I was talking to a prospective client recently who was interested in starting a new mid-level program, and all they wanted to talk about was what they would call their giving clubs and the subsequent incentives so that donors would give more.
I was like, “Why do you think you need to start a giving club? Do you want transactional giving, or transformational donors?”
Of course, she answered that she wanted transformational donors, but she had “heard” that if you want to have a mid-level program, you really need to create giving clubs so donors feel an affinity with other donors, and it gives them a reason to give more.
Ugh. I wanted to scream!
I hear from many prospective clients how successful their giving clubs are. Then, I look at their data. The data paints a different picture.
In the data, what I see are donors who give the same amounts year after year after year. Now, why do you think that is? Because they reached the threshold of their giving club.
Whether it’s $1,500, $2,500, $5,000, $10,000 a year, the donor just does enough to remain a member of that club with all the benefits offered at that club level.
If you are really serious about building a relationship with your donor and helping the donor find joy and fulfillment in their giving and in service of the mission of your organization, move away from these giving clubs and really find out who these donors are. Find out their passions and interests and match those up with everything you are doing to change the world.
And this is especially true if you are building a strong mid-level program. Because it’s in your mid-level program where you are identifying donors who are now giving at a level that can significantly impact your organization’s work. They’re creating a ton of net revenue and some of them may one day aspire to give at higher levels, eventually landing in a major gift portfolio.
If you are cultivating donors with the incentive of a giving club, you are taking away the donor’s motivation to give toward the mission. You are unknowingly keeping them in the mindset of your lower-dollar cultivation program, with a transactional philosophy.
“Yeah, but what about the idea that donors like giving clubs because they like to be in a group of other donors?”
You can create community with your donors without creating a giving club. Once you find out your donor’s passions and interests, there are plenty of ways to connect them with other donors who have similar passions and interests. You don’t need a club to do it.
Going back to the data. What happens when a non-profit initially starts a giving club is that you will see a big jump in increased giving. That happens because you market to them that if they could reach the next level of their giving with just $X amount more, they will be in the club. Great. So now you’ve done this upgrading strategy, and everyone thinks it’s a success.
But the problem is, over time, these donors get stuck in the giving club. The organization creates departments or teams of people just devoted to “renewing” people at their club level, and what do donors do? They give the same amounts every year. And they do this because that’s all we ask them to do.
You see how transactional that all is?
In these donor files, you see donors who have much more capacity – donors who are giving way more to other organizations.
I mean, I don’t even want to get into the ridiculous cost of branding, creating materials, etc., all devoted to these giving clubs. This inevitably gets the marketing team involved, who has no idea how to really talk to donors… it’s a mess.
Instead, consider this: Create a robust mid and major gift program that focuses on developing a relationship of trust that bonds the donor to your mission. Work to develop such great relationships with your donors that you know their passions and interests so well that can tell exactly what programs and projects they would love to invest in. Build relationships with your donors that are deep enough that you can have honest discussions about how they’d like to partner with you in the next several years to strengthen your work. Be bold and generous in your asking, and with this solid foundation, you can even discuss how they could leave a legacy with your organization after they pass.
Yes, that is hard work. Much harder than building a giving club so your $5,000 donor can reach $7,500.
But if you are SERIOUS about helping your donors find joy in their giving and helping them realize their full potential as partners in your mission, you will do the hard work and forego the temptation of bogging yourself down in giving clubs.
Instead, build the proper structure; create revenue goals and strategic plans for those donors that properly cultivate, steward, report back on impact; connect donors to the community; and inspire them to higher levels of giving by asking them to give to your mission. Hire good people to build those relationships, and invest in those people, not in branding and premiums.
If you do that, you will see those clogs in your donor pipeline disappear, more donors moving into major gifts, and many more donors giving transformational gifts, finding true joy in their giving.