From Cultivation to Stewardship: Building Long Term Major Giving Relationships

1. From Cultivation to Stewardship:Building Long Term Major Giving Relationships PBS Development Conference Saturday, October 8 1 – 4:30 p.m. Kay Sprinkel Grace, Facilitator

3. Special Thanks to the Workshop Team • Georgi Kelly, KQED • Cheryl Ikemiya, OPB • Michele Ripley, KET

4. Agenda • Welcome and introductions • Overview of this “hands on” session • Defining and developing a donor-centered fund raising program (cultivation, solicitation and stewardship) • Creating a plan to sustain a relationship-based major giving program at your station • Maintaining an investor relationship with donors • Creating and sustaining a culture of philanthropy

5. Overview of Session • Intended to be “hands up” (please interrupt with questions) as well as “hands on” – a working session based on presentation of material • Three major giving officers from stations are here as a team with the facilitator – they will each present some ideas and material, but they are also here to help facilitate and be a resource • Information balanced with interaction in small groups • Two opportunities to plan; lots of opportunities to think and talk

6. Participant Expectations and Issues at Your Stations: Discussion • What did you come here to learn? • What issues are you confronting at your station in major giving? • What challenges would you like to have the skills to overcome? • Are there “givens” that you will have to work with and you want to learn “coping skills?” • What would be the best outcome of the session for you?

7. Defining and Developing a Donor-Centered Fund Raising Program Basis for a successful major giving program

8. What We Know About Our Donors • “Show me that you know me.” • How much do you know about yours? • What would your major donors say motivates them to give? Georgi Kelly on the KQED major donor focus groups and their findings • Presentation • Discussion

9. KQED Producer’s Circle Focus Groups • Our Goal: Through the focus groups we sought to better understand why donors increase their support of KQED and how they view us vis-à-vis other cultural institutions in the Bay Area.

10. KQED Producer’s Circle Focus Groups • Our Process - Step by Step 1. Co-Chairs of the Producer’s Circle, key staff and the consultant met three times to define the project and identify what we hoped to learn. 2. Identified the number and types of groups we wanted to conduct, where we would have them and who we would invite. Invited participants by letter with phone follow up.

11. KQED Producer’s Circle Focus Groups • Our process, step by step, cont. • 3. Developed discussion guides and collected “stimuli”. • 4. Conducted the events: • Served dinner and, even some wine… • Recorded the event (promised anonymity, but not confidentiality) • No staff were allowed to participate • 5. The consultant transcribed the recordings, provided a literal (coded) transcript, a full analysis and report and an executive summary—and made a full presentation to the Producer’s Circle Committee.

12. KQED Producer’s Circle Focus Groups • Changes we have made in response to the feedback we received. • Case statement: increased focus on interest areas (e.g. arts and science). • “How-to” events. • Increased program specific mailings (e.g. tune-in cards, but decreased frequency of our newsletter).

13. KQED Producer’s Circle Focus Groups • Final Observations: • How we fit against the “competition”. • Great way to involve volunteers and Board members. • A form of high level stewardship for the participants. • “Prove” (or “dis-prove”) your hypotheses!

14. What We Know About Major Gifts • Their size is relevant: what is major to some stations/organizations is not major to another • We should not gauge their value by their size, but by the commitment the gift symbolizes • Not all “major donors” make major gifts • They can be restricted or unrestricted, annual or capital, planned/deferred or simply occasional • Your station, no matter its size, is “eligible” for major investment if you build relationships • Major gifts are growing faster than any other kind

15. Realities of Major Giving • Major giving cannot be compartmentalized from the rest of your giving programs – including special events, pledge and direct marketing/membership programs – at some point all giving is part of a continuum (point of entry to point of exit) • Major giving doesn’t work without volunteers • What happens in other giving programs influences the success of attracting and retaining major donors • From the earliest point of the relationship, there is a critical need to start building a relationship with the donor – to become donor-centered • How are you doing on this at your station?

16. Ingredients of a Successful Major Giving Program • A compelling case for support based on mission, vision and values of the organization, shared with the community through outreach, programs and projects • Staff vision for what is possible for the organization, but also for the giving program: a solid plan • Qualified prospects (connection, concern, capacity) and a belief in relationship-based engagement • Willing volunteers (Ambassadors, Advocates, Askers)

17. Ingredients of a Successful Major Giving Program - 2 • Commitment to strategic cultivation and on-going donor stewardship • Understanding of donor motivation (more on this later) • Recognition that major gifts are social investments made by social investors • Organizational focus on communicating the impact of major gifts on the community and the organization • How do you evaluate your station on these points?

18. Three Core Steps in the Development Process • Cultivation • Strategic (not “events for the sake of events”) • “Horizontal” and “vertical” • More than “random acts of kindness” • Personal and communications outreach • Solicitation • Based on donor’s interests and needs • Focus on relationships and values, not just $ • Stewardship • What the donor wants in terms of a continuing relationship

19. Ten Principles to Guide Donor-Centered Giving Understanding motivation is the key to building relationships and keeping your donors loyal

20. Rethink Old Generalizations About Motivation • Younger generations, women, people off the social circuit and people of color are not always motivated by the old “carrots” – recognition, peer pressure, guilt, quest for immortality • They are cause-drawn and outcome-motivated • They are also keen on accountability and transparency • Its not your father’s philanthropy: like your mother’s, newer donors are looking for involvement before and after they give

21. 2. Motivation Grows Out of Values • Match the donor’s values (e.g., your focus on program/outreach issues – health, aging, domestic violence – matches his/her values and your delivery of those messages is having a community impact) • Convey values by linking prospects with projects and people: words alone don’t do it • Motivate donor-investors by connecting them with the values impact of your projects; involving donors with cultivation of new donors also works wonders (create “donor champions” through your stewardship)

22. 3. Remember the Three Basic Motivations for Giving • Connection (linkage) • Knows someone on staff or board • Is passionate about public broadcasting • Concern (interest) • Issues you address are relevant to them • Capacity (ability) • Relative and absolute • The least important motivation in giving

24. 4. Motivation is Ignited by Passion for the Mission • The age of passive philanthropy is ending (one of the reasons we struggle with membership decline); as the face of philanthropy changes, so does its quest. • A heightened interest in outcomes is replacing a need for rewards (and premiums) • Recognition must be increasingly mission-connected • Passion is fueled by involvement (previews, production opportunities, time with teachers) • All meetings involving donors and volunteers need to have a “mission moment” with a direct message from those who benefit from what you do

25. 5. Research Can Give Clues About Motivation, but the Donor Knows Best! • Get to know your major prospects and donors (“Show me that you know me”) • Use research (Wealth ID, PIN, in-house) to provide a platform for exploration but rely on personal interaction and mission exposure to learn more about “psychographics” • HOWEVER: many “new” donors are either not on our radar screens OR not known to us at all (they may be looking at us because of the issues we are dealing with) • We focus on motivation to get the gift, but often fail at keeping that motivation alive once the gift is received (transactional –vs- transformational approach)

26. How Do We Use Research to Find Out More About Donors? • What does research tell you? • What does it not tell you? • How do you handle research in your station? • How OPB is going to manage their prospect information from wealth screening (policies, procedures, practices) • Cheryl Ikemiya • Discussion: how would you use this information?

27. Prospect Research at OPB:Before we got started • What makes a screening successful? • Clear expectations of the screening results and of roles/responsibilities for everyone involved • Good housekeeping—accuracy of records, policies and procedures • Didn’t press “SEND” until we had an implementation plan • Keep goals realistic, timeframes short

28. From Prospect Research to Prospect Management: Implementation Plan • Identify an administrator for the screening project and ongoing prospect management program • Assess needs for skill building and plan appropriate training for everyone involved • Document Prospect Management Practices for the full Development Team (staff and volunteers) – roles/responsibilities, confidentiality, ID & qualification, assignment, tracking & reporting

29. From Prospect Research to Prospect Management: Implementation Plan - 2 • Set up systems in donor database to support prospect management • Decide what research results to upload into the donor database • Decide how many “good prospects” needed to meet goals

30. From Prospect Research to Prospect Management: Implementation Plan - 3 • Portfolio Analysis: • Category 1 – Highly rated by the screening and currently under management by OPB development officers • Category 2 – Not rated as good prospects by the screening but have been under management • Category 3 – Highly rated by the screening and not on our radar

31. From Prospect Research to Prospect Management: Implementation Plan - 4 • Verify prospects in Category 2 and 3 • Establish exploratory strategies for Category 3 prospects (highly rated but not on radar), group strategy and assignment • Determine specific roles for key volunteers in prospect management process • Placeholder strategies • Calendar progress reporting and process evaluation meetings

32. Research Resources • Enlisting the Board of Directors and other volunteers • Helpful web sites • Research firms

33. 6. Motivation is Internal: You Provide External Messages that Connect with Existing Motivations • You cannot motivate people: they are already motivated – your job is to find out what motivates them and give the messages and create the environment for involvement that will help their motivation flourish and engage them with you • Listen (two ears, one mouth ratio) to what donors say and ask; observe who they gravitate towards at events • Most of all, listen for the nearly audible “click” when your station’s values combine with theirs

34. Incorporating Issues and Values in Membership and Major Giving • Is your case compelling? • Does it focus on issues that will draw out the values of your members and donors? • Are you consistent across all programs and platforms with your messaging? • How KET’s fund raising programs (even pledge programs) convey the values of the station • Michele Ripley, KET • Discussion – how do yours measure up?

35. KET: Kentucky Educational Television • “Across Kentucky, I saw the heroic struggle to provide equal education thwarted by the barrier to unequal resources. It was essential that we harness the power of television to assure the education and enrichment of our people so they would have every possible opportunity. We could not afford to accept less.” KET Founder O. Leonard Press

36. KET: Changing philanthropy demands case that merits support • A majority of giving has shifted to restricted and special interest projects. • Repositioned KET not as a television station (operational?), but rather as the state’s largest educational institution. • Added new opportunities for major, restricted gifts • Case Statement: compelling, donor-centric, reinforces impact on external needs, reflects significance of ask, reassures transformational decision, stands-out in competitive environment. • Basis for new values messaging across all platforms.

37. KET: The results • Individual and Foundation major gifts have exceeded 30% each of the past three years (system average: 6%). • 153% net fund-raising growth since 2002.

38. 7. Giving and Renewing is a Matter of Connecting to the Vision and Seeing it Unfold • People buy in to a vision: if you want BIG gifts, make it BIG • Cultivation is based on enrolling prospects in a vision. • Solicitation is based on engaging a prospect to become an investor in the vision while acting on his/her values. • Stewardship is based on the progress towards vision, and how the donor’s investment is helping advance that vision.

39. 7. Giving and Renewing is a Matter of Connecting to the Vision and Seeing it Unfold (continued) • Vision is not just for your station: it is for the community if your vision is fulfilled • Vision is another source that fuels passion: with the feeling of powerlessness in the face of national and world events that many people have experienced recently, engaging in your vision may be the most empowering thing they can do

40. How Changing the Way We Approach Cultivation, Solicitation and Stewardship Can Inspire Donor Engagement From High Impact Philanthropy Kay Sprinkel Grace & Alan Wendroff (Wiley, 2000)

41. Transactional Giving:The Bell Curve High Impact Philanthropy Kay Sprinkel Grace, Alan Wendroff

42. Transformational Giving: The Infinity Loop High Impact Philanthropy Kay Sprinkel Grace, Alan Wendroff

43. The Goal of Good Stewardship is to Keep the Donor Relationship Strong • Stewardship: the ongoing relationship with a donor based on mutual respect for both the source and impact of the gift (Beyond Fund Raising, Grace, 1997; Beyond Fundraising, Second Edition, 2005) • A key ingredient in effective stewardship is the ability to communicate progress towards vision • We retain our donor-investors through stewardship: their commitment to us motivates them to become ambassadors, advocates and askers – in short, our champions – and helps us bring in new prospects and donors who share our values and vision

45. 9. Motivated Donors Should be Linked with Motivated Volunteers • Staff-only soliciting is not a good trend: it may be more efficient and in some cases more effective, but volunteers represent the community, evidence commitment to the station and may link better with the prospect’s experience and values. They are critical to relationship-based social investment. • The peer ask is still the most effective and most motivating in most major gifts programs: volunteers can also learn the “cues and clues” for having a conversation about planned giving • The best approach is to have trained and knowledgeable staff working with motivated and committed volunteers

46. 10. The Self Solicit • Ultimately, if you do your job right and build relationships, the most motivated major donors will “self-solicit” (the late Bill Kimball, former Chair, Stanford University Board of Trustees and a great major gifts volunteer) • A motivation-stimulating environment, connection with the programs and people that “click” with a prospect’s values and connection with volunteers who also care will lead to an internal dialogue resulting in the “self-solicit” • It also works for well-stewarded donor-investors

47. 21st Century Donor-InvestorsWhat’s the Basis for the Relationship? What Makes Them Tick? From Interviews for High Impact Philanthropy (Kay Sprinkel Grace and Alan Wendroff, 2001)

48. Five “I”s of 21st Century Donor Motivation • To make relevant social investment, not just a gift • To see and know true impact -- The focus groups with major donors at KQED revealed their interest in the impact of their gift on the capacity of KQED public broadcasting to fulfill its mission • To fund issues that reflect their values and desires • To fund new ideas that effectively address needs or problems whether they are old or emergent • To respond to opportunities for appropriate involvement (stewardship and the market of one)

49. From the Workshop Team How is all of this working at your station? • What would you challenge? • What would you endorse? • What are some of the relationship-based successes you have had? • Discussion and questions

50. Culture of Philanthropy • Everyone on staff is willing to be part of the “development” (relationship creating and nurturing) team • Everyone on the board takes a motivating role (Ambassador, Asker, Advocate) • From the “top down” there is a commitment to the importance of philanthropy • What can you do to increase that culture in your station? (Georgi, Cheryl, Michele with small groups)