Top 5 Ways to Diversify Your Nonprofit’s Fundraising Strategy
Posted on February 7, 2023
If the last few years has taught us anything, it is to be resilient in the face of unexpected changes to the economy and society.
It is never truer than for non-profits. Not only did many NPOs suffer funding shortfalls during the pandemic as many fundraising ideas and events got put on hold, but the pandemic followed a change in the tax laws that has crimped charitable giving for many people.
Absent a steady stream of fat-wallet donors writing big one-time checks, diversifying funding sources is never more critical. Here are five Nonprofit Fundraising Solutions:
Peer-To-Peer and/or Team Fundraising
Big-brand companies, like Nike, Starbucks, Ford, Apple, etc. rely a great deal on their customers sharing stories of support and affection about their favorite brands to inspire and build legions of repeat customers. The same can be done in the non-profit world. People are often as passionate about the causes they support as they are about the brands they love.
This kind of fundraising works when an organization’s supporters and donors reach out to the people they know, often through social media, to ask them to give to a cause close to their heart on behalf of the organization. We have all seen this on Facebook and Instagram when people ask their friends to support their causes leading up to a birthday or anniversary. NPO’s can nudge their existing supporters to engage this strategy through outreach. If the organization has birthdates of its donor database, an email or phone call to wish them a “Happy Birthday” can be accompanied by a suggestion that they use their social media heft to multiply their giving.
“Peer-to-peer” and “team” fundraising are similar, but with a few slight differences worth pointing out. Peer-to-peer fundraising can be specifically for individuals, as in the case of birthday efforts, whereas groups of supporters can do “team fundraising.” Non-profits that support disease research for example, organize monthly walking, cycling or running goals among donors and supporters, who in turn attract sponsorship for the monthly goal or a per-mile sponsorship. Additionally, gaming can be layered on top of the effort where teams or individuals compete to see which team or individual can raise the most money, with the winner getting a prize.
These fundraising efforts are fueled by social media, and work wonders to attract new donors who get added to the database and can be leveraged into long-term supporters.
Facebook and Instagram make it easy for donors to create fundraising pages, which is a far better and easier method than going around with a clipboard, hitting up friends and friends-of-friends for per-mile support in the case of walking and cycling goals.
It goes without saying that the more information you can collect from each donor, the better you will be at retaining them, and converting first-timers to long-term supporters and advocates.
iConnectX gives you a fundraising platform on which to keep all your efforts organized and efficient, with a high degree of automation when it comes to donor communications.
Major Gift Giving
Major gifts are still a significant source of funding for most NPOs. Indeed, 90% of all fundraising dollars come from just 12% of donors, so you can’t afford to let up on those efforts.
Cultivating major gift-giving is a serious and specific talent and must be properly resourced with the right staff and software tools—building relationships with a list of prospects identified as being likely givers if approached the correct manner.
Major-gift fundraising involves six stages: Identification, Qualification, Cultivation, Solicitation, Negotiation, and Stewardship. iConnectX software helps you organize and manage the prospects through those stages by helping you stay organized and automating certain processes. For one, you’ll need to record every touchpoint that you have with donors, especially the major ones. There is a strategy to be hatched around staying in touch the right amount to keep them engaged and involved, while not over communicating.
A major donor has a high net worth and may own real estate, stocks, bonds or cryptocurrency, and can be persuaded to gift any of those assets in lieu of cash. Wealthy “older” donors are often the best prospects, but don’t ignore millennials who have achieved early wealth and have interest in giving.
Wealth screening enables an organization to learn about current donors’ and prospects’ wealth or capacity to give. Wealth screening shows an individual’s past giving to other charities, political contributions, business affiliations, real estate ownership, SEC stock holdings and the like.
Auctions are fun, and an excellent source of funding for NPOs. Nonprofit auctions (whether live, silent, online, or hybrid) are events that draw in supporters to bid on items, services or packages. Items and packages are often donated, but sometimes organizations buy them at cost. Auctions can provide multiple tax deductions, first for the donor of the item and then for the one buying it.
Some NPOs have in-person auctions, but online and hybrid auctions are becoming more the norm. Online auctions and hybrid auctions require tools to pull off, and they go much smoother when using our software.
Live auctions or high-bid auctions are different animals. A live auction can be a snazzy, fun event as part of a gala featuring entertainment. With as live auctioneer, attendees place bids by raising paddles or signaling. This live version can also be live-streamed to attract more people.
A best-bid auction has items displayed with sign-in sheets on each one, and people browse and place bids on the items they want. This can be done live, or on a web page we create for you. A mobile app we provide can also streamline the process. Heading into 2023, more people are gathering in person. However, many people have become accustomed to solely online events. Many still participate in them and, in some cases, prefer joining from home.
Hybrid auctions are a very popular type of auction. This type of auction combines an in-person auction with the ability to take bids from online supporters. Event organizers are also able to track the auction’s progress online. Those at the event and those online can place bids from their device, and when the bidding period ends, the highest bidder wins.
Remote Celebrity Events
Since the pandemic, everyone is comfortable working and taking part in events online. Booking celebrities for fundraising events—whether they be athletes, business leaders, performers, authors—is easier today because of remote appearances.
For causes these celebrities support, many will do appearances for free. Others will do remote fundraisers for a discounted rate. A NPO can reach out to donors and prospects with a “private event,” that will be “A Conversation with…”
Depending on the financial goals of the event, the attendee list can be restricted to a set number that will allow each attendee to ask the guest a question.
These events can also be held live for the attendees, but remote for the celebrity guest. The point is that it has become easier to book well-known people because the investment of time is relatively small. No travel required.
Because many performers have built mini-studios in their homes, it can also more possible today to enlist a singer/musician performer to entertain your donors without ever leaving their house.
Supporters who are not high net-worth individuals who want to give, but aren’t able to write a big check should can be presented with the option of a monthly pledge. A donor may only be able to afford a $50 check today, but if they have a structure in which they can pledge $10 a month, you’ve just increased their yield from $50 to $120.
This works almost like a gym or streaming-service subscription in that it never ends until the individual stops the payments. The more people an NPO can enlist into this program, the greater the reliable monthly cash-flow.
Monthly giving or pledges are efficient when they are managed through our software. These types of donations, once set up, are automated. The only management of that donor, then, becomes relationship management via email and snail-mail, making sure they are invited to events, thanked, receiving newsletters, etc. Research shows that monthly donation programs yields more than 40% greater giving from the same people who previously wrote one-time checks.
All of your touchpoints with these donors, with all your donors, are managed and tracked in our iConnectX fundraising software suite. And at the end of the year, the donor automatically gets a statement of giving they can apply to their tax returns. There is very little for an NPO’s team to do once the system is set up.
There are so many benefits to a monthly giving program:
Benefits of Monthly Giving Programs and Donation Pledges
There are many benefits to your donors subscribing to your monthly giving program.
- Steady recurring revenue
- Increased supporter connection and stronger donor base
- Increased Lifetime Value of donors.
- Greater supporter engagement.
- Lower donor acquisition costs.
- Easier financial forecasting.
Economic times change and stock market returns cycle up and down. But through any rough patch, supporters of your NPO still want to give, still want to feel connected.
When economic downturns occur, people naturally cut back and review their spending. But if they feel they are connected and valued by your NPO, your organization stands a much better chance of making the cut.
During the pandemic, some NPOs, like churches, theatre companies, food banks and outreach organizations for children and families in need reported upticks in giving. Difficult times often make those who are insulated from adversity even more generous.
But establishing that kind of relationship with donors requires sound and stead relationship management.
Using technology to run fundraising activities is an easy way to start to build your funding. iConnectX is a solution that provides easy-to-use online auction and event ticketing tools for nonprofits. Best of all, the tools are free to use for US registered nonprofit organizations. Not sure about using tech for your fundraising, set up a demo to see how it works. https://www.iconnectx.com/