Before embarking on a donor cultivation programme, get back to basics, says Tobias Jung.
‘Developing financial resilience’ has become a widespread mantra within civil society. Ongoing spending cuts by government and reduced levels of individual philanthropy mean that the pressure is on to build and develop your donor base. Independently of whether you are revisiting and scrutinising existing fundraising activities, or entering the fundraising arena for the first time, the question is how best to proceed with cultivating your donor base?
Trying to make use of existing fundraising literature to find out more about donor cultivation can be daunting: There is a mushrooming of approaches and ideas, whereby minor modifications can appear ‘rebranded’ under new titles, means that the field can be difficult to navigate. This is complicated further by variations in the language used: terms such as ‘stewardship’ and ‘donor relations’ are often applied indiscriminately and synonymously. A second problem is that there appears to be little testing of existing models and only limited guidance on how to implement or integrate them within your organisational practices. Finally, models tend to be idealised and simplistic: notions of donor acquisition, retention and development seem straightforward, but, how do they relate to your organisation in reality?
It is in this context, that the Centre for Charitable Giving and Philanthropy at Cass Business School and Arts & Business Scotland have developed a research-based, ‘reflective framework’ for organisations that are beginning to examine donor cultivation. This Thinkit, as we have called it, is based on the insights from a research project between the two organisations. The research combined a literature review with an online survey, focus groups and telephone interviews among the arts members of Arts & Business Scotland. The aim of the Thinkit is to help organisations steer through the complex donor cultivation field.
Given that donor cultivation is an ill-defined idea, it is useful to consider it as an overarching concept that covers the whole lifecycle of giving: from planting the seed for a donation to its full flowering with legacy giving.
We have identified six broad areas that appear to be central to developing a donor cultivation programme. The first five factors were identified from the fieldwork and cover the sections which headline our list of questions: organisational factors, contexts and relationships, donors, approaches and success.
In addition to the below five factors, a sixth dimension emerged from the literature review: the need for clarifying how your organisation perceives its relationship with its donors. We found three methods of conceptualising this: interactive, instructive, and directive.
The interactive perspective takes a very transactional stance. It focuses on fostering mutually beneficial and distinctive relationships. The focus is not only on your organisation’s gains, but also on the benefits to the donor. These can be tangible, such as special events, or intangible, such as the symbolic or emotional advantages your donors might get.
The instructive perspective is further down the intangible benefit route. Based on the view that donors are more likely to give and remain loyal to an organisation the better they understand the organisation and its work, this archetype casts the relationship in educational terms; it focuses on the learning opportunities available to donors and how donors can be ‘educated’.
The directive ‘power’ perspective meanwhile acknowledges that donors are becoming more engaged and strategic in their giving, they may have a growing desire for control over how their donations are used. Although it may seem to be the case that organisations can only play a reactive role in such a relationship this may not necessarily be true. Organisations can, for example, take a ‘matchmaking’ stance by designing donor-centred approaches via prospecting.
In combination, the six dimensions of the Thinkit offer an initial step for thinking through the development of a donor cultivation programme. Having derived the framework from field research, we are now engaged in testing out its wider value with the aim to report back further.
Tobias Jung is principal research fellow at Cass Business School, City University London and honorary research fellow at the University of Edinburgh Business School. The full Thinkit tool kit is available on the CGAP website.
Thinkit questions to ask of your charity:
- What is the status of fundraising within your organisation?
- How does this affect fundraisers’ ability to carry out their job?
- How are the aims, objectives and mission of your organisation reflected in the donor cultivation strategy, and communicated both internally and externally?
- How does the board view the role of fundraising and how can board members be engaged with the process?
- Does your board view have the right mix of expertise? If not, how can this be addressed?
- What are your organisation’s capabilities for donor cultivation, bearing in mind its size, current funding and aims?
- What are the organisational resources (staff time, money, and training) available for current and future fundraising activity? How appropriate are they? How they can be used?
- What challenges and opportunities do physical factors present?
- How can fundraising responsibility be better managed, coordinated and shared? Can responsibility be better shared and coordinated across departments (eg marketing, fundraising, development)?
- Who is in charge of the various components of donor cultivation?
- Who is responsible for managing relationships established?
Contexts and relationships
- What funding is available?
- Do you need to build financial resilience, continue as you are or expand?
- Can you use existing relationships and fundraising resources more effectively, or access new ones? If so, how?
- What networks are you already in? Are there any networks you should be a member of?
- What learning resources are available? How do they relate to your situation? How can you access and use them?
- Have you explored case studies and resources from other nonprofit sectors?
- Is there scope to share knowledge? Collaborate rather than compete?
- What is it that is unique about your organisation?
- What donor data do you collect?
- What do you know about your donors’ motivations for giving?
- What do you know about their preferences for communication?
- Can you use this information more effectively, establish or manage a database, segment your donors, keep track of communications, recent gifts?
- How can you find out more about existing or potential donors? Can you access data from other similar organisations?
- Would professional database management software be a worthwhile investment?
- Have you explored all the contacts your board has?
- Can you engage new people through your existing schemes?
- How are you interacting?
- How are you educating?
- Are you being directive or directed?
- What is the appropriate balance when communicating with donors?
- What is successful cultivation for your organisation? Is it: – The amount raised for a capital appeal? – The number of new donors? – The number of new and satisfied donors? – A repeat donation? – Less about the money, and more about the relationship?
- How did you get on? – Have you calculated the time and cost of the cultivation? – Have you calculated the returns: financial, the number of new members, satisfaction and support for your organisation? – Are tools such as social return on investment appropriate?
- How could you illustrate or explain to donors the tangible or intangible value/impact of their gifts?
- Should you communicate with donors to inform them of the impact of gift? If so, how?
- Are you communicating your value as an organisation more widely, to current and potential donors and funders?
- Are you using all available media tools to get the message across?