Most of us are familiar with Pareto’s Principle, which states that 80% of outcomes are going to be achieved by 20% of causes. In the fundraising world this applies as well; most organizations report that 20% of their supporters contribute 80% of their annual fundraising revenue. These individuals are commonly referred to as "major donors."
The idea that large donors are integral to a nonprofit organization is nothing new. Since the advent of philanthropy, nonprofits, charities, and churches have benefited from wealthy donors serving as consistent backers or sponsors.
Strengthening partnerships with major donors will help your organization grow and achieve campaign goals.
Asking for money can be awkward or challenging, making it all the more important to have a game plan going in. How do you unlock larger donations without pressuring or alienating your donor base?
First, remember to keep everything relational over transactional. Giving typically starts in the heart, not the head. If your supporters were purely thinking of what would save them the most money or provide them the largest tangible return on investment, giving wouldn't be at the top of the list. They're most likely giving because they believe in your cause.
Second, identify which donors have the most propensity to give stock and create a plan of action to encourage them to give via Overflow.
With that in mind, here are a few tips to consider incorporating in your plan:
Tip #1: Educate Donors About Non-Cash Giving
Most major donors are likely aware of the tax implications of giving stock, but you can remind them that their stock (or crypto) gift isn't subject to the 20% capital gains tax if it's given directly to a 501c3 organization. That could mean the difference of several thousand dollars when dealing with large gifts. And those tax savings will be passed directly to your organization.
Some may associate stock giving with the historically lengthy stock giving process, which entails several forms being filled out and passed back and forth.
Conversely, Overflow makes it easy to give stock online with a few button clicks.
The whole goal is to build more confidence in non-cash fundraising and allow donors to give bigger than they ever have before.
Tip #2: Have Direct, One-on-One Conversations
As we said earlier, giving is relational. So while it may be tempting to want to send one to many messages or blast announcements for the sake of convenience, the most effective way to build trust and commitment to your organization is through one-on-one conversations.
Not unlike any relationship or friendship, fostering a connection takes time and patience. These are real people with their own financial goals, dreams, and wants, so the fact that they're choosing to give is already a big leap of faith and act of trust.
In these conversations, show them the value and impact of their contributions. Thank them for their support and engaging them with stories of breakthroughs, navigating challenges, successes, and future dreams.
That said, the most simple way you're going to get bigger donations is by making a direct ask. This may seem intimidating, but people are surprisingly receptive to honesty and clarity.
Don’t worry, we have a downloadable worksheet available to make this strategy approachable. Request this resource here.
The "Ask" tool on the worksheet (available to Overflow clients) helps hone your story and refine what you want to communicate to the major donor such as what your needs are and what your plan is for achieving your mission. It's important to include a clear why behind those needs.
Once your plan is established, your next step will be to invite them into a one on one conversation by sending them a letter, giving them a call, or inviting them via email. Ideally this will result in having a conversation with them about giving through Overflow.
If they do commit to giving through Overflow, consider asking them if they'd be willing to share why they gave as a testimonial. This can have a multiplying effect on other givers, who might be emboldened by seeing others have success.
Conversation #3: Talk Data and Analytics
Using analytics is a proven way to make strategic, informed fundraising decisions.
Data-driven fundraising is simply looking at data and trends from past donations and using that to make the best decisions going forward.
While your donors may love stories or testimonials about your cause, there's a handful that will simply want hard data of how effectively their money is being used. Being able to pull accurate figures for them at the drop of a hat will help build trust, transparency, and confidence.
The whole goal is to build relationships through relevancy. That means taking into account each donor's specific situation and tailoring your ask to it.
If you can match the data with an "impact statement," it helps people see a direct link between their giving and meaningful change. For instance: "your stock gift of $2,000 just provided 200 meals for at-risk youth."
Parting Word: Create a moment in time to share your organization's vision and current needs. (Events, galas, fundraisers)
This isn't so much of a tip, but more of a reminder to host events where you can share your vision and needs. Events provide a space to have those one on one conversations about Overflow, share analytics and progress, and make the cause even more real by putting faces to names. When everything is done digitally, it's hard for people to feel fully connected or deeply understand what drives your organization.
Per Nonprofit Source, 56% of donors attend fundraising events, making this a huge opportunity to connect with a large part of your audience. Of that figure, it's highly likely that a significant portion will be major donors.
A few helpful reminders to keep in mind when you're hosting an event:
-There's an amplification effect that happens when you have an auction or some kind of live fundraising component with a captive audience. In the spirit of fun, people often compete and bid on items they don't really need or could easily go buy themselves to evoke the philanthropic spirit and rally others to do the same.
-Though the name may suggest otherwise, fundraisers aren't just about raising money – they're about building relationships. The goal isn't that people would feel pressured to give a large amount, but rather become a lifelong partner or supporter of your cause by feeling like they're an integral part of the mission.
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