Having a Major Gifts Program is a MUST: Here’s How to Create Your Own
If you don’t already have a Major Gifts Program, you are missing the boat! Offering a Major Gifts Program is crucial for any NPO wanting to secure larger donations from existing donors and attract new ones. With nearly 90% of all fundraising dollars coming from just 12% of donors, focusing on major gifts can significantly impact your organization’s financial health, mission success, and sustainability.
Understanding Major Gifts
A Major Giving Program aims to build relationships with potential donors with the capacity and willingness to make large contributions. The definition of a major gift varies by organization and is based on the gift’s impact on your specific needs and goals. Small nonprofits with limited resources can benefit from focusing on major gifts, as they offer a higher return on investment than regular donations.
The financial landscape for potential major donors is promising. Over the past decade, the stock market has grown by more than 300%, and the average income of wealthy individuals has increased by over 25%. This growth in wealth means that now is an ideal time to cultivate relationships with your wealthiest supporters and inspire them to make significant contributions now and in the future.
Steps to Establishing a Major Gifts Program
- Define Major Gifts for Your Organization
Determining what constitutes a major gift for your organization involves analyzing your donation history. Start by examining the 25 largest gifts received in the past five years, excluding outliers. Calculate the median of this range to establish a realistic minimum for major gifts. Be flexible with this figure, adjusting it based on donor capacity and donation trends.
- Assign a Point Person to Lead the Program
Whether or not you have the resources for a dedicated major giving department, appointing a major gifts officer or point person is crucial. This individual will identify, cultivate, solicit, and steward major donors. Focus on managing a small, qualified list of prospects to ensure personalized and effective relationship-building. As your program grows, you can expand this list to include more potential donors.
Incorporate major giving options into your existing outreach efforts and highlight them on your website. Collaborate with your communications or marketing teams to promote major gifts, such as stock or IRA contributions, using email signatures, postscripts, and website banners.
- Facilitate Non-Cash Gifts on Your Website
Non-cash gifts, like stocks and real estate, are often much larger than cash donations. Since 97% of wealth is in non-cash assets, facilitating these gifts can significantly boost your fundraising revenue. Ensure your website is equipped to handle these donations, with dedicated giving pages and forms that collect donor information and provide instructions for making gifts.
Consider offering a dedicated page for Qualified Charitable Distributions (QCDs) that includes tax benefits information and gift instructions, simplifying the process for donors.
- Identify Major Gift Prospects
Effective major gift programs rely on identifying the right prospects. Board members and loyal donors who have previously given large gifts are excellent starting points for building your prospect list. These individuals are already connected to your organization and likely have the capacity to make large donations.
- Cultivate Relationships with Prospects
The key to securing major gifts is cultivating strong relationships with potential donors, which can take six months or more. Engage with prospects through one-on-one meetings, phone calls, volunteer opportunities, and exclusive events. Use these interactions to understand their motivations and educate them on tax-savvy options like stocks, DAFs, and QCDs. Track these interactions in a donor CRM or spreadsheet to tailor your communications and customize your long-term outreach.
- Recognize and Steward Major Donors
Donor stewardship involves maintaining relationships after a gift is made, ensuring donors feel appreciated and understand the impact of their support. Public recognition, named endowments, and regular updates on the impact of their donations can encourage repeat giving. Regular thank-yous and invitations to exclusive events further solidify their connection to your organization, creating a sense of belonging and responsibility for accomplishing your overall mission and goals.
Ready to Get Started?
Starting a major gifts program is feasible for nonprofits of any size. By strategically cultivating and stewarding major donors, your organization can achieve significant financial gains that substantially impact your mission. Investing in the time to build these relationships will yield substantial returns.
If you need support to get started, contact our team of experts today!