Be sure to say "Thank you"

The Association of Fundraising Professionals (AFP) defines “stewardship” as “a process whereby an organization seeks to be worthy of continued philanthropic support, including the acknowledgment of gifts, donor recognition, the honoring of donor intent, prudent investment of gifts, and the effective and efficient use of funds to further the mission of the organization.”

 

As you think about your Rotary events, meeting every element of this definition would mean that you:

 

1. Provide a prompt and accurate acknowledgment of your donor’s investment. Please note:  “Prompt” in the fundraising profession means that the donor receives this written acknowledgement, complete with appropriate tax deductibility information, within 24-48 hours of making their gift, and not when a volunteer committee or treasurer can get around to it. Use what I call the “personal litmus test” here:  How would it feel to you if you sent a gift and the thank you letter arrived weeks (or heaven forbid, months) later? That acknowledgement would likely feel like a long-neglected afterthought. And chances are, the 3-4 other charities supported by donors born 1965-1995, the 4-5 other charities supported by your Baby Boomer donors (born 1946-1964) or the 6-7 other charities supported by donors born 1945 or earlier are getting their thank you letters out in a timely fashion… (Statistics from an August 2013 Blackbaud study entitled “The Next Generation of American Givers.”)

 

2. Did you recognize the donor’s involvement in supporting the event, not only as promised (by listing their name in a roster, perhaps, for example), but also did you seek that donor out at the event and express your gratitude? Even beyond the official acknowledgement, did anyone send a note to let the donor know how grateful your Club was that they offer their philanthropic support? In a fundraising study by philanthropy researcher Penelope Burk, it was noted that when donors received a phone call from the receiving organization that expressed both gratitude as well as the meaningful impact (see #5 below) of their gift, 39% of those donors gave at a higher level when the agency next solicited them for a gift.

 

3. Did you at any point report to your donor that the funds were spent the way they were intended? The fourth item on A Donor Bill of Rights is that a donor should have the right “to be assured their gifts will be used for the purposes for which they were given.” An example might be if a company provided a table sponsorship for your dinner event but declined to send attendees, did you perhaps fill that table with 8 prospective Rotarians (or another effective use of the table sponsorship funds)? And if so, did you report that back to your underwriter? Or for the donor who raised their auction paddle to contribute to a RYLA scholarship, did your Club send a note to that donor, sharing the names of the RYLA attendees and/or inviting the donor to come hear the students speak when they presented to your Club? Donor loyalty to a charity is driven by similar factors as retail customer loyalty:  donor satisfaction, donor commitment and donor trust. Demonstrating that your Club has honored donor intent will have positive impact on all three drivers.

 

4. Did you serve as a “prudent investor” of the donor’s contribution? You might offer a quick Return on Investment (ROI) calculation (divide the total contributions by the total costs of your event and multiply by 100).  Or you might dial in more and run that calculation on your donor’s gift specifically, demonstrating what their $500 sponsorship gift (as an example) “returned” to the organization in the form of net proceeds for the event. Why is this important? Because for more than a decade now, donors have been viewing themselves as investors rather than donors. And as investors, they expect measurable, demonstrable financial and/or social returns on their investment.  (See, as examples, “Investing in Society: Why we need a more efficient social capital market – and how we can get there.” Cited at the Stanford Social Innovation Review or Brest & Harvey, Money Well Spent.)

 

5. How did you demonstrate effective, efficient use of your donor’s investment? If the net proceeds from the event will enable your Club to provide 5 water wells in Africa, or feed 120 homeless individuals in a single night, or offer RYLA scholarships to 4 high school students, share that information with your donor! Dr. Adrian Sargeant, the Robert P. Hartsook Professor of Fundraising at the Lilly Family School of Philanthropy at Indiana University has demonstrated that one means by which to enhance donor loyalty and retention to your organization is “to foster trust” between the donor and your organization. A key component of fostering trust? “Communicate the achievements of the organization and, where possible, relate these to the individual contributions made by individuals or segments of supporters.” (“Donor Retention: What do we know & what can we do about it?” August 15, 2013. Cited at Nonprofit Quarterly.)

 

So what’s the end goal to all of this “stewardship stuff”?

 

Simply and bluntly, it’s to demonstrate that Rotary is worthy of donor investment. Because if you’ve created a “one and done” transactional culture for your donors by way of sloppy (or nonexistent) stewardship, you’re missing out on donor loyalty, donor retention and sustainability of your Rotary programs and services.

 

Instead, take the time – MAKE the time – to carry out excellent stewardship.

 

Doing so will not only demonstrate truth and trustworthiness to your donors, but I dare add it will be fair to all concerned, build goodwill and better friendships…and in both the short- and long-run, will be beneficial to all concerned.