May 6, 2010

 

 

May 6, 2010

 

 

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Grant-Makers Believe They Did A Good Job

By Mark Hrywna

Foundations were swift and flexible in responding to the economic crisis, with grants first addressing the mortgage delinquencies and then focusing on unemployment, according to a newly released study.

Consistent with past studies of foundation grantmaking in times of disaster, such as the Sept. 11, 2001 terrorist attacks and Gulf Coast hurricanes of 2005, government “was not the only institution to react to the economic crisis.”

“Responding In Crisis: An Early Analysis of Foundations’ Grantmaking During the Economic Crisis,” a fawning report that describes foundations responding in a targeted and timely manner, directing grants toward communities with the most need in spite of their own financial distress. The study was released today (May 6) by The Philanthropic Collaborative (TPC), a coalition of charities, foundations and elected officials that is “dedicated to educating policy makers regarding the economic value of foundations and the work they do to improve America’s communities.”

The report is considered by some to be the first formal analysis of the grantmaking activity of foundations in response to the current economic crisis. TPC analyzed 2,672 grants totaling $472 million of foundation giving from 2008 to 2009 and early planned giving for 2010. Recipients were located in 47 states and grants averaged $176,608, ranging from $500 to $5 million. Information was compiled from the Foundation Center, which maintains the most comprehensive database of foundations’ grant-making activities.

 

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Prospect Research …
Three ideas for middle donor acquisition

Modeling for a grouping of four to five variables in donor behavior modeling might identify people likely to be prospects for a middle donor program. “Nonprofits need the right data sets to measure a different sense of wealth,” said Caroline Oblack, director of client service for WealthEngine in Bethesda, Md. “They probably have more in their database than they think and they need to get a clear snapshot of the prospect.” Here are some ideas for getting that picture:

  • Identify some new data sets beyond real estate and stock with recent election contributions at either the national or state level;
  •  Look at affiliations. In healthcare, maybe a donor is giving to a competitor and would be interested in helping another such organization;
  • One reason real estate and age can be shaky is that a donor might be close to retirement and the economy could affect them so the expected disposable income could be needed.

Organizations could potentially benefit by changing the outlook on particular industries. For example, green industries seem to be thriving. “While the financial sector has been hit, some survivors still exist,” she said. “So organizations that can identify prospects who are aligned with these types of industries may see some success.”

 

 

Donors …
Finding your nearby emerging philanthropist


We all know what we mean by the “wealthy philanthropist.” That’s a white man in his mid-50s or older, married, owns his own business.

Speaking at the 47th AFP International Conference on Fundraising, Katherine Swank, a consultant with Target Analytics, noted that the standard image of a philanthropist is changing, giving way to the Emergent Philanthropist.

Swank shared information on the attributes that are coming to describe the emergent group.

  • They are younger.
  • They are entrepreneurs. This includes technology, real estate, athletics, entertainment, corporate leadership.
  • They are just as likely to be female.
  • They are just as likely to be a minority. That includes, African-Americans, Hispanic/Latino heritage Americans and Asian-Americans.
  • Giving is linked to family and kinship.
  • Religion is very important.
  • The majority of giving is personal and informal.
  • They feel an obligation to help others.

Swank offered further tips specific to African-Americans:

  • There are approximately 2.4 million African-Americans living in households with annual incomes of $75,000 or more. That is about 13 percent of the total U.S. population.
  • Affluent areas with an African-American majority include Prince George's County, Maryland, DeKalb County, Georgia and Charles City County, Virginia.
  • Traditional African-American wealth comes from family businesses, but recent wealth comes from entrepreneurial businesses or self-employment, real estate, certified professions and sports, media and entertainment.

 

 

Direct Response …
Going after cost-effective low-hanging dollars

While we’re all doing our patriotic duty by going without so that bankers can get their bonuses, nonprofit managers find themselves having to do more with less, not just fundraising but doing so by the most efficient means possible.

During the recent Direct Marketing Association 2010 Washington Nonprofit Conference, Brian Cowart and Erika Kloehn of St. Jude's Children's Research Hospital and Dave Strauss of SCA Direct outlined the benefits of capitalizing on low-hanging fruit, utilizing simple and cost-efficient ways to drive revenue.
They emphasized the following:

  • Improve efficiency of direct marketing programs. In one example, St. Jude's created a “St. Jude Holiday Rock” video that featured a simple thank-you from beneficiaries of the mission. It was promoted by social media, and email blast, a handful of corporate partners on their Web pages and encouraged forwarding. It resulted in 98,000 views in less than two weeks and raised more than $91,000 with no ask in video or distribution.
  • Increased revenue from offer and ask strategy adjustments. For increasing response rates in acquisition mail, a test mail sent state-specific labels in packages to prospects in Texas and Virginia, with simply versioned creative at no additional cost. The result was a response rate up 6 percent in Texas and 12 percent in Virginia.
  • Maximizing credit card donations. St. Jude's attempted rejected credit cards multiple times, starting 10 days after the initial attempt. There was a 15-20 percent win back in early results and an annual revenue recapture of $1.2 million.

 

 

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