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Fundraising Fundamentals, Section 7.7


Annual Fund/Giving campaigns

Annual fund is a catch-all term for fundraising activities that are designed to stimulate regular giving. It encompasses activities such as telephone campaigns, direct mail, e-appeals, inserts in alumni magazines, adverts and web-based appeals. These activities are important for many reasons, including that they:

  • Provide income both for specific projects and unrestricted funds,
  • Establish giving habits and enable patterns of giving to be tracked,
  • Establish a donor pipeline, enabling the identification of donors with the potential capacity and propensity to give bigger gifts in the future,
  • Increase donor participation rates,
  • Help improve and keep data about prospects up to date,
  • Are a great stewardship tool,
  • Help reinforce core messages about an institution,
  • Help identify the enthusiasts who might be leaders or significant volunteers and
  • Strengthen the bonds between an institution and its prospects.

According to the 2010–2011 Ross-CASE Survey, the 143 institutions that participated in the survey (excluding Oxford and Cambridge, so as not to skew the data because of their large annual fund contributions) raised £21 million from annual fund cash income (up from £17 million in 2009–10). There was a very wide distribution across the higher education sector: 36 universities (25 percent) reported receiving no annual fund cash income; 49 (34 percent) received less than £50,000 in annual fund income; and 15 had annual funds that received £500,000 or more in cash income.

Planning an Annual Fund Strategy

When putting together your annual fund strategy you need to consider two main factors: (1) the volume and quality of your data, and (2) your investment budget. Annual funds are not cheap to run and require substantial investment before returns are seen.

You can obtain benchmarking data on annual funds at comparable institutions from the Ross-CASE Survey, which will provide you with indicative return on investment figures to assist your planning. Most annual funds comprise a combination of activities with a strong emphasis on telephone fundraising, as it tends to offer the best return on investment.

Telephone Fundraising

Telephone fundraising gives you a direct link with a prospect, offering a higher chance of success and the flexibility to be able to offer prospects multiple giving options (e.g., someone may dislike the idea of committing to a regular gift but may be interested in leaving a legacy instead). Telephone fundraising is also an opportunity to gather qualitative data on prospects that can be invaluable when identifying major gift prospects.

Telephone fundraising is a tightly managed process. Callers are rigorously trained and given scripts as the basis for their conversation with prospects. Commonly, prospects are alerted in advance, by letter or email, that they will be called.

Callers encourage donors to commit to regular gifts by direct debit or to increase their current giving levels of frequency of giving. During the call they will update the data held on prospects and listen out for indicators that prospects might have the potential to become major gift donors.

Direct Mail, Adverts, Inserts and Web-based Appeals

These methods of fundraising tend to be less effective than telephone fundraising, as they require more effort on the part of the prospect. Typically, fewer than 5 percent of recipients will respond.

However, these methods do help to reinforce the messages of the institution and encourage the momentum of shifting to a culture that is more accepting of fundraising to support higher education.

It costs very little to always carry an appeal on your website, and nothing at all to use your email footers, Facebook pages, Twitter feeds and other e-media to promote appeals. It all helps to reinforce your fundraising messages.

Most important, you should make it easy for people to give. Donors won’t want to fill in long forms that then have to be put in an envelope and posted. Make things easy by introducing ‘text’ mobile phone giving, web-based giving and other shortcuts. Always stress the benefits of any tax or government incentives (e.g., gift aid in the UK) or corporate matching – to maximize the donor’s gift. Always suggest set amounts to guide the donor’s choice.

The Who, When and What of Asking

Many institutions aim to ‘ask’ all their donors at least once a year by whatever the most effective method they have at their disposal.

Whilst some institutions differentiate between major donors and annual fund donors, others do not. The risk in separating out major gift prospects is that they will go ‘unasked’ for long periods of time and lose interest in your institution. Receiving an annual appeal after having made a major gift would offend most major donors, however.

An important success factor in annual funds is the skilled segmentation of your database so people are asked at the right time and asked appropriately and the chances of success are maximised.

The most successful ‘asks’ are those that go to existing donors. They already know and like your institution and will be more like to renew or increase their gift (especially if they have been well-stewarded).

You also need to ask lapsed, occasional and nondonors so you can increase your donor pool and remain sustainable. You might segment your data in a number of ways: age, subject of study, gender, nationality, ‘warmth to institution’ and known capacity to give.

Your decision about when to make your asks should be based on several factors:

  • Your accounting year. You might want to ask at the beginning of the accounting year so the gifts come in during that year.
  • Your capacity to deal with the response. You need to ensure that you have sufficient staff and resources in place to cope with a peak in activity.
  • The time of year. Avoid summer holidays, when people might be away, and months like January, when people have just suffered the expense of the holidays. Many institutions like to call during the autumn term, as it is the start of the academic year, people are returning to school and work after a summer break and are perhaps feeling more positive and energised than at other times of the year.
  • The availability of suitable fundraising projects.

When considering what to ask people to support, you need to minimise the options available and tailor them to the segment you are approaching. For example, when contacting engineering graduates you might offer them two options - an unrestricted fund to support projects in the engineering faculty or the chance to sponsor engineering scholarships for students from deprived backgrounds – and propose one giving method on the donation form (e.g., direct debit).

The ask should be simple and easy to communicate to prospects: they need to be able to ‘get it’ within a very short space of time. Experience has shown that donors are more likely to give if they have fewer options.

Offering clear giving options is also helpful, especially if they can be related to the project. For example, the successful charity equates donations to specific items: £10 buys a bag garden, £20 buys four chickens.

How to Know If It Is Working

Successful annual fund managers love numbers. They are great at looking at a multitude of numerical indicators to decide whether a campaign is working and at using these figures to inform future campaigns.

Return on investment weighed against the income generated per alum is an important factor. It might cost £20 to telephone an alumnus, but the return rate per 1,000 calls might be £20,000. Other measurements of success might include:

  • Number of renewing donors,
  • Number of lapsed donors renewing,
  • Number of new donors,
  • Numbers of legacy pledges or requests for legacy information,
  • Number of major gift prospects identified,
  • Number of gift level upgrades,
  • Number of offers of nonfinancial support (volunteers),
  • New data obtained (updated addresses, email addresses, mobile phone numbers, etc.) and
  • Length of phone calls (indicative of interest in and warmth toward the institution).

Action Items
  • Carefully consider the budget, strategy, data, target audience, timing, staff capacity to implement and follow-up and expected ROI before launching an annual fund campaign.
  • Every annual fund is different and needs to be tweaked to reflect the idiosyncrasies of each institution’s prospect pool. The key to success is to know your data and to tailor your campaigns and asking methods.

You Might Also Want to Read:

Role and importance of alumni relations
Partnering with other advancement-related departments
The database
Prospect management
Selecting the right communication channels


CASE offers numerous fundraising resources on annual funds, campaigns (including direct mail, online solicitations and phonathons), challenge and matching gifts, constituency giving and student advancement programs.

Adrian Salmon, annual fund manager at the University of Leeds, talks about campaign solicitation methods and compares the costs and returns of each.
Salmon talks about data segmentation of donors at Leeds using campaign examples and databases.  
Salmon discusses propensity modelling.
Adrian Salmon discusses the growth of income and how it relates to donor participation, as well as what to measure and what to invest in.
Salmon compares pre-call communications that are sent to donors either via letter or email.
T.J. Rawlinson, director of campaigns and alumni relations at the University of Bristol, talks about the importance of annual giving.
T.J. Rawlinson talks about the return on investment for annual giving.
T.J. Rawlinson talks about data and indicators on annual giving and the focus her institution has on retention, participation and profiling.
Andy Wood, director of development and alumni relations at the University of Reading, talks about the relationship between major gifts and annual campaigns.