show an increase. For a small number of those organizations, the anticipated increase would be significant. Whichever camp your nonprofits is in, EOY is bound to be important.
One more wrinkle for some organizations is the fact that some have had or are in the midst of emergency fund campaigns. You have to ask yourself, how much can my donors really give—and how often should I ask?
That contentious election might teach us something. If you are anything like me, you have been inundated with appeals. Daily. Yes, I delete a lot. And I throw a fair amount into my “junk” mailbox, but every so often, something speaks loudly to me….and I give. Again. I don’t advocate being as relentless as the politicians, but your clients, your cause, have needs. Don’t shortchange them because you are afraid to ask too often. Do, however, consider, reaching out in equal amounts to simply say thank you or to show your donors what their support actually means.
Given all this, what are we going to do about End of the Year Giving? Let’s look at the 5 most important things you can do to end the year successfully. Note that these are not singular but part of a continuum; your success will come when these work together.
1. Set a goal
It is hard to get where you want to go if you have no clue where that is. Setting the goal wisely is critical. Too often, nonprofits look at what they raised last year—and add a percentage to that. While that is never a great way to set a goal, this year it is really a bad way.
A second, very popular way, is what is commonly called fundraising to the gap (or deficit fundraising). You take the amount you need to run your organization for the year, subtract the revenue you have already raised, and then that gap is what you have to raise during these last few months. While there is a case to be made for bridging that gap with your end of year fundraising efforts, too often either the organization leaves a lot on the table (we only need another $40,000—so once we raise that, we can stop) OR sets itself up for failure (consider, over the course of the rest of the year we’ve raised $22,000. We actually need $150,000 to break even. How realistic is that?)
The best way is to consider your resources. These include:
Your mission (some things, some years, are just more likely to attract donors
Your donor pool. Who gave to your end of year appeal last year? (do you have enough donors at the right levels? A gift chart is really useful here. Consider how many prospects you have at a variety of levels; figure you need at least 4 prospects to equal one donor, however, if you do have a sure thing donor, include that; then add your numbers up.) And then check:
Your past EOY fundraising efforts and your donor retention rates. If you raised $50,000 last year and your donor retention rates among those who have given to end of year is 40%, you can assume that this year you can count on $20,000. Unless you’ve done some really extensive stewardship work this past year
Your current fundraising plans. I mentioned emergency fund drives—have you recently held one? That could impact your ability to raise more funds. On the other hand, if you haven’t done any fundraising at all this year, that too could have a negative fundraising impact. People want to feel that their giving makes a difference. If you haven’t asked, well…maybe you don’t need and even if you need, maybe you don’t think they have been important.
Your human resources for fundraising. The more people you have who can ask others to join with them, the more ability you will have to raise funds. Fundraising, even transactional, arm’s length fundraising is all about relationships. This is why I advise thinking carefully about who is signing your appeal letter/email and who is making that one on one ask.
2. Segment your list
At a minimum, divide your prospect/donor list into three:
Those who gave last year
Those who gave in the past but not last year (LYBUNTs)
Those who have never given
I would recommend further segmenting those who gave last year:
Loyal donors (those who have given for 3 or more years)
Larger (than your average gift) donors
Those you believe have greater capacity than their giving shows
3. Develop an EOY Campaign Plan
Look at your goal and your segmented lists. How are you going to reach each segment?
Direct mail—still alive and kicking. Despite the rise of social media and other electronic ways to reach people—and I am someone who lives and dies by email and text—direct mail is still alive and well. In fact, it is still a very productive way to fundraise. Recent studies have shown that 50 percent of people pay more attention to direct mail than any other marketing channel. And yes, this includes Millennials. Moreover, depending on the nonprofit organization, the direct mail channel often delivers between 60 and 80 percent of total revenue. The email channel provides between 5 and 15 percent.
On average, direct mail response rates stand at 10 to 30 times that of email, and even higher when compared to online display. But they are still low. the response rate for direct mail is only about 4% for a warm list. If you were to buy an acquisition list, the rate is closer to .004%. If you can afford to buy and mail to at least 1M households, it could pay off. However, for most of us, it is not a good way to either grow our prospect pool or to raise money.
An EOY campaign page on your website—visible from your homepage (Don’t bury it under “giving”)
A challenge or matching gift. People love to leverage. A gift that offers a way for their gift to count more works.
Blog postings
Social media postings. And do target the social media sites to your audiences. If your donor pool is made up mainly boomers and Gen Xers, you might not want to go to Instagram where 90% of the users are under age 35.
Send out postcards. Big postcards. They don’t cost more and they do grab attention. Use those to push people to your website
Shot a video. Send it in an email and post it everywhere you can.
Pull together a call bank. Note that 90% of your calls will go to voice. LEAVE A MESSAGE. You will see a bump.
Do a text-a-thon
Peer to Peer appeals
Crowdfunding
I’d be remiss if I didn’t mention my favorite way to raise funds—the palor party or salon This is not the year to be planning an in person event, but you can plan a virtual one (or ones, as parlor parties by definition are small, you will want to have several). Just make sure that you have a program that will appeal to your invitees, and that your invitees will want to be in the same meeting with each other.
4. Yes, talk about impact but highlight urgent needs—yours and your clients
Most years, I advise my clients to develop messaging that speaks to their success. Show donors how much their gift matters by showcasing the achievements this past year that resulted from your work and their support. This year, however, that could be a double-edged sword. Donors might just feel that if you are doing really well perhaps, they should give their support to those who aren’t. Not, mind you, that I am suggesting you cry poverty, or talk about all the gloom and doom. What I am suggesting is that you be honest. If, for example, cancelling your gala or not being able to sell tickets to a performance meant a huge reduction in revenue, share that. And talk about the challenges you and your clients are facing because of COVID and the social unrest.
5. The impact of COVID for donors
There are things that COVID has changed, and you’ll talk about the most important ones as you highlight your urgent needs. And also make sure your donors understand how the CARES act provides them with charitable benefits—for 2020. While I don’t think that most annual givers support you because of tax deductions, it can’t hurt to remind them (or let them know in the first place) that:
Individuals who normally take the standard deduction on their taxes can also deduct up to $300 in gifts for 2020
Those who itemize can deduct donations up to 100% (instead of 60%--the former maximum) of their 2020 adjusted gross income
And no, this does not apply to DAFs
While these 5 steps are critical for your end of the year success, so, too is understanding that EOY does not stand alone. It is part of your entire fundraising program. Fundraising is not a series of discrete activities that start and stop but, rather, that it is an ongoing process. So, you are not waiting until the end of the year to remind them that you exist and that THEY are important. To be really successful, your end of the year fundraising is part of an entire year of strategic fundraising activities, that culminates in your end of the year campaign.
Arguably, the most important aspect of your EOY campaign is the understanding of and acting on the fact that true fundraising starts with gratitude. Remember those lapsed donors we discussed earlier? A strong stewardship program will help to minimize attrition and help keep retention rates high. Part of your fundraising plan must focus on strong, consistent ways to keep your donors close to you and always moving forward toward their next gift.
That means that in actuality, end of the year fundraising begins at the start of every year. With a robust and comprehensive fundraising plan, that includes ways to reach new donors, move up loyal ones, bring back lapsed donors, and include your clients so they can become not just recipients but also investors (at any level, in many different ways) in what you do. It means appealing to your broadest base while working to make each and every one of them feel that they are part of the specialness of your organization.
And as you close the door to this end of year campaign, remember that it is now time to open the door to next year’s