📕 Issue 21: Boosting donations
Approaching major donors, communicating effectively and adopting technologies to increase the convenience and emotional connection of giving.
💬 What's in this issue:
Grant Forrest of Parish Giving Scheme, looks at the role of communication in increasing donations
Dan Doherty from Better Story, gives his top tips for raising money from major donors
Elroy Fernandes explores how to boost donations amid a cashless society
Increasing donor value through effective communication
by Grant Forrest, CEO, Parish Giving Scheme
At a time of high inflation, many charities face an existential dichotomy. The costs for providing their services, and in many cases the level of demand for them, is higher. But donor income often falls, as donors experience their own financial pressures and hard choices.
Even during the comparatively low inflation years, the challenge of static giving is considerable. According to the Bank of England, services costing £50 in 2013 would now set you back by £66.66. If we think about this in terms of donations, I wonder how many of your regular givers have increased the value of their gifts from £50 to £66.66 over the last 10 years? Put another way, a £50 donation today is the equivalent of £38 a decade ago.
So, how can charities support the donor journey in a way that protects donation income?
Clearly, communication with donors has many dimensions; a clear vision and storytelling around impacts are vital. But we’d like to share our experience of communicating about inflation and the reactions from our regular givers.
The Parish Giving Scheme provides a regular giving service to nearly 5,000 churches in England, with more than 80,000 regular givers. Almost half of givers have opted into the inflationary increase scheme, in which they are invited annually to increase the value of their gift in line with inflation. Overwhelmingly, over 90% of these givers increase annually; some go even further and super-inflate. Only around 2% of givers will hit pause on increasing their gift, and a similar number will use that as a moment to cancel. However, retention of regular givers remains strong despite the cost-of-living crisis, which provides stability for so many churches.
We must also recognise a researched difference indicating that religious people will give more generously than non-religious (YouGov 2021 [1]). We caveat that our experience is a faith-based response to regular giving.
Nevertheless, what are the learnings we can share?
Context
It’s essential to recognise the reality of the world in which we live, what is happening in the towns and cities in which you operate and in the lives of the individuals you receive from and serve. Be real to your context, do what’s right for your organisation and reflect this in what you choose to do in response.
Communication
We consciously chose to move away from the word donor in our context. We adopted a Christian language of giver and gift, and we write to our givers with plenty of time before their gifts annualise, so that they can reflect on the changes suggested. Our communications recognise the context and make it clear what actions a giver may need to take, and we do so with compassion. We emphasise that they are always in control and can adjust the value of their gift at any time.
Compassion
We are empathetic in our communications and in our responses. There is no judgment or ‘donor retention’ department as a last-minute bid to keep you subscribing! We want our givers to be free to decide how they will respond. We explain how the church receiving their gift will have increased costs, but recognise that we are all in the same situation, so it is an invitation to respond.
Collaboration
We invite the givers using our scheme to reflect on what they want to do; we inform them of the amount their gift would increase by to maintain the value of their giving. And we share with them the value that giving in line with inflation brings to their churches; a regular income that helps them to plan for the future and serve their communities.
We hope you are encouraged to offer invitations to those who give, to speak of financial value, and to prevent static giving in your charity.
How to ask someone for thousands of pounds
by Better Story
It might feel very un-British to ask somebody for a lot of money. But there are plenty of people out there looking to use some of their wealth to make a difference in the world.
Most charities already have a list of ‘major donors’ - people who have given significant one-off gifts. Whether they’ve given before or you’re asking them for the first time, it’s worth approaching these contacts in a unique way.
Dan from Better Story has worked in this area for many years - here are his top tips.
Find out what their passion is
Major donors really care about your cause. But every person’s motivation will be different.
Why do they want to invest their time and money in what you do? Do they have a passion for a particular country, city or people group they’ve spent time with? Or are they firm believers in a type of work you do - like microfinance, girls’ education or digging wells?
Try to find all this out before you go to them with a proposal. Match something that needs funding with their personal passion. They are likely to give a large sum to fund a tangible project.
When you know your major donors well, you will start to think: “That new education project in Malawi needs a start-up fund – Graham might be interested in that…”
Be personal and professional
Working with major donors is mostly relational. Share your own story with them too, and connect over your shared passion for your cause.
Meet them in person and be on time. Look presentable. Show you’re serious about this.
If somebody is considering funding a large part of a project, they see it as a big investment. They will want to see facts and figures and understand where the money will go and what it will achieve. Make sure you do your research and have all the numbers to hand when you meet.
Remember, most of these people have been very successful in business so don’t try to blag it with them. They know what they’re talking about!
Be bold
The best thing you can do is to ask clearly for what you need. Don’t be embarrassed or apologetic about asking for a lot of money. Be bold! It communicates that the work really matters and that it really does need their investment.
Look beyond their bank account
Major donors are investing a lot in your cause and your charity. Apart from money, they may be really interested in donating their expertise or time as well. Give them the opportunity to do so – as well as helping your charity, it shows that you value them as a person aside from their cheque book.
They’ll probably want to visit the project they’re funding, or at least get regular updates on how it’s going – so think about how you could make that happen.
Invest in your relationship and they’ll invest in your work
This all takes time, but it’s time well spent - the results could be game-changing for your charity.
📖 Other reads from around the web:
▶ Repeat giving gamified: Testing messaging to sustain repeat giving.
▶ How charities are increasing supporter retention in 2023
▶ CharityComms write about being strategic about charity marketing.
▶ Is irregularity the future of regular giving?
Combining convenience and emotional connection to boost charitable donations in a cashless society
by Elroy Fernandes, Managing Director, Dona Donations
Multiple factors are coming together to place enormous financial pressure on charities reliant upon public donations. After the disruption and drop in contributions endured during the pandemic, not only has the cost-of-living crisis significantly reduced individuals’ ability to make donations but the move to a cashless society has devastated both the planned and impromptu cash donations that have traditionally provided an essential fundraising stream.
It is now vital for charities to offer potential donors another option – and to find a way to motivate and inspire giving from both regular and occasional donors. Elroy Fernandes, Managing Director, Dona Donations explains how contactless payment terminals are not only providing a convenient alternative to cash donations but also the opportunity to engage emotionally with potential donors.
Financial Pressure
Charities are experiencing a year-on-year decline in donations: people in the UK gave £10.7 billion to charity in 2021, a significant drop from £11.3 billion in 2020. Personal financial pressures are also leading one in eight donors to consider cutting back or reducing donations to charities. The decline in cash usage by around 15% every year since 2017 – and 35% during 2020 - has also affected giving, especially in ad hoc situations such as museum visits or at religious venues, when weddings and funerals have previously generated significant cash collections.
Overall donations may be down in recent years but the fact that the war in Ukraine prompted the largest donation average ever recorded, with one in three people donating, demonstrates that individuals are still highly motivated to support causes they believe are truly important. So how can charities achieve a strong emotional engagement with potential donors?
In response to the decline in cash, growing numbers of charities have embraced self-service card donation terminals to provide a simple, convenient way for individuals to donate. But this is not just a straight ‘cash for contactless’ swap – with the right approach, charities can achieve a new level of engagement and motivation to achieve an incremental increase in donations.
Emotional Connection
The motivations of donors typically fall into one of three reasons: Wanting to improve things for others, having a tangible positive impact or ensuring others do not suffer or have a negative experience. Within these motivations, there is growing focus on two donor personas: the Trust Based Donor and the Impact Donor. Both want to know how the charity is going to use the money, who is being helped and by how much – and the onus is on charities to find the best ways to inform and thus engage these individuals.
Self-service contactless terminals can be designed to engage potential donors in different ways. In addition to providing a number of suggested donation values, they can also include information about the way each donation will be used. For example, a picture of the stained window that needs to be repaired, with the amount outstanding required. Information about cost of maintaining a building each day, even the different ways each donation value would be used – such as £5 to feed a child for a day or £20 to provide one night in a homeless shelter.
Providing a link between a donor and the difference the money will make to an individual, group or even historic location is increasingly recognised to be far more compelling than a generic ‘donate now’ option. It provides people with a sense of emotional engagement and real commitment to a specific cause and, with measurable donation options, a chance to choose exactly how they want to help.
Convenience and Simplicity
The entire contactless model is designed not only to be incredibly simple and easy to use but also to maximise donations. Contactless terminals can display up to six different donation options – including ‘other’ – which helps donors to decide how much to give. On average, individuals donate £12 each time at a terminal, which is a significant amount when the average of all giving, including direct debits and standing orders, is £27 per person.
With a simple, one-time Gift Aid opt in, this approach also significantly boosts the charity’s Gift Aid contributions – with around 40% of contactless donations including the additional 25% Gift Aid. In addition, while every donation can be made anonymously, the addition of a GDPR compliant Marketing Opt-In also provides charities with a chance to capture donor information for future communications.
Positioned conveniently at locations throughout a building, these terminals can even be encased in stands that are sensitive to the building’s history and purpose – something that is especially important in historic locations that can benefit from significant tourist contributions. In addition, they can also be unlocked and, with the addition of a SIM card and 4G connection, used at different locations to support other fundraising activity, such as fetes, bake sales and festivals.
Conclusion
Offering an alternative to cash donations is a priority in today’s cashless society; but, in many ways, it is the way charities use these terminals to share information with donors, offering a way to boost engagement and inspire additional donations that is the most valuable aspect of the contactless solution.
There is no doubt that the donation landscape has changed dramatically in recent years, but there is reason for optimism. Younger generations are increasingly committed to good causes, with 16-24-year-olds showing an increased willingness to donate despite their typically weaker financial capability when compared to over-65s. They also show a lot of interest in innovative methods of donating and engaging with charities, such as using app, contactless donation points in public spaces and virtual reality at fundraising events.
With the right approach that combines convenience with inspiration, charities can continue to engage both individuals and communities and attract the ad hoc donations that will remain a key contribution to overall revenue.
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Thanks particularly to Dan, Grant and Elroy for their contributions this month.
Steven Hopkins
Editor of Charities Network