How to Knock Your Next Fundraising Auction Out of the Park

I was recently contacted by Anthony Wilson, founder of Groupfinity, about participating in his podcast series. Groupfinity is a new resource for volunteers and volunteer organizations, committed to providing support and tools for success.

Anthony contacted me because he had served on a number of fundraising auction committees, but had never worked with a professional fundraising auctioneer and consultant before. He had a lot of questions about best practices, and once we got rolling our conversation was, as you can imagine, extensive. I ended up providing him with enough material for two podcasts. We covered myriad topics, from how many volunteers it takes to make an auction successful, to the goals of fundraising auctions, to how to leverage your board to make your next fundraising auction successful.

In short, it was a distillation of my entire philosophy down to an hour of podcast. You can find the entire podcast here, and the timestamps below outline the entire podcast.

[2:48] How many people do you have who are committed to volunteer to make the auction successful
[3:08] For an auction to be successful you have to have a couple of key components taken care of
[3:52] Get people you know have capacity and are prepared to support your event/organization
[4:12] Every event is made by 15 bidders
[4:42] You need people who have connections to invite your supporters
[5:02] The goals of a fundraising auction is three fold 1 Raise money 2 Tell your story 3 Engage new supporters
[6:47] For an event chair, you’ll spend 700 hours over 9 months
[7:39] If you’re looking for someone to chair your fundraising auction, find the busiest person you know
[9:58] In putting together a fundraising auction, it has to be FUN and it has to be FUNdraising
[10:28] Don’t throw a big party and then hit them over the head with an auction when they get there
[15:14] Fund a Need
[16:02] Keys to making your Fund a Need successful
[19:15] 7 Keys to a Fund a Need
[20:35] Fundraising is conversation with your community
[21:00] Talk to your donors to see what they’re interested in supporting
[22:20] We need somebody to get the ball rolling
[23:33] An auction breaks into 3 groups of people
[25:38] Your board needs to do 3 things to make the auction successful
[27:58] What item can I count on you to help bid up?
[28:39] Peer pressure drives donations
[28:56] Fundraising auctions are a place for people to make donations in a public setting

Gamblers like to know the odds

Raffles are an important revenue generator for most fundraising events. They provide a low-cost entry point for attendees to participate while simultaneously helping raise significant amounts. We consistently see raffles that raise $5,000 - $10,000 and occasionally see them in the $15,000 - $25,000 range.

Most people think the prize is the most important piece of a raffle and focus all of their attention on finding something they think will have universal appeal. While the prize is important, I argue that the number of tickets you are going to make available is even more crucial. 

Gamblers like to know the odds before they put down their money. When you limit the number of available tickets for a raffle, you are giving people a clear understanding of their odds. And a perceived “good chance” encourages people to pay a higher price to play.

Unlimited $25 raffle tickets aren’t as appealing – from a gambling standpoint – as 1 of 100 tickets at $50 each. Who knows how many people are going to buy one of those $25 tickets? But the $50 ticket? There are only 100 of those, and odds resonate with gamblers.

By limiting supply you also enable your staff or volunteers to create a sense of urgency: “Do you want a 1 in 100 chance to win this trip to Hawaii? There are only 50 chances left…” Tickets will run out. Buy yours now. For a limited time only.

There are a number of calculations that go into deciding how many tickets you should make available for a particular raffle and how much you should charge per ticket. First and foremost, you need to determine how much you want to raise in your raffle. Our recommendation is that any raffle should raise at least double the value of the donation.

Then you have to calculate how many tickets you think you could sell. If you’ve never done a raffle before and have no data to rely on, just know that you can’t expect 100% of your attendees to buy raffle tickets. Between 15% and 20% of your attendees is a reasonable assumption, if the raffle is compelling.

It is always preferable to have more demand than supply, so people will rush to get their tickets next year. Limit the number of tickets and increase the amount you raise in your raffle. People who participate in raffles are gamblers, and every gambler likes to think they are getting good odds.

Personalize your paddle raise

The paddle raise is the most important component of most fundraising auctions, often raising more than the rest of the auction combined. The way it is introduced is crucial to engaging the crowd and ensuring success.

A good paddle raise pitch tells stories that connect your audience to your mission on a personal level. It doesn't have to be long, it doesn't have to be overly dramatic, it just needs to be honest and engaging. Like this video of Trent Yaconelli, associate executive director of the Boys & Girls Clubs of St Helena and Calistoga, at their BIG Night gala.

One way the election will impact your fall auction: communications

Last week we explored the upcoming presidential election’s impact on fall fundraising auctions, and concluded that the popularly held beliefs are misconceptions (see our blog post on the topic for an in-depth analysis). But there is one area where the fall election cycle is going to impact fall events: direct mail, mailing houses, and the sheer volume of communication people will receive.

The first week of November is consistently one of the top three busiest weeks of the year for mail. If you are planning on sending an invitation or direct mail to your attendees between October 1st and November 4th, make sure that your mail house is not going to be inundated with political work. One event planner we work with only contracts mailing houses that don’t do any political work; she wants to ensure her clients are top priority.

Non-profit communication always faces stiff competition for recipients’ attention, and during an election year that competition is much fiercer. It is no longer limited solely to direct mail, either. Since the 2010 election, political campaigns have come to rely more upon email, social media and other electronic outlets. For events in November, this means that your two-week prior touch-base with attendees to confirm their attendance and get them a copy of your auction catalog is going to be competing with a lot of other noise.

Your most ardent supporters will know who you are and open your emails to them – but their guests might be another story. Relationships rule development, so leverage all of the connections you have. Utilize your network of supporters: have table captains reach out to their guests directly on your behalf to market your auction (see our blog post on the subject). And start now: I am a big fan of expectation management through clear communication. If you get your supporters committed to making your event a success in advance, they will help continue that tradition every year.

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!

Philanthropic potential is fleeting

The lights are low and the buzz is high. Silverware is clinking, people are happily chatting over some light background music while wait staff deftly move throughout the room. The energy is slowly building, and everyone at your event is having a great time.

You can see the energy in this room as people start to network other tables. Time to start the auction!

That buzz permeating your event is philanthropic potential. It is the result of months of planning and preparation, an ephemeral “vibe” that you and your committee work so hard to create. It is fleeting, it is delicate, and if you wait too long, it will dissipate into the ether, unused. Wasted.

It is up to you to capitalize on the philanthropic potential of your event, and make the most of your potential while it is at its peak. This often means cutting your guests’ “social time” short, and asking them to focus on the needs you have asked them to help you meet.

Efficiently utilizing your attendees’ time and attention to help you achieve your mission is your right. If you have properly communicated the message of your event beforehand, your guests will be ready to help your fundraising efforts succeed. Instead of putting your fundraising auction off until the very end of the evening, conduct your auction and fund-a-need while your potential is at its peak.

In many cases, this means conducting your auction and fund-a-need during dinner, not after it. Dessert is the turning point, when people start to get up and leave. If you haven’t done the most important element of your fundraising (for most of our events, this is the fund-a-need) before dessert is served, you’re losing money.

Efficient time management will help you raise more money and will ensure your event ends on time. It will also help attendees form an emotionally-charged long-term memory that they associate with your event. Long-term memories are formed when an experience is paired with an emotion.

No offense to your caterer, but few people will remember the food at your event, unless it is ridiculously good or bad. Everyone, however, will remember the way they felt when your event transcended a mere “gala” and became a life-changing experience. 

This only happens if you capitalize on the potential you’ve worked so hard to create while it is at its max. Because the philanthropic potential of your event is ephemeral, once it is gone it is gone. If you don’t take advantage of it while you can, you’ll never get it back.

Write up the fund-a-need In your catalog

The fund-a-need is the most crucial component of almost every fundraising auction. The fund-a-need raises more money than any single auction lot and often raises more money than the rest of the auction lots combined.

All of which underscores why the fund-a-need deserves prominent placement in your auction catalog or your written program for the evening.

Don’t make the mistake of assuming that everyone attending your event knows what you are raising money for. Take advantage of the opportunity to market your mission in a heartfelt manner, and encourage newcomers to become supporters by enabling a very specific component of your mission. The fund-a-need is your chance to tell your story in a more focused way to engage existing donors and potential new donors alike on a meaningful, empowering level.

A successful fund-a-need doesn't just happen, it is the result of well-orchestrated marketing, reinforced at every opportunity - including in the written catalog.

The catalog provides you with a means for educating people about your fund-a-need: laying out the case for supporting you and quantifying how they can help you change the world. Even if you have a spectacular speaker, or an incredible video, you should still make an engaging case for your fund-a-need in your catalog.

Spell out exactly what the fund-a-need will help you do, and quantify your ask in very specific ways. It always helps to quantify your need in increments that map directly to the levels you will be asking for in the fund-a-need. For example, if you know you’ll be asking for $5,000, $2,500, $1,000, $500, $250 and $100, tell people exactly what a donation at each of those increments will help you do.

And make sure your quantifications carry heft. People are more likely to respond emotionally if they have already arrived at a logical conclusion. Guide them to that logical conclusion in the catalog, so they can get emotional with their paddles when the time comes to make pledges in your auction.

Revenue enhancer: the golden paddle

One of our favorite revenue enhancement additions to fundraising auction events is the Golden Paddle. Simply put, the Golden Paddle is a chance drawing to win a credit that is good only in the live auction. The credit is represented by a golden paddle that the winner uses to bid with in the auction – letting the auctioneer and everyone else in the crowd know who they are and what they are up to.

Make sure your Golden Paddle stands out in the crowd. The brighter and louder, the better.

I’ll try to make this more clear by way of an example: sell 100 tickets for $100 each, generating $10,000 for your event. Take $5,000 immediately off of the top, and apply it towards your proceeds for the evening – that’s pure profit. Take the other $5,000 and apply it to the Golden Paddle – you aren’t losing this money, you’re just making sure it is spent in the auction.

This doesn’t just generate $5,000 for your event, it has the potential to generate a new bidder who can help drive the prices up on lots of other items. At the very least, it adds to the amount an existing bidder is willing to spend. We’ve seen lots of people who won the Golden Paddle immediately “get it” and use their windfall to bid lots of other people up in the live auction. When this happens, you wind up making a lot more than just the $5,000 they have to spend – because they increase the price on multiple items.

You shouldn’t set the Golden Paddle amount to be higher than the amount typically spent on any one item in your event. You don’t want your big bidders to be priced out by someone who spent $100 and got lucky. You also don’t want your Golden Paddle winner to dominate the auction and buy a large percentage of the items. You want someone to be able to push your big bidders up to their limits, and possibly buy one high-end item or two low-level ones.

So crunch the numbers and alter the metrics to work best with your event. We’ve seen Golden Paddles raffles where 100 tickets were sold at $50 each and the paddle had a credit of $2,500 on it. Alter the numbers to best fit the culture of your event.

There are just a few things to note. The winner must be present to win. The paddle is only good in the live auction – and sometimes the fund-a-need, depending on whether or not you want to funnel the money towards that restricted bucket of funds.

And finally, make sure the actual Golden Paddle is very flashy. Have your craftiest volunteer or staff member create it, challenge them to come up with something so over the top that it can’t be ignored. We advocate LED lights, sequins, glitter, gold paint – whatever they can come up. So that way, every time your Golden Paddle winner bids the whole crowd knows – and thinks to themselves, “Next year, I’m going to win that Golden Paddle!”