addressing the second-level donor pyramid
DESCRIPTION
bbcon 2013TRANSCRIPT
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Addressing the Second Level Donor Pyramid
PRESENTED BY PAGE BULLINGTON,
DIRECTOR PROFESSIONAL SERVICES
TARGET ANALYTICS
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TARGET ANALYTICS
Leading Provider of Supporter Insight & Analytics to the Nonprofit Sector
� Division of Blackbaud, Inc.
� 7,000+ Customers, Across All Nonprofit Segments
Key Assets:
� Cooperative Database - Industry’s largest donor database; over 2B philanthropic transactions from 80M+ households
� NOZA Database - Industry’s largest searchable database; over 65M uniquely identified gift records
� donorCentrics – Nonprofit’s largest & most established performance benchmarking practice, with more than 530 participating organizations
Key Product Lines:
� Direct Marketing Solutions
� Major Gift Fundraising Solutions
� Data Enrichment Services
� Performance Benchmarking & Reporting
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THE SCREENING PROCESS
You
Industry/External
Target Analytics
We apply the models to pinpoint supporters with the likelihood and capacity to
give to your mission
We perform detailed screening to uncover actual wealth, career and philanthropic
connections on the individuals most likely to be annual, major and planned gift
prospects
We utilize your organization’s unique giving
records, proprietary and external data, and our
proven statistical analysis to create custom models
Model types
MAJOR
PRINCIPAL
PLANNED $$$
$$
$
$
$$
$$$
$$$
$$ $$
$$$
$$
$$$
$$$$
$$
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WHY A SECOND LEVEL?
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Major
Mid
Annual
SECOND LEVEL DONOR MOVEMENT
Principal
Non Donors
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• Designed to jump start the campaign
• Could equal roughly 80% of the dollars raised
• Help demonstrate campaign leadership and capacity
• Elevate individuals to (and provide examples of) pace setter status
• Ability to influence later giving at all levels
• Will provide a vehicle for publicity
PRINCIPAL GIFT DONORS
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• Designed to jump start capital campaigns
• Could equal roughly 80% 90% of the dollars raised
• Help demonstrate campaign leadership and capacity
• Elevate individuals to (and provide examples of) pace setter status
• Ability to influence later giving at all levels
• Will provide a vehicle for publicity
AndF
“Of the nearly $300 billion donated [in 2011] more than
70 percent was given by individuals, of which
roughly half was given by the wealthiest 3 percent
of American households.”
WHY PRINCIPAL GIFTS?
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Additional Note:
The most common motivations for stopping
support are an organization soliciting
the donor too
frequently or asking for
an inappropriate
amount.
BIGGEST MOTIVATIONS FOR GIVING
Bank of America Merrill Lynch/ Center on Philanthropy at Indiana University Center for Philanthropy http://www.philanthropy.iupui.edu/research-by-category/the-2012-study-of-high-net-worth-philanthropy ; accessed on 11/5/12
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WHO ARE THEY?
Inclination
Giving history is trending positively
Confirmed patterns of philanthropic
donations
Capacity
Well educated and belong to
affluent demographic
segments
Live in areas where a higher quality of life
index is present
Asset Valuation
Purchase expensive homes
and vehicles
Long-established credit history
High real estate valuation
Wealth Indicators
Benchmarked against peers
giving principal & lead gifts
Higher incomes and known public assets including
stock
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HOW DO WE FIND THEM?
PRINCIPAL GIFT LIKELIHOOD
What is Principal Gift Likelihood?
Scores a donor based on their likelihood to give a principal gift, typically $250k or more.
What does Principal Gift Likelihood do?
The model identifies ultra-high-value prospects who have the means, passion, and commitment to make game-changing principal gifts to a non-profit
How does Principal Gift Likelihood work?
By utilizing a proprietary archive of principal gift contributions, along with a wide array of financial, demographic, and lifestyle attributes linked to each analyzed constituent.
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WEALTH DOESN’T TELL ALL
The following assets can often be discovered in publically
available data sources:
The following assets can often be discovered in publically
available data sources:
Real estate values
Public company “insider” stock holdings
Some private company affiliations
Federal political donations above $250
Charitable donations cataloged from online sites
These assets are usually well-hidden and will not be
discovered:
These assets are usually well-hidden and will not be
discovered:
Debts and most Mortgages
Bank Account Holdings
Retirement Assets
Non-”insider” stock holdings
Business Assets not voluntarily disclosed
Detailed wealth screening uncovers roughly 40% of assets.
You must do more to uncover these prospects.
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CASE STUDY – HIGHER EDUCATION
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The Challenge• $250 million dollar campaign
• Gap analysis reveals campaign pyramid gaps at the highest giving levels
CASE STUDY #1
Goals & Objectives• Identify new prospects of Ultra-High Wealth
• Increase size of current donor’s gift amounts
• Increase response rates across all gift levels
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CASE STUDY #1
• 600 previously-assigned prospects
• Tripled prospects rated at $1M+ for multi-year commitments
1,843 TOTAL IDENTIFIED PRINCIPAL GIFT PROSPECTS
SegmentationCapacity to
Client
Number of
Prospects
Tier 1 $1M+ 188
Tier 2 $750K - $1M 199
Tier 3 $500K - $750K 416
Tier 4 $250K - $500K 1,040
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IMPLEMENTATION STRATEGY
Focused on realignment of major gift officer portfolios:
Review Of Assigned Prospects
Team Pre-Qualifies Unassigned
MGO Portfolios Revised
Old Prospects Dropped & New Prospects Added
Tier 1 Assigned For Exec Cultivation
Tier 2 Assigned to MGOs, Personal Solicitation Plan
Tier 3 Assigned for 2nd Phase of Personal Cultivation
Tier 4 Received Higher-End
Mailings & Calls
Moved To Primary Cultivation With “Self Selects”
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CASE STUDY #1 - RESULTS
• Major Gift portfolios realigned to represent larger capacity
• More value in portfolios, fewer constituents
• Streamlined system for managing lower-level prospects; ensures contact is made and initial cultivation begins
• Lower potential prospects moved from the assignment pool
• Development officers focused on the right individuals
Individual accepted;
following the event he made a commitment for a $500K gift.
Individual accepted;
following the event he made a commitment for a $500K gift.
Prior to new Tier rating, the
individual was in higher-end
direct mail pool
Prior to new Tier rating, the
individual was in higher-end
direct mail pool
Cumulative lifetime giving
prior to the invitation was only $30,000
Cumulative lifetime giving
prior to the invitation was only $30,000
Previously underrated prospect
received personal invitation to
cultivation event
Previously underrated prospect
received personal invitation to
cultivation event
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CASE STUDY 2 - CULTURAL
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The Challenge• Large # of low-level donors (< $1K)
• Sub-optimal response rates
• Upcoming budget cuts & streamlining
OVERVIEW OF CHALLENGE
Goals & Objectives• Uncover regular monthly donors that should
be upgraded
• Develop pipeline that will support multi year capital campaign
• Discover new previously overlooked principal gift prospects
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INITIAL RESULTS – 21,220 TOTAL RECORDS
$50,000
$100,000
$250,000
$500,000+
P
P
P
P
P
P
P
P
P
P
P
P
P
P
PP
P
74
6,248
5,431
9,467
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FURTHER PRIORITIZATION OF RESULTS
USING ADDITIONAL SCORECARD METRICS FOCUSED ON PHILANTHROPY AND
GIVING TO ORGANIZATION PROSPECTS WERE FURTHER SEGMENTED INTO 10
TIERS:
Group/Wave Record Count Rationale
1 2044 Tier 1 and Tier 2
2 1859 Tier 2
3 2419 Tier 2
4 1962 Tier 3
5 1760 Tier 3
6 1709 Tier 3
7 2151 Tier 4
8 1959 Tier 4
9 2157 Tier 4
10 3200 Tier 4
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INTERESTING OBSERVATIONS
Only 961 of these prospects have a Solicitor assignment
<1/2 have made a gift to in the past three years
Top States:• NY (13,883)• CT (2,301)• NJ (1,436)• CA (1,521)• FL (417)• MA (340)• TX (209)
~2,800 have never made a gift
21,220
Records
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PRINCIPAL GIVING SOLUTION: INITIAL
NEXT STEPS
Wave 1
• Prospects for immediate review
• Confirm that all prospects in these groups have assigned solicitors, are disqualified or there is a plan in place for prioritizing qualification
• Some qualified prospects should be surfaced to executives for cultivation
Waves 2 & 3
• Use these pools for initial portfolio refinement over time
• Interim engagement should be assessed using mid-level or leadership level programming opportunities
• Begin monitoring activity of un-assigned prospects to help with prioritization
Waves 4 – 10
• Further prioritization should occur using special cohorts, geography and other factors
• Consider pre-cultivation engagement strategies to help prospects ‘self select’
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CONCLUSION
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IN SUMMARY
Well Designed & Executed Analytics?.
• Uncover supporter insights that aren’t easily derived from wealth screening alone
• Streamline the process of interacting day-to-day with supporters
• Direct our investment towards the constituents & initiatives which yield the highest ROI
• Produce results that far surpass past performance, in terms of revenue and efficiency
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TWEET ABOUT YOUR SESSION
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#PRESENTER