Major gifts are an essential aspect of any fundraising campaign for a nonprofit organization. Yet only the wealthiest 12% of donors account for almost 88% of nonprofit funding. Because these substantial donations have a significant impact on your nonprofit’s strategy, experienced fundraisers are paying more attention to major individual gifts.
Not only do these gifts play such an important role in charity fundraising, but a recent trend in the nonprofit sector indicates that the number of small to medium gifts is declining.
What are Major Gifts?
Major gifts are the most significant donations nonprofits receive. The exact size of what is considered a “major gift” changes per organization depending on the past average gift sizes and the nonprofit’s size.
While some larger organizations may consider major donations to only be $100,000 or larger, other smaller donations might consider $2,000 to count in this category. Undoubtedly, major gifts are significant for your organization’s fundraising efforts.
In 2017, $410 billion was given in philanthropy, even though fewer families than ever before contributed to these programs. However, just the wealthiest one percent of donors give over half of all gifts, and only roughly 91 percent of high-net-worth households give to charity. This indicates your major gifts program has a lot of promise.
How to Find Major Donors
A substantial donation to a nonprofit is rarely made on the spur of the moment without prior discussion between the donor and the organization. Building relationships with supporters and focusing on your donor retention methods are two of the finest ways to attract more significant gifts to your organization.
Identification Factors
When you start searching your donor database for potential major donors, you’ll want to look at the three C’s of major prospects: a) the depth of their connection to you, b) demonstrated concern they have for your mission, and c) anything you know about their capacity to give.
Prioritize Potential Prospects
You won’t be able to qualify each prospect in your database due to a lack of time. That’s why you’ve compiled an initial to-do list. While you care about each one of the people in your donor database, not everyone needs to be on this first list of prospects.
This is why you should use the old Pareto Rule:
- Put 80% of your resources into the top 20% of prospective donors likely to give you 80% of your funding. Prioritize your list of identified prospects to make sure you’re hitting the right demographic for this top 20 percent.
Qualify Your Prospects
Not every single one of your prospects wants to be courted. This is why you must qualify your prospects, limiting your list to a manageable size for your large contribution campaign’s cultivation and stewardship stages.
The qualification process is all about getting to know your prospects on a personal level, nurturing them, and convincing them to consent to a more personal interaction with your company’s executives.
The rule of seven is one of the most efficient strategies to get to know your donor. Getting a conversation with a potential donor usually takes seven tries. If you attempt and contact your prospect seven times and they don’t respond, go on to other donors who might.
These seven steps will likely look something like this:
- Start by sending an introductory letter.
- Follow up with a phone call, thanking them for past engagement and discussing what they love about your mission.
- Leave a message if you don’t reach them.
- Send a follow-up email or letter.
- Send a survey if you don’t hear back.
- Follow up on a different marketing channel.
- Make one last phone call.
Major Gift Cultivation
You wouldn’t approach a stranger on the street and demand $5,000. However, when you don’t have a solid relationship with your supporters, you’re essentially doing the same thing when you ask for a large donation. That’s why it’s critical to design tactics that will allow you to cultivate relationships with prospects and significant donors over time.
Gardening is a good analogy for cultivation. You plant a seed, water, soil, and fertilizer it, monitor its growth and blossoming, and then take the fruit from the stem and allow it to disseminate its seeds to create new plants when the time comes.
- Not all of your prospects will bear fruit, much like the seeds you plant.
- Start the cultivation process by developing a concrete case for support that you can use to explain why you need help. Donors don’t give to your organization; they give to your mission. Therefore, explaining why you need their support and how they’ll make an impact is a key element to obtaining gifts.
- Start by creating opportunities that allow you to get to know your supporters on an intimate level.
Create a Major Gift Solicitation Strategy
There are two primary parts of this strategy that you should keep in mind: a) the meeting setting and b) the actual language you use to ask for a donation.
The Meeting Setting
You may consider asking donors if they have a preference as to whether they’d instead meet virtually or in person.
Virtual meetings are convenient for many individuals with tight schedules, allowing organizations to reach further geographically. However, they leave something to be desired as they don’t allow for the same personal interaction level with supporters as the in-person counterpart.
When you schedule meetings with prospective major donors, make sure the space you choose provides an intimate conversation environment.
Language to Ask for a Major Gift
Chances are your major prospects understand that you’re going to make the ask and have predicted the purpose of your meeting. Therefore, the critical part of the meeting is simply ensuring that you ask the right way.
- The first step to asking for a major gift is to show appreciation for their past contributions. Most likely, they’ve gotten involved in several other ways, whether through donations, volunteer work, or event attendance.
- Then, when you get to the actual asking portion, you should frame the ask as a “consideration,” and provide a specific amount and identify the program details and objectives.
- Ask with confidence while remaining humble. You should also prepare for a refusal and be ready to ask for a donation at the next lowest tier so that you can still raise some funds from the meeting.
Say Thank You to Major Donors
While many fundraisers consider the solicitation to be the most challenging and essential aspect of major gift fundraising, they’re incorrect. Of course, one significant donation can help you in the present, but the promise of future major gifts is one of your strategy’s greatest strengths because it strengthens your program as a whole.
That’s why stewardship is such a vital part of major gift fundraising. Stewardship starts with two simple words: “thank you.” Show your appreciation for everything your major donors do for your organization. This helps cement the relationship you’ve built with them and encourages future involvement with your organization.
Because your major donors are such a big deal, your signs of appreciation should also be a big deal. Therefore, you might decide to implement the following strategies as part of your donor appreciation plan:
- Donor recognition wall.
- Phone calls.
- Host intimate & exclusive events.
- Handwritten letters.
Assess Major Gift Results
Once you’ve set up a major gift program for your organization, you should be sure to assess the results to determine how well the program works and identify opportunities for improvement. When you set up the program, be sure to have a report template preset in your CRM to measure your program’s essential impacts.
This report should list out metrics such as:
- Program ROI.
- Retention rate.
- Number of gifts secured.
- Average donation size.
- Average giving capacity.
- Number of asks.
Next Steps to Get Started with Major Gifts
Major gifts are an essential part of your nonprofit’s fundraising strategy. The statistics show this importance, and building a program is the first step to success.
To conclude, we want to provide you with a list of the next steps to take to start building your major gift program.
- Discuss a major gifts program with your nonprofit’s leadership. Make a case for starting the program and ensure everyone is on the same page about its importance.
- Recruit your major gift officer either internally or externally at the organization to have a dedicated leader of the program itself.
- Define what major gifts look like for your organization. Do the calculations to see where the top 20% of your donations come from and identify the amount that is considered “major.”
- Determine major prospects with the capacity to give in the range identified. Look first at your donor database, then start doing prospect research in the community.
- Create a cultivation strategy with your major gift officer to build relationships with your prospects interested in developing a relationship with your organization.
- Build a solicitation strategy to guide the conversation for each of your prospects. Then, schedule meetings with them to make the asks.
- Steward your donors after they’ve contributed to your organization to continue building relationships with them and to set yourself up for future donations.
- Assess the results of your major gift program and look for opportunities to improve and build even stronger relationships.
To learn more about developing a viable long-term fundraising plan, join us (virtually) for the SUSTAINABILITY – Campaigning to Potential, Part II: Big Gifts on Saturday, February 26 from 1 to 5 pm. This class is part of the Sunshine Certificate in Nonprofit Management.
Author: Claire Axelrad https://bloomerang.co/blog/top-strategies-to-kickstart-major-gift-fundraising/