Consider the obvious differences between regular annual/membership giving on the one hand and major/planned giving on the other.
Ideally, a person’s giving to an organization or institution evolves gradually over a lifetime. As the donor learns more about the mission and cares more about it, hopefully his or her financial capability to make larger gifts also increases.
Ideally, the character of the relationship between donor and charity changes over time from one based on a series of gift transactions to a rare, strong connection that can be termed a genuine relationship. This relationship may be capped with the ultimate gift of a lifetime, most often made through the donor’s estate.
The larger a donor base, the more likely an organization is to manage its file of donors or members using a computerized system. Each detailed gift record is evidence of a transaction. Many transactions viewed as a whole form a mosaic picture of a long-term relationship.
Just a few years ago, less advanced technology and the cost of disk storage space meant that detailed donor records could often only be maintained for a relatively short time, if at all.
Older detailed data was routinely dumped to tape or paper reports for archival purposes. In many cases, this was equivalent to destroying the data for all practical future uses. To use our analogy, part of the mosaic was ripped up and thrown away (or, at least, hidden from view).
These days, most are able to keep detailed records dating back many years. Some organizations are now dusting off archive tapes to load the old data back onto new systems with more disk space — an excellent idea. In addition, many institutions now know the ages and general wealth levels of donors as a result of file enhancement services that are readily available and quite inexpensive.
Moving forward, more and more nonprofits will have better “pictures” of their donors based on giving history, stage of life, wealth factors, and other information. That’s the good news.
The bad news is that many organizations overlook using their enhanced database records to help them identify ideal prospects for planned gifts — particularly for bequests and gift annuities.
Unfortunately, there are too many cases in which a female donor, age 77, who has faithfully given for more than 25 years is “lapsed” from the active donor file in the same fashion as a 31-year-old person who has given only one time.
Ten years ago, not much could have been done to correct this situation. Age information was difficult, if not impossible, to obtain, and long-term giving histories were usually nonexistent.
Looking forward, however, there is no reason to let this continue to happen.
Whether you work with a small PC or a mainframe computer, the solution is to store as much gift history as possible and to learn your donors’ ages whenever possible. With this information, you can construct a selection criteria, such as described below, which may be incorporated in the middle to latter stages of existing efforts to renew a membership, annual, or other regular gift.
- If the donor has not responded to the second renewal reminder, check total number of gifts on file and the donor’s age.
- If the donor has been giving for five years or longer, or has a large number of gifts on file, and/or is age 70 or more, then STOP!
Instead of sending a third renewal reminder, consider diverting the donors fitting this criteria to receive an alternate letter. Without mentioning age, the alternative letter would make it clear that your organization understands that there are times when one may not be able to continue their regular giving. It would then offer ideas and more helpful information on how one can remain in the family of supporters through various planned gift opportunities.
What is accomplished?
Instead of derailing a relationship with your longtime donor late in its development, this approach allows you the opportunity to suggest options to a committed supporter who has simply passed the point in life when she can continue ro make regular current gifts.
Our research shows that the typical bequest comes from a female who dies at about age 82. She put the organization in her will at about age 78 or 79, which also happens to be the age at which she stopped her regular giving. She had been on file about seven years prior to making her last will and had given less than the overall average annual gift each year.
While there are many exceptions to this composite, it appears to be fairly accurate overall. It illustrates the need to offer long-term donors a way to “stay in the family” via membership in a “legacy” society and to highlight a will as well as other plans as ways to make ultimate gifts, even as they downgrade or entirely cease their long tradition of regular contributions.