Crafting Successful Annual Fund Strategies
From marketing materials to salaries for hardworking staff members, all nonprofit organizations have overhead for day-to-day operations. How will your nonprofit cover such expenses? Annual funds can help cover these expenses each year, and many successful annual fund strategies begin with accurate donor data and cultivation.
When was the last time you reevaluated your annual fundraising strategies? The iWave team is here to give you a crash course in this type of funding, so you can propel your nonprofit forward for years to come.
To find out more, schedule an assessment with iWave and see how far your annual fund strategies can take you!
What Is an Annual Fund?
An annual fund is the pool of money that enables a nonprofit to continue running throughout the year. It’s like an ongoing fundraising campaign that keeps the lights on, so to speak. Any annual fund will be divided into an array of smaller strategies known as annual giving campaigns.
Your organization’s livelihood will depend on annual funds. Along with trying to contact new donor prospects, your annual fund will engage the donors who have already given to your nonprofit in the past. Nurturing these relationships will help ensure the success of your nonprofit.
Best Practices for Advertising Your Annual Giving Campaigns
The first step in the annual fund strategy process is getting the word out about your campaign. The fastest way to do this is by creating a webpage for it. Your annual fund campaign webpage should include:
- An explanation of where donations go.
- A breakdown of why these funds matter.
- Updates about how the funds raised are used.
When deciding whether to donate to a particular cause, people want to feel connected to the big picture. By clearly explaining the essential role your annual fund plays, you increase the likelihood that prospects will choose to contribute again and again.
What to Include
To lay out the goals of your annual fund, start by reiterating your organization’s mission and vision. That way, your donor prospects won’t need to go searching to learn about what you do. Along with this, you can incorporate details about what sets your nonprofit apart, such as your unique culture and the values you strive to exemplify.
Other items to include on your annual fund campaign webpage include:
- All your annual fund goals for the year.
- An events calendar with more information about how to get involved.
- Your annual fund-specific online donation form.
Once you’ve created a landing page for your annual fund campaign, be sure to incorporate it into all communications with your donor base. Not only does this save your donor prospects from doing extra work, but it also makes it easy for them to spread the word to other potential donors.
Ways to Make Donating Easy
Other helpful items to include on your annual giving campaign homepage, as well as throughout your annual fund marketing content, are links to crowdfunding pages.
A standard online crowdfunding page can easily be shared across communication channels, along with social media platforms to reach a wide audience. Such pages should include descriptions and images designed to attract new donors to your cause.
Live crowdfunding is an online event during which a member of your team can give a speech or pitch about your annual fund campaign. Along with that, you can speak about the importance of any related smaller fundraising projects or child campaigns, which we’ll explore in greater detail down below. During the event, the audience can make donation pledges.
Keep in mind, if you choose to utilize crowdfunding, you need to make sure you’re operating in compliance with all charitable solicitation state laws.
Digging into Prospect Research
For the most part, larger gifts will comprise a greater portion of your annual fund than smaller gifts. In fact, for the most part, major donations will comprise up to 60% of your annual fundraising for a given year. This is where prospect research comes into play. Knowing how much each donor can give will help you determine who to focus your efforts on and how to engage them.
Insights: Capacity & Affinity
Developing a targeted annual fund campaign strategy will better ensure you connect with the right donors at the right time, so no money is left on the table. Some of the key details you’ll want to consider as part of your wealth screening include:
- Biographical information, such as age, birthplace, occupation, and much more.
- Wealth indicators, such as real estate or stock ownership, giving amounts, and more.
- Giving history, including gifts to your nonprofit, as well as to other organizations.
- Affinity, including volunteer participation and philanthropic involvement.
iWave offers fully customizable fundraising intelligence that puts you in control of the numbers. No two nonprofits or fundraising goals are the same, and you’ll have the power to mold iWave to your needs.
Furthermore, at iWave, we provide our clients with complete transparency into the data, formulas, and sources of information used. That way, you can always trust the intel you are using to make data-driven fundraising asks. This ensures you make the most of all your major donor relationships and all your annual fund donors.
Not only will you be able to see capacity to give, but also a prospective donor’s affinity for your cause. In other words, have they given to likeminded organizations? Might they have a personal stake in your mission? This connection and inclination to give can hold just as much weight as wealth capacity (and in some cases, more).
With the right information in hand, you can take a holistic approach to your annual fund strategy and donor engagement, thus maximizing results!
Analyzing Child Campaigns
Since an annual fund campaign extends over the course of an entire year, it helps to break it up into what are known as child campaigns. These are more specific campaigns connected to the larger aims of your annual fund.
Through these more narrowly defined campaigns, you can gain additional insights into what motivates and inspires your donors, which will guide you towards the best method of connecting with them. Though some donors will prefer to contribute to your overarching annual fund campaign, many may need additional inspiration to do so.
Child campaigns are the perfect way to help your donor prospects feel more connected to your cause, in turn leading them to make a contribution that will benefit your annual fund. Be sure to draw a clear connection to your annual fund to give donors a well-rounded picture.
Consider using a customer relationship management (CRM) system to keep an ongoing record of your donor data. Then, you can reference and reflect on this data to craft a more compelling annual fund strategy as you move forward.
Customize your prospect research based on the specific child campaign you’re hosting to ensure the best results. The more granular and personal you make your research, the more likely you are to uncover the best possible donors for your mission.
How to Approach Donors at Different Levels of the Pyramid
Every donor is unique and should be approached as such. In your pool of contributors, you will likely have a combination of one-time givers and recurring donors (falling into different tiers of your donor pyramid), as well as:
- Major gift givers.
- Past contributors who have not donated in a while.
- Volunteers/event attendees.
Be sure to tailor your communications about your annual fund campaign according to different levels of the donor pyramid. Recurring donors and major gift givers will be more likely to have both an interest in and a capacity for giving to your annual fund campaign. Less frequent contributors and volunteers on the other hand may be less likely and should be approached differently.
Also, keep in mind that in general recurring donors will contribute more to your organization. For this reason, it is most expedient to center your annual fund strategy around encouraging recurring donations throughout the year.
Throughout your annual fund campaign, continually update this information within your chosen CRM system or other format to ensure accuracy and evaluate your data at pre-set times from month to month. This will give you the opportunity to make any necessary adjustments to improve as you go.
Building a Diverse, Cohesive Annual Fund Strategy Team
Due to the nature and scope of an annual fund campaign, you’ll want to assign experienced, dedicated team members to run the show. Along with this, it helps to draw staff from various departments to bring unique skillsets together.
As a best practice, it helps to thoroughly train everyone on how to use your chosen prospect research solutions, so the team is on the same page. iWave provides continual support, so every member of your team will always have someone to walk them through the software and to help them take advantage of its capabilities along the way.
Clearly assigning roles will ensure every element of your organization’s annual fund campaign is accounted for, such as marketing, outreach, and events.
It also helps to have a back-up plan or two. Pre-assign a replacement in the event that a member of your annual fund team cannot complete one or more of their assigned tasks. This safeguards your annual fund campaign strategy, so that you can follow through with your strategy even if the unexpected occurs.
Meeting Donors Where They Are
When promoting your annual fund campaign, consider who you’re reaching out to. Some demographics may prefer to learn about and connect with your nonprofit in different ways, such as through:
- Phone calls and/or texts
- Social media platforms (Facebook, Instagram, YouTube, Twitter, etc.)
- Email communications (newsletters)
- Print (newspapers/flyers)
- Direct mail (brochures/letters)
The team members tasked with marketing and outreach should utilize donor data to determine the best way to engage individual donors. Using segmented lists to differentiate each donor type can streamline the communication process right off the bat, leading to a more successful annual fund strategy overall.
iWave’s new Multi-Lens Scoring feature allows nonprofits to diversify their list segmentation. Using five different lenses, you can drill down on your list and create more comprehensive segmentation, thus cultivating a broader swathe of donors.
Incentivize Donors with Membership Reward Programs
A membership program is an opportunity for donors to enjoy unique benefits as a thank you for their continued support. In addition to material benefits, memberships bring people together more intimately. By offering a membership rewards program with a set fee, you’ll be able to better predict recurring donations.
Depending on your nonprofit’s resources, you might offer exclusive sneak peaks, member-exclusive activities, or other event-based perks like reserved seating. Handing out goody bags with items that sport your organization’s emblem is another option. Not only is this a desirable incentive, but it also gets the word out about your nonprofit even more!
Offer Plenty of Giving Options
Since recurring donors ultimately contribute more to your organization in the long run, it’s important to emphasize retaining this type of support throughout the course of your annual fund campaign.
One simple way to do this is by adding a recurring payment option to your annual fund campaign landing page. To provide donors with further flexibility, you can offer:
- Customized giving amounts with details about what each monetary gift will do to support your nonprofit’s mission.
- A matching gift search link on your webpage, so donors can check to see if their employer matches gifts (this can quickly double your funds without any extra effort).
Craft a Pledging Program
Another valuable type of program that you can offer to your donors is a pledging program. Pledging programs allow donors to make a donation at the time of your ask; however, they can hold off delivering the gift until a later date.
This type of giving has plenty of benefits to both your organization and your supporters. For starters, you want your annual fund to have lasting power throughout the year. By spreading out major donations, you’ll receive the support you need on a consistent basis.
In order to have a successful program, you’ll want to designate a team member to be in charge of organizing and cultivating these pledges. Some of their duties will include:
- Setting the terms of the pledges.
- Recording the pledges.
- Following up with pledges to receive the gift.
- Processing received pledges.
This team member can either be an existing member of your donor team, or you can bring in someone new with pledging program experience. Either way, you’ll want them to be highly organized and fully onboard with your nonprofit’s mission.
Another benefit of pledging programs is that they can fit into your donor’s needs better by allowing them to make a donation on a date that works best for them. This kind of flexibility is always a plus!
More Ways to Donate
No two donors are the same, so you shouldn’t expect all donors to give the same amount. Asking for too much can lead to a prospect becoming discouraged, and too little can leave money on the table. To remedy this, consider crafting strategies specifically for various donor levels and offering unique donation avenues.
- Donor Levels
Let your supporters know that any amount can help support your mission and propel your nonprofit forward. Use wealth screenings and affinity insights to derive a clear picture of how much a donor prospect may be able to contribute and then build out the levels below and above. Always keep the donor pyramid in mind.
Emphasize different perks at each level as well as what programs can be funded by a specific amount. This can motivate more supporters to take action because it puts the direct impact of their donation front of mind. Let donors submit a custom amount too, so you can ensure they feel comfortable with their gift.
- Donation Options
Similarly, you’ll want to offer different programs donors can enter in. If a donor appears to have the capacity or inclination to become a part of a monthly or quarterly donation program, then you’ll want to offer this avenue of giving. Look beyond only one-time donations to support your annual fund.
Along with this, be sure to highlight the value of recurring donations. Incorporate a clear call to action with an eye-catching button that makes it easy to set up a recurring contribution.
Be as Personal as Possible
When it comes to cultivating supporters, it’s key to build strong and lasting relationships. Get to know your donors! Nobody wants to be seen as just a dollar amount, so make sure you’re letting donor prospects know you’re interested in building a strong connection that extends well beyond gift giving.
When forging new relationships, take care to ensure you spell the donor’s name correctly in all correspondence. Address them by their name frequently, as well, so they feel like you’re really talking to them and not just any donor.
Before heading into an ask, look through your prospect research to learn more about the potential donor. Perform outside research as well to learn about community involvement and personal interests (for example, you could look them up on social media).
After using prospect research to find the right donors, set up meetings with them. Take the time to learn more about them and their interests, so you can better understand how they align with your nonprofit’s mission.
After this initial meeting, have your team craft an individualized cultivation strategy. This should include invitations to events you may think would interest them or more meetings with various staff members so they can better understand your culture. While at events, make personal introductions to other major donors or key staff members so that prospects can put friendly faces to your entire cause.
Events: Put It on the Calendar
Mapping out your annual calendar early will better ensure the success of your annual campaign and all your child campaigns. During the planning process, you’ll want to decide the number, as well as the types of events you want to host. To begin, decide on the:
- Annual fund campaign launch and wrap-up dates.
- Fundraising events both big and small.
- Timelines for marketing and outreach strategies.
Along with these, you may also want to include any pertinent administrative dates, as well as holidays. With these dates pinned down, you’ll have a clearer picture of what resources you’ll need to gather and when. Defining a schedule will also help you inform donors, so they can plan their attendance accordingly.
Dedicate ample energy and resources to your end-of-year appeals. Typically, people feel more charitable closer to the holidays, which makes it an opportune time to remind your donor base about your mission and why it matters. Using this to your advantage can help you end every year on a high note.
When writing end-of-year appeal letters, emphasize one or more of your success stories that demonstrates the impact of your nonprofit. Combine these with a picture and/or video depending on the format of your letters, whether in print or online. Emotional language and images like these will evoke passion for the work your organization does.
Amp Up the Intrigue
Many nonprofits host large annual events. Even if you host the same type of annual event, allocate time and energy to changing things up to excite donors year after year. For example, consider connecting people from across the country and globe by hosting a virtual event featuring special guest speakers.
Depending on the resources your organization has on hand, you may want to consider breaking your annual campaign up into events scheduled throughout the year. This method can also be very effective and will keep your donors engaged on a more routine basis.
You can foster intrigue further by diversifying your forms of engagement. Remember that not all forms of engagement must require monetary support. Enthused promoters of your mission can naturally lead to that monetary support you seek. Just consider some of these engagement options to achieve such a goal:
- Volunteer opportunities: These allow your supporters to get some hands-on experiences and see how your nonprofit creates change in your community. The more people know about what goes on behind the scenes, the more energized and inspired they will feel about your cause. Offering multiple ways for people to volunteer their time and energy will expand the possibilities for your engagement strategy, as well as your community outreach.
- Peer-to-peer fundraising: This type of engagement is a form of crowdfunding that enables your most dedicated supporters to create their own fundraising pages for your organization that they can then share with their network. Peer-to-peer fundraising can greatly increase your audience and build a larger community of trust, helping you reach your annual fundraising goals with minimal effort and resources.
While this type of involvement does result in monetary gifts, it also helps your donors better understand your nonprofit as well as what goes into the donor cultivation process.
- Share social media pages or a newsletter: The biggest way donors can support you is by spreading your message. Look into competitions based on sharing social media posts to help encourage supporters to spread the word about your mission, along with your annual fund campaign, special events, volunteer opportunities, and any other relevant information that may motivate people to take action.
These methods will also help your organization retain donors year after year, which translates into a well-balanced and supported annual fund. Make donor retention a top priority in your annual fund strategy to meet present and future goals.
When it comes to hosting events for your annual fund campaign, corporate sponsorships can make a huge difference. Not only can they provide money, but they can also draw more attention to your event, thus bringing in more donors.
The best place to start is by reaching out to your team members and long-time donors to see if there are any connections waiting to be nurtured.
Give Thanks, Foster Connection
If time and funds allow once you’ve completed your annual fund campaign, celebrate your nonprofit’s achievements at the beginning of the next year. Whether virtually or in person, a final event is a great way to help your donors feel like part of your nonprofit. It will keep them coming back, too.
Since building donor relationships is the bread and butter of any annual fund campaign strategy, it is especially important to take the time to thank all the people who stepped up to support your organization. At the same time, you can send along donation receipts to streamline the tax deductions process for your donors.
Lastly, be sure to personalize all follow-up engagement by letting your donor data inform how you reach out to every contributor. Remember, no one wants to feel like a checkbook, so the more time and effort you put into building relationships, the more connected to your cause a donor will feel over time.
Don’t Forget to Celebrate!
When giving thanks, you’ll also want to celebrate all you’ve accomplished with the people who helped get you there. Host a year-end celebration to wrap up your year of annual fundraising. Invite all your major donors to thank them for their support and encourage them to continue to support you in the coming years.
At this event, you should share a presentation about what your nonprofit has accomplished in the past year. Include video testimonials from the community to really highlight the ways you’ve made a difference. Your donors will also get a chance to meet more of your team and get to know your organization better, fostering stronger donor relationships still.
Additionally, this celebration is a great way to thank your staff. They work hard to run your nonprofit every day and to cultivate donors, so be sure to celebrate all their successes and look forward to the next year of working together.
Start Crafting Successful Annual Fund Strategies with the Help of Prospect Research
At iWave, we help you fundraise with confidence. Part of that means providing you with the reliable data you need to develop successful annual fund strategies year after year. Our nonprofit fundraising solutions draw from billions of data points to bring key capacity and affinity insights right to your fingertips.
We help our clients turn quality data into actionable information in order to achieve annual fundraising goals quickly and easily. Discover the potential of iWave by scheduling an assessment or a free demo today!
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