Now is NOT the Time to NOT Be Fundraising

Many organizations are having a difficult time fundraising right now. Or rather, they are having a hard time justifying to themselves that they should be fundraising right now. They feel that since they are not a direct service organization feeding the needy, or providing PPE to front line workers, or helping maintain a roof over people’s heads, they don’t deserve to ask for money.

It is an understandable sentiment, but one that may prove to be extremely self-harmful. If you are an organization that is dependent upon annual fundraising efforts for survival, 2020 may be the most important year to be asking your donors to support you.

We know from experience that if you do not ask supporters for donations one year, it is harder to get them to engage the following year. People who are used to being asked to support you on an annual basis won’t simply stockpile that cash on your behalf. They look elsewhere to donate and give another organization the opportunity to build a meaningful relationship.

Now, more than ever, is the time to be reaching out to your supporters and engaging them to support you.

This tendency is being heavily multiplied right now since we also know that in an economic downturn, donors don’t stop giving, they simply reduce the number of organizations to which they give. They pull back and fortify the organizations they perceive to need them most.

During 2008, for example, if a donor usually donated $10,000 across five organizations, the trend we saw was to reduce the number of events they attended and possibly increase the donation per event. So a donor would attend three events and donate $10,000 to each, or two events and donate $15,000 to each. They didn’t stop giving, but they became more selective in their giving. Organizations who were able to clearly and effectively communicate the immediacy and relevance of their need were able to convince these retracting donors to fortify them, and not another organization.

Which brings us to right now: you may feel like now is not the time to be asking for money. You may feel like the right thing to do is to encourage people to support our front-line health care workers, a food bank, or another organization that is directly addressing our current crisis. It is a valid and understandable feeling, and those organizations deserve support. But so does yours.

I am a firm proponent of honest, engaging fundraising. So indulge me three questions:

• Has your need become greater since the outbreak of the Coronavirus?

• Do your clients need you?

• Are you dependent upon fundraising to survive?

If you answered yes to any of those questions, you have an honest, engaging reason to reach out to your donor base and ask them to support you. If you answered “yes” to all of those questions, you should undoubtedly be fundraising this year.

My final thought: people want to give money to more than just one set of causes. Yes, people want to support direct service organizations; but they still want to support the arts, and their kids’ school, and…well…you.

The Keys to Going Out on a Limb in Fund-A-Need

For years, one of our recommended strategies for a successful fund-a-need has been to begin asking for pledges at the highest level with a lead donor lined-up in advance. In other words, start asking for money at a level you know will be immediately successful.

Even the most impromptu moments are the result of tons of planning, and your fund-a-need is no different. 

We had a lot of rationalizations for this: It forces events to have important conversations with donors pre-event; it pre-determines whether or not key supporters believe in what you’re asking them to help fund; and the night-of the event, it ensures that the fund-a-need starts off with immediate momentum.

In the past few years, however, we’ve had some phenomenal successes starting the fund-a-need “out on a limb,” at a higher level than our lead donor commitment. At one event we had a $10,000 donor identified in advance, but we went out on a limb and another donor offered to pledge $100,000. He was followed by two more donors at $100,000, including a woman who was completely new to the organization.

We’ve also had some abysmal failures, which are difficult to recover from. At a recent event, I was sent out on a limb at $50,000 and told to ask for $25,000 next. We received zero pledges at those two levels, killing most of the momentum the testimonial had generated. 

We have, therefore, identified four keys that will determine whether going out on a limb in the fund-a-need is appropriate for your event.

1)  Can you justify starting higher? It seems like a silly question to ask, but do you need more money? If so, you need to be able to tell that story the night of your event in a way that empowers people to support you at a higher level. If you are going to send your auctioneer out on a limb, make sure you have tied that limb to the change you are asking people to fund.

Example: You normally start your fund-a-need at $5,000 but this year you’d like to ask for $10,000. Prepare some examples of what $10,000 will help you do and utilize them as a reason for asking for more money.

2) Determine if your existing lead donor(s) will be upset by you asking for more than they agreed to pledge. Sometimes ego comes into play with high-dollar donors. I’ve seen instances where lead donors felt slighted because they thought they were going to be the top dog in the fund-a-need, and then we asked for more.

3) If you go out on a limb at a specific amount, make sure you have a *guaranteed* donor committed at the next level down. A fund-a-need that starts off with no pledges at one level can recover quickly if there is an immediate pledge at the next level down. Two levels of zero pledges can have a significantly negative impact on the momentum of your appeal and the amount you raise.

4) Do you have donors in the room who have the capacity to support you at a higher level? The $100,000 example above was set into motion the previous year, when a donor came to us after the event and assured us we had started the fund-a-need too low. He was right, as he was one of the donors who stepped up at $100,000.

You may not know all of the donors in your room and may not know the individual capacity of all of them, but you should have a good sense of the potential capacity – or at least know someone who does. When in doubt, ask your supporters – your table captains or board members – for a reality check. You may have untapped potential in your crowd, and you’ll never know if you never ask.

The multiplier effect of good sponsorship

Event sponsorship can have many potentially positive and negative impacts on an event, but the natural tendency is to focus solely on the positive. Planning committees tend to look at the amount sponsorship raised pre-event or the number of tables pre-sold. People seldom focus on, let alone proactively work to mitigate, the potentially negative impacts sponsors can have.

Good sponsors do more than "just" buy tables, good sponsors bring qualified guests who are prepared to engage with your event.

Obviously, sponsorships help generate income pre-event and can guarantee profitability before the doors open. Table sponsorships are an integral part of every large gala I work with and account for a significant percentage of the seats sold at many events. Raising money before the doors open is a good thing, but it is meant to be a means, not an end.

Challenges arise when sponsors make their pre-event contribution and then count their job as done. We see it frequently: the sponsor who uses their table as a chance to reward employees, clients, or some friends with a “fun party.” Or the worst-case scenario: the sponsor who doesn’t even bother to fill their table and lets it sit there, empty.

The opposite of this is when sponsors see their contribution as an opportunity and leverage their donation to help generate more donations. We need sponsors to commit to utilizing their position of influence to help create more supporters for your organization by bringing people of potential to the table.

The way they do this is by strategically seeding their table with individuals who have capacity and making sure that those individuals understand their role at the event. It doesn’t have to be as brash as, “I’m expecting you to come spend money and support this cause.” But sponsors believe in your cause for a reason, and if they share their passion for your work with potential supporters in their network, it will yield short-term and long-term benefits.

When sponsors take this approach, they apply a multiplier to their initial donation that can be felt the night-of your event. In this way, a $10,000 table sponsorship can yield $25,000 in contributions – if the right bidders join the sponsor at their table.

This approach also helps fill your donor development pipeline with potential long-term donors. Once a potential donor is “in the room,” it is up to you to meaningfully engage them, motivate them to contribute, and cultivate them for future support. But it only works if they are qualified individuals who come open to being engaged.

These sponsor conversations are not always easy to have – no sponsor wants to hear that their cash gift isn’t enough. It is important that the right person discusses it with your sponsors and that the message is couched in utilizing their generosity to help create even more success for your organization.

Sponsors support you because they believe in your work and they want to help you change the world. Engage them on a deeper level, it will be more rewarding for all involved.

The dangers of the biennial event

Producing a successful fundraising auction is no small challenge. A successful auction requires hundreds of hours of planning, solicitation, and marketing. It requires leaning on your closest supporters to bring their friends and contacts to support you. It requires a lot of work.

It is therefore understandable that many organizations would perceive holding their auction every other year as the solution – especially if they can raise enough in one night to cover two years of need. What we’ve found, however, is that holding an auction every other year is actually more challenging in the long run. 

Your Date is Your Date

When you hold an event every year, it becomes established within your support base. People have busy schedules, and getting something on their calendar is a challenge. Keeping it on their calendar is your responsibility. Do you hold your event in one of the two busiest times of year, spring or fall? Odds are, if you take a year off of your event, a good portion of your crowd is going to get invited to another event – and it’ll be up to you to win them back. Every. Other. Year.

Donor Cultivation Suffers in a 730-Day Cycle

Fundraising auctions are an established pipeline for attracting new potential donors. Auction events are a known commodity, and donors understand what is being asked of them when they are invited to a new event. Once a potential donor is “in the room” at your event, it is up to you to engage them and convert them to becoming a long-term donor. Inviting them back to your next gala is one of the more simple means of cultivation. Inviting them back to your next gala – two years from now – lacks imperative.

Institutional Knowledge Retention

One of an auction committee’s many responsibilities is to pass along the institutional knowledge of an event from year to year. Unless you have an incredibly well-documented event, much of the information on how to get it done lives in the heads of your staff and volunteers.  Staff and volunteers that may turn over.

An entire planning committee recently had to start from scratch on an every other year event because I was the only person left who had worked on their last auction, two years ago. All of the institutional knowledge was gone. Caterer? Auction lots? Recording of the previous auction?

The Message of We Make Enough

Every organization holds a fundraising auction out of need. What does it say about your need if you only need to do your auction every other year? There is a good chance that your large donors understand your needs well enough to keep you on their list of planned donations. But smaller, newer donors? The same donors you should be trying to cultivate in the long term? They are more likely to misinterpret your lack of annual event as a lack of annual need.

Auction Solicitation Challenges

Much like cash donors, the people and businesses who donate auction lots often have a finite number of donations they can make in a year. If you let them off the hook one year, you run the risk of losing them long-term. I’ve seen this happen in the most innocuous of ways. A donor who put their Italian vacation home in an every-other-year auction donated it to another event in an off year. And it did so well at that other event that they doubled it on the spot, taking away her ability to donate to the every other year event.

Maintaining Your Venue/Vendors

The competition for venues is extreme, and if you walk away from your venue one year, you better have a plan in place for getting it back the next. Same goes with your vendors. As a company we give our clients the first right of refusal on “their” date on a year-by-year basis. If an event chooses not to hire us one year, we’re going to do our best to fill that date the next year, even if they say they are coming back in two years. Our budget doesn’t allow for a two-year cycle of income.

If you are currently holding a successful event on an every other year basis, my goal isn’t to convince you to change your model. But if your event has become more challenging to produce every other year, or your biennial results are no longer meeting your needs, take a hard look at your goals and why they aren’t being met. More often than not, the challenges of producing an annual event are outweighed by the benefits.

How will the election impact your fundraising auction?

Arguably, 2016 is the most contentious presidential election in my lifetime. The emotional impact is extremely high, and very few people in my network are unaffected by it.

Charitable giving infographic created by Beth Sandefur.

The majority of the spring fundraising season was complete before either party had finalized its candidate. We didn’t see events suffer negative impacts that we could attribute to directly the presidential campaign. But now that the candidates are set, the conventions are over and the fur is starting to fly, how will the election impact events in the fall?

The commonly held “wisdom” is that charitable fundraising falters in an election year, for a variety of reasons. The predominant theories being that donors give to campaigns instead of charities, or donors are scared away by uncertainty or fear. A recently released study by Blackbaud sheds interesting light on both of these theories.

The report is based on data from the 2012 election, and focused on 143 national 501(c)(3) organizations. Blackbaud found that donors who contributed to political campaigns also increased their 2012 charitable contributions 0.9% compared to the previous year. Donors who were engaged in the political process increased their donations to charities.

Donors who did not make a political contribution in 2012, however, gave 2.1% less to charitable causes than in 2011. Donors who were not engaged in the political process decreased their donations to charities.

Charitable fundraising as a whole was up 1.7% in 2012, but mainly because contributions to religious organizations was up 6.1% and contributions to education was up 1.6%. If you take those two categories out of the mix, charitable giving as a whole was down 1.7%. Individuals donated an estimated $258.51 billion to charitable organizations in 2014 (results for 2015 have not yet been reported). So a 1.7% swing at that level could wipe out numerous organizations.  Unless you were a school or a church, your category of charity saw a decline in charitable giving during the last presidential election.

Blackbaud doesn’t offer any deeper insight into their numbers, but we can draw a few conclusions. Obviously, unless you are a religious organization or a school, you are going to have to work harder to make the same amount of money as you did last year.

If your support base is energized by this election, it is a good sign for your event. People who are engaged in the process are more likely to engage with your cause. I would theorize that this is because people who engage in the political process believe in it and believe that they can make a difference in the process; and then that “actionable optimism” carries over to their charitable beliefs. 

According to the statistics, the potential problem for charities is the donors who are not contributing to politics at all this year – because they’ll be contributing less to charity as well. There is a lot of fear, uncertainty and doubt surrounding this election, and it is easy to imagine people cocooning until Thanksgiving. If your donor base buries their collective head in the sand, you and your clients will wind up paying the price. But only if you can’t effectively communicate you and your clients’ needs.

It always comes back to messaging, communication, and conversations: Establish why you are asking for money and empower people to help change the world by supporting your cause. You always have to compete with a lot of external noise to get the attention of your donors. This year that noise is much louder than usual, and you’ll have to work harder than usual to make your case.

Cultivation is a conversation, not a one-off ask that happens only at your event. Engage your donors. If you are worried about the election, discuss it with them. Work with your biggest supporters to formulate strategies specifically for your donor base. Engage, engage, engage. This year and every year.

Statistically speaking, the election is bound to have little impact on your event. But from a practical standpoint, it is best to assume the election will impact your donors, and then work hard to make sure it doesn’t. 

The pre-event marketing that will change your event’s bottom line

If you want your fundraising auction to succeed, you have to market your auction lots in advance of the event. Pre-event marketing can make the difference between an average and a spectacular auction, and different forms of marketing yield varied results.

We often see events focus on methods of broadcasting instead of leveraging individual relationships. For example, we see lots of events focus on publishing the live auction catalog on the Internet or sending it out via hotsheets, email, and social media.

These all have value and are a valid component of any pre-event marketing campaign. However, the most important element of an auction’s success is much more direct: reaching out to individual bidders in person, by phone, or email.

The most successful auction chairs and committees invest time and energy identifying potential bidders for specific auction lots and contacting them in advance to interest them. The most successful auctions have at least two individuals committed to bidding on specific lots in advance.

It is incredibly valuable if you can line up two bidders for each and every lot in advance of your auction – but it’s also an unreasonable amount of work to demand for a longer auction. The truth is it doesn’t have to be done on every lot in an auction, but should be done on a few select lots, including:

• The first two lots in the auction; they set the tone for the rest of the auction. 
• Any lot that has an exceptionally high value; or is more valuable than any lot sold at your auction in the past. 
• Trips with set dates or extended trips that require air travel. 
• Buy-in parties/events.
• Art and jewelry
• Unique access that pertains to the tastes of someone you or the committee knows.

In each case, we are aiming to create momentum, avoid dead-air, and insure that challenging lots are successful in the heat of the moment. The first two lots, for example, set the pace and tone for the rest of the auction. Art and jewelry are the most challenging items to include in most any fundraising auction, and if we must have a certain piece or art or jewelry in the auction, it is important to make sure it succeeds.

The expectation put on these bidders isn’t necessarily that they must commit to bidding until they buy. We are looking to them to get the bidding going; and hopefully drive up the price. If your pre-committed bidders wind up becoming so interested in a lot that they vigorously bid on it and win, fantastic! But it’s not the expectation. At a certain point, we have to trust the process of an auction, and any momentum boost makes that process more successful.

Do you need more than just an "auctioneer"?

Many of our new clients are pleasantly surprised after our second or third meeting about how we have offered many new suggestions and ideas about ways to grow their events. "Our last Auctioneer never mentioned any of this stuff, we talked a couple of times and then he/she showed up at the event, read our catalog to the crowd, and left!" 

We believe that the best way to have a great idea is to have a lot of ideas, ideas that are based on what has worked at hundreds and hundreds of events nationwide and what might work at yours.  Would you welcome suggestions and new approaches about:

• Getting your board on-board
• Getting everybody on your committee on the same page
• Timelines
• Messaging
• Silent auction strategies
• Unique new live auction lots and their ordering
• Crafted appeals
• Changing the mindset of your attendees from "They do the same thing every year" to "I wonder what they're going to do this year?"

As far as I know, the only way to accomplish this is to engage a CONSULTING FUNDRAISING AUCTIONEER, who will work with your team.  Just a few questions during the interview about what kind of participation to expect from a prospective Auctioneer should let you know whether you're getting a bid caller or a game changer!

When Not to Do a Challenge Grant

Challenge grants are one of the most useful ways to increase participation in a fund-a-need. Donors like to know that their money is being put to good use, and nothing lures potential donors like the possibility of their money being doubled. Challenge grants are a way to engage new donors, and they are a proven mechanism for encouraging donors to increase their giving and “step-up” a level.

The success of a fund-a-need is based on visible participation. Don't do a challenge grant if it is going to take visibly pledged money out of the room.

It is difficult to obtain tens- or hundreds-of-thousands of dollars to use in a challenge grant. Many organizations get creative, and use multiple donors to cobble together one large challenge grant. This idea is great, as long as it isn’t “taking money out of room.”

We often get a challenge grant that has been created by supporters of the organization pooling their resources. And while this might seem like a good idea on the surface, I believe it actually hurts the performance of the fund-a-need in the long run. One thing that makes a fund-a-need successful is the visible presence of leaders within the organization participating in the fund-a-need.

Think about it this way, if someone invites you to sit at their table for their organization’s gala, and then proceeds to make a pledge to the fund-a-need, you take note; especially if it was one of the higher pledges. You would probably feel obligated to participate in the fund-a-need, and hopefully would do so at a level at least commiserate with the ticket price if not above.

But if the same person invites you to sit at their table, and then the auctioneer simply announces that “a group of supporters chimed in to create a challenge grant for tonight” it loses its impact. The supporter is no longer actively participating in the fund-a-need. Even if they stand up as a group to be recognized as contributors to a challenge grant, the amount they individually pledged is a mystery and thereby doesn’t apply as much pressure as if they’d raised their paddle.

Less people raising their paddles also means we’re losing potential momentum in the room, because all of those paddles are now remaining stationary.  Challenge grants are nice, but it is better to have people raise their paddles at whatever level they were planning on participating than to have them sit on their hands and challenge the rest of the room. Active pledging applies more peer pressure, and generates more momentum for the fund-a-need as a whole.

How to solicit wineries for auction donations

Wine and wine-related experiences are consistently some of the best-selling items in a fundraising auction. Almost every auction committee we work with is attempting to add more wine to their auction, and the question we get asked most is, “How do I get wineries to participate in our auction?”

Tony Lombardi of Lombardi Wines has helped hundreds of causes over the years.

My good friend Tony Lombardi, founder of Lombardi Wines and former brand manager at Kosta Browne Winery, offered to share some of his insights on this process. In his years at Kosta Browne, he fielded as many as 35 requests a week for donations to fundraising auctions. And while his new venture, Lombardi Wines, may not have the global recognition of KB yet, he still gets lots of solicitations for donations.

And where he can help make a difference in the world, Lombardi loves to do so. “I love working in an industry that is so giving,” Lombardi says, “One that helps raise funds and awareness for so many worthwhile causes, through the donation of wine.” The challenge with so many organizations who do great work seeking donations is narrowing down the list to the few they can support every year. Here are some of Lombardi’s biggest tips for soliciting wineries.

People Support People

First and foremost, don’t go in cold. “The key thing,” Lombardi says, “is relationships. I’d look through the many requests we got every day to see if there were any names I knew, charitable organizations within our local community or causes that were near and dear. If there was no direct connection, it was a little easier to deny the request.”

If you know someone at the winery, make some effort to reach out in a personal (and personable) way. Give them a call, or better yet stop by the winery in person. If you don’t live in the Bay Area and can’t afford a trip to visit wineries in person, write a letter and include a hand-written note. Whatever you do, don’t just send a fax.

Popular wineries get five to twelve fax requests a day, and they all wind up in a big pile. Unless your fax is addressed specifically to someone you know at the winery, odds are it is going to wind up in the recycling.

Know Your Cause

This is a good guideline for anyone doing solicitation, but especially anyone soliciting wineries. You need to know what you are raising money for, where the money goes, and the change you are asking people to help make in the world. If you aren’t clearly communicating key information, it will make a bad impression. And you don’t get many chances to make an impression.

Communicate the emotionally engaging elements of your cause, let the winery know who you are trying to help, and how. Your description should be a solid elevator pitch, not a keynote speech. And if your organization isn’t one of the stereotypically emotionally engaging ones, you need to work even harder to communicate why it needs support (a common theme for arts organizations everywhere).

Everyone who works at a winery – from the proprietor to the winemaker to the marketing manager and so on – has personal causes they believe in. Ask them if there are specific causes they support, and then honor that choice.

Know Your Stats

Wineries make donations to fundraising events because they want to do good in the world, but they also donate to fundraising events because it is a proven method of marketing. A crowd of people willing to spend thousands of dollars on a trip to wine country will yield more guaranteed lifetime customers than any advertisement.

You need to know the statistics of your event, says Lombardi: “How many people attend, what the ticket price is, what the most expensive auction lot sells for, how many wine lots there are,” is all data that will help guide a potential donor.  “We’re looking for customers that share the same ideals and a loyal relationship we can nurture over a long period of time.” Wineries are looking for a target market, and yours might just be it.

Build Long-Term Relationships

How you approach people and how you build relationships has everything to do with the support base you build. If a winery doesn’t support you the first year you ask, accept it graciously and move on. Get on their mailing list or find someone in your organization who can get on their mailing list. Send the winery a thank you note for their time, and stay in touch. 

If they do make a donation, be sure to let them know how it helped. Get photos of the winning bidders and email them to the winery with a thank you after the event. Make them feel like part of your event. Better yet, make them part of your event next year by inviting them.

However you go about it, the most important thing to realize is that you are dealing with people. And people always react better and give greater support to people they know. So get out there and build relationships in the name of your event – it’s the best excuse to go wine tasting you’ll ever have.

Get attendees to (willingly) give you their contact information

Does your event face the challenge of getting attendees to give you their contact information? Do you have a lot of guests who sit at purchased tables who give you nothing more than their name and the name of the person whose table they are sitting at?

One creative solution we’ve seen to this challenge is to incentivize attendees to give their contact information by offering “free” entry into a raffle in exchange for their contact information. Use pre-printed slips that are handed out to every attendee, asking for name, email address and telephone number. Make all information mandatory in order to be eligible to win.

Then use a small prize from your silent auction, or solicit a small prize specifically for this raffle. One year an organization used a fine bottle of wine. The next year, they offered up a weekend getaway at a local resort (see the photo below). Their fish bowl of entry slips was full to the brim. And so was their contact database.

You can’t cultivate donors if you can’t get in touch with them. And donor cultivation is one of the three main reasons to hold an auction, right behind raising money and tied with messaging. So if you find yourself struggling to get contact information from your event’s attendees, give them good reason to give you their information. Then follow-up and give them even more good reasons to give you their support year-round.