Introduction to Planned Giving Seminar in Chicago, September 29-30

PAGE 4 PAGE 6 PAGE 7

9 Ways to Make Your Website More Appealing

Managing the Donor Downgrade

Augu

st 2

015

| V

ol. 4

8 N

o. 8

July

201

5 |

Vol

. 48

No.

7

WA

SHIN

GTO

N •

ATLA

NTA

• M

EMPH

IS •

SAN

FRA

NCI

SCO

I D E A S A N D I N S I G H T S F R O M S H A R P E G R O U P

Finding the Needles in Your Haystack Page 2

Finding the Needles in Your Haystack

Identifying prospective donors with the potential to make larger gifts, whether current or deferred, is a little bit like looking for the proverbial “needle in the haystack,” only maybe even harder.

No matter how long and hard you search for it, the needle in the haystack remains a needle and your job is to find it. However, a variety of factors may affect which members of your constituency have the capacity to consider a larger gift now or in the future.

Your constituents’ economic and personal situations are constantly in flux. Life-changing events and economic forces—such as changes in employment and marital sta-tus, job promotions, inheritances, fluctuating real estate and investment values, family commitments and stage of life issues—can drastically affect a potential donor’s ability to give.

Looking back.This certainly has been the case during the past decade. The housing bubble, Great Recession and financial crisis had a dramatic impact on individual and household wealth and income. Millions of people were unemployed or un-deremployed, housing prices bottomed out and the Dow Jones stock index crashed from over 14,000 to less than half that level.

With disposable income and wealth thus reduced, the U.S. experienced the greatest decline in giving since the Great Depression. All in all, household net worth fell from a record peak of $66.8 trillion in 2007 to $58.3 trillion by

2August 2015

by Barlow Mann

the end of 2009. An unprecedented $8.5 trillion in wealth had been lost in just two years. In hindsight, it is now clear that much of the drop in giving by individuals was among donors of the largest amounts.

Recovery at the top.The subsequent recovery has been long and uneven, with only a relatively small percentage of the population enjoy-ing most of the reported increases in household wealth and income. Nevertheless, the Federal Reserve reported that household net worth reached a new record level of $82.9 trillion in the fourth quarter of 2014 and rose another $1.6 trillion between January and March of 2015.

According to the 2015 Giving USA report, charitable giving has also benefited from the recovery and, at $358.4 billion, is once again at a record level in both nominal and inflation-adjusted dollars.

Find your best prospects.Now may be the time to focus on the top tier of your constituency—those benefitting from the creation of this new wealth and enjoying larger incomes.

Prospect research and other data and file enhance-ment services can help find these individuals, but only if the results are current. Individual prospect research and

Announcing National Estate Planning Awareness Week

The National Association of Estate Planners & Councils (NAEPC) adopted a public awareness campaign beginning in 2008 to help the public understand the importance of estate planning, a process that resulted in the establishment of National Estate Planning Awareness Week.

Surveys show that less than half of all Americans have an up-to-date estate plan. Make a special effort to educate your donors about the importance of planning their estates, including the charitable dimension, during the 2015 National Estate Planning Awareness Week, October 19-25. Check with Sharpe Group for an array of publications

you can use to support a special communication, at events or as leave-behinds at a donor meeting, including Has Congress Changed Your Will?, 37 Things People “Know” About Wills That Aren’t Really So, How to Make a Will That Works and Personal Financial Affairs Record. Learn more about Sharpe’s communications pieces at www.SHARPEnet.com/shop. ■

3

What Does a Gift Planner Look Like?

Gift planner profile.The Partnership for Philanthropic Planning (PPP) re-cently conducted a membership survey to update the demographic profile of its membership. The complete report, “Gift Planner Profile 7,” is available from the PPP.

Nonprofit PPP members.According to the PPP Gift Planner Profile, some 54 percent are female, and nearly 70 percent of respon-dents are aged 50 and older.

As a group they are well educated, with 72 percent of nonprofit gift planners holding advanced degrees, in-cluding 31 percent with either an MBA or JD.

Over half of nonprofit gift planners work in higher education and healthcare (36 and 16 percent respec-tively). The balance is spread across community foun-dations, religion, arts, environmental and other nonprofit organizations and institutions. Further, about two-thirds of all gift planners have established a planned gift of their own.

The median nonprofit gift planner salary was in the $80,000 to $89,900 range. Those earning above the me-dian range were more likely to work with larger organi-zations. Additionally, this group was more likely to have more than ten years’ experience and have a law degree and/or serve in a vice president role. ■

For additional results, see www.pppnet.org.

www.SHARPEnet.com

wealth-screening services can be expensive but are cer-tainly worth the investment if utilized strategically. Sim-ilarly, file overlays or enhancements can be used as a cost-effective segmentation tool to separate your files into distinct “haystacks,” which will likely prove to be more pro-ductive than a single large one.

In other instances, donor behavioral data can help de-velop specific appeals based on gift levels, length of giving and cumulative amounts of giving. For example, donors with a history of larger-than-average gifts, or of making noncash gifts such as stock or real estate, may be target-ed for a special appeal. If your donor file has recent income and wealth information, you might ask those in the higher ranges to consider additional or larger gifts this year.

If you have prospect research capabilities, consider updating your research for a smaller but more manageable number of top donors and prospects. Ideally this group, perhaps a few dozen or a few hundred (depending on or-ganizational capacity), can be broken out for individual at-tention, including personal contact and a higher-level “ask” or proposal with sufficient information to assist them in considering five, six or seven-figure gifts.

Finally, consider the benefits of a relatively broad communications strategy that promotes larger gifts from those whom your other tactical measures were unable to identify. For example, consider including a message about the advantages of giving noncash assets such as securi-ties in a regular or special donor appeal. According to IRS figures, the average gift of stock is around $64,000.

By taking steps now to identify your best potential do-nors, you can provide them with the information they need to make their gifts in the most effective ways, ensuring the best use of both your resources and theirs. Fall is a good time to reach out to all donors as many charities receive 40 percent or more of their fundraising totals in the final weeks of the year. Consider a year-end giving mailing such as a brochure on special ways to give. ■

For information on enhancing your donor data file, visit www.SHARPEnet.com/data-enhancement-services. In ad-dition, Sharpe offers a range of materials designed to en-hance your appeals this fall. Sharpe can also customize a year-end giving communications specifically for your needs. Visit www.SHARPEnet.com/publications.

Barlow Mann is Chief Operating Officer of Sharpe Group.

35.6%

31%

20.7%

13%

60+

40-49>40

50-59

PPP Nonprofit Members by Age

*Partnership for Philanthropic Planning Gift Planner Profile 7

44

9 Ways to Make Your Website More Appealing

The average age of gift annuitants is 79 and more than 80 percent are over 75 (see http://www.acga-web.org/about-gift-annuities-top/gift-annuity-best-practices). Ac-cording to Dr. Russell James, some 80 percent of bequest donors are over age 75 when they execute a will including a bequest (see “What’s Wrong with Focusing on Bequest Intentions from 40-Year-Olds?” Give & Take, December 2013). Given these facts, it is important to keep in mind that the majority of donors over 75 may not be as in-clined as other generations to be influenced by your web-site alone (see http://www.pewinternet.org/2014/04/03/ older-adults-and-technology-use/).

That is why it is important to use a carefully integrated mix of marketing channels including mail, telephone, websites, online marketing, donor gatherings and one-on-one communication.

Sharpe’s consultants have helped web services clients employ a number of successful communications techniques in conjunction with their gift planning website that have helped spark fruitful relationships and resulted in a number of excellent gifts from donors of all ages.

Here are some tips we offer based on their success:

Enhance the “Contact Us” page by designing an informational request form. You might include specific complimentary offers of helpful information. This could be an e-brochure (included with a Sharpe site) or other printed materials of your own creation or procured from other sources.

Make the “Contact Us” page more inviting by including a group picture or individual staff photos.

Include references to the website in other development publications and communications, newsletters, magazines, annual fund, etc. An example would be: “Learn more about special ways to support (your organization) at (web address).”

Include an invitation to visit the website in the annual report, individual proposals and pledge reminder letters.

Periodically share links via email with individuals as warranted and with certain groups such as current and former trustees, campaign volunteers and retired faculty and staff.

Invite the aforementioned groups to consider “back-linking” your site from their personal or corporate websites as appropriate.

Encourage these same groups to “LIKE” or reference supporting your organization with a link back to your site.

Add a variety of donor stories and even donor videos, and announce in print and digital communications that they are now online.

Every organization is unique. Periodically review Analytics after specific changes in your content or communication adjustments to see if web traffic increases.

A well-designed, donor-friendly website that is easy to read and navigate is essential. Integrate online marketing with other media, especially in the case of seniors where studies show that print is the media they still prefer.

An effective website can provide easily accessible information to donors of all ages as they plan their gifts and can be helpful as a source of information for family members, attorneys or financial advisors when helping a senior relative or client who was initially influenced through print media.

Integrated marketing solutions created by highly experienced editors and consultants who understand how to assist in creating comprehensive marketing plans and communicate plans to donors and prospective donors using various media have been the hallmark of success for Sharpe clients for decades. ■

To learn more about how to create a website with supporting materials that are attractive and appealing to your donors, contact a Sharpe representative at 901.680.5300 or info@SHARPEnet.com.

Adding an online component to your planned giving marketing can be an effective complement to other donor communications. Digital marketing in the planned giving arena can be especially successful if it is a strategic component of an overall plan that considers differences in communication preferences based on age, wealth and other relevant factors.

August 2015

Start Planning Now for a Successful Year-End Giving SeasonMany charities receive roughly 40 percent of their yearly fundraising totals in the final weeks of the year. Start planning now—don’t wait until it’s too late.

Positive growth in the economy and ongoing changes in the nation’s tax laws are providing powerful incentives for char-itable gifts that are completed in the most effective way. In this positive environment, it’s a great time to remind your donors of the benefits of giving before the end of 2015.

Start the conversation with your donors now. Sharpe’s 2015 year-end giving communications are a convenient and cost-effective way to share with donors the advan-tages of funding gifts with cash or other assets including appreciated property and utilizing other long-range plans.

Sharpe’s 2015 year-end offerings include:

Giving Thanks at Year-End

Giving at Year-End (two versions)

Time for Giving

5

Reserve Your Materials Now

Place your order by September 15, 2015 to receive special pricing. For more information, visit www.SHARPEnet.com/publications or contact us at info@SHARPEnet.com or 901.680.5300. ■

Sharpe’s year-end giving communications include a prototype cover letter, suggested reply card content, P.S. language for other communications and suggested web/article copy for use with your communications this fall. Sharpe can personalize your brochures by adding your logo and contact information on the front, back or both. If you prefer something more unique to your brand, ask about communications tailored specifically to your needs (minimum quantity 1,000 copies). ■

To learn more about Sharpe’s year-end communica-tions, visit www.SHARPEnet.com/publications or email us at info@SHARPEnet.com or call 901.680.5300.

www.SHARPEnet.com

6

An Introduction to Planned Giving

New Offering: Gift Planning Toolbox

Integrating Major and Planned Gifts

See full agendas and register at www.SHARPEnet.com/seminars or call 901.680.5318 with questions.

Discover how to build your planned giving program.

Learn the keys to effective commu-nications with your donors. Exam-ine the donor life cycle and explore how you can help donors make larg-er gifts today and plan gifts through bequests, trusts, gift annuities and other techniques. Learn to work effectively with those 65 and older who may make up much of your donor base—or soon will. This semi-nar is appropriate for those who are new to planned giving.

Acquire the knowledge you need to complete larger gifts.

Learn the basic workings of the most common gift planning tools, focusing on how to use them individually or blend them for maximum gift value. Determine which gift arrangements may be best able to fulfill a donor’s personal and philanthropic objectives and learn to recognize the typical donor profile for each type of gift. Register for this seminar to benefit from training on various charitable planned gifts.

Learn how major and planned giving can work together.

Discover how to help donors make the best gifts for their age, wealth and oth-er factors, while meeting your current, capital and endowment needs. Learn how to interpret a donor’s verbal and non-verbal clues to determine which giving option is right and how to help donors make larger charitable gifts that might not otherwise be possible. This seminar is for you if your organization has both departments and would like to bring everyone together, or if you or others are responsible for both major and planned gifts.

Chicago September 29-30, 2015 Indianapolis October 26-27, 2015 Washington November 16-17, 2015

2015 Dates for Sharpe Group Seminars

Sharpe Group On the Road

› Sharpe Group Senior Consultant John Jensen will present a session on “Generating the Ultimate Gift of a Lifetime: Who, When, What, How and How Long?” at the National Catholic Development Conference (NCDC) Annual Conference and Exposition, Septem-ber 13-16 in Lake Buena Vista, Florida.

› Sharpe Group representatives will also be present at the PPP (Partnership for Philanthropic Planning) National Conference, October 21-23 in Orlando, Florida. ■

Please help us make our Give & Take publication better by taking a very brief survey at:

https://www.surveymonkey.com/r/3TPLZ9Z or by calling 901.680.5300.

August 2015

Regular

Special

Age

Millennials & Generation X

Baby Boomers Silent & G.I. Generation

Gift

Am

ount

Sharpe Donor Life Cycle

Ultimate

Deferred Gift Zone

025

25 30 35 40 45 50 55 60 65 70 75 80 85 90 95

5075

100125150175200225250275300325350375400425450475500

MotivationCapability

Managing the Donor DowngradePaying attention to the donor life cycle can pay off.

One of the most frequently cited myths about fundraising—and a reason why many gift planners face resistance from their peers involved in other individual gift development efforts such as annual giving, membership and major gifts—is the belief that planned giving can interfere with other giving. That is, some people believe that reaching out to donors in ways designed to encourage the “gift of a lifetime” will cause them to reduce or even completely stop making other gifts.

The truth is, most donors follow a typical “life cycle” in which bequests and other gifts through one’s estate can play an important and natural part. Research shows there is a natural relationship between the donor’s age and the types of gifts the donor chooses to make. Older donors, when facing reduced income and increased healthcare costs, sometimes cut back on outright gifts during their retirement years, whether or not they have an organization named in their estate plans.

The key to keeping donors actively involved in later years lies in recognizing their stage in the donor lifecy-cle and sharing gift opportunities that will speak to their changing concerns and needs.

The early years.In the Early Years, for our purposes those under age 50, people typically are at the onset of their careers. Many are starting families and purchasing homes while also repaying student loans. Donors at this age are prospects for regular gifts and are often open to new ways to make gifts. They are more likely to respond to online solicitations using credit and debit cards. The fundraising focus is mainly on donor acqui-sition, retention and gradual increases in gift amounts. This group of donors is made up of Millennials and Generation X.

The middle years.Regular giving continues during the Middle Years (for our purposes ages 50-69). For many, this is the most gener-ous stage of their lives. This age range now encompass-es virtually the entire baby boom generation. Many are in their peak earning years and may have more discretionary income and assets than ever before. Some of these loyal contributors may be able to make major or special gifts, often in the context of a campaign. Most are not yet con-sidering their ultimate gifts as they are anticipating a life expectancy of 20 to 40 years or more.

The later years.As noted earlier, in the Later Years (70+), some donors be-gin to decrease their regular outright giving as their income falls and health expenses rise. People in the later stages of life may be considering making their ultimate gift. The ulti-

7 www.SHARPEnet.com

mate gift is defined as the largest gift a person is capable of forming the donative intent to make. Motivation to give often remains high, but the ability to give as they did in the past can be under pressure.

It is inevitable that most donors, even major donors with significant amounts of assets, will begin to reduce or stop their giving at some point prior to death. The most successful development programs incorporate efforts de-signed to anticipate and control this process to the extent possible. While proven methodologies exist for the acquisi-tion, retention and upgrading of donors, few organizations have considered developing tactics designed to manage what for most donors will be an inevitable “downgrade.”

The real choice is not between a current gift and a de-ferred or planned gift. Rather the choice is between partici-pating in the donor’s ultimate gift decisions or no gift at all as every donor will eventually stop giving. The most effec-tive fundraisers will pay attention to each donor’s stage of life and work with him or her to make the most appropriate gift at the most beneficial time to create the kind of lasting legacy the donor desires. ■

Excerpted from Sharpe Group’s seminar “Integrating Major and Planned Gifts.” For more information, see Page 6 or visit www.SHARPEnet.com/seminars.

901.680.5300 info@SHARPEnet.com | www.SHARPEnet.com

Websites

Your donors expect your website to provide information that guides them through the planning of their gift. If you don’t want to build, maintain and update the com-plex gift planning modules of your nonprofit’s website yourself, integrate Sharpe’s gift planning website into your existing site , using your current branding.

With Sharpe’s site, you can provide your advisors, development staff, donors and their advisors with a comprehensive and up-to-date reference resource unlike any other planned giving website available.

Sharpe websites deliver in-depth regulatory, legal and tax information with con-text-sensitive live links to articles and databases, including the IRS-approved forms required to complete the gift, where available. The content is written by Sharpe consultants and is always up-to-date, so you have the comfort of knowing your site is always delivering the most accurate and relevant information. And our flexible website makes it easy to apply your branding and update copy whenever needed.

Your website will also include our proprietary, integrated, in-line calculation engine that performs the heavy lifting for you and your donors. From your website, your donors and their advisors can easily tailor an industry-leading list of planned gifts. Donors and their advisors can change various factors to arrive at the plan that suits them best. Calculations are delivered right from the site in real time, for easy, confi-dential sharing with the people involved in the gift decision.

Sharpe’s expertise, delivered in

a self-contained website under your

brand, to guide your donors, their advisors

and your volunteers through the gift

planning process.

Contact us for a live demo.