Anyone who has held posts in annual fund, alumni relations, or major giving functions will be familiar with the (valid) argument that increased donor numbers benefit the major gift pipeline. However, there is a tension that exists when different fundraising and engagement programmes are forced to compete with one another for limited resources.
This tension is evident in the recent Ross-CASE benchmarking results, which this year make for an interesting study of paradox: increased donor numbers have been accompanied by decreased total funds raised.
It may seem counter-intuitive, but there are several theories that could explain this:
Theory: Increased donor numbers are evidence that HE is successfully embracing new fundraising tactics.
There is no denying that Universities have upped their game when it comes to exploring innovative new fundraising tools and platforms. On the surface, this should only be seen as a good thing, helping to establish a broad-based culture of giving and responding to current marketing trends and preferences.
However, for small teams, every crowdfunding appeal or contactless donation pilot simply means less time spent on the road cultivating major gift relationships. Do not misinterpret this as a statement against innovation, but merely a note of caution that strategy should always drive action. Before jumping in to implement the ‘next biggest thing’, first ask yourself how it will help you achieve a predefined fundraising objective, and then collate evidence as to whether this goal could be better achieved through more traditional means.
Theory: External challenges to the HE sector are negatively impacting the amount of time Vice-Chancellors can dedicate to fundraising.
The act of increasing donor numbers requires little active involvement from institutional leadership. Sure, they play their part in delivering well-timed messages at alumni reunions and emphasising the importance of philanthropy to internal colleagues, but most of the activity is led and implemented by the development professionals.
Contrast this with major gifts, where the engaged involvement of Vice-Chancellors is crucial to developing long-term relationships with high net worth individuals and organisations. Frequent press articles highlight the many challenges currently facing Vice-Chancellors – ranging from the uncertainty over Brexit to an increased spotlight on University governance. Facing such pressures, it seems fair to assume that Vice-Chancellors are spending less time on fundraising. If so, this year’s benchmarking data should be viewed as the ‘canary in the coal mine’ – yes, we know these are challenging times, but whatever you do, don’t stop asking!
Theory: A slight dip in funds raised is simply representative of a natural dip in the donor cycle.
It is well-established that institutions in campaign raise more than those out of campaign. We have also come to expect that institutions will experience a dip in funds raised in the years immediately following the successful closing of a campaign. There has been a boom in the number of HE fundraising campaigns in recent years, so could it be that this year’s results are simply demonstrating an aggregated (but perfectly natural) sense of major donor fatigue?
If so, this should be a call to action for the sector to come together and consider how best to mitigate against peaks and troughs of major donor cycles. For example, Universities may need to invest more resource towards the close of a campaign to begin cultivating the next cycle of donors.
It’s difficult to say which of these theories is responsible for the survey results, and indeed it’s likely that all three are contributing factors. Regardless, this year’s report begs the question: should the results instill a sense of optimism (that increased donor numbers will eventually result in increased funds raised) or caution (that the balance is tipping too far in the direction of mass fundraising participation, at the expense of major gift success)?
Ultimately, both sentiments are justified, leading us to this takeaway: allow the data to inform your strategic planning and be prepared to present both sides of the evidence.
Which means that if you perceive the dip in total funds raised as a cause for concern, use the data to convince your leadership that this warning must be heeded to avoid philanthropic stagnation. But don’t forget to point to the evidence that the willingness from donors is there and that engagement at the leadership level is needed to ensure their interest does not wane.
And from the more sanguine perspective, if you interpret the increase in donor numbers as an underlying success story, use the data to justify investment in newly-recognised best practices. And don’t forget to point to the evidence that a mere increase in donors does not automatically result in an increase in philanthropic support.
For more expert analysis of the Ross-CASE 2018 findings, see our highlights and insights.
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