Nonprofit Fundraising Study Reveals Why High Net Worth Donors Give
End of year nonprofit fundraising is a critical period for organizations as it can be the deciding factor in whether annual fundraising goals are met. Recently I provided 6 Tips for End of Year Nonprofit Fundraising Email Campaigns for Stronger Results and 5 Tips for Stronger 2013 End of Year Nonprofit Fundraising in which I suggested reaching out to top donors via telephone or in-person as a fundraising initiative that should be included during this period. These high net worth donors are a key demographic to pay special attention to as I highlighted in 3 Target Demographics to Boost Nonprofit Fundraising and Engagement Results in 2013. To improve your results when engaging these valued donors it’s important to understand their motivations and overall needs.
A recent report released this month, The U.S. Trust Study of the Philanthropic Conversation: Understanding Advisor Approaches and Client Expectations, provides some insight into high net worth individuals and what is behind their philanthropic activities. Although the report is focused on the conversations between high net worth individuals and their advisors, the results of the 120 high net worth individuals (having more than $3 million in investable assets and active in charitable giving) that were surveyed provides an interesting perspective in why they give.
6 Reasons Why High Net Worth Individuals Give
- Being Passionate About a Cause
- Having a Strong Desire to Give Back
- Positive Impact on Society and the World
- Encourage Charitable Giving by the Next Generation
- Religious or Spiritual Motivations
- Believe Giving Back is an Obligation of Wealth
It’s important for organizations to focus on and build relationships with high net worth donors who have – and continue – to make generous gifts to their cause. Reaching out to them during the final quarter of the year needs to be strategically planned to ensure the reasons they are giving are being addressed and satisfied. The best way to address the top three reasons these donors give is through continuous communication and engagement, including:
- Communicate engaging cause related stories that will incite and maintain their passion for your cause. It’s important to keep their passion alive.
- Engage them with specific details on projects or campaigns and how their support will benefit the cause, thereby driving their desire to give.
- Follow up with the final results of a project or campaign and provide specifics on how their support had a positive impact on the cause.
Interesting to note is that as much as tax deductions can be seen as an added benefit to giving, only 10% of respondents cited reducing taxes among their motivations for giving. Further evidence to this is the 45% who responded that they would reduce their giving if income tax deductions were eliminated and 6% that would reduce their giving if estate tax were eliminated.
3 Reasons Why High Net Worth Individuals Shy Away From Giving
- Gift Won’t Be Used Wisely by a Nonprofit Recipient (30%)
- Lack of Knowledge about or Connection to a Charity (24%)
- Fear of Increased Donation Requests from Others (17%)
Communication and engagement is key in ensuring that high net worth donors are educated about an organization’s purpose and overall mission while also keeping them informed on how their generous gifts are being used and allocated efficiently. Based on these findings it’s also important to keep these individual’s information confidential and not trade or sell their information to other organizations. Nonprofits are well advised to curb the instinct to over solicit as this may result in the loss of their support in the future.
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Miratel Solutions is a Toronto call centre, eBusiness, and letter shop mail house specializing in professional fundraising services including telephone fundraising, online fundraising, lottery services, donation caging, donation processing and other donor management services. We are committed to our CSR business values in all contact centre services and mail house operations and advancing the missions of the nonprofits we proudly serve.