Donor Power!

Two events caught my attention recently because of their implications for all of fundraising. The first was a direct-mail appeal letter that provided solid clues about donor trust. The second was publication of a new book about who gives in America. Strategically aware fundraisers can glean valuable opportunities from both.

Trust your donors and they’ll trust you
Last April, a social-services organization near Chicago mailed an appeal to its donors. The letter announced the approach of the organization’s fiscal year-end and detailed a series of projects that still needed to be funded. The letter provided a description for five projects, the specific dollar amount that needed to be raised for each project and an invitation for donors to designate which project they wanted to help fund.

All five projects related to the core mission of the organization. All were compelling; four of the five involved services provided directly to children with special physical and emotional needs.

Importantly, the letter also gave donors the option to allow the organization to use gifts “where needed most,” effectively overriding any specific designation. The key paragraph near the end of the letter read: “On the enclosed reply memo, you can designate your gift to one or more of (the specific projects). Or, you can let us place it where it’s needed most.” The reply memo repeated these options.

Of those who responded with gifts, 91 percent selected the “where needed most” option. Their average gift size was $49.97. The remaining 9 percent of respondents — with an average gift of $40.85 — designated their gifts to one or more of the five projects.

Clearly, donor trust in this particular organization is extremely high. Nearly everyone who responded voted their confidence in the organization’s ability to spend their money effectively.

The donors who let the organization choose the use of funds gave gifts 22 percent larger than those who designated their giving.

Many organizations avoid designated appeals because they fear over-funding projects or prefer general, undesignated funds and the flexibility of use that accompanies them. The results of this campaign indicate that highly project-specific appeals can be used effectively, but that donors also may effectively “undesignate” their gift when given that option.

Giving donors choice and control is an example of donor-focused fundraising. It gives donors power. The moral: Trust your donors and they will trust you.

Who really gives?
In the closing weeks of 2006, a new and provocative book was published. It’s created a stir because it is not politically correct. “Who Really Cares: America’s Charity Divide,” by Arthur C. Brooks, argues that regular church attendees (most of them religious conservatives) are the country’s best givers and volunteers to all shapes and forms of nonprofits, including non-religious ones. (In the spirit of full disclosure, Arthur C. Brooks, professor of public administration at Syracuse University, is the brother of my work colleague, Jeff Brooks.)

The book is a fascinating read packed full of well-written illustrations and statistics, but if you focus only on Brooks’ political and social characterizations, you’ll miss what I believe is the book’s greatest value: It’s a wake-up call aimed squarely at political liberals to stop avoiding faith issues.

Brooks also argues that America’s charity sector will decline unless religious and secular, conservative and liberal folks come together in a common cause to advance the good deeds of all nonprofit organizations by changing the charity culture so more people are motivated to become givers. His prescription starts with reformed government policies toward charitable giving, including allowing all taxpayers — not just those who itemize — to deduct charitable gifts.

How well do you know your donors? You might pick up a copy of Brooks’ book and see if his conclusions match yours.

Tim Burgess is co-founder of direct-response fundraising firm Merkle│| Domain. Contact: tim.burgess@merkledomain.com.