In 2015, Microsoft released an alarming study: Humans now have a shorter attention span (eight seconds) than a goldfish’s (nine seconds). That same year, people received an average of 88 emails per day, with half of those coming from businesses in the form of newsletters and other marketing and promotional messages.
We know we compete for donors’ ever-dwindling attention span. And every day, they receive more messages from friends, family, brands, and organizations via television, email, text, social media, etc.
The noise is louder. The competition is fiercer. Purse strings are tighter. And the priority to your institution must be higher.
How can your organization increase donations in this environment?
People tend to pay attention to rankings. Which movie won the most awards at the Oscars? Which football program is number one in the AP pre-season poll? Which cookie recipe is the most popular? Maybe you’ve even asked donors, “Where does our institution rank in your philanthropic priorities?”
Even though that’s a lovely question, are you really going to ask your entire alumni-base their giving priorities? Probably not. But finding the best people to answer that question can help your institution grow capital and achieve goals.
Clearly Navigate Individual Giving
How can you find those individuals who have the willingness to give and a large capacity to do so?
Think about it this way: When you travel somewhere by car, what do you do? You look up the directions, lock in the address to your GPS, and go. It provides guidance on which turns to take and how to get there.
Fundraising also has a GPS: data. By creating a data-driven donor strategy, you can pinpoint which donors and prospects you need to contact. In fact,
Institutions can identify an approximate 30-35 percent increase in their giving rate at the individual donor level by analyzing and studying data.
For example, by running a Donor Retention study, schools can realize an increase in the giving amounts from two segments:
- currently donating alumni
- non-donating alumni
at a combined rate of 35-40 percent of the total alumni. You can expect to uncover more individuals who have the ability and the inclination to give either more or participate more frequently.
Don’t believe me? Let’s look at the math.
Math for Donor Retention Analysis to realize 30-35 percent giving rate return
Here are the assumptions:
- The ratio of “Total Alumni Population” to “Total Donors Who Do Give” is roughly two-thirds to one-third or less.
- The study analyzes lifetime giving over 10 years and predicts donation amounts for alumni who have never donated by comparing non-donors to the donating population using data modeling techniques to predict giving behavior.
- Alumni who gave anytime over the 10- year period were considered donors.
Simply, the math is:
Number of non-donors (lifetime giving = $0) who are predicted to give anything > $0
+
Number of donors whose predicted annual gift amount is greater than their most recent gift amount
—–Divided by—–
Total Universe of Alumni in the Study
Here’s an example from our latest work with a mid-sized university:
This university has 19,800 total alumni in this study with 3,300 alumni giving annually. Therefore, it meets the 2/3:1/3 threshold.
By analyzing their “never donated” population of 16,500, it predicted that 11,728 of those who had never donated to give something greater than zero. Moreover, out of the 3,300 of those who do give, it predicted 1,263 donors to give an annual gift in an amount greater than their most recent gift.
Therefore,
(11,728+ 1263)/19,800 or
12991/19800 = .656
1-.656= 34 percent
By creating a blueprint for individual giving that identified those undergraduate alumni who could increase their giving rate over a third to 34 percent in this fiscal year, the head of development was able to provide her annual, leadership and major gift officers actionable data to use in their outreach efforts and to pinpoint those donors to spend time on. Time is our most precious asset in this race for fundraising dollars and knowing where to spend your time for the return is invaluable.
Lisa and her colleagues will be presenting at the 2018 CASE D1 conference. Join them on Thursday, March 15, 2018 at 10:15 a.m. in Newbury to hear their presentation, “The Magic of the Mundane: How Data Science Can Be Applied to College Fundraising and the Bottom Line.”