Industry-wide, nonprofit organizations are investing in mid-level programs to generate more revenue. Implementing targeted programs to build major donor revenues is, of course, important to diversifying valuable fundraising income at the top of your donor pyramid. But organizations have historically forgotten the middle-tier that is both a critical to bridge to major gifts and essential to the success of an overall direct marketing program.
Why is focusing on mid-level giving so important?
- Renewal rates are declining industry-wide — but donor upgrades are increasing. Many households are focusing their support on a smaller number of organizations overall but at higher levels. And, in today’s crises, many donors are sticking strongly with nonprofits that they have a history of supporting, opting for larger gifts to the groups they care about to help them navigate choppy waters.
- Meet donors where they want to be giving — knowing that a direct marketing donor may not be interested in face-to-face giving. Even if they have the capacity to give at higher levels, donors may feel more comfortable giving by mail or online. Respecting their preferences shows that you value them, which is essential for strong relationship building and can boost their support.
- If you don’t ask, you don’t get. While you may think that a donor who can give $500 instead of $50 will decide, unprompted, to make that larger gift, that may not be the case. It is your responsibility to present a well-reasoned case to a donor for increased support. This is why we pull together personalized proposals for major gift asks, and the same approach applies for mid-level giving. It also helps build transparency and accountability, and it is a sign of respecting their charitable decision-making that is valuable for relationship building.
- A person who can give $500 or $1,000 through the mail usually has the capacity to give a lot more over time. If you can secure an upgraded mid-level gift from a donor, then you want to be sure that you have a strong follow-up strategy to steward that donor and support their continued giving at that level (or higher!) for years to come. Mid-level strategies are not focused only on a one-off mail or digital appeal — they are best thought of with a long-term perspective.
In all likelihood, you have diamonds in the rough already waiting in your donor database — now, we just have to find them!
Who are mid-level donors?
The most significant indicator of giving is not necessarily capacity to give, but rather interest in your mission. A response to a direct marketing contact, no matter how small, is a demonstration of that interest. How you steward that interest is the key to earning increased, long-term rewards. That means your current database is a great starting point to identifying mid-level donor leads.
Of course, some level of capacity to give at a mid-level is important to consider. That’s why, when we look at launching mid-level program strategies, our first step is to identify internal prospects to approach based on giving history. Typically, we look at those donors giving $100 or more over the past four years, followed by a detailed review of their year-over-year performance. In particular, our team also looks at:
- Predictive Donation Modeling. Beyond response modeling that can be used in acquisition, other models can use hard donation data or attributes to predict donations, enabling us to ask for more when soliciting a donor. Instead of using just a donor’s gift history to your organization, we add in gift history to other charities and/or predictive gift giving estimates based on our model’s output.
- Cluster Analysis. When our team carries out a data audit for one of our nonprofit partners, we identify clusters of giving that will enable us to determine the levels we will target for upgrading. This analysis is also helpful in setting giving circle levels that make sense in a particular donor universe — a valuable strategy we discuss below for mid-level programs. For example, a base primarily made up of $10-99 donors and very few $100-199 donors is not ready for giving circles that begins at $250. They can, however, target upgrades to the $100 or $150 with specialized language or even back-end premiums.
Similar to major gifts by organization, the cut-off in gift amount for mid-level donors can vary by organization. A good rule of thumb is to start your program at four times the amount of your average offline direct mail gift.
Pending the starting level that is set, we create the broader mid-level prospect universe that we can then build targeted mail and digital cultivation plans around — all leading up to the major gifts cut-off point, thereby ensuring an unbroken continuum of the donor’s journey across all giving levels.
How can you secure mid-level upgrades?
Any mid-level program should have dedicated messaging that makes the case for giving at that higher level. Depending on what your needs are and the potential to create meaningful symbolic or concrete asks for the donor audience, that case may look different from other groups. In building a comprehensive mid-level program, you may want to answer the following questions:
- WHY. What is the need that your mid-level donor group is instrumental in meeting? What is the impetus to drive increased giving over what they may have given in the past?
- WHAT. Are your mid-level donors attached to funding a particular program area or theme? How is your organization responding to the particular needs being presented?
- WHY NOW. It always helps to add urgency! Are you offering an opportunity for donors to meet a particular moment and match their contributions for greater impact? Or has something in the overall landscape of your mission changed that means increased support is required right away?
- HOW MUCH. The value of symbolic asks and funding targets should not be overstated, as well as clear giving levels. You want to be concrete in asking for a specific level of giving, for all of the reasons we have already discussed!
- WHAT’S THE BENEFIT. This can be framed both in the context of the program impact and benefits accruing to your target beneficiaries, as well as what the donor can expect from the program in return. For example, will donors gain insider access and updates? This should feel like a step above what they have received previously.
You may also want to incorporate mid-level marketing tactics, such as:
- Challenge Matches. You can bring your major donors into the process of building a mid-level program by asking them to create a matching gift to motivate lower-dollar donors to give more. This may be done with a single significant matching gift, or creating a pooled fund that leverages the contributions of multiple higher-dollar donors. In addition to adding motivating upgrades from lower-dollar donors, this can also be a valuable tool to cultivate your major donors — or secure that extra gift from them!
- Mini-Proposal. This is a great way to make the pitch to donors for a specific investment in improved services or programming. In it, you set a goal, parameters for the project and a pyramid of giving that details how many gifts are required at different levels to reach your target. This helps donors to directly see the impact they would have through their gift, as well as to identify how they fit into the broader picture of achieving this goal. Because mid-level giving for your organization may have the ultimate objective of securing unrestricted revenues, it is worth noting that the packages can be written to either solicit restricted or unrestricted funding.
- Named Societies or Giving Circles. To generate more revenue from donors, we often recommend launching a dedicated Giving Circle program to incentivize upgraded giving and create new, deeper relationships with your donors. These should be promoted across the following channels:
- Website: The donation page should list membership benefits and encourage donors to sign up.
- Acknowledgments: Update any current letter and/or include an insert that details member benefits.
- Newsletters: Benefits should be listed on the newsletter somewhere.
- Direct Mail: List benefits on the back of your reply device. We also suggest at least one dedicated mail campaign that invites donors to the program.
- Encourage Donor-Advised Fund (DAF) Giving. Many donors who give through DAFs will fall into your ideal mid-level or major donor audiences, because required minimums for many of these accounts in the five-plus figures. You can encourage DAF gifts by adding language to existing direct mail solicitations, as well as by installing a widget on your website that directs donors to DAFDirect. Moreover, if you notice that you receive a smaller donation through a DAF, you can already flag this donor as having potential to upgrade.
So… does this all work?
Yes! For a recent partner in the education sector, we executed a revamp and launch of their mid-level program through an integrated mail and digital campaign. From the launch alone, including a fine-tuned ask and updated creative, they saw a 47% increase in revenue!
Are you ready to take your mid-level program planning to the next level? We are here to help you strategize for success! Reach out to our team at any time.
About the author
Sally Frank — Senior Vice-President, Strategy and Innovation, at Faircom NY
Sally has over 20 years experience in direct marketing, having worked in both the for-profit and non-profit sectors. From using data driven techniques to solicit small business card members for American Express, to targeting investors for Goldman Sachs’ start up, GS.com, Sally brings a diverse background to Faircom New York. She works with the Cousteau Society, the Nelson Mandela Foundation, Human Rights Watch, USCJ, and TechnoServe among others.
Sally has a B.A. from Brown University and an M.B.A./M.A. from NYU’s Stern School of Business and Institute of French Studies, including studies at Hautes Études Commerciales in France. Outside of work, Sally likes to cook and run (not usually at the same time, but with four kids, the two activities sometimes overlap), and she plays flute in the Riverwinds Woodwind Quintet that she founded in 2010.