Nonprofit fundraising philosophy has gone through three significant shifts since the 1980s. Funders initially were courted with relevant messages — especially responses to initial donations — geared toward personally acknowledging gifts. There was a shift to more measurement-driven ideologies in the late 1990s, when fundraising professionals looked toward key elements of trust, satisfaction and commitment to guide their approaches.
One of the newest iterations of fundraising theory represents a further shift, from an exchange-based approach to one based in the psychological needs of funders. In these cases, approaches are rooted in acknowledging a funder’s identity and wellbeing and gleaning insight into how funders give and receive love, according to Relationship Fundraising 3.0: A Review, Assessment & Experimental Results, a study from academics Kathryn Edworthy, Adrian Sargeant and Jen Shang on behalf of the Devon, U.K.-based Institute for Sustainable Philanthropy.
Using a love-based approach, the driver of communication and interactions is rooted in how giving makes funders feel, whether about the positive outcome of a gift on the impacted community, or about themselves as altruistic individuals. As the report authors note, “…we can change what we choose to help people feel good about. Supper journeys can thus be created that result in the welfare of both the donor AND the communities that they choose to support. More communal relationships can be developed that educate donors about their role in bringing about change and how the love that they have to offer might be better articulated, channeled, and experienced.”
Understanding their theory requires following the evolution of fundraising theory. Edworthy, Sargeant and Shang’s work builds on the term established by London-based nonprofit marketing communication consultant Ken Burnett, who in 2002 defined relationship fundraising as “[a]n approach to the marketing of a cause that centres on the unique and special relationship between a nonprofit and each supporter. Its overriding consideration is to care for and develop that bond and to do nothing that might damage or jeopardize it. Every activity is therefore geared toward making sure donors know they are important, valued, and considered, which ahs the effect of maximizing funds per donor in the long term.”
As the report authors note, within the initial codification of relationship fundraising “…the needs of the donor are regarded as important and attended to because doing so is ultimately in an organization’s best interests. Focusing and enhancing the quality of the donor experience ultimately delivers greater revenue.”
This first wave of relationship fundraising is well-embraced by major gift executives, who know poorly timed, stiff and impersonal acknowledgments of their gifts are a waste of an organization’s resources, as they don’t engender any goodwill toward the organization. But something as simple as a prompt and thoughtful thank-you note pries open wallets.
The report authors further note that there are several factors influences donor acknowledgements, such as basic communication, gratitude or quality service, when appropriate, and that these needs may vary both by fundraising context as well as the ever changing relationship stage a donor has with an organization. Communication practices can include surveys and the ability of donors to earmark their donations for specific functions. Even exit polling, which attempts to discover the reasons for, and potentially ameliorate, donor attrition has been an important part of the initial wave of relationship fundraising.
A full copy of the report is available here: https://www.philanthropy-institute.org.uk/relationship-fundraising-3