Transactions, Transitions and Transformation of Donors
Unlike most practitioners of the trade that have years of preparation for a career in development, I landed immediately after graduation and was expected to perform. I was hired at the University of Louisville in their development department. I was as green as one could be. We had a small staff, and I found myself as director annual giving, major gifts and planned gifts — at the same time! I did not know anything about donors, donor relations or techniques to upgrade donors.
At best, I was just asking for gifts at any level. I was the king of transactions. Because of my drive to achieve goals and lack of experience, at first, I would ask 10 people for $1 to secure a goal of $10. Since I had no knowledge of the concept of the term transformation, I did not have the forethought of transitioning donors from being an annual transactional donor to a lifetime transformational donor.
According to Westfall Gold, nonprofit organizations and their donors have established a transactional giving culture over time. That type of giving involves a propositional ask of what donors will receive for a proposed benefit or result. A “2018 Fundraising Effectiveness Survey Report” calculated a donor retention rate at approximately 46%.
This was a result of fundraising models that focus on a giving model as a transaction more than building a donor relationship over time. The traditional ask is simple and successful. It is used by professionals at various gift levels. This style of approach leads many times to one-time success. It does not bond the donor to the organization. It does result in poor engagement and limited giving success.
Clarification emphasizes that a development officer’s role is to create donor journeys. Seek progress with each donor that is transformational over time. Asking for money on a continuous basis without true engagement is dull and boring. That is why transactional fundraising has affected donor retention. Donors are not made to feel good, appreciated or wanted.
Your job is not to take money alone from donors but to give donors purpose. These individuals must find meaning in their lives. The best development professionals are engagement experts. Seek to build a robust gratitude program, build a donor relationship strategy and establish a progress plan. At its core, the donor process is obtaining value for organizational value.
Westfall Gold believes transformational giving is an ongoing relationship between a nonprofit organization and a donor who shares resources to advance a shared mission. This involves having development professionals build an emotional, intellectual and transformational bridge of trust with donors. Over a period, with total buy-in by a donor, these individuals will be concrete advocates for your organization. You have passion for your mission and in your engagement with your donors. Your goal is to seek the same passion for those you solicit. This exchange will bring great joy to both parties seeking a mutual partnership.
Nonprofit professionals must understand the difference between transactional and transformational gifts. Veritus Group emphasizes that transformational gifts should take donors to a new place. Donors will view the organization and themselves differently. Development departments need to create an environment that focuses on the donor and not just the need. Transformational giving should transform the asker as well as the donor.
TrueSense believes some fresh ways to show your gratitude and create a transformational donor relationship over time is through nine simple acts. These acts are as follows:
- Make the phone call and communicate with your donor.
- Send a handwritten thank-you note to your donor.
- Send a welcome package that can educate your donor.
- Send a series of welcoming emails.
- Send a newsletter to them.
- Feature donors on your website.
- Create a thank-you video.
- Say it on social media.
- Invite donors to upcoming events, when socially appropriate.
The Veritus Group also noted that in every nonprofit organizational database, there are donors that have the possibility of giving high six- or seven-figure gifts. To achieve success with these potential donors, you must have a targeted, long-term strategy. Transformational gifts require a strong relationship of trust and accountability with a donor. Research on these prospects is a must that evolves into a dynamic strategy.
In many cases, the larger the ultimate gift, the more time it takes to germinate the seed. To secure this type of gift it takes identification, creation of a multi-month plan, solicitation of ongoing gifts, reporting on impact, engagement to the donor beyond money and the development of a transformational gift plan that shows organizational impact.
We all want transformational gifts while continuing the transactional approach with certain market segments. Do not forget the important transitional process that is required to take donors from transactional to transformational in scope. Understand the three-step process of transactional, transitional and transformational. Strive to educate yourself from any method available to you. Development is complex at its core. Once you gain the ability and understanding of working with an array of donors, with confidence, you will secure larger and more meaningful gifts. Your ultimate impact on your organization will be profound and memorable!
Duke Haddad, Ed.D., CFRE, is currently associate director of development, director of capital campaigns and director of corporate development for The Salvation Army Indiana Division in Indianapolis. He also serves as president of Duke Haddad and Associates LLC and is a freelance instructor for Nonprofit Web Advisor.
He has been a contributing author to NonProfit PRO since 2008.
He received his doctorate degree from West Virginia University with an emphasis on education administration plus a dissertation on donor characteristics. He received a master’s degree from Marshall University with an emphasis on public administration plus a thesis on annual fund analysis. He secured a bachelor’s degree (cum laude) with an emphasis on marketing/management. He has done post graduate work at the University of Louisville.
Duke has received the Fundraising Executive of the Year Award, from the Association of Fundraising Professionals Indiana Chapter. He also was given the Outstanding West Virginian Award, Kentucky Colonel Award and Sagamore of the Wabash Award from the governors of West Virginia, Kentucky and Indiana, respectively, for his many career contributions in the field of philanthropy. He has maintained a Certified Fund Raising Executive (CFRE) designation for three decades.