Fundraising Isn’t Transactional — 3 Case Studies That Solidify the Importance of Strategy and Relationships

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By Jeff Jowdy

I am constantly inspired by the generosity and leadership of incredible professionals and volunteers. Philanthropy is indeed life-changing and life-saving.

Yet, I find myself frustrated by the nonprofit sector and the fundraising profession. For decades, giving has been a relatively stagnant percentage of gross domestic product. Too often, there’s a scarcity mentality instead of blue-sky thinking. This thinking limits potential giving and leads to unnecessary competition among organizations and even within organizations.

While we have many superstars in the nonprofit arena, too many professionals don’t understand the art, science and nuances of nonprofit leadership — boards, strategic planning, program evaluation and fundraising — and too many others aren’t willing to insist on proven best practices.

Take higher education, for example. Although I’ve seen many leaders carefully research, plan, and properly strategize and implement fundraising, others just fall far short of their potential by not understanding the numbers or implementing effective fundraising strategies.

Today, too many institutions take a sales approach to fundraising. But fundraising isn’t transactional, it’s transformational. All donors have a season in their lives when they are not able to support an organization as strongly as they would desire, whether this is for personal, financial, health, family or other considerations — including a lack of connectivity to the institution or the project.

Case Study No. 1: Leadership Troubles

One major institution’s president had a public falling-out with its most beloved leader. As a result, many donors pulled out and pledged not to give again until there was a change in the presidency. With a new president, these donors returned. Several of the university’s colleges engaged in capital campaigns and staffing at the university-level increased dramatically. But while giving increased, the university was unable to peel back the layers, analyze where the money was coming from — and why — or assess whether the capacity-building was effective. In this case, a new sales focus on the bottom line caused many donor relationships to suffer — and many effective longtime staff with deep relationships to leave.

A healthy culture is vital. And it is essential that higher education and beyond hire for excellence and then work to keep their staff. People stay where they feel valued and can grow.

Case Study No. 2: Lack of Fundraising Strategy

Recently, I read a news release about a university’s capital project. The release, which announced a $1 million gift, simply concluded by asking interested donors to contact them. This reeked of no strategy. Since I had a friend who was on the campaign committee, I dug deeper:

  • Was there a campaign plan? No.
  • Who staffed the campaign? The college’s chief advancement officer, who had no significant campaign experience.
  • Was the campaign supported by the university’s advancement office? As a committee member, my friend never met with anyone from the central office in support of the committee.

I then asked, based on the news release, “Am I right in guessing that you haven’t raised much after a year into the campaign?” I guessed correctly — they had raised just $2 million total — including the trumpeted $1 million gift — toward a $26 million goal one year into the campaign, following four to five years of cultivation.

Using a sales approach to fundraising hampers relationships. Fundraising is a long game. At one institution in the closing months of the fiscal year, the top advancement professionals gave their staff this directive regarding their fundraising expectations: “Don’t embarrass us.” Ouch!

Case Study No. 3: Impersonal Relationships

Another institution’s vice president began handling all million-dollar donor prospects, seeing himself as more of a major gifts officer than a leader whose job was to empower and inspire. In one notable instance, his sales approach backfired, prompting the loss of a potential seven-figure gift that the college had been working for years to cultivate. The would-be donor expressed frustration over the vice president’s repeated missteps, including taking the project away from the people and the college that understood it best and with whom they had a relationship. A focus on long-term relationships and the use of moves management to include staff and volunteers as primary and secondary players is vital to a transformational experience.

At the same institution, a donor who had funded a $1 million program received a past due letter — electronically signed by the vice president — requesting the second installment of an additional $50,000 gift. As it turned out, the institution had not properly recorded or understood the timing of the gift. It’s bad enough that this mix-up happened, given that the $1 million gift had already been fulfilled. But, just as important, no donor should ever receive a bill stating that a gift is past due! If this delinquent status didn’t trigger follow-up research or if the vice president didn’t have time to call the donor — no matter how large the institution — there is a significant issue.

Maximizing success and deepening a culture of philanthropy takes time and effort. This includes gathering research based on an unbiased campaign planning study. You should also create a campaign plan that incorporates clear strategy, milestones and accountability — including proven best practices, such as sequential giving, as well as securing leadership gifts from the campaign committee when donors are recruited.

Be sure to have a donor-focused fundraising program and invest in all donor relationships in the most appropriate and personal way possible. Fundraising success is a team endeavor — not a Lone Ranger affair where it’s all about the credit. With any donor, be sure several staff or volunteers are engaged in the relationship to ensure it transcends turnover.

The right strategy and a genuine focus on deepening donor relationships — at all levels — will be an incredible asset to your institution and its vital mission in the short and long term to ensure fundraising isn’t transactional.

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