“We’re finding that donors are willing to make their gifts earlier this year to help with this crisis, but we worry about the impact on our budget and cash flow at the end of the year. Any suggestions?”
That’s the question that recently came in from one of our webinar attendees. Jeff and I see some form of this question very frequently. Let me dissect the question before I answer the question.
- Donors: not prospects, but current donors.
- Willing to make their gifts earlier: the donor has the expectation that they will give at year end. This is the understanding they have with the non-profit. The non-profit is operating with an “annual gift” mentality, in other words “donor, commit to making an annual gift to us.”
- Worry about the impact on our budget/cash flow at end of the year: the other side of the annual philosophy. Donors are not expected to give again because, once they have, that’s it. And so, if the gift comes in earlier than budgeted, there’s a negative effect on the non-profit’s budget.
This is what the question means in my mind. And here are our suggestions:
- Move away from the annual mentality. This whole annual gift thing is purely transactional. It has nothing to do with the mission of your organization or the heart of the matter. And it actually suppresses giving. In other words, when a donor has made their annual gift they are “done” with you and, if they have more resources, which they usually do, they will give to the “pressing needs” of other non-profits. As a result, you’ve missed out on their continued impulse to give.
- Bond the donor to a program category that matches their passions and interests. The donor REALLY cares about what needs to be done, in an area that matches the donor’s passions and interests. You should be talking about that all year round, nothing more. Focus your efforts on bonding the donor to that content.
- Tell the donor what needs to be done. When you’ve bonded the donor to the program category that THEY are interested in, then the whole conversation is about what needs to be done. And when your content is about what needs to be done, there is urgency and energy that is timeless.
- Let all of the above drive the cadence, frequency and timing of your asks. When you do all that I’ve suggested above, then it’s no longer about an annual gift or one gift or one amount. It’s about what needs to be done that the donor is interested in. The frequency and amounts of giving change. Something mystical and magical happens. And your entire relationship with the donor changes.
If you do these four things we can, pretty much, assure you that your budget and cash flow worries will go away. Why? Because donors are really interested in solving problems and getting things done. And when you change the focus to that, the money follows. (Tweet it!) Remember, in major gift fundraising, money and giving is a result, not an objective.