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Every Gift Is a Test Gift

Donors’ gifts to your organization are signs that they have found something in your mission that they believe in. They have voluntarily invested in moving your nonprofit’s purpose forward, without the expectation that they will receive anything tangible in return.

Every time your organization accepts a gift, it makes a promise. The donors have placed their trust in your institution to use their generosity wisely, with transparency. In effect, they are testing your organization’s worthiness of that trust.

Our institutions’ long-term success is dependent on our ability to demonstrate that they are worthy of our donors’ trust. That requires exceptional stewardship. For example, 94% of donors surveyed as part of the US Trust’s 2018 Study of High Net Worth Philanthropy give because of their belief in the mission of the organization and 93% give because they believe their gift can make a difference (respondents could select more than one response). 71% look to the organizations they support to provide information about whether their charitable giving is having an impact.

A proactive effort to report to donors on the impact of their giving—how their gifts were used and the outcomes they helped to accomplish—or, better yet, showing donors their gifts’ impact is necessary to retain your donors and deepen their relationship with your organization over time. Transparency also helps align donor and organizational expectations and avoid misunderstanding, according to the study. 60% of donors surveyed expect the nonprofit organizations they support to demonstrate sound, ethical business practices, including full disclosure of financial statements.

Transparency and accountability are not just expectations of donors who make major gifts. The majority of any nonprofit’s donors began by making relatively modest gifts.  For example, at a university where I led the development efforts, we found that all but one of the donors who had given at least $1 million had made a first gift of less than $250 through the annual giving phone-a-thon.

Retaining donors at any level is not a trivial challenge. Inspiring donors to repeat their gifts and increase them over time is heavily influenced by the organization’s integrity and outcomes. By providing exceptional stewardship for every gift, you can pass the trust test and grow donors to higher levels of giving, shift to a major gift culture, and sustainably increase fundraising results.

Provide exceptional stewardship

Exceptional stewardship requires preparation and strategy even before gifts are solicited. Preparation means ensuring your organization’s gift appeals—regardless of the medium—are clear about the intended use of donors’ gifts and that the organization has the ability to follow through on those intentions. The institution also needs to have policies and processes in place to provide donors with timely and accurate gift receipts, appropriate acknowledgement and recognition, and reports on the use of the gifts.

It’s imperative to develop strategies for how your institution will express gratitude, recognize, and report to donors. Those strategies should focus on ways the institution can deepen its relationship with donors to inspire them to repeat and increase their giving.

When expressing gratitude, an institution can use the opportunity to share information about its work and the importance of philanthropy to enable that work. High-performing institutions focus on their organizational vision and the intangible benefits of giving rather than on token gifts such as coffee mugs or tote bags. Relationships based on belief in your organization’s mission will outlast those based on a token gift.

The strategy should map out how the institution will recognize donors in ways that enhance the relationship. For example, some institutions—such as universities—may find value in developing naming policies to honor donors in their buildings while others—such as international humanitarian organizations—may find that such a recognition doesn’t resonate. Your strategy should engage donors with organizational leadership or provide access to information or experiences not available to the general public.

Institutions should also find ways to demonstrate to donors the impact of their gift and, when appropriate, connect them with those who are benefitting from their philanthropy. That may be via a written report, a tour, or a personal experience. An effective and meaningful demonstration of impact for a scholarship donor, for example, is meeting the recipient of the scholarship to enable the donor to hear stories of how the scholarship opened up new opportunities. That meeting also enables the recipient to express gratitude. Done effectively, the experience can be emotional for both the donor and recipient.

It’s important that the strategy details when and how you’ll continue the giving conversation with your donors and that the conversation doesn’t cause you to fail the trust test by asking for another gift before expressing gratitude for the previous one.

The challenge

Unfortunately, the simple step of saying thank you trips up many organizations and, all too often, sours the donor relationship. For example, I once toured a residential shelter and food kitchen for homeless individuals a few blocks away from where I was employed. I was so impressed with the organization’s work that I went home and wrote a check that was, for me, a significant first-time gift.

Within a couple weeks, I received a solicitation…then another…and another. I never received an acknowledgement of my gift and had to check with my bank to see if the shelter had cashed my check. The experience made me question how the organization managed its funds and drove me to find another way to support solutions for homelessness and food insecurity in my community. I’m certain my experience was not unique. I wonder how many donors and repeat gifts were lost by the organization’s failure to simply say thank you.

All too often in the nonprofit world, our resources are scarce and we’re under pressure to meet fundraising goals that only increase. It’s easy to overlook the time and attention it takes to provide exceptional stewardship. Stewardship is not rocket science, but it does have to be intentional. Our organizations stand to lose critical support without it. Thoughtful preparation and consistent, long-term strategies for expressing gratitude, recognizing donors, and reporting the impact of their gifts instill confidence and trust with each new—and larger—gift.

 

If you need help developing your stewardship plan, contact Laura Simic at lsimic@grenzglier.com.

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About the author

Laura Simic

Vice President

Laura Simic, Vice President, brings more than 35 years of experience in fundraising and executive leadership in public and private higher education to the GG+A team.  She has frontline development officer and two decades of executive leadership experience encompassing all areas of advancement including alumni relations, advancement services, communications, annual…

Full Biography View More Posts

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