Hidden Gold Chapter 5: "The six essential ingredients of a successful monthly giving program"
by Harvey McKinnon

 

I have developed successful monthly giving programs in Canada, thex Unitedx States,x and xAustraliax forx charities workingx inx the areas of international aid, health care, social service and welfare, religion, peace, social justice, women’s issues, advocacy, the environment, and politics. All of these groups have benefited from increased revenue from their monthly donors. Most have tripled participating donors’ previous annual giving levels.

 

All these successful monthly giving programs are based on the premise that a nonprofit organization’s most valuable asset is the loyalty of its donors—and the recognition that loyalty is a two-way street.

 

1. Your organization must recognize that donor loyalty is a two-way street.

 

How well does your organization treat its donors?

 

After a person’s initial gift, what’s your next communication? Is it a warm thank-you—or a request to give again? Not appreciation for the gift, just "Send more money, we have needs"?

 

Now ask yourself, How do you personally respond when you’ve done someone a favor, and, instead of thanks, all you get in return is a plea for more help? If you’re like me—or the vast majority of other humans on this planet—you probably feel at least a little resentful.

 

Clearly, then, it should be no surprise to learn (as research confirms again and again) that donors feel mistreated when they’re treated this way. Yet the number of seemingly successful nonprofits who have alienated donors by not showing proper appreciation is shocking.

 

In the days when nearly every charity treated its donors equally badly, donors often endured such disdainful behavior unquestioningly. But today, when a competing charity just might send a graceful thank-you note to a donor who’s given to you both, it’s easy for that person to recognize shabby treatment for what it is.

 

In today’s fundraising environment, when most organizations must invest in acquiring first-time donors, loyal long-term donors have become increasingly valuable. But to foster loyalty among its donors, a nonprofit must treat them well—valuing them, respecting them, attending to their needs and interests, listening to them, and adopting policies and practices that keep them connected to its work. This is especially true of those donors you hope to recruit into a monthly giving program!

 

Assuming, then, that you and your colleagues share this donor-friendly attitude, you’ve got a shot at building a successful monthly giving program. But there are five other essential ingredients you’ll need to bring to bear.

 

2. Your organization must have an appealing mission.

 

An organization must provide a potential donor with a compelling reason to give away her hard-earned money. This is always the case for charities needing repeated individual gifts, and even more so in monthly giving programs.

 

Research has shown that many people make one-time gifts because they’re testing to see how an organization responds to them. Others give small amounts just because you happen to hit them at the right time (and might get nothing at any other time). But to attract genuine commitment—to persuade a donor to pledge monthly gifts to you on a continuing basis—your organization must have a vision, a practical plan for realizing it, and either the track record or the inherent credibility to prove its practicality.

 

As in any fundraising program, the most important factor in an individual’s decision to give on a monthly basis is the simple fact that he was asked to do so. But the second most important factor is the appeal of your mission. Your challenge is to convince the donor he is giving to a dynamic cause for which his donation will make a difference. You communicate this message in a simple, direct manner, appealing both to the heart and to the mind. You must inspire a prospect with an action-oriented case, making him believe that money invested in your cause is money well spent. And be sure you write your case for giving from the donor’s perspective, not obscured by jargon or institutional considerations.

 

3. You must communicate your message effectively.

 

A few years ago I was hired by a nonprofit organization whose "case statement" was 32 pages long! It took a lot of work with this academic-led organization to convince them that no one would take the time to read or understand their case—even staff and board members!

 

Not surprisingly, the organization was having a tough time raising money. The case statement was symptomatic of the leadership’s fuzzy thinking and demonstrated their inability to communicate a clear, strong reason for giving.

 

After a lot of hard work, rethinking their goals and setting realistic priorities, they created a succinct case statement, which they’ve made the basis of all their promotional materials. Today, the organization’s donor base is growing rapidly and its monthly giving program is highly profitable.

 

Brevity and clarity are essential in donor communications. But your writing must also be simple, powerful, and emotionally engaging. This boils down to telling a story, or creating a letter that reads like one individual’s letter to a close friend—and it means writing all your materials at the level of Grades 7 to 9. This doesn’t mean that your letter, brochure, or annual report will lack substance—but it does mean you must use short, simple words, short sentences, and short paragraphs. Even if you’re a university professor, it is still easier for you to read a letter written at a Grade 8 level, if only because the brain (even a big brain) can process short words and short sentences quickly. (The Wall Street Journal is written at a high school level.) As a fundraiser, your goal is to make everything as easy as possible for your donors and prospects. Remember, if they’re not reading and absorbing what you write, you’ll generate far fewer gifts!

 

Effective written communication requires more than words. Typeface, layout, and photos or drawings play a major role too, sometimes dramatically increasing—or depressing—response rates. The most useful book you’ll find on the subject of communication and design—the two are intertwined—is Type and Layout by Colin Wheildon, published by Strathmoor Press. (See the recommended reading section at the back of this book for details.)

 

4. You must have an efficient and responsive "back-end" system.

 

Processing monthly pledges—what I call the "back end"—is often the most difficult challenge for both very small and very large charities.

 

If creating a monthly billing system seems to be more than you can handle, don’t be discouraged. Perhaps you can find a dedicated volunteer who will manage the program. If not, you might consider accepting monthly gifts exclusively via electronic channels—and let someone else do the processing.

 

Jim Fleckenstein at the Navy Memorial Foundation made a wise decision to enroll monthly donors through EFT only. He knew he could effectively handle the back-end work for an EFT program, but not for a more labor-intensive program.

 

If you decide to mail monthly statements, you’ll have to work harder for your money, contacting your donors each month and motivating them to give . . . again and again. This means sending more than a bill. Maintaining the strong, emotional connection that’s necessary to keep people giving monthly also requires some sort of personal message and a reply envelope along with the invoice. You may also include a separate insert that dramatizes some recent event or some special benefit just for monthly givers.

 

5. You must be able to thank donors promptly and answer their individual concerns.

 

Maximizing income from a monthly giving program means enrolling as many individuals as possible . . . keeping them active for as long as you possibly can . . . upgrading them on a regular basis . . . and (as you’ll soon see) converting donors who give by check to forms of electronic giving. Thanking your donors in regular and meaningful ways is essential at every stage in this process because:

 

• Your donors will like you more and therefore be more likely to join a monthly giving program.
• Thank-yous help donors become multi-givers, enhancing their tendency to join monthly giving programs. When appropriate, thank-you packages may even invite donors to join a monthly giving club.
• A timely thank-you conveys an impression of efficiency. A donor assumes that if you’re efficient in processing his gift, then you’re also spending it effectively.
• A quick response also demonstrates that you’re focused on serving donors’ needs.
  Thanking donors is one of the best ways to reward them. Thanking a donor on the anniversary of her first monthly gift—or for her five or ten years of continuous giving—are great ways to strengthen a donor’s bond with your organization.

 

6. You need an integrated approach to building a donor program.

 

There are many ways to recruit members to a monthly giving program:

• direct mail
• person-to-person
• telemarketing
• through special events
• space ads
• television
• annual reports
  

You need to determine which of these channels you’ll use—and look for ways they can reinforce one another. Ideally, you’ll make use of several recruitment channels (for example, direct mail and space ads supplemented by telemarketing)—and integrate the whole effort into your organization’s overall fundraising program.

 

A client of mine once wanted to develop a monthly giving program but wouldn’t allow me to soft-sell the program with an option box on the response devices in their mailings to the house file. I was refused permission even to add a statement along the lines of "For more information on our monthly giving program, please check here." The client would only run a monthly donor promotional ad in its newsletter once a year and send special recruitment appeals. Clearly, this was not the best strategy to build a large monthly giving program!

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