One of the first things we like to do with a new client is take them through a donor pyramid building exercise. We talk about starting with a solid base of single-gift donors who will support your organization year over year. From there, we develop strategies to grow the pyramid vertically, by converting donors to one of three streams: 1) monthly giving, 2) mid-level giving, and 3) legacy giving.
Both monthly giving and legacy giving are pretty well understood.
- We know that monthly donors stay on file longer than single-gift donors and give more frequently, and because of that, their long-term donor value (LTDV) is much higher. (In our experience, the 7-year LTDV of a monthly donor is usually 4-6 times greater than that of a single gift donor.)
- We also know that a well-executed legacy series of persuasion/identification packages can identify existing bequests that may not yet be known to the organization, and persuade prospects who haven’t made a bequest to do so.
On the other hand, mid-level giving is still a fairly new concept that only started gaining traction over the last five years or so. Already, it has come to be seen by some as the silver bullet. Before I go any further, I want to take a minute to explain mid-level giving, and how it can make a huge impact on your organization’s bottom line.
Mid-level represents the range of giving between an everyday donor and your major gift threshold, therefore the definition of a mid-level donor can vary from organization to organization. For some, a $500 donor will be considered ‘mid-level’, for others, it will be $1,000 or even $5,000+. Regardless of the amount, with the right offer, any of these donors could be inspired to double or perhaps even triple their gift. And what is the ‘right’ offer you ask? The right offer for your organization is something tangible that you can build a strong case around – a new MRI machine, a parenting program for adolescent moms working on their high school diploma, or support for research into new treatments for lung disease and cancers.
It’s important to note that although every organization is looking to grow their revenues, not all organizations are in a position to implement a successful mid-level giving program. Before jumping right in, there are some key indicators that can essentially predict whether or not your fundraising program can sustain a mid-level giving approach.
Here are the three key indicators of mid-level giving success:
The right support
One of the most important determinants of success is donor capacity. This usually means doing a bit of an audit of your existing donor database to identify potential donor/prospect segments that have both the capacity and the inclination to make mid-level gifts. Consider your one-time gift donors, cumulative givers and monthly donors. It’s important to understand the difference and create giving opportunities that work for each one. For example, a donor making one-time gifts of $1,000 is likely going to respond differently to a $2,000 stretch ask than a donor making cumulative annual gifts of $1,000. (The cumulative donor may not see themselves as a $1,000 donor, and may need to be reminded about how much they’ve already given).
Once you’ve determined how many donors fit into each bucket, you can decide whether or not you have the numbers you need to justify the investment (mid-level packages are costly, and mailing fewer than 500 pieces is not typically a good investment).
If you’re interested in learning more about mid-level giving, you may want to read our Hidden Heroes whitepaper.
The right offer
Just as important as donor capacity is whether or not you have a solid case. Donors can be motivated to increase their giving when presented with a compelling (and tangible) case for support. If you have the donors but you don’t yet have a strong case, you just aren’t going to generate the revenue you’re looking for. We’ve seen this happen many times, so we know that your case (or lack thereof) can make or break your mid-level program.
What to know what works? You can view a sample mid-level letter here.
The right stewardship
Appropriate stewardship doesn’t get nearly the attention it should. If we’re going to ask donors to increase their support for a specific purpose, we need to be making a clear statement as to how and when we will report back on this initiative. This doesn’t have to take loads of time and resources. An effective mid-level stewardship plan includes a thank you call within 48 hours of receiving the gift, a tax receipt and thank you letter with a live signature (even better if you can include a handwritten note), and a report back (either when the goal is accomplished or an update if the project is delayed). And bonus points to organizations that invite donors to come in and see firsthand how their support is making a difference (you can also bring the impact directly to the donor via video or special thank you message).
You can view a sample mid-level donor impact report here.
Donors want to make a meaningful contribution and they want to know that their support is truly appreciated. Be thoughtful about your approach. Identify the right donor segments and the right upgrade offer. You’ll not only generate significant revenues, but you’ll strengthen relationships between donors and the cause.
This post was written by Heather Brown, former Philanthropic Counsel at Good Works and fundraiser extraordinaire.