Presented by Kathleen E. Pavelka, CFRE, President Telecomp, Inc. ADVANCED ANNUAL GIVING TECHNIQUES: Taking Your Program to the Next Level

Presented by Kathleen E. Pavelka, CFRE, President

Telecomp, Inc.

ADVANCED ANNUAL GIVING TECHNIQUES:Taking Your Program to the Next Level

Formula for Success

There are only TWO ways to Increase your Success:

#1 Increase the number of people giving

#2 Increase the average level of support

Do BOTH

Your Foundation for Success

Major Gift Donors

Leadership Donors

Repeat Annual Donors

First-time Annual Donors

#1 Increase the Number of Donors

Ask More Expand your solicitation pool

(Ask More People) Increase the number of times you ask

(Ask More Often)

Ask Smarter Increase response rates (A Higher Percentage of your prospects

become donors)

#2 Increase the Average Gift

Ask More Increase your Expectations

(Ask people to give more) Ask Smarter

Determine most capable and willing donors(Ask the right people)

Method(Ask the right way)

Embrace the Power of Math

You are smarter than a 5th Grader There is no test at the end This isn’t Rocket Science Numbers tell a story – get into your

comfort zone

The Power of Math

Client A

9,305 Donors

$114 Average Gift

Increase Average Gift by $10 = $93,050

(8.7% increase)

Client B 6,406 Donors

$226 Average Gift 75,000 Patients Increase Response Rate

by ½ point = 75,000 x .005 = 375 new donors x

$226 = $84,750 (5.9% increase)

Expand yourPyramid

Major Donors

Leadership Donors

Repeat Annual Donors

First-time Annual Donors

Increase your

Success

Know what it is

or . . .

. . . You’ll spend a lot of time running in place

#1 Increase the Number of Donors Maximize Renewal Rate


How to calculate Number of Prior Year Donors = 1,000

Number of Prior Year Donors who also have

made a gift in the current year = 600

Renewal Rate = 60% (600/1,000)

Benchmark Renewal Rate = 70% - 85%**Depending on type of institution


Most cost-effective donor Most likely to increase giving Most likely to become long-term consistent

donors Prospective leadership donor pool

#1 Increase the Number of DonorsSegmentation Relationship to Institution/Organization

Group prospect/donors based on their relationship to you

Establish hierarchy and dual relationships Unique Case for Support

Segment should require a unique message Unique Objective

Segment should have a specific objective

#1 Increase the Number of DonorsSegmentation

Sample Donor Objectives

Leadership: Increased giving/Major gift cultivation

Potential Leadership: Increase gift to Leadership LevelRenewing Donors: Increase gift by 30% or moreLapsed Donors: Reactivate giving; increasing is

secondaryLong Lapsed/Sybunts: Reactivate giving (even if decrease)Special Event/Telethon/ Memorial-only Donors: Convert to unrestricted Annual

DonorsEmployee Donors: Renew and increase gift; good

example of unique message


Segmentation versus Fragmentation If it doesn’t require a unique message and/or

have a unique objective then it is likely a waste of resources

Segmentation versus Tracking Codes Track all you want; just make sure group is

large enough for meaningful result


Segmentation versus Restricted Giving Build rapport/case based on their interest, but

does not mean that you have to restrict their gift -- two separate and distinct issues

#1 Increase the Number of Donors Solicitation Opportunities

Must provide multiple opportunities to give throughout the year

Solicit as long as each successive effort is cost effective In direct mail, expect the successive effort to cut in half Suggested Opportunities per year:Leadership: 3-5 Long-Lapsed/Non-Donors: 1-2 Potential Leadership: 5-8 Second Gift Appeal: 1-2Renewals: 5-8 Lapsed Donors: 3-5

#1 Increase the Number of Donors Solicitation OpportunitiesRenewals

Different objective as you move through the year

Increasing → Renewal

#1 Increase the Number of Donors Solicitation Opportunities

Renewal Plan

Segment

Number of Renewal Efforts

CountPersonal

SolicitationFeb

PhoneFeb Mail

March Phone

April Mail

July Mail

October Mail

Nov Phone

Year-End Mail

Board of Directors/Trustees 5 30 X X X X X X

Staff/Employees 5 400 X X X X X

Major Gifts Donors 5 50 X X X X X X

Major Gifts Prospects 5 100 X X X X X X

Leadership 5 300 X X X X X

Potential Leadership 7 780 X X X X X X X

Donors 6 5,000 X X X X X X

Potential Leadership & Donors w/o Phone Numbers 5 500 X X X X X

Memorial-only Donors 2 10 X X

Special Event-only Donors 2 250 X X

GRAND TOTAL 7,420

Solicitation Effort (Calendar Year Basis)

#1 Increase the Number of DonorsCase for Support

Talk about the Future The “What If” is almost always more powerful

that the “What Was” or “What Is” Tell a Story

Giving comes from the heart; the head is a regulator

Peer-to-Peer is Best A major gift rule that applies to all giving

#1 Increase the Number of DonorsCase for Support

Focus on the Donor What is important to him/her?

Impact of Gift Not what the money will buy; what it

will mean Vary the Case for Support

People give for different reasons

#2 Increasing the Average GiftObjective for Renewals

Increase giving from renewing donors to equal the “loss” from those who

do not renew

#2 Increasing the Average Gift Objective Illustration

Number Average

of Donors Gift Income Gift

Prior Year Results 1,000 $100,000 $100

Average Gift needed to generate the same $100,000 gift income at different Renewal Rates:

@ 70% 700 $143 @ 65% 650 $154 @ 60% 600 $167

#2 Increasing the Average GiftCreate New Leadership Donors

Establish a “Chair” of your leadership society for communication purposes

Benefits that reinforce your case for giving On-campus activities AFP Leadership Society – great example Leadership Emails

Target mid-range donors and ask for a leadership gift ONLY

#2 Increasing the Average GiftCreate New Leadership Donors

Treat them like a leadership donor Communications, invitations, etc.

Quality solicitation materials Must match to the significance of the gift

Be specific – ask for a specific amount

#1 Increase the Average GiftCreating Leadership Donors Invitation-Style Leadership Package

Gannon University Targeted Leadership Solicitation

Method: Telephone Outreach Pledge RateAverage Pledge

Percent Increase

Targeted Solicitation for $1,000+ giftCalling period ended 12/15

9% $1,681 232%

Renewal Solicitation to remaining groupCalling period began 12/22

53% $321

Rochester Philharmonic Orchestra Targeted Leadership Solicitation

Method: Telephone Outreach Pledge RateAverage Pledge

Percent Increase

Targeted Solicitation for $600+ giftCalling period ended 12/11

7.7% $696 46%

Renewal Solicitation to remaining groupCalling period began 12/12

53% $354

McDaniel College Targeted Leadership Solicitation

Method: Telephone OutreachPledge Rate

Average Pledge

Percent Increase

First YearTargeted Solicitation for $1,000+ gift

7% $903 154%

First YearRenewal Solicitation to remaining group

55% $263 3%

Second YearTargeted Solicitation for $1,000+ gift

11% $1,023 51%

Second YearRenewal Solicitation to remaining group

67% $255 -2%

#1 Increase the Average GiftCreating Leadership DonorsLeadership Lead Letter Series: Letter #1

#1 Increase the Average GiftCreating Leadership Donors Leadership Lead Letter Series: Brochure

#1 Increase the Average GiftCreating Leadership DonorsLeadership Lead Letter Series: Letter #2

New York Presbyterian Hospital Targeted Leadership Solicitation

Method: Telephone Outreach

Pledge Rate

Average Pledge

Percent Increase

First YearDonors $250 - $999

56% $487 34%

Second YearDonors $250 - $999

46% $506 42%

Method: Telephone Outreach

Number of

Pledges

Number of $1,000+ Pledges

Percent of New $1,000+

Pledges

First YearDonors $250 - $999

112 21 19%

Second YearDonors $250 - $999

70 18 26%

New York Presbyterian Hospital

Targeted Leadership Solicitation


Source of $1,000+ Donors

#2 Increasing the Average GiftSecond Gift Program

Solicit current year donors for a second gift The old adage applies:

Your best donor prospect is a current donor Vary case for support; “special appeal” Combined annual giving determines giving

society level


Segment Pledge

Rate Average Pledge

Income per Solicitation


Current Donors $1-$99

25% $52 $13


46% $115 $53


37% $270 $99

Current Donors $1,000+

51% $1,046 $535


Segment Pledge

Rate Average Pledge


Children’s Memorial Hospital

Current Donors $25 - $249

21% $70 $15


21% $650 $135

Somerset Medical Center


25% $61 $15

#1 Increase the Number of DonorsAcquisition

Investing in new donors to generate a future return

#1 Increase the Number of DonorsAcquisition

Set reasonable to high expectations for giving

New low-end donors generally

DO NOT serve your organization

Children’s Memorial HospitalResults by Donor Giving Level

Segment Pledge Rate

Average Pledge


FY ’05 Donors <$25 20% $25 $5 $25-$49 29% $44 $13 $50-$99 28% $67 $18 $100+

31% $127 $40

Recently Lapsed Donors <$25 6% $26 $1 $25-$49 14% $43 $6 $50-$99 14% $64 $9 $100+

18% $121 $22

Acquisition

Minimizing your loss and achieving your goal as effectively as possible

RESULTS


Acquisition Response RatesTelephone Outreach and Direct Mail

Telephone Outreach Direct Mail

Response Rate 5.9% .64%

Gifts per 10,000 Prospects 590 64

Gifts per 50,000 Prospects 2,950 320

Average Gift $70.01 $62.80

Income per 10,000 Prospects $41,306 $4,019

Income per 50,000 Prospects $206,530 $20,096


Cost of AcquisitionTelephone Outreach and Direct Mail

Telephone Outreach Direct Mail

Year 1 Loss per New Donor $16.74 $13.88

Year 2 Renewal Response Rate 39% 22%

Year 2 Average Gift $95.36 $67.64

Year 2 Net Income per Donor $72.21 $44.49

Year 1 & 2 Cumulative Net Income per Donor

$55.47 $30.61

Cumulative Net Income per 10,000 Prospects

$12,763 $431

Cumulative Net Income per 50,000 Prospects

$63,818 $2,155

New York Presbyterian HospitalComparative Results of Rated Prospects in an Acquisition Effort

Segment Contact

Rate Pledge

Rate Average Pledge


Lenox Inpatients Wealth Screen

64% 17% $188 $33

General Inpatients Lenox Series

51% 16% $178 $24

General Inpatients Standard

57% 17% $131 $22

Lenox Outpatients Wealth Screen

51% 8% $188 $14

General Outpatients Standard

51% 13% $92 $12

Morristown Memorial Hospital

Target America Comparative Results

Number Assigned

Number of

PledgesPledge

RatePledged Income

Average Pledge

Pledged Income Per Assigned

Telecomp Totals 17,700 1,168 6.6% $98,956 $85 $5.59

TA Totals 1,322 105 7.9% $9,450 $90 $7.15

TA Investors 312 29 9.3% $2,910 $100 $9.33TA Keoughs 36 2 5.6% $120 $60 $3.33TA Luxury Estates 188 15 8.0% $2,335 $156 $12.42TA SEC Possibles 100 6 6.0% $385 $64 $3.85TA Confirmed Executives26 6 23.1% $620 $103 $23.85TA Bus.Cross Ref 566 44 7.8% $2,785 $63 $4.92TA Foundation 49 5 10.2% $225 $45 $4.59TA Wealthy 405 30 7.4% $3,075 $103 $7.59TA Affluent 212 20 9.4% $1,860 $93 $8.77

MEASURE

EVERYTHING

After all, you must Know Your Math

MEASURE

EVERYTHING

After all, you must Know Your Math

Barriers to Getting It Done

Budget Restrictions Short-Staffed Management Approval Board Approval Philosophy IT

Show them The Power of Math

And take your institution to new heights!

Documents

Presented by Kathleen E. Pavelka, CFRE, President Telecomp, Inc. ADVANCED ANNUAL GIVING TECHNIQUES: Taking Your Program to the Next Level