Building Strategy Using Data-Derived Insights: Major Gifts

800.933.4446 | www.wealthengine.com | info@wealthengine.com

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Presented By

Sally BoucherDirector of Research, WealthEngine Institute

Sally Boucher, CFRE, is the Director of Research at WealthEngine with a 15-year background in higher education, the arts, and human services development. She has provided professional services to hundreds of non-profit organizations.

Sally is the primary author of the Growing Individual Gifts Workbook, the Best Practices for Prospect Research in Higher Education Fundraising Report, and a contributor to the Measuring Fundraising Return on Investment and the Impact of Prospect Research white paper. She regularly presents on analytics, return on investment, research and major giving.

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Building Strategy Using Data and Analytics

This presentation is based on information in WealthEngine Institute’s workbook, Growing Individual Gifts: An Analytic Approach to Data-Driven Success.

For more strategies on using data and analytics, join WealthEngine Institute.

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WealthEngine Helps Nonprofits Find the Right People for the Right Purpose

Fully integrated. Scalable. Best in class. Your results are ready.

Who are my best donors and prospects? Analytics allows you to draw conclusions and make informed decisions.

What can I learn about these people? In-depth, contextual information to better understand each of your prospects.

How can I find more prospects just like them? Leading tools to build your prospect pipeline and thoughtfully expand your reach.

What strategies should I use to reach them? Customized insight and advice to develop and execute your fundraising strategy with precision.

Use Analytics to Drive Strategy

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What is Analytics?

Analytics + Analysis = Data Driven Decision Making

AnalysisThe process of breaking a complex topic or substance into smaller parts to gain a better understanding of it.

AnalyticsThe process of developing optimal or realistic decision recommendations based on insights derived through analysis

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Data Leads to Actionable Insight

WisdomEvaluated understanding

KnowledgeApplication of data and information; answers "how” & “why” questions

InformationData that are processed to be useful; provides answers to "who", "what", "where", and "when" questions

DataSymbols

Wisdom

Knowledge

Information

Data

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All Strategy Derives from Organizational Objectives and Goals

Vision

Mission

Objectives

Goals

Strategies

Tactics

Increase capacity to transport excess food to those in need

Increase major gift revenue by 20%

A world without hunger

Feed the hungry

Invest in screening data

Use data to optimize portfolios and ask values

Answer

“Why?” Questions

Answer

“What?” Questions

Answer

“How?” Questions

Capacity and likelihood to give data identify the best major gift prospects…

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Use Data to Optimize Portfolios by Finding the Best Prospects

Based on Capacity and Likelihood to Give (or Affinity), an entire constituency can be segmented for application of distinct strategies:

For major gifts, constituents with high capacity and high affinity are shaded in green for immediate assignment and cultivationConstituents in shaded in blue are second tier prospects and should be engaged in high-touch cultivation at the annual giving level

Cap

acit

y

Likelihood to Give

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Use Data to Optimize Portfolios by Finding the Best Prospects

2 2 47

41 30 525

3,626 2,397 8,328

Cap

acit

y

Likelihood to Give

Based on Capacity and Likelihood to Give (or Affinity), an entire constituency can be segmented for application of distinct strategies:

For major gifts, constituents with high capacity and high affinity are shaded in green for immediate assignment and cultivationConstituents in shaded in blue are second tier prospects and should be engaged in high-touch cultivation at the annual giving level

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Data Appends (Wealth, Demographic and Lifestyle Attributes) Allow Evaluation of All Constituents

  Affinity Score

Capacity RangeVery Low

LowModerat

eHigh

Very High

Total

$5M+     1 3 2 6

$1M up to $5M   2 1 19 23 45

$500K up to $1M   7 11 50 39 107

$250K up to $500K   34 19 301 135 489

$100K up to $250K   139 60 905 358 1,462

$50K up to $100K 6 490 469 2,155 774 3,894

$25K up to $50K 186 795 1,037 1,288 761 4,067

$15K up to $25K 132 464 498 607 365 2,066

Up to $15K 127 278 67 216 146 834

Unrated 525 484 266 466 287 2,028

Total 976 2,693 2,429 6,010 2,890 14,998

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  Affinity Score

Capacity RangeVery Low

LowModerat

eHigh

Very High

Total

$5M+     1 3 2 6

$1M up to $5M   2 1 19 23 45

$500K up to $1M   7 11 50 39 107

$250K up to $500K   34 19 301 135 489

$100K up to $250K   139 60 905 358 1,462

$50K up to $100K 6 490 469 2,155 774 3,894

$25K up to $50K 186 795 1,037 1,288 761 4,067

$15K up to $25K 132 464 498 607 365 2,066

Up to $15K 127 278 67 216 146 834

Unrated 525 484 266 466 287 2,028

Total 976 2,693 2,429 6,010 2,890 14,998

Quickly Identify the Best Prospects for Major Gift Cultivation

28 shaded green have high capacity, high likelihood to give

3 2

23

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  Affinity Score

Capacity RangeVery Low

LowModerat

eHigh

Very High

Total

$5M+     1 3 2 6

$1M up to $5M   2 1 19 23 45

$500K up to $1M   7 11 50 39 107

$250K up to $500K   34 19 301 135 489

$100K up to $250K   139 60 905 358 1,462

$50K up to $100K 6 490 469 2,155 774 3,894

$25K up to $50K 186 795 1,037 1,288 761 4,067

$15K up to $25K 132 464 498 607 365 2,066

Up to $15K 127 278 67 216 146 834

Unrated 525 484 266 466 287 2,028

Total 976 2,693 2,429 6,010 2,890 14,998

Identify Second Tier Prospects for High-Touch Leadership Giving Program

19

50 39

301 135

544 shaded in blue are also good major gift candidates

Portfolios are often selected based on past giving history…

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  Affinity Score

Capacity Range Very Low Low Moderate High Very High Total

$5M+         $7,983,010 $7,983,010

$1M up to $5M        $10,481,10

5$10,481,10

5

$500K up to $1M         $4,120,173 $4,120,173

$250K up to $500K   $370,479 $341,000 $440,241 $6,786,036 $7,937,755

$100K up to $250K   $601,489 $332,565 $1,545,482 $6,350,829 $8,830,365

$50K up tp $100K   $196,430 $243,806 $712,639 $3,133,520 $4,286,395

$25K up to $50K $94,259 $289,513 $201,514 $583,946 $1,119,834 $2,289,066

$15K up to $25K   $39,287 $24,468 $73,790 $134,884 $272,430

Up to $15K $40,226     $10,961 $36,692 $87,880

Unrated $27,383 $15,889   $11,409 $9,571 $64,252

Total $161,868$1,513,08

7$1,143,35

3$3,378,46

9$40,155,6

53$46,352,4

30

The Current Portfolios Under Management have a Total Value of $46MM

243 prospects are currently under management (assigned to a gift officer or volunteer)These were selected based on total givingValues in the cells are the sum of the capacity of each individual who falls within the range

$46,352,430

The total capacity of the prospects under management is the total number in the lower right-hand corner ($46MM)

Potential soars when portfolios are selected based on capacity and likelihood to give ratings…

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243 Optimal Prospects @$286MM(Selected Based on Capacity and Likelihood Ratings)

  Affinity Score

Capacity Range Very Low Low Moderate High Very High Total

$5M+       89,015,427 19,223,723 108,239,150

$1M up to $5M       35,938,650 48,700,146 84,638,796

$500K up to $1M       34,221,647 27,739,460 61,961,108

$250K up to $500K         30,862,459 30,862,459

$100K up to $250K            

$50K up tp $100K            

$25K up to $50K            

$15K up to $25K            

Up to $15K            

Unrated            

Total       159,175,725 126,525,788 285,701,513

Selecting the 243 optimal prospects yields $286MM under managementThis is 6 times the capacity under management

89,015,427 19,223,723 108,239,150

35,938,650 48,700,146 84,638,796

34,221,647 27,739,460 61,961,108

  30,862,459 30,862,459

285,701,513

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Strategy Grows Out of Analysis

All else being equal, if 20 gifts close at 10% of capacity, this

change in portfolio value would result in an additional $2MM

($2,351,452 vs. $381,501)

To activate this potential, any high-likelihood, high-capacity

prospects not under management by an individual staff or

volunteer should be assigned

Currently assigned prospects with lower capacity/likelihood

scores should only be kept under management if they are close

to or in the solicitation phase

The second tier of prospects with high capacity and likelihood

scores should be “fast-tracked” in high-touch annual

giving/cultivation program

Ask amounts are often based on instinct, “gut” feelings, or the comfort level of the solicitor…

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Data including Capacity Estimates Allow Analysis of Major Gift Solicitations

Prospect Manager or Major Gift Officer

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $24,167 14% $16,667 69% 10%

Total $131,662 $24,226 18% $13,455 56% 10%

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This Organization Receives on Average Only 10% of Potential Gift Value

Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $24,167 14% $16,667 69% 10%

Total $131,662 $24,226 18% $13,455 56% 10%

Analysis shows gifts received are valued at approximately 10% of capacity

11%

10%

10%

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Gift Officers May be Defaulting to the Minimum Major Gift Level

Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $24,167 14% $16,667 69% 10%

Total $131,662 $24,226 18% $13,455 56% 10%

With a minimum major gift amount of $25K, it looks like prospect managers may be satisfied asking for gifts of $25K

$24,286

$24,167

$24,226

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With Gifts Closing at Just 56% of Asks, There May be Money Left on the Table

Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $24,167 14% $16,667 69% 10%

Total $131,662 $24,226 18% $13,455 56% 10%

On average, they are receiving gifts of $10K-$15K

$10,242

$16,667

$13,455

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If 20 Gifts are Closed with Gifts Averaging 10% of Capacity, the Organization will Realize $263,324

Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $24,167 14% $16,667 69% 10%

Total $131,662 $24,226 18% $13,455 56% 10%

$131,662 x 10% x 20

Gifts

$131,662 10%

$131,662 x 10% x 20 Gifts =

$263,324

If ask amounts are adjusted to reflect capacity on an individual basis, fundraising potential increases…

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Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $41,927 25% $28,929 69% 17%

Total $131,662 $32,915 25% $19,585 59% 15%

Adjusting Average Ask Amount Up to 25% of Capacity on Average Leads to Higher Asks

Sarah’s asks are adjusted from 14% to 25% of capacity, resulting in an average ask of $41,927

$41,927 25%

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Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $41,927 25% $28,929 69% 17%

Total $131,662 $32,915 25% $19,585 59% 15%

Higher Asks Lead to Higher Closed Gift Amounts

This leads to a 17% of capacity average gift for Sarah and 15% overall 15%

17%

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Prospect Manager

Average Capacity

of Prospects

Average Ask

Amount

% of Capacity

Asked

Average Gift

Amount

% of Ask Received

% of Capacity Received

Jocelyn $95,617 $24,286 25% $10,242 42% 11%

Sarah $167,708 $41,927 25% $28,929 69% 17%

Total $131,662 $32,915 25% $19,585 59% 15%

If 20 Gifts are Closed with Gifts Averaging 15% of Capacity, the Organization will Realize $394,986

15%$131,662

$131,662 x 15% x 20

Gifts $131,662 x 15% x 20 Gifts =

$394,986

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All else being held constant, If 20 gifts close at 15% of capacity

on average, this will result in $394,986 in revenue

This represents an additional $131,662 in revenue over prior

asks

Ask amounts do not need to be a set and static percentage of

capacity, but should be evaluated on an individual basis

Questions to ask include:– Are we one of this prospects top three priorities?

– Is this prospect enthusiastic about a particular project or program?

– Do we have a funding need that meshes with this prospect’s interests?

– What other current commitments do they have?

If gift officers default to a low ask amount, consider training to

boost confidence in the ratings and/or confidence in the process

Strategy Grows Out of Analysis

Organizations that invest in analytics and data develop strategies that realize untapped fundraising potential

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Key Takeaways from Today’s Presentation:

By analyzing file capacity and modeling likelihood to give, this

organization was able to increase capacity under management

and (without closing more gifts) increase potential funds

raised by $2MM

By analyzing ask amounts in relation to capacity, this

organization was able to identify a weakness in their major gift

program and by encouraging each gift officer to ask for a

minimum of 25% of capacity, increases fundraising potential

by $131,662

If this organization realizes even 10% of this potential $2.1MM

gain, they will have realized a Return on Investment (ROI)of

740% based on a $25,000 investment in data and analytics

More wealth and fundraising intelligence

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Knowledge Center & Thought Leadership

We support innovation and advancement in the field…

Growing Individual Gifts WorkbookTools you need to grow your fundraising results

ProspectResearchResources.comFree tools for every research request

WealthEngine InstituteFree education, knowledge sharing and networking

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Questions? Contact Us!

800.933.4446www.wealthengine.com

info@wealthengine.com

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