If you looked up suggestions for which major gifts metrics and KPIs your organization should be measuring, most of what you’d find would seem fairly reasonable.
The typical metrics measure activities quantitatively, such as number of calls, number of visits, number of solicitations, number of gifts, and so on.
But there’s a problem with most of those metrics.
Those metrics don’t reveal the quality of your relationships with your major gift donors and prospects. They don’t measure the value your donors get from engaging with you and supporting your mission. And they don’t help you make critical decisions, such as when to make an ask, or how to make a strategic plan for what to say and when.
Can any metrics really do that, though?
Yes! And it’s time to meet the new major gifts fundraising metrics, made possible through technology and automation.
Because the point of metrics is to amass data that indicates how well your current strategies are working, so you can adjust them to work better. If your metrics (especially major gift officer activity and revenue metrics) don’t directly measure what is happening with each donor, then they aren’t very useful.
That’s mostly because they look backwards to measure past activity, which is like looking in the rearview mirror all the time.
Ultimately, you can’t get to where you want to go if you’re always looking backwards!
What Makes Major Gifts Fundraising Metrics Different?
In Dr. Russell James’ Fundraising Myth & Science series of books, he reminds us, “Small-gift metrics simply do not apply to large-gift operations.” He goes on to emphasize the fact that small gifts don’t matter that much in a world where almost 80% of donor dollars come from just 3% of the donors, and most charitable bequest dollars come from 0.1% of deceased people (that’s just 1 out of 1,000!).
That’s because most major gifts and planned giving fundraising efforts are done relationally.
These are one-to-one interactions by phone, in person, via Zoom, and even with direct mail, text messaging, and email. Email can also be automated, which enables you to scale up your major gifts fundraising without having to hire more people.
The point is, major gifts fundraising is about delivering value. Building trust helps support value delivery. After all, if you don’t have trust, you can’t grow a relationship. And yes, you can automate value delivery to develop trust.
How much value are you delivering to each donor? Remember, value is in the eye of the beholder. In order to determine this metric, you’ve got to get to know each potential major gift prospect or donor well.
Then you might be able to determine what level of trust you have established with each donor, and if it is growing? Receding? Staying constant?
You need metrics that answer these kinds of questions for each individual donor and prospect.
What Are Some Commonly Used Major Gifts Metrics?
The idea of using trust-measuring metrics contrasts with much of what you’ll hear elsewhere about metrics, even from reputable experts. A popular CRM company (that doesn’t actually do any major gift fundraising at all), for instance, says the most important major gifts metric is “asks made.” This is based on the fact that this item (an activity metric) appeared on everyone’s list of metrics at a conference during a random exercise.
Not very scientific!
Nevertheless, this is in line with the common notion that asking (soliciting) is the most important part of fundraising. The more asks you make, the more money you’ll raise, goes the conventional wisdom.
We at MarketSmart respectfully submit that this is incorrect. And we have a lot of data to support that position, collected over many years from our major gifts fundraising software.
Amy Eisenstein, a well-known fundraising consultant, recommends four key major gifts metrics: retention, dollars requested and received, meaningful visits, and stewardship efforts.
That’s a better list than the usual activity metrics. But even her metrics still don’t reveal much about the level of trust between you and each individual donor. They’re still very broad, looking down from the 10,000-foot level and mostly backwards.
Why does this matter so much?
Because if you can measure value (especially trust), then you will know when to ask and how to ask. That may mean you end up making fewer asks but raising more money because you asked at the right time and in the most personalized way.
Never forget that your role is to help your major donors find meaning in their lives. It’s to help them enhance their identity so they feel like the hero in their own life story.
When you deliver that kind of value, you raise much more money.
Major Gifts Fundraising Metrics that Measure Value and Trust
So how do you measure perceived value and trust while forecasting future major giving instead of looking backwards? Here are a few ways:
Level of commitment to your organization’s mission
How committed is each major gifts prospect to your nonprofit’s mission? Are they invested for the long term? Do they care about future generations, not just next week? Do they see your organization’s survival as being of utmost importance to them? Major gifts fundraising is about providing for future generations. It isn’t disaster fundraising.
Rank of your organization compared to others they support
Yes, it’s a harsh truth we must all accept: donors almost always give to more than one nonprofit, and yours might not be their favorite. (Gasp!). This matters, because while a donor might give to five different organizations, they might be most inclined to give a major gift to only one or two of those. You need to know that information and you need to know if they are moving yours up in their rankings or down. Either one forecasts more giving or less.
Position within the ‘consideration continuum’
The farther along a prospect is in considering making a major gift, the easier it will be to secure a gift when you ask them. This goes completely against that CRM firm’s assertion that ‘asks made’ are what matter most. Asking at the right time matters much more. If you can measure how far along a prospect is, you will know when to ask with a far higher probability of success. More asks won’t generate more dollars. But more asks conducted at the right time will. The most successful fundraisers know that asks should only occur once trust has been established, and the donor can visualize the value they will gain in exchange for their hard-earned money.
Integrating the role of an important figure in their life in their passion for your cause
This metric speaks to why someone cares about your mission. If you ask a supporter about that, they’ll usually tell you a story that involves either their life history, their values, or their people and community (or all of the above). An especially powerful connector to your cause is another person. That could be a professor who changed their career trajectory or a nurse who saved their mother’s life. If you understand more personally and intimately why they care, you’ll be better prepared to make a personalized ask that connects deeply to their original identity and helps them gain value through enhanced identity (which is what they get for their money). For example, who inspired them to go down the philanthropic path they’re on with you? How much does that matter to them?
Degree of connection between your mission and their life story
A cancer patient who got cured at a hospital has a very strong connection between the mission of that hospital and their life. This matters for the same reason as the last metric. Why does each prospect care about your mission? The reasons vary. But knowing the reasons allows you to forge much greater trust and a stronger bond with each prospect before and when you make an ask. Again, these metrics forecast giving, making major gifts of assets much more likely.
Do they volunteer? Refer others? Share your social posts? Engage in other ways online? Do they respond to mailings more than emails? You can measure all their ‘touches’ and create a metric to represent each prospect’s level of engagement. Higher engagement means stronger trust and more value gained.
Outlier major donor prospect engagement
You can measure how much value your team is delivering to potential outliers (people who have tremendous capacity), and you can measure how much value they feel they’re receiving. Both metrics help you decide if you need to scale up, maintain, or adjust your outreach, engagement, trust-building, and value delivery efforts in alignment with how they’d like to enhance their identity through philanthropy — before you make any asks. Let’s be honest with ourselves. Entirely disengaged people won’t respond favorably to your major gift solicitations. You know that instinctively, and that’s why measuring engagement is so important.
Likelihood of making a major gift of assets (according to the donor)
This is a big one, and not just because it’s according to the donor. The real money in major gifts isn’t made in cash donations. It’s made in gifts of assets like stock options, property, and retirement accounts. If you know how likely a prospect is to make such a gift before you ask them, it’s a whole lot easier to ask with a high percentage of success and less often. Are you seeing how these metrics look forwards, not backwards?
Plans in place to solicit likely donors
You can measure this, too. Suppose 20 prospects have indicated they are open to making a major gift of assets because of their life story connections, their deep level of engagement, where they told you they reside in the consideration continuum, their level of commitment to your organization, how they rank your organization compared to others, and so on. Suppose you have plans in place to solicit eight of them because you’ve been assured that the timing is right, they trust you, and you understand how they would perceive a worthwhile exchange of value. Now you’ve got to get to work creating similar strategic plans for the other twelve. See how metrics like this directly inform how you use your time? You’ll waste far less effort shooting in the dark and more time focusing on the donors who are ready for your counsel and facilitation.
Frequency of visitation for donors and prospects
Ah! Finally, a metric that shows up on some of the other lists of major gifts fundraising metrics. Well, this one is important. If you aren’t communicating and maintaining the relationship, it is probably withering. But you’ve got to remember that some donors simply don’t want to be visited. Some, in fact, will give more if you visit them less. So be careful with this one. Instead, you might consider measuring how closely you are being attentive to your donors’ and prospects’ needs as reported back by them once or twice a year through feedback surveys.
Lastly, you want to start measuring your average lifetime donor value. This will quantify the value of how much trust you have developed in each relationship over their lifetime. What you’ll notice here is that the more work you can devote to sustaining and deepening trust, the more this metric will increase. If you want to see how you compare, check out the ‘live’ benchmarks I capture every day in my Fundraising Report Card.
More value delivery and increased trust equals more donations. Measure trust using the metrics above and you will increase your donor lifetime value.
Wait, Wait, Wait – What About Money Raised?
Monthly and even annual revenue from major gifts isn’t as important as lifetime donor value. This isn’t to say you shouldn’t also measure those more popular metrics; just that they aren’t nearly as important.
Any major gifts fundraiser knows it takes months, and often years, to secure a major gift. And sometimes years more to retain that donation, if it’s a planned gift. So if it takes months to secure a gift, what’s the point of a monthly major gifts revenue metric?
You might have four months with no major gifts, and then in one month, six donors give huge gifts and you bring in $4 million. You can’t then look at that number and say, “Well gee, what did we do that month that we didn’t do those other four months?” That’s a silly question. Obviously, you were spending those other months working with the donors who eventually gave. They just happened to all give the same month.
The monthly metric means almost nothing.
The annual one may have a little more significance, but not much, and for the same reasons.
Lifetime value is what matters most, not one-time gifts.
Pipeline growth matters too!
Pipeline metrics help you assess whether you have enough potential major donors considering making major gifts of assets moving themselves through the consideration continuum.
If your pipeline is small, it will be easy to forecast poor future results.
However, if it is big and growing, your future will likely be bright.
So measure how many relationships you have in which you and your supporter both expect a solicitation to occur in the next year or so. Then determine a gift amount you expect. You might want to be conservative with this figure. Next, assign a ‘deal stage’ (usually according to the donor) based on where they reside in the consideration continuum, and be sure to include a deal percentage. This is your assessment of the likelihood that the gift will close. Then plot out the calculation by multiplying the projected gift amount by the likelihood percentage, and be sure the figure lands in the month (or year) you and the donor have agreed it will reasonably happen.
Here’s an example of how this looks. In the private sector, we call this a risk-adjusted pipeline.
As you grow your pipeline, you’ll want to keep an eye on whether your supporters are moving themselves forward through the consideration continuum. One way to measure that is by tracking ‘days to close.’ This is the number of days from the time the donor opted-in to be in your caseload (portfolio) to the day their gift was closed. However, you should also measure how long it takes for them to move themselves to each stage.
Monitoring velocity will not only help you understand the typical length of the process. It will also help you see where supporters are getting hung up. For instance, if they are not moving forward (or perhaps even moving backward) after meeting with only one particular gift officer, that might mean that fundraiser needs training (or should no longer meet with prospective donors).
Maybe all this sounds great to you. But that list of major gifts metrics given earlier isn’t normal. How do you measure how much a person is committed to your organization? How do you measure the influence of a key person in their life?
There is a way.
The way to measure most of the metrics listed earlier is with automated emails, online engagement tracking, and surveys.
When you send a survey to a donor and they fill it out, they’re already self-qualifying by helping you learn the kinds of information in those metrics. Plus, you can stay attuned to their pulse over time, with additional surveys sent at respectful intervals, combined with email communication that is targeted and personalized to each prospect. Automating this helps you collect the data you need to quantify those metrics.
It’s powerful, and it works!
Eventually, you will be able to say that Prospect A is 90% of the way along the consideration continuum, but Prospect B is only 60%, and here’s why. So prepare to make an ask for A, and alter your approach to keep cultivating the relationship with B.
I hope you agree that these metrics can revolutionize how you measure, track, and utilize your information for each major-gifts prospect and donor.
Want to know more? Click below to find out how you can automate trust with major gifts prospects.
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