Stop irritating your donors

Next up: John Taylor on "Reengaging the Disenchanted Donor, or, How to avoid ticking them off to begin with!" Since stewardship has just become part of my shop, I am very eager to hear this best practices session. AASP has been developing best practices for a variety of Advancement Services disciplines.

At John's shop, North Carolina State, stewardship reports to him, and is being expanded to include donor communication.

John is starting out with what disenchants donors. First, not following a donor's intentions tends to make them angry. This might be because the intentions were not clearly documented at the beginning. Not using the gift is another issue. It's amazing that folks donate to our organizations, and then we fail to spend the money! Or, they give us a gift, and then never hear from us again.

John points out that disenchantment is not confined to major donors. Institutions can make big decisions that upset broad swathes of donors. As an example, one university gave its president a second house! This angered many alumni. Another example: an all-women college made a "surprise" announcement that it was going co-ed.

If you ask donors how they want to be communicated with, make sure you honor that. For example, John got a call from his alma mater. He was on the do not call list, and got called by their phone fundraisers three nights in a row! Each night he told them that he was on their do not call list..but they kept calling.

One of the biggest reason we lose donors is that we fail to adhere to the donor bill of rights. John says that nonprofits outside of higher education do a better job of adhering to this than higher education institutions do. He suggest posting the bill of rights on your organization's website. One of the most challenging aspects of this is donor intent -- honoring the donor's desires for how the funds will be spent. The best way to accomplish this is through a gift agreement. Make sure it is clear; irrevocable; will stand the test of time; and is clear regarding recognition, in particular whether a building or fund can be "un-named."

John recommends not including endowment terms. Reference your policy, as it may change. Don't go into great detail regarding scholarship and fellowship terms, or reporting requirements.

On your pledge agreement, ask donors how they would like their name to be written in recognition of their gift. If they are going to be paying part from a donor-advised fund or a matching gift, include a sentence that says if the above-named entities do not pay, the donor will pay. Then when the payment is received from the fund or company, write down the original pledge and book the payment as a separate gift, with a soft credit to the donor.

Donors also become disenchanted because (in descending order) they no longer feel connected to the institution, feel compelled to give to other causes, were being solicited too often, felt their donation was mismanaged, assets were mismanaged, or did not keep accurate records of their donations. This is per the 2008 Bank of America Study of High Net-Worth Philanthropy.

Communications is key -- gift agreements, donor intent, regular & consistent reporting. Reporting is not only for endowment donors. Send a report of how money was used to your annual fund donors too. How many donors contributed, how much was given, and what was done with the money? Consider doing a "thank-a-thon" using your phone fundraising callers. Segment your calls so that students are calling donors to their programs.

For endowment reporting, include the frequency (but not the specific date) in your gift agreement. Provide them within 90 days of the close of the fiscal year. Err on the side of providing too much information. Include the book value, the market value and clearly define them both.

To steward scholarship donors, send a thank you from their recipient. Make writing the letter a condition of receiving the scholarship, but don't let the student send out the letter without vetting it first. There's nothing worse than a poorly-written letter from a scholarship recipient.

Invite donors to special events for free -- art openings, lectures, etc.

There are some ways to figure out which donors are disenchanted. Look at alumni participation rates by class year, sudden drops in revenue, and analytics. Conduct an attitudinal survey which looks at demographics, loyalty, overall experience, student experience, and alumni experience. Pay attention to the open-ended questions.

Consider doing a donor relations survey. In John's experience, donors remember when they get a thank you from a student or former professor, and don't care so much about a letter from the president or a development officer. Birthday and holiday cards are worthless. Higher ed is terrible at providing specific information about the impact of the gift itself.

Don't be afraid to apologize. If you've upset a donor, communicate and don't try to find someone to blame. Don't blame a staff member. Self-deprecation is also not the answer. Do provide reassurance that you have addressed the issue.

Understand and meet the donor's expectations. Thank them in a timely and appropriate way -- issue a receipt within 48 hours. Don't treat everyone the same -- thank them in a way that is appropriate to them.

Negativity does not mean you should leave them alone. But don't wait -- the longer you wait to re-engage, the less effective it will be. Donors that are more than six years lapsed in their giving probably will not give again.

Venture philanthropists are interesting birds. Don't come back to them for a new gift until you have an interesting project. Do make sure to ask for their input and to communicate the impact of their gift.