One of the most important tests of a fundraising strategy is that it sustainably increases donation income over time. But how can you know in advance that this will happen?
Here we explore the mechanisms that enable a strong fundraising strategy to increase philanthropic income.
Jump straight to the bottom to test your fundraising strategy against each of these mechanisms.
You can’t do everything
It doesn’t matter how big your fundraising team is, you can’t do everything. Try to do too much and you risk mediocrity, with ‘OK’ outcomes. And in the worst case scenario, you drop balls and make mistakes that lose you potential donors.
So every fundraising team has to make choices about what to do. This is the essence of strong strategy: it focuses your scarce resources. So when you go through a strategy-setting process you need to consider the most important things to focus on to achieve your goals.
Making strategic choices
The ‘right’ things to focus on will be unique to each organisation – there is no one-size fits all solution.
I recently worked with a school development office with just two part-time staff who wanted to step up their bursary fundraising. They were ambitiously planning to expand their regular giving programme, reinvigorate their social media output, establish a legacy society, improve their careers mentoring and continue their current communications and events programmes. I commended their ambition but was exhausted just listening to everything they had planned!
As I guided them through a fundraising strategy-setting process we decided to restructure their plans into a staged approach. This was designed to bring early fundraising results to support their proposal to the governing body for more resources. I didn’t scale back their ambition, but I did bring some reality to the equation: their primary goal was to start increasing fundraising income to strengthen their case for increased investment.
After refocusing their vision and completing a fundraising audit it all became clearer. Their initial focus would be more structured major gift fundraising and establishing a legacy society. Their current regular giving, social media and events activity would just tick over in the background until they had more resources to advance in these areas too.
Finding the giving potential in your community
A critical component of making these strategic choices is working out where the potential donors are in your community. This is part art and part science; part gut instinct and part data-driven decision-making.
One school head I talked to recently had a clear sense that they have very few potential six and seven-figure donors in their community. But, they have a large number of potential five-figure donors for their bursary campaign.
In this case, it makes sense to focus their efforts on a giving circle based on lifetime giving, aimed at bringing more donors on board at this five-figure level and then stewarding and cultivating them to perhaps make further gifts at the same level. In contrast, a school with a larger number of potential six-figure donors might structure a giving circle with levels that encourage single donations at a higher level.
So a strong fundraising strategy will identify where the giving potential is in your community. It then focuses your efforts on building relationships with these groups.
Consciously balancing short and long-term results
We all know that fundraising is a long-term game. We are building sustainable cultures of giving which will last for generations to come. It is possible, therefore, to justify focusing mainly on activities that take time and effort now but only build philanthropic income slowly over time. For example, community-building activities or slowly increasing regular giving participation rates.
However, securing a small number of inspirational gifts in the short or medium term is also a fantastic way to build a culture of giving. It allows you to demonstrate the impact of donations, publicly thank major donors and show others that ‘people like them’ support the cause. Securing major gifts also supports the case for additional investment in fundraising capacity to build up slow-burn activities such as regular giving.
The importance of major gifts is also backed up by data in the 2018 IDPE benchmarking report. School development offices which raise more than £1million per annum spent an average of 20% of their time on major gift fundraising. In comparison, schools raising less than £500k spent less than 10% of their time on major gift fundraising.
Strategy is all about balancing long-term vision and short or medium-term tactics. So a strong fundraising strategy will keep both long and short-term goals in mind.
It’s also important that your fundraising strategy informs your day-to-day decision making. Your development office team needs to allocate its time based on your strategic focus, not on what appears to be most urgent each day. I know that’s easier said than done! But it gets much easier when you have a robust fundraising strategy in place.
Checklist: How strong is your fundraising strategy?
We’ve now seen the mechanisms which enable a strong fundraising strategy to increase philanthropic income. So how does your fundraising strategy measure up?
Does your fundraising strategy make tough choices about what you are not going to focus on? If you’re trying to do everything you need to tighten up your strategic focus.
When you set your fundraising strategy did you identify where the potential donors are in your community? Did you base this on both data and gut-instinct?
Does your fundraising strategy allocate your scarce resources to the activities that will cultivate these groups of potential donors?
Does your fundraising strategy balance activities which will generate a flow of donations in the short and long-term?
Does your fundraising strategy inform your day-to-day decision making? Does it help you prioritise what’s important amid inevitable distractions?
If you answered ‘no’ to any of these questions then it’s time to revisit your fundraising strategy.
If you answered ‘yes’ to them all then you have a strong strategy that positions you to sustainably increase your fundraising income.
Agree? Disagree?
I always welcome feedback - debate and conversation sparks innovation! Contact me via LinkedIn or Twitter.
Juliet Corbett is an experienced strategy consultant working with schools and fundraisers to help them achieve their vision faster.
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