How to raise money for charity?
Raising money is one of the fundamental tasks undertaken by every nonprofit organization.
Your fundraising campaigns provide you with the opportunity to solicit much-needed funds, as well as spread awareness about your organization and cause. However, fundraising also represents one of the most challenging aspects of nonprofit work. It generally provides the primary income source for charitable organizations and is a massive endeavor.
Fundraising is also a KPI (Key Performance Indicator) against which senior leadership is measured. It’s the lifeblood of the organization, allowing you to serve the mission that you were founded for, pay your team members, and take care of the costs associated with running the organization.
There are many options open to nonprofits for ways to fundraise. In fact, narrowing down what will work best for your organization can be part of the challenge. The advent of technology in the nonprofit sector has helped to expand your options, as well as help you to hone in on the best methods, and ways of finding new donors.
The place to start is with a robust plan, which is where this guide to raising money for charity comes in. Here’s how you can put the nuts and bolts together for successful fundraising:
Define your goals, mission, and story
The first step of any good fundraising plan is that you’ve got to define where you’re going. This helps you to narrow down your choices to suit your goals, and to define appropriate milestones and KPIs so you can accurately measure success.
Your goal setting almost always starts with your mission. Why? Because your mission tells you what you need the money for and by extension, how much money you need to raise.
The number you need to raise should be rooted in the needs of your mission. Many nonprofits set annual goals, then break those down across the campaigns they plan on running over the year. It’s important to consider beyond this year as well, especially if you want to set the roots for campaigns that you hope to grow over the next few years.
Goal setting should be part of your annual planning because you don’t want to have any stressful surprises. You wouldn’t want to find that you suddenly need to rely more heavily on year-end campaigns to meet your goal because other campaigns didn’t yield enough.
Your mission and story
Your mission and story play a key role in drawing donors to your organization. Make sure you have yours carefully defined and ready to present to the world. People want to know what you’re using donations for and how donations will contribute to furthering your mission.
Transparency is important to your donors and can contribute to the success of your campaigns. In fact, being transparent can help to increase your donations by 50%. Additionally, 62% of people research charities online before they give, while donors also say they’d be inclined to give more if they saw increased results.
Develop your fundraising strategy
With goals set for your fundraising efforts, it’s time to talk strategy. There are almost endless possibilities for fundraising initiatives, so putting a strategy together that aligns with your overall goals will help you to narrow down your options.
Evaluate any current fundraising initiatives
First of all, how have any current or recent fundraising activities gone? Have you achieved what you hoped? One way to evaluate your fundraising initiatives is to conduct a SWOT analysis, where you identify your strengths, weaknesses, opportunities, and threats.
For example, let’s take a look at an imaginary annual Turkey Trot fun run. A SWOT analysis might look something like this:
- Strengths – Our last event was the best-attended yet, with 500 entrants. Our course is a popular one for runners.
- Weaknesses – We tend to struggle to maintain supporter engagement after the event.
- Opportunities – We have a willing partnership in the pipeline to help grow and promote the event.
- Threats – The cost of permitting and concessions have gone up, along with the costs of supporter swag, and other aspects that help give attendees a good event experience.
At this stage, you may want to evaluate past campaign data as well so you can look for any trends. Do any patterns emerge from your activities over the past few years?
Know your audience
Knowing your audience is critical for any sort of campaign so that you can be highly targeted with how you implement facets of your fundraising.
Every nonprofit should develop clear descriptions of its target audience. It’s likely that you’ll have multiple segments, so you’ll need multiple descriptions. For example, segments can be broken down into groups such as:
- High-value donors
- Monthly donors
- Stewards and volunteers
- Online donors vs. local donors
Predictive modeling tools like those offered by iWave can help you to identify different segments among your current donors, as well as new prospects who may fit into those groups.
Define your timeline
Every good goal is time-bound, so you need a clear timeline for your fundraising strategy. Fundraising is a project, and good project management practices include setting up timelines and milestones.
Define the type of campaign you’d like to run
How are you going to raise money? To help you narrow down your options, consider how much you’d like to raise and the types of donors you hope to attract. Different types of donors go for different types of fundraising.
If you’re hosting a black tie gala with an auction of high-end items, that will tend to attract high net worth individuals. On the other hand, an event such as a fun run will often attract a range of people, with the common element being that they don’t mind moving their bodies for charity. The gala will generally have a much higher price point on tickets than the fun run.
You should also consider how much you’re willing to spend on fundraising campaigns. Events are always more expensive than online fundraising, but they also tend to be more engaging for donors.
Your organization type also plays a role in the type of fundraising that will be more successful and appropriate for you. We created a guide to fundraising ideas for different types of nonprofits here.
Assess the resources you will need
What resources do you need to help you successfully pull off the fundraising event? Consider these types of resources:
- People. These can include your paid team members as well as volunteers or contractors.
- Software. There are various types of software available to nonprofits that help to make the fundraising process more efficient. For example CRM software (for managing your donor information and communications), fundraising intelligence software (like iWave – for prospecting and building relationships with donors), fundraising software (to provide the fundraising function, such as online auction tools or pledge tools), marketing software, and project management or planning software.
- Venue. Needed if you’re running an in-person event.
- Permits, insurance, and licenses. These also may be needed for in-person events.
- Goods and services. For example, maybe you need food and beverages, porta-potties, swag, and more.
Assemble your team
Fundraising campaigns have a lot of different parts to them. They often require a team of people with different expertise. In many nonprofit organizations, the whole team is involved in campaigns, however, it’s still important to clearly assign individuals or sub-committees to head up key components.
Some of the tasks you may need to be covered include:
- Marketing for the fundraiser.
- Seeking new partnerships or sponsorships.
- Training and leading volunteers.
- Overseeing any software or technology needed to administer the fundraising.
- Event planning and organizing.
- Overseeing the funds raised.
- Data analysis and measuring of performance.
Develop your marketing campaigns
Spreading the word about your fundraising campaigns is a key part of overall success. You’ve got to have the right type of marketing campaigns that reach the right people. For example, local fun runs need to be promoted via local channels. You would waste unnecessary coverage on a national campaign.
Do you have a budget that includes paid marketing? Not all campaigns need a huge investment in advertising, and most nonprofits need to be mindful of every dollar spent. It’s important to understand your audience and how you are most likely to reach them.
Paid marketing includes channels like:
- Social media advertising.
- Google PPC advertising.
- Print media.
- Podcast advertising.
- Flyers and posters.
Your current donors are always a good place to start because they already know and love you, and you already know they have the propensity to give to your organization. Hopefully, you have been keeping donors engaged through a regular cadence of communication so that they’re already primed to hear from you.
It helps if you start by identifying who among your current donors is a good match for your current campaign goals. Screening software such as iWave can help you to identify donors who match the criteria you are looking for. You can gain intelligence such as any relevant changes that have happened in their lives since your last campaign.
Importantly, personalized outreach is an effective strategy among your current donors. They have a history with you so you can reference that background information and make sure you approach them as you know them. Personalization is an expectation among consumers that carries to the nonprofit sector. 71% expect personalized interactions.
Will you have an online component to your fundraising? Digital marketing requires a certain skill set and knowledge of how digital platforms work. You need someone familiar with digital campaigns who can develop an effective marketing strategy.
Online marketing might include a mix of social media, email, website optimization, and any paid advertising, such as through Google. One of the great advantages of digital marketing is that if your campaigns are carefully strategized, you’re able to reach a wider audience of your ideal donors.
Another consideration here is if you’re following a P2P (peer-to-peer) model of fundraising. This involves getting your supporters to reach out to their networks to solicit donations. For P2P to be successful, you’ll want to provide supporters with the right marketing tools to help. These might include things like marketing collateral, or platforms they can fundraise from.
Does your campaign involve soliciting major gifts? You’ll definitely want a specific marketing strategy for those. The Pareto principle generally applies; that 80% of your funding will come from just 20% of donors, so your approach is key.
The first step is generally to identify donors who have the capacity, affinity with your cause, and tendency to donate. Wealth screening software can be a great advantage for identifying those people.
Major donations tend to involve a lot of personalized attention toward the prospect. For example, you might invite them to an event, or to meet your organization’s leaders. It’s about cultivating relationships so that the prospect feels like they belong with your organization and want to back your mission.
Partnerships can be an advantage for marketing fundraising campaigns because you get to leverage the audiences of your chosen partners. The idea is that partners promote your fundraising efforts too, reaching out to their followers.
When we say “strategic” it’s because the partnership should make sense for your nonprofit. Any partner should be in alignment with your mission and values and should be a good fit in the eyes of your donors, too.
Identify potential donors
Identifying potential donors is an important piece for any fundraising campaign. Doing so allows you to be relevant with your communications and engage better with prospects. It’s the difference between a mass marketing approach that tries to appeal to everyone but only nets a few, and a targeted approach that hones in on a narrower audience, but speaks to those people directly.
Screen and segment existing donors
We mentioned this when we talked about donor stewardship previously. You should start with your existing donors because you already know a lot about them, including that they are already primed to donate to your organization.
Use screening solutions such as iWave to help segment your existing donors and devise outreach strategies.
Leverage prospecting tools
Prospecting tools help you to identify new prospects who may have never donated to your organization before. The power of artificial intelligence can help you to build tailored prospect lists that fit your criteria. This is an efficient way to cut through the piles of data out there and find your most likely prospects.
Evaluate your progress
It’s important to check in regularly during your fundraising campaigns to see how you’re doing. To ensure that you have complete and accurate information to evaluate, you should initiate strong data hygiene practices. For example, by having clear procedures for people to follow and regular checks to ensure accuracy. This might mean:
- Auditing your database.
- Having a particular process that everyone must follow. (Girl Scout troops must enter their cookie booth sales into a system right afterward, for example).
- Making sure team members know how to correctly enter information and how to correct mistakes if necessary.
Compare progress against your goals
You should have some specific goals and some KPIs which help you to track your progress. Check in at various stages throughout the campaign to see if you are on track, ahead, or behind.
Where your goal is to raise a specific dollar amount, it can be very helpful to share your progress. Donors will often be motivated to contribute when they see how you’re tracking and that you’re transparent about it. Visual tools such as fundraising thermometers and progress bars are helpful for easily presenting your progress.
Make any necessary changes
If you find that you’re not where you need to be, you may want to implement changes based on your findings. Perhaps you need to invest a bit more into marketing, or maybe you need more people on the phone contacting current donors.
The great thing about evaluating your progress regularly is that it allows you to be proactive. It’s much better to have the opportunity to make changes that can improve your success during your campaign, rather than waiting until the end of a campaign to look back and wish you’d pivoted.
Engage with donors
Donors are VIPs for nonprofits and should be treated as such. We’ve got this step last in this guide, but really, it’s an ongoing process. Donor retention is a key concern for most nonprofits and maintaining engagement is a key part of retention.
In a nutshell, engaging with and retaining your donors helps you to have a wider pool of donors to call on for future fundraising campaigns. It means you don’t have to start from scratch every time and find new donors.
Thank all donors
Absolutely all donors should be thanked as soon as practicable after they donate. There’s no excuse not to thank them. Not only is it in poor form, but not being thanked is a common reason given for donor churn.
Keep donors engaged
Keep donors engaged by communicating with them often. This might include things like:
- Email welcome series sent to new donors.
- Regular email newsletters.
- Personalized updates – how has their contribution been used to further your mission?
- Inviting them to events.
- Showing them “behind the scenes.”
Fundraising is a core focus for every nonprofit organization. This guide has provided an overview of key tasks needed when planning out your fundraising strategies. These steps can help you to take a holistic approach, from planning to evaluation.
Finding the right donors is key for every fundraising effort. iWave is here to help you do just that. Our fundraising intelligence software allows you to find new prospects with smart AI, discover donor segments, and identify those with the capacity, affinity, and propensity to give.
Request your free demo of iWave today to see how we can help you to power your future fundraising campaigns.
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