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***************************************************************** Use <Pg Up> <Pg Dn> or arrow keys. Press <esc> when finished. ***************************************************************** FUND RAISING PRINCIPLES & PRACTICES THE SEMINAR PRESENTED BY HOWARD M. SCHWARTZ UNIVERSITY-ON-A-DISK SERIES ■ FUND RAISING:PRINCIPLES & PRACTICES This disk contains the material presented in the fund raising seminar conducted by Howard M. Schwartz. Over 300 full-day sessions of this seminar have been presented to date throughout the United States. More than 10,000 executives from non profit institutions and organizations have attended the seminar and 92% have rated the program "above-average" to "outstanding!" The complete proceedings are also available on audio cassettes together with a l60-page course manual. This UNIVERSITY-ON-A-DISK ■ program is provided to help the thousands of worthy nonprofit institutions and organizations raise the funds they require to serve their constituents and thereby perpetuate the great American tradition of "PRIVATE GIVING FOR THE PUBLIC GOOD! You are encouraged to copy this disk freely and distribute it to your friends and associates who might benefit from the material presented. If you find this disk of value, you are asked to consider sending a registration fee of $25 to the author. When you register, your name will be added to the list of those who will receive updates and supplements to this program. FUND RAISING:PRINCIPLES & PRACTICES is copyrighted by Marketing Services Corporation of America and protected by federal statute. REGISTER TODAY! Send your $25 registration fee to: Howard M. Schwartz Marketing Services Corporation of America #1 Marketing Centre 3157 Madison Street Waukesha, WI 53188-4409 (414) 521-8057 ■1990 MSCA FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────────────────────────── SEMINAR AGENDA SECTION PAGE I Philanthropy and Democracy:Historical background...... 4 II Sources and Distribution of the Charitable Dollar..... 10 III The Case Statement: Role and Preparation.............. 14 IV Fund Raising Techniques............................... 16 V Psychological Factors in Fund Raising................. 30 VI Changing Societal Trends.............................. 48 VII Direct Mail Techniques................................ 49 VIII Computer-Assisted Fund Raising........................ 72 IX Obtaining Grants from Foundations..................... 79 X Obtaining Grants from Corporations.................... 85 XI Programs for Priority Prospects....................... 86 XII Public Relations and Promotion ....................... 92 XIII Planned Giving Programs............................... 95 XIV Campaign Organization................................. 98 XV Epilogue.............................................. 99 SEMINAR INSTRUCTOR HOWARD M. SCHWARTZ Howard Schwartz is recognized nationally for his accomplishments as a professional fund raiser. He has planned and implemented annual giving, deferred giving and capital fund programs for major institutions and organizations throughout the country which have raised over $250,000,000. Mr. Schwartz is President of Marketing Services Corporation of America, a consulting firm serving both nonprofit organizations as well as business and industry. Prior to forming his company, he served as Vice President of Institutional Advancement (fund raising) for a professional college and two hospitals, as Vice President of the Burns International Division of the Borg- Warner Corporation, President of the house advertising and marketing agency for General Electric Ltd. (UK) and Vice President of Toronto-based Fortress Scientific Ltd. He has been active in affairs of the American Alumni Council, Council for Advancement and Support of Education and the National Association for Hospital Development. He also served as President of the Mid-Atlantic Chapter of the National Society of Fund Raising Executives and was appointed by the Governor of Pennsylvania as Chairman of the State's Commission on Charitable Affairs. He is an accredited member of the Public Relations Society of America and has served as a member of the Adjunct Faculty of New York University, Temple University, University of Wisconsin, Marquette University and Cardinal Stritch College. Mr. Schwartz is the author of "COMPUTER-ASSISTED FUND RAISING" and "DIRECT MAIL FOR BUSINESS AND INDUSTRY." He has also contributed chapters to four books and has had over 500 articles published in the trade and professional journals. He speaks regularly before varied groups and has conducted over 300 full-day seminars which have been attended by over 10,000 individuals. Mr. Schwartz is listed in Who's Who in America, Outstanding Educators of America, Outstanding Young Men in America and The International Bibliography of Distinguished Americans and International Notables. FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────── 1. Charity is part of our cultural heritage. 2. Budda, in the year 450BC set forth 5-step tenet on ways to treat friends: (1) GENEROSITY (2) BENEVOLENCE 3. From earliest recorded history, Jews tithed 1/l0th of their harvest for relief of the poor! 4. A quarter millenium before Jesus, Indian King Asoka devoted his wealth to spreading the gospel of Budda! 5. The Bible quotes Paul, "...Though I speak with the tongues of men and of angels, and have not CHARITY,I am as sounding brass, or a tinkling cymbal...." 6. The Yoruba tribe in Nigeria, whose culture dates back to 1200AD, subscribed to the teachings of Mohammed, who said: "... A MAN'S TRUE WEALTH IS THE GOOD HE DOES IN THIS WORLD...." The Yoruba's word for stranger translates to BROTHER! 7. In 321 AD Constantine gave license to give or bequeath money to the church. This was the earliest example of endowment! 8. Among early American settlers were graduates of Emmanuel College at Cambridge University, established as a benevolence of Queen Elizabeth in 1584. These graduates in turn founded Harvard University. ──────────────────────────────────────────────────PHILANTHROPY & DEMOCRACY -5- FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────── I. PHILANTROPY & DEMOCRACY : HISTORICAL BACKGROUND A. RAISING FUNDS FOR WORTHY PURPOSES IS FACILITATED BY OUR CULTURAL BACKGROUNDS AND HERITAGE ! 1. MAIMONIDES - Rabbi,Physician & Philosopher 1135-1205 SET FORTH 8 LEVELS OF "TZEDAKA" (charity): (1) THE HIGHEST LEVEL OF CHARITY IS TO PUT A POOR PERSON ON THEIR FEET WITH A LOAN OR GIFT THAT ENABLES THEM TO DO BUSINESS OR TO HELP THEM FIND A JOB AND PROVIDE FOR THEMSELVES (2) A STEP BELOW, IS THE CHARITY GIVEN IN A MANNER THAT THE DONOR DOES NOT KNOW THE RECIPIENT AND THE RECIPIENT DOES NOT KNOW HIS BENEFACTOR. THIS IS ANONYMITY, AS IN THE CASE OF A CHARITY FUND OR CHARITABLE ORGANIZATION (3) BELOW THAT IS WHEN THE DONOR KNOWS THE RECIPIENT BUT THE RECIPIENT DOES NOT KNOW THE DONOR (4) BELOW THAT IS WHEN THE RECIPIENT KNOWS HIS BENEFACTOR BUT THE BENEFACTOR DOES NOT KNOW THE RECIPIENT (5) BELOW THAT IS GIVING BEFORE BEING ASKED (6) BELOW THAT IS GIVING AFTER BEING ASKED (7) BELOW THAT IS GIVING LESS THAN REQUESTED BUT WITH JOY AND A SMILE (8) THE LOWEST LEVEL OF CHARITY IS GIVING UNHAPPILY AND WITH A SAD FACE ■────────────────────────────────PHILANTHROPY & DEMOCRACY────────────────────■ -4- ■══════════════════════════════════════════════■ FUND RAISING:PRINCIPLES & PRACTICES The Seminar ■══════════════════════════════════════════════■ The seminar, FUND RAISING:PRINCIPLES & PRACTICES, is copyrighted by Marketing Services Corporation of America. All rights reserved. ■ 1990 MSCA MARKETING SERVICES CORPORATION OF AMERICA\#1 MARKETING CENTRE\3157 MADISON STREET\WAUKESHA,WI 53188 (414) 521-8057 FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────────────────────── B. EARLY ORGANIZED CHARITIES 1. After Benjamin Franklin sold his printing company he devoted the balance of his life to public service. HE NEVER PATENTED OR PROFITED FROM ANY OF HIS INVENTIONS! 2. Andrew Carnegie Established the Carnegie Foundation in 1911. 3. John D. Rockefeller incorporated his foundation in 1913. 4. By 1915, there were 27 foundations in the United States. 5. Last year, over 40,000 foundations were registered with the Internal Revenue Service. 6. The National Tuberculosis Foundation was formed in 1904. 7. The American Cancer Society was formed in 1913. 8. The American Foundation for the Blind was formed in 1921 and Helen Keller played a leading role in raising its endowment. 9. The development of the Salk vaccine in 1955 climaxed 16 years of work by the National Foundation for Infantile paralysis. The word "PHILANTHROPY" is derived from the Greek "PHILEIN," meaning "love" and "ANTHROPOS," meaning "man." PHILANTHROPY = LOVE OF MAN FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────── C. THE PRESENT DAY WORLD OF PHILANTHROPY... ■ There are presently over 400,000 nonprofit institutions and organizations in the United States, NOT including chapters and affiliates of national organizations! 350,000 religious organizations 37,000 human service organizations 6,000 museums 5,500 private libraries 4,600 privately-supported secondary schools 6,000 private hospitals 3,000 private colleges and universities 2,000 symphony orchestras ■ In New York City there are over 6,000 neighborhood civic associations! ■ Arlington, Massachusetts-population 52,000-has 350 neighborhood block groups! ■ The students of private schools and colleges in the U.S. exceeds the population of New York City! ■ 1 in 10 service workers in the United States is employed by a nonprofit organization! ■ 1/9th of ALL property in the United States is owned by nonprofit groups! PHILANTHROPY IN THE UNITED STATES IS BIG BUSINESS! FUND RAISERS MUST COMPETE WITH EACH OTHER FOR THE CHARITABLE DOLLAR! CREATIVE AND AGGRESSIVE PROGRAMS SUCCEED...PASSIVE PROGRAMS FAIL! WORTHINESS OF THE CAUSE HAS NO RELATIONSHIP TO SUCCESS IN GAINING PUBLIC SUPPORT! (eg. The National Association for Hospital Development predicts that 40% of hospitals in the U.S. will close their doors in the next 10 years because of their inability to raise needed funds) ■────────────────────────────────PHILANTHROPY & DEMOCRACY───────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────────■ D. ABERRATIONS OF NOTE ■ Over 90% of the $114-billion contributed to charity in 1989 came from INDIVIDUALS...not foundations,corporations or government sources! DONORS WITH INCOMES OF LESS THAN $20,000 PER YEAR REPRESENTED ONE-HALF OF ALL DONORS! THE MOST PREVALENT REASON FOR FAILURE IN FUND RAISING IS KNOCKING ON THE WRONG DOORS! ■ College graduates give 6-times as much to charity as high school graduates! ■ Small-town residents give more than city dwellers! ■ Married people give more than single people! ■ Older people give more than young! ■ There is little relationship to the needs of a cause and the amount of money they raise... EXAMPLES: Boy's Town of Nebraska has an endowment fund of over $225,000,000! Each "poor orphan" at Boy's Town is in fact a millionaire! The Pallotine Fathers raised over $20,000,000 in an 18-month period in the 70's. 3% went to the cause of their work! Religious TV preachers have vividly shown they have mastered the fine art of fund raising. At the peak of their popularity, the major players raised annually... FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────────■ Rex Humbard $20,000,000 Oral Roberts $30,000,000 Billy Graham $27,000,000 Jim and Tammy $75,000,000 ■══════════════════════════════════════════════════════════■ MOST DONORS ARE UNSOPHISTICATED IN THE PROCESS OF CHARITABLE GIVING, RELYING MORE UPON EMOTIONS THAN REASON TO INFLUENCE THE CAUSES THEY SUPPORT! PROFESSIONAL FUND RAISERS KNOW THIS AND BUILD THEIR PROGRAMS WITH EMOTIONAL "TRIGGERS" TO STIMULATE CHARITABLE GIFTS! ■═══════════════════════════════════════════════════════════■ │ SEE CHAPTER V FOR FURTHER INSIGHT INTO THE │ │ APPLICATION OF PSYCHOLOGICAL STRATEGIES IN │ FUND RAISING E. SOME CAMPAIGNS ARE MODELS IN TERMS OF UTILIZING A FULL RANGE OF PSYCHOLOGICAL "TRIGGERS" TO EVOKE RESPONSE: EXAMPLE- JERRY LEWIS' MDA TELETHON 1988 financial report showed- PLEDGES $41,132,113 PLEDGES COLLECTED $35,244,082 85.7% of total EXPENSES $10,823,991 ____________ $24,420,094 59% of total pledged (Financial data obtained by Philanthropic Advisory Service of the National Council of Better Business Bureaus) FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ II SOURCES AND DISTRIBUTION OF THE CHARITABLE DOLLAR (For the year 1989, as reported by Giving USA, the philanthropy yearbook) ************************************************** 1989 CHARITABLE GIVING EXCEEDED $114.7-BILLION, AN ALL-TIME HIGH THAT FAR OUTPACED INFLATION! ************************************************** *************************************** 90% OF ALL GIFTS CAME FROM INDIVIDUALS! *************************************** * GIVING USA may be ordered from: AAFRC Trust for Philanthropy,25 W. 43rd St.,NY,NY 20036. Cost is $45. ■────────────────────────────────SOURCES & DISTRIBUTION──────── FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────■ A. COMMENTS ON LAST YEAR'S CHARITABLE GIVING 1. Colleges and Universities continue to be in the forefront of creating and implementing innovative and effective fund raising campaigns. Most of the strategies in common use today were introduced in college and university programs,including endowment fund, planned giving, priority gift, annual giving and capital fund campaigns. 2. A three-year study of fund raising costs at colleges and universities conducted by the Lilly Endowment and the Council for Advancement & Support of Education found the average institution spends about 2% of its operating budget on direct fund raising costs while generating about 10% of the annual budget through gifts! The study revealed that overall fund raising costs averaged 16% of funds raised, or a 525% return on each dollar spent! 3. Fund raising drives set up as alternatives to United Way raised $121.8-million in 1989 and are expected to increase more than 10% per year over the next few years, reflecting growing donor discontent with federated campaign organizations. 4. Fund raising charlatans continue to cast their dark shadows upon legitimate causes. For example, The National Children's Cancer Society, Inc. raised $9,000,000 and allocated only 9% of this sum for charitable purposes! The remaining $8.2-million was unaccounted for. 5. Despite pressing need, regulation of fund raising activities by local, state and federal agencies is not uniform, consistent or effective. ■────────────────────────────────SOURCES & DISTRIBUTION─────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ 6. This past year saw the announcement of a number of major campaigns with record goals: (1) Cornell University announced a $1.25- billion 5-year campaign. Concurrent with their announcement, Cornell reported that $337,000,000 of the goal was already in hand! (2) The United Jewish Federation of New York embarked upon a $1.2-billion campaign for endowment and capital projects. At the time the campaign was announced, over $400-million was already contributed, including 70 individual gifts of over $l,000,000 each and five gifts in excess of $25,000,000 each! (3) Case Western Reserve University launched a $350,000,000 five-year campaign and reported $100-million of the goal already received. (4) Ohio State University reported $401.2- million contributed toward its $350- million campaign. (5) the University of Kansas increased its capital fund campaign goal by $27-million to $177-million. Gifts in hand now total $136.1-million. The campaign is scheduled to run for two more years. (6) Georgetown University concluded its $110,000,000 campaign with $128,750,000 raised! 7. IMPORTANT TO NOTE THAT THE COUNTRY'S ECONOMIC CLIMATE HAD LITTLE AFFECT UPON CHARITABLE GIVING...IN FACT,GIFTS INCREASED OVER PRIOR YEAR! THIS PATTERN HAS BEEN IN PLACE OVER A LONG PERIOD. ■────────────────────────────────SOURCES & DISTRIBUTION■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────── 8. In addition to actual funds contributed, 89 million Americans donated an average of 3.5 hours per week to charitable causes. This time was worth an estimated $25-billion. Volunteerism is an important part of philanthropy. 9. It was only in 1989 that the Supreme Court defined a charitable gift. In the case of Hernandez v. Commissioner, the court said " a charitable gift is a payment to a charity where there is no expectation of any quid pro quo." The ruling was based upon a case where members of the Church of Scientology claimed charitable deductions for fees paid to attend auditing or training sessions. 10. The IRS has recently spelled out new guidelines concerning numerous aspects of charitable giving and deductibility rules which apply in specific instances. NOTE: Information concerning regulation of charitable giving is available from: ■ Internal Revenue Service ■ United States Postal Service (Domestic Mail Manual) ■ Council of Better Business Bureaus,4200 Wilson Blvd., Arlington, VA 22203 ■ National Charities Information Bureau, 19 Union Square,West, New York, NY 10003 ■ American Association of Fund Raising Counsel, 25 W. 43rd St.,NY,NY 10036 ■ The office of each state's Attorney General or Secretary of State. ■────────────────────────────────SOURCES & DISTRIBUTION─────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────── III THE CASE STATEMENT 1. ATTRIBUTES OF THE CASE STATEMENT ■ THE CASE STATEMENT IS A SUCCINCT, YET COMPLETE ARGUMENT IN FAVOR OF SUPPORTING YOUR CAUSE.... ■ THE CASE STATEMENT SERVES AS THE MASTER GUIDE IN PLANNING AND CONDUCTING A FUND RAISING PROGRAM ■ EVERY CAMPAIGN MUST HAVE A CASE STATEMENT ■ CREATION OF A CASE STATEMENT ESTABLISHES THAT TECHNIQUES AND STRATEGIES ARE ADEQUATELY DEFINED ■ THE CASE STATEMENT SETS FORTH "THE PARTY LINE" AND ASSURES THAT EVERYONE IS SPEAKING THE SAME LANGUAGE ■ ALL NECESSARY PROMOTIONAL MATERIALS ARE PREPARED USING BASIC INFORMATION DERIVED FROM THE CASE STATEMENT ■ THE CASE STATEMENT IS AN INTERNAL DOCUMENT 2. VITAL QUESTIONS TO BE ANSWERED IN THE CASE STATEMENT (1) Is the cause deserving? (2) Can the cause me marketed? (3) How should the cause be marketed? (4) Is their a viable constituency to support the cause? (5) How can the constituency be reached effectively? (6) Why do we exist? (7) What business are we in? (8) What is our most important service? (9) Who are our clients/constituents? (10) Who can we count on (volunteers,board,etc)? (11) Who are our present donors? (12) What are our unique strengths? (13) What are our major weaknesses? (14) What philosophic issues are important to us? (15) What special circumstances could affect our future? (16) How have we changed in the past 5 years? (17) How must we change in the next five years? ■─────────────────────────────────────────────────────────────── IV FUND RAISING TECHNIQUES 1. IDENTIFYING YOUR CONSTITUENCY a. ALWAYS CONSIDER YOUR CURRENT DONOR FILE AS THE GOLDEN LIST. WORK THE LIST! b. DEVELOP VIABLE PROGRAMS TO ASSURE RENEWAL OF PRIOR GIFTS. c. DON'T GIVE UP ON DONORS JUST BECAUSE THEY FAIL TO RESPOND TO A PARTICULAR APPEAL. (1) LYBUNTS (last year but not this year) (2) PYBUNTS (past year but not this year) d. DEVELOP PROGRAMS TO ATTRACT MAJOR GIFTS. (1) Involve their families (2) Honor their life's work (3) Respect their values (4) Answer their questions (5) Ennoble their lives (6) Honor their family name (7) Showcase their talents (8) Give them financial security (9) Make sure the right person asks (10) Make them part of your cause ■═══════════════════════════════════■ NEVER THINK YOU HAVE TO APOLOGIZE FOR ASKING SOMEONE TO GIVE TO A WORTHY CAUSE ■══════════════════════════════════════■ ■ ─────────────────────────FUND RAISING TECHNIQUES───────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────■ ■══════════════════════════════════════════════■ WHEN YOU ASK SOMEONE TO GIVE TO A WORTHY CAUSE, YOU ARE AFFORDING THEM AN OPPORTUNITY TO MAKE A BLUE CHIP INVESTMENT !!!!!!!!! ■══════════════════════════════════════════════■ e. RECAP ■ (1) Make every effort to renew gifts from prior contributors ■ (2) Develop programs to attract new donors ■ (3) Upgrade levels of giving 2. CREATIVE STRATEGIES FOR FINDING NEW SUPPORTERS ■ A. Don't give up on prospects previously solicited but who never contributed until cost of acquiring them as a donor becomes unprofitable ■ B. Consider soliciting individuals who supported causes similar or related to your own. Rent or trade mailing lists ■ C. Consider soliciting clients/recipients of your group's services ■ D. Consider soliciting family, friends and relatives of those who benefitted from your group's services ■─────────────────────────FUND RAISING TECHNIQUES─────────────── FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────── ■ Consider soliciting suppliers/vendors. They have a vested interest in your continuing viability ■ Consider soliciting staff ■ Consider soliciting volunteers ■ Be sure to solicit board members ■ Look for new, untapped, eager donor prospects....... IN ALL CASES,PROSPECTS MUST HAVE BOTH THE INCLINATION AND CAPACITY TO SUPPORT YOUR CAUSE! CONSIDER THE "INVISIBLE" DONOR GROUP -- SENIOR CITIZENS! MOST OTHER ORGANIZATIONS DISCOUNT & OVERLOOK THEM! Here are the facts about 70,000,000 Americans who are among the best prospects you are likely to find: ■ Senior citizens are seen by many as a group of poor and sickly individuals! BOTH OF THESE SUPPOSITIONS ARE FALSE! ■─────────────────────────────────────■ ■ The health of senior citizens as a group is no different from the general population! They do tend to require more care when they become sick, but otherwise they enjoy the same general health as the rest of us! ■ Senior citizens have more disposable income than younger segments of the population! And they have shown themselves to be "DISSAVERS!" ■─────────────────────────FUND RAISING TECHNIQUES─────────────────── FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────── MORE FACTS ABOUT SENIORS........................ 1. 85% of seniors have health insurance! 2. Seniors are responsible for 80% of leisure travel in the U.S.! 3. Seniors constitute 75% of overseas travel groups! 4. 5,000 American reach age 65 daily! 5. Seniors control over 50% of the discretionary income in the country (the 35-50 age groups controls only 30%)! 6. The annual income of seniors is 27% ABOVE the national average! 7. Seniors control 77% of ALL U.S. assets and have 2 1/2-times the assets of the 35-45 age group,double the assets of the 45-54 age group! 8. 75% of seniors own their own homes, 80% without a mortgage! 9. Seniors buy more boats,RV's and condos than any other age group! 10. Seniors represent the fastest growing age group in the U.S. Within 20 years 1 in 7 Americans will be a senior, within 40 years seniors will represent 1 in 3 Americans! 11. The 50+ age group accounts for more than $500- billion annual income and makes 25% of all consumer purchases! 12. The movement of senior citizens from New York City to the sunbelt over the next 5 years will represent a LOSS of $2.8-billion to New York! 13. 68% of all money market accounts are in the hands of seniors! 14. 80% of savings & loan accounts are held by seniors! 15. Seniors purchase 48% of all luxury cars! SENIOR CITIZENS ARE A POWER IN THE ECONOMY AND CAN HELP MAKE YOUR CAMPAIGNS SUCCESSFUL. INCLUDE THEM IN YOUR PLANS! ■─────────────────────────FUND RAISING TECHNIQUES───────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────── 3. MORE STRATEGIES FOR EFFECTIVE FUND RAISING A. FUND RAISING is FRIEND RAISING! B. Fund Raising is the nonprofit world's equivalent of marketing...but more difficult. In the business world, you take a dollar and deliver a product. In fund raising, we take a dollar and deliver "A GOOD FEELING!" C. Donor cultivation must be a continuous process! D. Fund raising requires commitment! E. Those involved in fund raising must have "MORAL AUTHORITY!" F. Preplanning is vital BEFORE the start of a fund raising effort! You must have A Case Statement and a detailed logistical plan. G. Prospect research and prioritization lead to the realization of goals! H. Gifts should be solicited in prioritized order! I. Important to create an environment of excitement and enthusiasm! J. Exploit at every opportunity. Publicize the generosity and spirit of those who support your cause! K. Make it "chic" to be associated with your organization! L. Show clearly what gifts to your organization have accomplished! M. Present opportunities for new fundable programs and projects! ■─────────────────────────FUND RAISING TECHNIQUES───────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────■ N. Be careful not to "over-automate" your fund raising efforts. Don't let computers or systems make your campaign impersonal! O. Assure an adequate budget to INVEST in fund raising. It takes money to make money! P. Gain support from the "insiders" first and at respectable levels before going outside your organization (MORAL AUTHORITY)! FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────── 4. SOLICITATION TECHNIQUES (See addendum #4 and #6) (1) Go for the big gifts first! (2) Solicit major gifts in person only! (3) Use a "team" to solicit! (4) Make sure every solicitor has MORAL AUTHORITY to ask others to give! (5) Solicit in prioritized order by size of gift! (6) Research prospects BEFORE soliciting them! (7) Rehearse solicitation whenever possible! (8) Contact prospects on their own "turf!" (9) Always ask for a specific amount! (10) Cite examples of others! (11) Afford the opportunity for "immortality!" (12) Make it easy to give to your cause! ■─────────────────────────FUND RAISING TECHNIQUES───────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────■ (13) Get the commitment on the FIRST visit! (14) Have the proper attitude...you are offering the prospect an opportunity to MAKE A BLUE CHIP INVESTMENT! (15) Expand the donor's involvement AFTER the gift! (16) Listen carefully to the donor's needs and try to fulfill these needs! 5. RESEARCHING AND EVALUATING PROSPECTIVE CONTRIBUTORS A. THE "COMMITTEE" ■ TOP CHOICE! B. House files C. Newspaper articles D. Directories E. Proxy statements F. Credit reporting services G. Public records H. OTHER SOURCES: 6. SETTING AND ACHIEVING GOALS ■═════════════════════════════════════════════════■ IT IS MOST IMPORTANT FOR EVERY CAMPAIGN TO HAVE A STATED GOAL AND A TIMETABLE FOR REACHING IT! ■═════════════════════════════════════════════════■ ■ ■ │ The Case Statement must address whether │ │ the goal and timetable are realistic and │ │ set forth the definitive plan to reach │ │ the goals! │ ■ ■ Almost all campaigns can utilize one of two formulas to set dollar goals: FORMULA #1 THE RULE OF THIRDS 1/3 of goal will be met with the top 10 gifts 1/3 of goal will be met with next 100 gifts 1/3 of goal will be met with all other gifts FORMULA #2 80% to 90% of all gifts will come from top 10% to l5% of the donors! ■─────────────────────────────────────────────────────■ 7. THOUGHT STARTERS FOR CREATIVE FUND RAISING...... Ally with federated campaigns (United Way,etc) Street corner solicitation Coin canisters on retail store counters Bequest programs Deferred gift programs Life insurance programs Annuity programs Gifts in kind Endowment fund programs Scholarship fund programs Memorial fund programs Special events Membership campaigns Foundation grant proposals Corporate appeals Sponsored research Major gift clubs Merchandise sales Auctions Door-to-door solicitations ■─────────────────────────FUND RAISING TECHNIQUES───────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────■ MORE THOUGHT STARTERS........ Sponsored competitions (runs, walks, races,etc) Telethons Service club sponsorship Direct mail campaigns Sponsored advertising Service projects (car washes, etc.) Newspaper supplements TV appeals Radio appeals Capital fund appeals Emergency appeals Seasonal appeals OTHER IDEAS: V PSYCHOLOGICAL FACTORS IN FUND RAISING ■═══════════════════════════════════════■ UNDERSTANDING THE APPLICATION OF PSYCHOLOGICAL STRATEGIES TO YOUR FUND RAISING PROGRAM CAN MEAN THE DIFFERENCE BETWEEN SUCCESS AND FAILURE! ■═══════════════════════════════════════■ ■═══════════════════════════════════════■ OF ALL THE FACTORS UNDER THE CONTROL OF THE FUND RAISER, EFFECTIVELY USING PSYCHOLOGICAL "TRIGGERS" HAS THE MOST IMPACT UPON THE FINAL CAMPAIGN RESULTS! ■═══════════════════════════════════════■ THE SECRET OF THE GOLDEN ARCHES --- FINALLY REVEALED! MacDONALDS DOES NOT SELL FOOD! MacDONALDS DOES NOT SELL CONVENIENCE! well, what does MacDonalds sell? MacDONALDS SELLS THE MAGIC MOMENT! MacDonalds entire marketing program is built around emotional factors For example: The Nostalgic Appeal- ■ where the old high school gang hung out... ■ where a cute 2-year-old munches her fries as her grandad looks on..................... ■ where you went with your first date amidst chrome, grease and styrofoam................. ■─────────────────────────────PSYCHOLOGICAL FACTORS─────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ Magic Moments, that's neat...but what does it have to do with fund raising? THE MAGIC MOMENT IS EVERYWHERE IN ADVERTISING TODAY! ┌───────────────────────────────────────────────────────────────┐ │ GOOD ADVERTISING DOESN'T SELL PRODUCTS....IT SELLS EMOTIONS! │ │ │ │ │ │EFFECTIVE FUND RAISING SATISFIES EMOTIONAL NEEDS OF THE DONOR! │ │ │ └───────────────────────────────────────────────────────────────┘ Well, OK... let's put it to work... A. START WITH BASIC RESEARCH 1. Determine the ATTITUDES your constituents have toward your organization. a. Be sure you understand the difference between ATTITUDES and OPINIONS. (1) ATTITUDES A MENTAL POSITION WITH REGARD TO A FACT OR STATE. A PREDISPOSITION TOWARD AN OPINION. (2) OPINION A BELIEF, GENERALLY STRONGER THAN AN IMPRESSION, AND LESS THAN POSITIVE KNOWLEDGE. A JUDGEMENT FORMED IN THE MIND ABOUT A PARTICULAR MATTER. b. GET ANSWERS TO THESE VITAL QUESTIONS: (1) What do your constituents know about you? (2) What do they think of your work or cause? (3) How important is your group's work to the individual? (4) What aspects of your operation emotionally stimulates your prospects? (5) What aspects of your operation do your constituents like least? (6) What aspects of your operation do your constituents like most? (7) Do your constituents want to be part of your organization's work? To what degree? (8) What can you do to make your cause more appealing to your constituents? 2. THE REASONING PROCESS-It makes sense, but it may not work for you.... WE HAVE A GOOD CAUSE................. WE DESERVE SUPPORT.................... IF WE PRESENT THE FACTS, PEOPLE WILL SUPPORT OUR WORK! 3. THE TASK OF COMMUNICATING COMPOUNDS THE PROBLEM The human brain can store an unbelievable amount of data- 10,000,000,000,000,000,000,000,000,000 IT IS RECALLED IN THE SAME MANNER A COMPUTER OPERATES... IF THE PERSON WANTS TO SEARCH THEIR MEMORY! PSYCHOLOGICAL STRATEGIES CAN HELP YOU WIN FRIENDS 4. THE COMMUNICATION PROCESS IS FURTHER COMPOUNDED BY THE MASS OF MESSAGES WE ARE EXPOSED TO EACH DAY! 5. AND JUST TO COMPLICATE THINGS FURTHER, THE HUMAN BRAIN HAS SOME VERY INTERESTING IDIOSYNCRACIES.... THE HUMAN BRAIN Right Side-Left Side a. THE HARVARD STUDY Finally, the answer to why people do what they do!Emotions are more important than facts! b. PSYCHOLINGUISTICS "The language of the mind" The conversations we have with ourselves are the most important we can have. GUT FEELINGS AFTER THE LEFT BRAIN ANALYZES, SCRUTINIZES AND REACHES A CONCLUSION...WE THEN DRAW UPON OUR GUT FEELINGS WHICH, MORE OFTEN THAN NOT, COUNTERS FACT & LOGIC! THE RIGHT BRAIN IS EXPRESSING ITSELF...AND WE USUALLY LISTEN TO IT! ■────────────────────────────────────────────────────────── B. AVOID THE TRAP OF PRESUMING TO KNOW ANSWERS TO VITAL QUESTIONS WITHOUT CONDUCTING RESEARCH! *** ANYTIME YOU PRESUME, YOU ARE EXPRESSING YOUR PERSONAL JUDGEMENT WHICH MAY, OR MAY NOT, REFLECT FACT! *** CONSIDER THE FOLLOWING FACTS, THEN DECIDE IF THESE FACTS REPRESENT WHAT YOU WOULD HAVE PRESUMED IN EACH INSTANCE...... THE AVERAGE AMERICAN * The average American man is 5' 9" tall * The average American Woman is 5'3.6" tall * Half of all American women wear the same size tops & bottoms * 38% of American women wear larger tops than bottoms * 12% of American women wear larger bottoms than tops * Average American marriage lasts 6 1/2 years * Average family watches TV 45 1/2 hours per week * Average teenager has watched 15,000 hours of TV and has seen 350,000 commercials by age 18 * 1/3 of American homes have a dog * Average American male has sex 2.2 times per week (same for women?) * 3/5 of all paperback books read by women,mostly romance novels. * Average man's fingernails grow 1/8" each month. Nails on right hand grow faster than left. * Americans spend more to subsidize teenage pregnancies than the combined budgets of New Zealand & Portugal. * The world's greatest philanthropist is CRACKER JACK...has given away 15-billion prizes! * Happily married women gain an average of 18.4 pounds in first 13 years of marriage * Unhappily married women gain average of 42.6 pounds in first 13 years of marriage * 84% of bikers say they daydream about sex while cycling, 20% say they dream about biking while having sex * Average woman burns 220 calories per hour while shopping * Americans use enough toilet paper in one day to wrap around the earth 9 times. If it were on 1 giant roll and we pulled at the same time,we would have the roll spinning at 7600 miles per hour - Mach 10, 10 times the speed of sound * Americans make 41,000 daily calls to DIAL-A-PORN, 800 daily calls to DIAL-A-PRAYER * Average American has 12 times greater chance of contracting a social disease than winning the lottery AUTHOR'S NOTE: While I'm sure I've already made my point about the dangers of presuming to know what the average person thinks and does, I have had so many good comments about the data I've collected on THE AVERAGE AMERICAN that I'll give you some more. It makes excellent cocktail party "nickel knowledge!" THE AVERAGE AMERICAN-continued * The tower atop the Empire State Building was originally designed as a mooring post for blimps * An l8% drop in the death rate occurred in Los Angeles in 1976 when doctors went on strike! When the strike ended, the death rate went back up to its original level! * A professional typist's fingers move 12 miles in a day's work * The Professional Rodeo Cowboy Association has a rule against sticking your fingers up a cow's nose... * People are about 1-inch shorter in late evening than in the morning * The world's largest manufacturer of women's clothing is Mattell Corporation...for their Barbie Doll! * The average face lift lasts 6 - 10 years * The painted line in the middle of the highway lasts 3 to 4 months * The average Mayfly lives one day * The average dollar bill circulates for l8 months * The average ballpoint pen writes for 2 years * The average pro basketball player's sneakers last two weeks * The average redwood tree lives 1,000 years * Each year, the U.S. moves 1" closer to Russia * 34% of U.S. women take charge of the TV remote control in their homes * 25% of Americans eat breakfast in their cars * It is against the law in South Carolina to toss a dwarf * Average American opens the refrigerator 22 times a day * Chicago produces 19,000 rolls of toilet paper from recycled city hall waste THE POINT OF IT ALL IS THAT THERE REALLY ISN'T SUCH A THING AS AN "AVERAGE" PERSON AND WE SHOULD NOT MAKE ANY PRESUMPTIONS IN THE PLANNING OF OUR CAMPAIGNS WITHOUT VALIDATING FACTS THROUGH RESEARCH! ■────────────────────────────────PSYCHOLOGICAL FACTORS──────────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────────────────────── C. MASLOW's HIERARCHY OF NEEDS THE EXPERIENCE OF GIVING TO CHARITY SATISFIES MANY OF OUR MOST BASIC HUMAN NEEDS D. LOOKING MORE DEEPLY INTO "WHY PEOPLE GIVE" 1.HUMAN NEEDS AND WANTS a. KNOW THE DIFFERENCE BETWEEN THE TWO (1) WANT: to have a longing for something (2) NEED: a pressing lack of something essential (a) Felt needs (b) created needs (c) Needs may change with time 2. PEOPLE CAMOUFLAGE THEMSELVES-SEE THROUGH THEM! 3. RECALL AS A FACTOR a. RECALL STUDIES People forget 75% of material presented to them in first 48 hours! 95% is lost in l week! b. CONCLUSIONS c. ANSWER THE QUESTION EVERY DONOR ASKS: WHAT'S IN IT FOR ME? 4. ROLE OF COGNITIVE DISSONANCE IN INFLUENCING ATTITUDES We easily modify our feelings to conform to expectations! E. THE EXPERT'S VIEWS ON BASIC MOTIVATION 1. Dr. Dorthea C. Leighton, Cornell University "...every individual needs to feel they are part of a worthwhile group...." 2. Winston Churchill "... the nature of American psychology is such that the bigger the idea, the more wholeheartedly the people throw themselves into making it a success...." 3. Dr. Lawrence C. Kolb, Director, NY Institute of Psychiatry "...people simply want to be sought...this is the reason why millions are institutionalized...they think nobody cares about them or wants to listen to them...." 4. John Steinbeck, author "...most people spend two-thirds of their lives clawing the guts out of society...and the last third trying to push them back in...." MOST SUCCESSFUL CAUSES PROSPER BEST IN TERMS OF KEEPING FAITH WITH THE PAST, KEEPING STEP WITH THE PRESENT AND KEEPING SOME REAL OR IMPLIED PROMISE TO POSTERITY! ■────────────────────────────────PSYCHOLOGICAL FACTORS──────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ F. WHY DO PEOPLE GIVE TO CHARITY? 1. To gain recognition 2. To follow religious beliefs 3. To win approval 4. To be part of a group 5. To relieve guilt 6. To get something in return 7. To relieve pressure 8. To further a cause 9. To identify with a particular organization 10. To avoid embarrassment G. THE RESEARCH & THEORIES OF DR.ERNEST DICHTER-WHY PEOPLE GIVE! 1. POWER! 2. ATTENTION! 3. PLEASURE! 4. RESPONSIBILITY! 5. DISASSOCIATION\PROTECTION! 6. IDENTIFICATION! * Dr. Dichter has written a number of books related to consumer motivation and behavior, including, HANDBOOK OF CONSUMER MOTIVATION and MOTIVATING HUMAN BEHAVIOR. His work is highly recommended. ■────────────────────────────────PSYCHOLOGICAL FACTORS──────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ MORE OF DR. DICHTER'S THEORIES I. PEOPLE FOLLOW LEADERS II PEOPLE STRIVE FOR PRAISEWORTHY ATTAINMENT III. PEOPLE SEEK UNITY BY GROUP ACTION IV. PEOPLE REACT BEST UNDER PRESSURE OF DEADLINES V. PEOPLE RELISH EARNED REWARDS VI. PEOPLE LIKE TO REPEAT PLEASURABLE EXPERIENCES VII. PEOPLE CONCEAL UNPRAISEWORTHY ATTITUDES VIII. PEOPLE EASILY LOSE THEIR SENSE OF IDENTIFICATION IX. PEOPLE GIVE INCOMPLETE ATTENTION X. PEOPLE GLANCE INSTEAD OF READ XI. PEOPLE ARE SUSPECT OF PERFECTION XII. PEOPLE GENERALIZE FROM ACCEPTABLE FRAGMENTS XIII. PEOPLE RESPOND TO THE WARMTH OF GOOD SENTIMENT XIV. PEOPLE PREFER INCOMPLETE EXPOSURE & A BIT OF MYSTERY XV. PEOPLE LIKE A DUE AMOUNT OF DIGNITY IN THEIR IMAGES XVI. PEOPLE LIKE OBLIQUE MESSAGES XVII. PEOPLE GO FOR GROOVES, CATEGORIES AND EASY FORMULAS XVIII. PEOPLE REJECT CONCEPT OF DEBT XIX. PEOPLE RESIST CHANGE OR IMPLIED THREATS TO THEIR SECURITY XX. PEOPLE GO WITH WINNERS XXI. PEOPLE SEEK AFFINITY XXII. PEOPLE WANT TO REVERE THE PAST, DEPRECATE THE PRESENT AND FEAR THE FUTURE XXIII. MOST PEOPLE SUFFER FROM "XENOPHOBIA" (fear of the stranger) H. MAGIC WORDS Experts in the fields of advertising and marketing are well aware of "psychological triggers" to evoke consumer responses. The most basic of the "triggers" used in advertising are certain words which move people to action. Why? What's the difference...they just work! HERE ARE SOME OF THE MAGIC WORDS YOU SHOULD TRY TO USE IN YOUR CAMPAIGN COMMUNICATIONS: 1. YOU 7. GUARANTEE 2. MONEY 8. LOVE 3. SAVE 9. DISCOVERY 4. NEW 10. RESULTS 5. EASY 11. HEALTH 6. FREE 12. PROVEN ■───────────────────────────────────────────────────────────────■ SOMETIMES IT'S HARD TO UNDERSTAND HOW PSYCHOLOGICAL "TRIGGERS" AFFECT FUND RAISING RESULTS. IT'S SORT OF LIKE YOUR DOCTOR TELLING YOU YOUR HEADACHES ARE CAUSED BY AN INFECTION BETWEEN YOUR TOES ! A BIT OF THOUGHT ESTABLISHES THE CONNECTION.... ■───────────────────────────────────────────────────────────────■ I. LOOK FOR THE PSYCHOLOGICAL "TRIGGERS" IN THE FOLLOWING PROMOTIONAL THEMES USED BY VARIOUS NONPROFIT GROUPS: The Heart Association is Fighting for your Life.... Blindness is Forever.... It's a Matter of Life and Breath.... He's Not Heavy...He's My Brother.... Learn Cancer's Seven Danger Signals.... No Man Stands So Tall As When He Stoops to help a boy... Helping Them Help Themselves.... Help my kids... Give the gift of Hope... You don't feel a thing...after a while you don't see a thing.... Give the gift of life... Lucky, lucky you... Give or we'll getcha...... (ONLY KIDDING!) A mind is a terrible thing to waste... ■────────────────────────────────PSYCHOLOGICAL FACTORS──────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ VI CHANGING SOCIETAL TRENDS As with any program dependent upon the synergism of the people involved, effective fund raising is influenced on a continuing basis by social changes. CONSIDER: ■ The population of the United States has increased by 22,000,000 in the past ten years! ■ The median age of people in the United States is rising: 1970 MEDIAN AGE 28.0 1980 MEDIAN AGE 30.2 1990 MEDIAN AGE 32.8 ■ Children and young adults are declining: ■ 1970 46% of the population ■ 1980 41% of the population ■ 1990 37% of the population ■ Family trends show smaller households but more of them ■ BLACKS, HISPANICS & ASIANS ARE EXPECTED TO REPRESENT FULLY 1/3 OF THE U.S. POPULATION BY THE 21St CENTURY! The Hispanic population has increased 10-fold in the past 10 years. Their population growth is five times faster than the rest of the population, three times as fast as Blacks! Sociologists say Hispanics will clearly be the MAJORITY in the United States in the near future! ■ Women are increasing their economic power and now account for fully 50% of the country's workforce! ■ An exodus to the sunbelt continues with a population growth of 40% in California, Florida & Texas in the past 20 years! ■─────────────────────────────────CHANGING SOCIETAL TRENDS──────■ FUND RAISING:PRINCIPLES & PRACTICES ■─────────────────────────────────────────────── VII. DIRECT MAIL TECHNIQUES ■════════════════════════════════════■ DIRECT MAIL CAN BE A MOST EFFECTIVE FUND RAISING TECHNIQUE. HOWEVER, IT SHOULD NOT BE USED AS AN ALTERNATIVE TO MORE PERSONAL CONTACTS MERELY BECAUSE IT IS EASIER TO IMPLEMENT AND INVOLVES LESS ORGANIZATION, VOLUNTEER COMMITMENT,ETC. ■════════════════════════════════════■ 1. DIRECT MAIL APPLICATIONS a. SECURING NEW DONORS (be prepared to pay for acquiring new donors) b. RENEWING ANNUAL GIFTS c. UPGRADING GIFT LEVELS (As donors reach higher giving levels, they should be contacted on a more personal basis) d. PROMOTING MAJOR GIFT CLUBS e. ATTRACTING PROSPECTS FOR PLANNED GIFTS (used as a tool to identify prospects only) f. ATTRACTING VOLUNTEERS ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ g. MAINTAINING DONOR FILES h. PROMOTING PROGRAMS & PROJECTS (PUBLIC RELATIONS) i. RENEWING LAPSED DONORS j. CONDUCTING MARKET RESEARCH k. INTRODUCING NEW PROGRAMS ■─────────────────────────────────────────────────■ THE ULTIMATE OBJECTIVE OF THE DIRECT MAIL PROGRAM SHOULD BE TO ATTRACT NEW DONORS, RENEW PREVIOUS DONORS AND TO UPGRADE LEVELS OF GIVING. WHEN DONORS REACH HIGHER GIFT LEVELS, THEY SHOULD RECEIVE MORE PERSONAL ATTENTION! ■─────────────────────────────────────────────────■ A WELL-PLANNED AND EXECUTED PROGRAM WILL AFFORD DONORS THE OPPORTUNITY TO SIGNAL THEIR CAPACITY AND INCLINATION TO BE MOVED TO A MORE SIGNIFICANT POSITION WITHIN THE DONOR ROLLS. 2. CONSUMER ATTITUDES TOWARD DIRECT MAIL (1) STUDIES SHOW CONCLUSIVELY THAT PEOPLE LIKE TO GET MAIL, OPEN THEIR MAIL AND TAKE ADVANTAGE OF OFFERS AND REQUESTS THROUGH THE MAIL! (2) USPS SURVEY RESULTS (a) 45% of individuals said they found unsolicited mail "USEFUL" (b) 23% of individuals said unsolicited mail was interesting & enjoyable (c) 20% said unsolicited mail was NOT useful or interesting (d) 4% said unsolicited mail was objectionable (e) 8% said they threw away unsolicited mail NOTE: USPS HANDLES OVER 100-BILLION PIECES OF MAIL ANNUALLY! 3. DIRECT MAIL HAS UNIQUE CHARACTERISTICS a) SELECTIVE b) PERSONAL c) WITHOUT DISTRACTION d) TIMELY e) FLEXIBLE FORMATS f) UNIQUE CREATIVE OPPORTUNITIES g) EASY TO MEASURE RESULTS 4. RECOMMENDED FREQUENCY FOR MAILING MAIL AS OFTEN AS DOLLAR RETURN EXCEEDS DOLLARS SPENT! EXCEPTION: Be prepared to spend money to acquire new donors! DONORS WILL NOT BE OFFENDED BY REPEATED CONTACTS THROUGH THE MAIL. 5. MAILING LISTS (1) CATEGORIES TO CONSIDER (a) PRESENT DONORS (b) PAST DONORS (c) IDENTIFIABLE PROSPECTS (d) DONORS TO SIMILAR CAUSES (e) AFFINITY GROUPS (f) OTHER (2) LIST SOURCES (a) Barter (b) Compile (c) Brokers (d) Managers (e) Compiler (f) Public records (3) BASIC LIST TYPES (a) COMPILED LISTS (b) RESPONSE LISTS (4) DEMOGRAPHICS MEASURABLE EXTERNALS OF A PERSON'S LIFESTYLE (5) PSYCHOGRAPHICS MEASURABLE INTERNALS OF A PERSON'S LIFESTYLES (6) COMPUTERIZED LIST ENHANCEMENT Offered by computer service bureaus to overlay files to produce lists that contain sophisticated detail about individual records. EXAMPLES 6. DIRECT MAIL MATH-BASIC FORMULAS ■ PERCENTAGE RETURN QUANTITY MAILED DIVIDED INTO NUMBER OF RESPONSES eg 100 responses ./. 10M mailed = 1.0% return ■ AVERAGE GIFT DEDUCT LARGER GIFTS FIRST, THEN NUMBER OF RESPONSES DIVIDED INTO AMOUNT RECEIVED eg 100 gifts = $900 including 1 gift of $100 = $800 ./. 99 responses = $8.08 average gift ■ INCOME PER THOUSAND MAILED DIVIDE QUANTITY MAILED INTO TOTAL INCOME eg $900 income ./. 10M mailed = $90 income per M ■ DOLLAR RETURN/DOLLAR SPENT DIVIDE INCOME BY COST eg 10M mailed at cost of $80/M = $800 cost produces income of $900 $900 income ./. $800 cost = $1.12 return for each $l.00 of cost ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────■ 7. THE DIRECT MAIL PACKAGE A. TYPICAL COMPONENTS a. Carrier envelope b. Letter c. Brochure d. Business reply envelope e. Premium B. COPY-THE MOST IMPORTANT ELEMENT 1. WORDS CAN HAVE CONNOTATIVE OR DENOTATIVE IMPACT AND CARRY WITH THEM EMOTIONAL AS WELL AS RATIONAL CONTENT a. DENOTATIVE WORDS Serve to indicate meaning b. CONNOTATIVE WORDS Suggest additional meanings. EXAMPLE The word HEAT is almost devoid of emotional context compared with the word WARMTH. The word GENUINE WOOL is denotative compared with WARM,SOFT LAMB'S WOOL. CHOOSE WORDS CAREFULLY FOR BEST CONNOTATIVE IMPACT! ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ 2. EXERCISE Utilize connotative words in place of denotative to describe your organization's contributions to society. EXAMPLES: DENOTATIVE WORD CONNOTATIVE WORD cold icy, frosty hot steaming, hearty, searing safe snug, secure strong rugged, durable reliable unfailing, dependable YOUR LIST: ------------------- ------------------ ------------------- ------------------ ------------------- ------------------ ------------------- ------------------ ------------------- ------------------ ------------------- ------------------ 3. CREATIVE COPYWRITING AND PACKAGE DESIGN START A "SWIPE" FILE AND USE IT! 4. COVENANT HOUSE-Father Bruce Ritter a. Excerpts from appeal letter: "...A lady should never get this dirty,she said. She stood there with a quiet, proud dignity. She was incomparably dirty -- her face & hands smeared, her clothes torn and soliled. The lady was 11 years old!" "...One night at 2AM of a bitter, cold day in February. six kids knocked on my door. It was cold and snowing very hard and the four boys and two girls looked half-frozen...they were quite young, all under 16, and they asked if they could sleep on the floor of my apartment...." CREATIVE COPY STRATEGY: TELL YOUR STORY IN SUCH A WAY THAT THE READER WILL BE ABLE TO DRAW BIG, BOLD, BEAUTIFUL WORD PICTURES IN THEIR OWN MINDS...IN FULL COLOR! 5. COPYWRITING FORMULAS a. The AIDA formula (1) ATTRACT ATTENTION (2) AROUSE INTEREST (3) STIMULATE DESIRE (4) ASK FOR ACTION b. 8-STEP FORMULA FOR WRITING A POWERFUL FUND RAISING LETTER (1) STATE THE NEED What major problem are you going to solve? (2) ILLUSTRATE THE NEED WITH A STORY Tell about someone in need and explain your organization's ability to help. (3) SHOW THE SOLUTION Tell about the specific programs your organization has which will help the individual. (4) TELL WHO YOU ARE What has your organization done in the past for people with similar problems? (5) TELL THE READER HOW THEY CAN HELP Explain in detail what the individual's gift will do. (6) ASK FOR THE GIFT Don't beat around the bush! Come straight out and ask for what you want! Include alternative giving options. Direct the reader's attention to the response device. (7) THANK & REASSURE THE DONOR Offer the donor the assurance they made the right decision in supporting your cause. (8) ADD A P.S. FOR A CLINCHER! 6. SAMPLE APPEAL LETTERS - Pick the winner! John J. Contributor 123 Main St. Anytown, USA Dear Mr. Contributor: For over 50 years, ABC Charity has provided the less fortunate in our community with free food and shelter. Our building at 657 GeorgeSt. stands as a haven for those who do not have the security of a family to look after them. Our professional staff assumes full care of the lonely, sick and desperate among us and offers these deprived souls a chance to rejoin the ranks of healthy, productive citizens. We do not charge for any of our services. All of the money we need for food, clothing,medical care, counselling comes from thoughtful gifts from kind people like you, Mr. Contributor! As we approach the holiday season, give thanks for your family's health and prosperity and help us take care of those less fortunate. Your gift of $25 will be of immeasurable help to us and will bring joy and happiness to those who must rely upon ABC Charity for their care in troubled times. In appreciation for your gift, we are pleased to enclose a WE CARE window sticker so others may know of your kind generosity. Sincerely, John Smith, Chairman PS: Your kind gift to the ABC Charity will provide hope for the less fortunate. We are pleased to enclose a WE CARE window sticker to identify you as a generous, caring donor. ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ ABC CHARITY Dear Friend: For over 50 years our organization has served the community. With rising costs of operation, we find we will have to close our doors within 30 days unless 1,000 people like you each contribute a minimum of $25 each to help us meet our budget! We have been here to serve everyone who needs us and as a good citizen, you should support us. Please take out your checkbook now and send us a gift. Our address is noted at the top of this letter. It would be a shame if we had to go out of existence because the community refused to support our cause! But this is exactly what will happen unless you respond to our appeal! Your gift is tax deductible, so why not consider sending DOUBLE what you originally considered? Remember, someday YOU might need our help.... With every good wish for continued health, we anxiously await your gift. Sincerely, Wilbur R. Wilburson ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ 7. THE "SECRETS" OF DIRECT MAIL SUCCESS IMPORTANT NOTE: ALL STRATEGIES MUST BE VALIDATED BY TESTING! ■ Use a #10 envelope when mailing to a business address ■ Use a # 7 or square envelope when mailing to home addresses ■ Use short words, 5 letters or less when possible ■ Use proper names only when you are sure of accuracy and when physical format is appropriate. Personalization will usually increase response but do NOT personalize an impersonal format. ■ Eliminating return address will NOT necessarily increase response. ■ Use of "teaser" copy on envelope may increase response. ■ Heavyweight paper stock usually outpulls lighter stock. ■ Airmail, Certified, Registered mail as well as Mailgrams may actually DECREASE response! ■ Best form of affixing postage - in decreasing order of effectiveness: Live stamps (any denomination) Meter Imprints Printed indicia Rubber stamp indicia ■ Inclusion of a letter in the package usually INCREASES response. ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ ■ Inclusion of a brochure in the fund raising package may actually DECREASE response! ■ Copy may be as long or short as necessary. ■ Copy style should be informal and directed to a SINGLE reader! ■ DISREGARD RULES OF GRAMMAR in favor of crisp, clear and convincing communication. Write as you would talk! ■ Letters should look like letters. No illustrations, rebus, photographs or other elements not normally found in letter formats. ■ Signature should always be in blue ink. ■ A letter should be signed by only ONE person. ■ Use an impressive title for the signer of the letter. ■ Use legible typestyle and those normally used to prepare a letter...no exotic typefaces! ■ Best color combinations are black & white with a blue signature. ■ Best letter size is 8 1/2" by 11". ■ Always use upper & lower case. Underlining, indentations and caps for emphasis are OK. ■ Always be sure your copy answers the vital question, " WHAT's IN IT FOR ME?" TELL WHAT THE GIFT WILL ACCOMPLISH! TELL HOW THE DONOR WILL FEEL AS A RESULT! ■ Tell the donor EXACTLY what you expect them to do! ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ ■ Use short sentences of about 25 syllables. ■ Allow room for the reader to use their imagination, to draw word pictures in their minds. Don't tell all! ■ Know how people read letters, design yours accordingly. ■ Make it easy to respond. Include a business reply envelope, offer an 800-number, preaddressed labels,etc. ■ Test use of a LIVE postage stamp instead of a BRE! ■ Enclose ANOTHER BRE when acknowledging a gift! ■ Test a package offering TACTILE INVOLVEMENT! EXCITE THE SENSES! STIMULATE THE EMOTIONS! ■ Mail as often as DOLLAR/RETURN versus DOLLAR/SPENT ration remains favorable! ■ Use appropriate BUZZWORDS in your copy. ■ Try to incorporate the MAGIC WORDS in your copy: FREE NEW YOU NOW WIN EASY INTRODUCING TODAY SAVE GUARANTEE ■ Focus attention to KEY points. Remember you have a very short period to attract attention, deliver the message and evoke response! And don't forget how quickly your prospect will FORGET your message! You must act fast and with maximum impact...You won't get a second chance! ■ Give honest, accurate information...but just enough to pique interest! ■ Be consistent with copy tone. Take the reader down the PATH without sudden diversions or cliffs to fall over.... ■ Try NEW,TESTED formats and the latest technology. ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ ■ Test use of ACTION PHRASES to arouse interest, such as "...FREE GIFT FOR YOU...." or "...YOUR NAME IS TO BE INCLUDED ON OUR HONOR ROLL...." ■ Ask questions to stimulate interest, "...HOW CAN YOU SAVE $10,000 A YEAR IN TAXES?" ■ Offer interesting FACTS to arouse interest: "OVER 50,000 PEOPLE ARE CURED OF MYLOPLACTA EACH YEAR!" ■ Use seasonal appeals, when appropriate: "MAKE CHRISTMAS MERRIER FOR LITTLE BOYS & GIRLS!" ■ Use CURIOSITY to arouse interest: "DO NOT OPEN UNTIL AFTER 8 PM!" ■ Be wary of SYMPATHY appeals! Rather, show HAPPY people AFTER they are helped by charitable gifts! ■ Try using SUSPENSE to hold reader's attention: " SUDDENLY A WOMAN'S PIERCING SCREAM RESOUNDED THROUGHOUT THE OLD HOUSE...CONTINUED INSIDE!" ■ Offer a GIFT in appreciation for support. ■ Accept pledges by phone. ■ Accept gifts charged to credit cards or on 900-telephone numbers. ■ At all costs, AVOID talking to yourself...or pleasing the Boss...when writing fund raising copy! ■ AVOID humor, it rarely sells! ■ Use colors to evoke maximum response, not just as decoration! Learn psychological implications of different colors upon different groups of people. ■ Be aware of laws and restrictions affecting direct mail. ■ Don't forget to start a SWIPE file...and use it! ■ ASK FOR WHAT YOU WANT! ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ 8. DIRECT MAIL TESTING a) THE PRIZEFIGHTER CONCEPT! Start with a CHAMP & try to beat the CHAMP! b) TYPES OF TESTS (1) TACTICAL Constituents do NOT see. Includes tests of lists, timing,application of list enhancements, geographic selections, etc. (2) APPROACH Constituents DO see. Includes tests of copy, offers, package formats, etc. CAVEATS FOR TESTING 1. ALWAYS TRY TO "BEAT THE CHAMP!" 2. BETTER NOT TO TEST AT ALL THAN TEST THE WRONG ELEMENTS AT THE WRONG TIME AND MISREAD THE RESULTS! ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ ELEMENTS TO CONSIDER TESTING: COPY LETTER SIGNER INCLUSION OR ELIMINATION OF BROCHURE CARRIER ENVELOPE TYPE USE OF ENVELOPE TEASER COPY METHOD OF AFFIXING POSTAGE USE OF COLOR USE OF TACTILE INVOLVEMENT DEVICES USE OF PREMIUMS PACKAGE FORMAT GRAPHIC DESIGN ELEMENTS SPECIAL ENCLOSURES PERSONALIZED VERSUS NON-PERSONALIZED LETTERS VARIOUS LISTS LIST ENHANCEMENTS TIMING OF MAILING ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ RULES FOR TESTING: 1. TEST FOR MEASURABLE INCREASES ONLY> Example: significant increase in percentage of overall response rate or gift level. 2. TEST ONLY ONE ELEMENT AT A TIME. 3. MAIL SPLIT TESTS IN CLOSE PROXIMITY. 4. USE SAME POSTAGE RATE WITH ALL TESTS. 5. MAIL TEST PACKAGES TO RANDOM SAMPLES WITHIN SAME MAILING LIST. 6. USE LISTS OF ADEQUATE SIZE TO ASSURE STATISTICAL RELIABILITY OF TESTS. BEST TIME TO TEAT (In descending order of productivity) JANUARY FEBRUARY SEPTEMBER OCTOBER AUGUST JULY MARCH NOVEMBER APRIL DECEMBER MAY JUNE BEST FOR MAIL TO ARRIVE ON TUESDAY AVOID TAX DEADLINES, MAJOR HOLIDAYS AND KEY ELECTIONS ■───────────────────────────────────DIRECT MAIL─────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────────────────■ VIII COMPUTER-ASSISTED FUND RAISING 1. RULE OF THUMB TO DETERMINE IF YOU SHOULD USE A COMPUTER IN YOUR PROGRAM: ■─────────────────────────────■ DISREGARD ALL RULES OF THUMB! ■─────────────────────────────■ 2. AUTOMATION IS REALISTIC WHEN IT CAN DO THE JOB BETTER AND YOUR ORGANIZATION IS WILLING TO PAY FOR IT! 3. CRITERIA a. Is required information ACCESSIBLE? b. Can information be recovered IN FORM NEEDED? c. Can information be recovered WHEN NEEDED? d. Can files be EASILY MAINTAINED? IF ANSWERS TO ANY OF ABOVE QUESTIONS ARE "NO," CONSIDER AUTOMATING. 4. COMMITMENT REQUIRED BY YOUR ORGANIZATION a. Adequate BUDGET b. Adequate STAFF c. SHARING of information d. Developmental PRIORITY e. Administrative INVOLVEMENT ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ 5. REALISTIC EXPECTATIONS a. Automation does NOT usually result in need for smaller staff. In fact, staff usually INCREASES! b. Automation requires much closer attention to ACCURACY. Is a fast sloppy clerk better than a slow sloppy clerk? Organization must be prepared to fully UTILIZE computer's productivity. d. The decision to automate is for the LONG TERM. 6. LEVEL OF COMPUTER "LITERACY" REQUIRED a. Organization can make basic decision concerning level of literacy and mode of service they want. (1) FULL UNDERSTANDING AND CAPABILITIES RELATED TO SYSTEM DESIGN, PROGRAMMING AND OPERATIONS. (2) UTILIZATION OF OUTSIDE SOURCES TO DESIGN AND IMPLEMENT PROGRAM WITH STAFF SKILLED IN BASICS OF OPERATION ONLY. (3) UTILIZATION OF IN-HOUSE CAPABILITIES TO PROVIDE FUNCTIONS OF #1 ABOVE WITH STAFF TRAINED IN OPERATION ONLY. ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────■ (4) COMPUTERIZED FUNCTIONS PROVIDED ON A SERVICE-BUREAU BASIS BY EITHER OUTSIDE FIRM OR IN-HOUSE DATA PROCESSING DEPARTMENT. 7. BENEFITS OF COMPUTERIZATION INCREASED WITH JUST A BASIC KNOWLEDGE OF "BLACK BOX" THEORY a. HISTORY Eniac developed at University of Pennsylvania in 1948. b. "INFORMATION EXPLOSION" spurred computer industry c. ESSENTIAL FUNCTIONS PERFORMED BY THE COMPUTER (1) Selection (2) Sorting (3) Summarizing (4) Retrieval (5) Computing (6) Printing d. BASIC COMPONENTS (1) Hardware (2) Software ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────■ 8. THE STARTING POINT Effective utilization of the computer begins with a careful definition and description of what you want the computerized system to do for you. This does NOT call for technical jargon of any type! Simply state your requirements. For example, you might want your system to record gifts and issue receipts, you might want to have weekly reports detailing gifts by source and purpose. You might also need to produce mailing labels, pledge cards,etc. Once you have completed this step, you have effectively completed the #1 step in the computerization process (System Design). Later, your defined requirements will be translated into "computereese" by the technician who will implement your system. When you define what you want to come OUT of the computer, it is relatively easy then to determine what needs to be put INTO the computer to meet your needs. 9. THE DATABASE The DATABASE details the elements of information to be captured, organized and recovered from your computerized fund raising system. Regardless of your level of computer expertise, YOU are the person most qualified to determine the composition of your database. See the specimen DATA ELEMENT DICTIONARY on page 76. It illustrates how information to be included in the database is initially detailed. ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────────■ 10. TYPICAL OUTPUT MATERIALS GENERATED FROM INFORMATION CONTAINED WITHIN THE DATABASE a. GIFT TRANSACTION EDIT Lists all gift transactions for auditing purposes b. MASTER FILE DETAIL List for each source group of all coding applied to each donor account. Used to analyze effectiveness of coding and to allow revising. c. SOLICITOR REPORT Details all prospects assigned to solicitors and tracks gift history. d. APPEAL ANALYSIS Details gifts received within selected periods for each separate appeal or campaign. Compares gifts in current period with those of prior periods to gauge growth. e. MAJOR GIFT LISTING Isolates and details all gifts received within defined major gift ranges. f. GIFT JOURNAL Details ALL gifts received. g. LYBUNT REPORT Details all gifts received in prior period but not renewed in current period. h. PYBUNT REPORT Details all gifts received prior to last period but not received in current period. ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ i. ALLOCATION REPORT Details all gifts by purpose to which they are to be applied. j. MAILING LABELS k. GIFT ACKNOWLEDGEMENTS & RECEIPTS l. APPEAL LETTERS m. DONOR LISTINGS\HONOR ROLLS n. SOURCE REPORT Details gifts by source from which received. o. GIFT SIZE ANALYSIS Details gifts by dollar range. p. GIFT TREND ANALYSIS Compares giving patterns & percentage renewals by various categories. q. DIRECTORIES r. PLEDGE CARDS s. PHONATHON FORMS t. SOLICITOR ASSIGNMENT FORMS u. PLEDGE ACKNOWLEDGEMENT FORMS v. ENVELOPES FOR MAILINGS w. INDIVIDUAL DONOR RECORD CARDS ■───────────────────────────COMPUTER-ASSISTED FUND RAISING──────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ IX FOUNDATIONS A. DEFINITION " A large body of money completely surrounded by people who want some...." H. M. Schwartz " A nongovernmental, nonprofit organization having a principal fund of its own, managed by its own trustees or directors, and established to maintain or aid social, educational, charitable, religious or other activities serving the common welfare" The Foundation Center B. PHILANTHROPIC PHILOSOPHIES 1. Andrew Carnegie " The wealthy should administer their wealth as a public trust during their lifetimes because, having proved themselves in the struggle for commercial success, they were particular fitting agents of the public trust...." 2. John D. Rockefeller "... if a combination to do business is effective in saving wastes and getting better results, why is not combination far more important in philanthropic work? Let us erect a foundation, a trust, and engage directors who will make it a life work to manage, with our personal cooperation, this business of benevolence properly and effectively...." ■─────────────────────────────────FOUNDATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ C. THE WORLD OF FOUNDATIONS The 13th Edition (1990) of The Foundation Directory lists 7,581 foundations in the United States with assets of at least $1-million or which make grants of at least $100,000 per year. These foundations have combined assets of $115-billion and make over $7-billion in grants each year. The Foundation Center estimates the major foundations listed account for 93% of all gifts from the foundation sector. ■─────────────────────────■ TOTAL FOUNDATION GRANTS IN 1989: $6.7-billion ■──────────────────────────■ ■──────────────────────────■ FOUNDATION GRANTS AS A PERCENTAGE OF ALL 1989 CHARITABLE GIVING: 5.8% ■──────────────────────────■ D. REALISTIC EXPECTATIONS 100 to 200 of the 7,581 major foundations account for over 80% of ALL foundation grants! E. Foundations are more than just legal entities. They exist to perpetuate the interests and concerns of the benefactors whose money they manage! If your cause happens to be compatible with these interests, you MIGHT have a chance for a grant! F. Foundations are run by people...If you have PROPER ACCESS to these people, you MIGHT get a grant! ■─────────────────────────────────FOUNDATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────────────────────■ G. Major foundations receive from 5,000 to 10,000 proposals a year requesting grants. Under the best of circumstances, it is a probability game to receive their attention, and even more tenuous to be fortunate to offer a program that matches their interest! SOUND DISCOURAGING? REMEMBER FOUNDATION GRANTS CONSTITUTED ONLY 5.8% OF CHARITABLE GIFTS LAST YEAR! H. A SIGNIFICANT COMMENT FROM A FOUNDATION EXECUTIVE " Most foundations are not philanthropies...they exist to hide taxes or to hold business control...." I. TYPES OF FOUNDATIONS 1. INDEPENDENT Represent 80% of foundations. These foundations obtain funds from a family, individual or groups of individuals and are unaffiliated with any business or other institution. Grants made by independent foundations are usually made to clearly defined areas of interest. 2. COMMUNITY There are 300 community foundations in the country. These foundations usually serve very specific areas, usually around major cities. Community foundations receive their money from individuals,independent and company-sponsored foundations.In some respects community foundations are a type of federated agency administering funds from many sources. Most community foundation grants go to causes specified by donors to the fund. 3. OPERATING There are 2100 operating foundations in the country.Operating foundations provide service such as health, education or research. Most of their funds come from a single source. 4. CORPORATE There are 1400 corporate foundations in the country. Most hold controlling interest in the firms that created them. ■─────────────────────────────────FOUNDATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ J. BASIC PROCEDURES FOR PURSUING FOUNDATION GRANTS 1. IDENTIFY A SPECIFIC PROGRAM OR PROJECT FOR WHICH YOU SEEK FUNDING 2. THOROUGHLY RESEARCH FUNDING SOURCES LIKELY TO BE INTERESTED IN YOUR PROJECT a. Internal Revenue Service Form 990-AR b. Foundation Library Center c. Foundation Directory d. Private Research Sources e. Foundation Annual Reports f. Publications (Chronicle of Philanthropy) g. Newspaper Libraries h. Public Libraries i. Clipping Services j. OTHER SOURCES 3. ATTEMPT TO IDENTIFY AN AFFINITY BETWEEN YOUR ORGANIZATION, THE PROJECT FOR WHICH YOU SEEK FUNDING AND FOUNDATION FUNDING SOURCES. ■────────────────────────────────────────────────────────■ A PERSONAL RELATIONSHIP BETWEEN INDIVIDUALS IN YOUR ORGANIZATION AND THE FOUNDATION(S) IS THE MOST IMPORTANT FACTOR IN DETERMINING IF YOU SHALL RECEIVE FUNDING FOR YOUR PROJECT! ■──────────────────────────────────────────────────────────■ ■─────────────────────────────────FOUNDATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■───────────────────────────────────────────────────■ 4. MAKE AN EXPLORATORY CONTACT TO ASCERTAIN POSSIBLE INTEREST IN YOUR PROJECT 5. IF INVITED TO DO SO, PREPARE AND SUBMIT A PROPOSAL 6. FOLLOW UP 7. EVERY INSTITUTION AND ORGANIZATION SHOULD ESTABLISH AND MAINTAIN AN ONGOING RELATIONSHIP WITH FOUNDATION OFFICERS BEFORE THE NEED TO SUBMIT A FUNDING REQUEST! K. BASIC ELEMENTS OF A FOUNDATION GRANT PROPOSAL 1. STATE THE PROBLEM YOU INTEND TO SOLVE 2. EXPLAIN HOW YOU INTEND TO SOLVE THE PROBLEM ESTABLISH WHY YOUR ORGANIZATION IS QUALIFIED TO SOLVE THE PROBLEM 4. DETAIL WHO WILL BE SOLVING THE PROBLEM 5. SET FORTH HOW MUCH THE PROJECT WILL COST 6. LIST THE RESOURCES YOUR ORGANIZATION IS PROVIDING 7. EXPLAIN HOW YOU WILL EVALUATE THE RESULTS OF THE PROJECT 8. ESTABLISH THE TRANSFERABILITY OF THE RESULTS YOU HOPE TO ACHIEVE 9. PROVIDE RELEVANT INFORMATION ABOUT YOUR ORGANIZATION, ITS STAFF, VOLUNTEERS, BOARD MEMBERS,ETC. ■─────────────────────────────────FOUNDATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────────■ L. OTHER SUGGESTIONS 1. Read successful proposals submitted by other organizations 2. Maintain files on foundations which have supported similar organizations to your own 3. Participate in professional fund raiser programs related to foundation grant seeking. I. CORPORATIONS A. CORPORATE GIFTS IN 1989 TOTALED $5-BILLION AND REPRESENTED 4.4% OF THE $114-BILLION CONTRIBUTED IN 1989 BY All SOURCES! B. THE IRS REPORTS THAT OVERALL LESS THAN 25% OF AMERICAN CORPORATIONS MAKE ANY TYPE OF CHARITABLE GIFT! C. CORPORATE PHILANTHROPIC PHILOSOPHIES 1. Henry Ford II " The corporation is not an all-purpose mechanism. It is a specialized instrument designed to serve the economic needs of society and it is not well equipped to serve social needs unrelated to its business operations...." 2. Edward Marness, Chairman Proctor & Gamble Inc. " the corporation's proper role is to produce economic goods or services in the pursuit of profit...." D. SEEKING CORPORATE SUPPORT PROCEDURES FOR SECURING SUPPORT FROM CORPORATIONS IS MUCH THE SAME AS FOR FOUNDATIONS. AS IN THE CASE WITH FOUNDATIONS, PERSONAL CONTACT AND THE RELEVANCY OF THE PROJECT TO BE FUNDED TO THE INTERESTS OF THE CORPORATION ARE KEY FACTORS IN INFLUENCING AWARD OF CORPORATE GRANTS! ■────────────────────────────────CORPORATIONS───────────────────■ FUND RAISING:PRINCIPLES & PRACTICES ■────────────────────────────────────────────────────────■ XI PROGRAMS FOR PRIORITY PROSPECTS A. BASIC PHILOSOPHY Seek out individuals with the INCLINATION and CAPACITY to make SIGNIFICANT gifts and ENTICE these people to this level of support through programs based upon ELITISM, PEER PRESSURE, and RECOGNITION ! B. PSYCHOLOGICAL APPEALS 1. YOU ARE SPECIAL! 2. OUR MAJOR GIFT CLUB IS SPECIAL! 3. THEREFORE, YOU SHOULD BELONG TO OUR CLUB! C. CHARACTERISTICS OF MAJOR GIFT CLUBS 1. UNIQUE & DISTINGUISHED NAME a. THE PRESIDENT'S CLUB b. FRIENDS OF XYZ ORGANIZATION c. THE $1,000,000 ROUNDTABLE d. THE JOHN JONES SOCIETY 2. SIGNIFICANT GIFT REQUIRED FOR MEMBERSHIP a. Club may be established at any dollar level b. Usually have multi-levels of membership to encourage donors to move up to more elite levels c. Annual renewal of gift required ■───────────────────────────PROGRAMS FOR PRIORITY PROSPECTS─────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ 3. MEMBERSHIP AFFORDS SPECIAL BENEFITS a. Tickets to special events b. Invitations to luncheons,dinners,cocktail parties e. Inclusion within HONOR ROLLS f. Reserved parking g. Commemorative gifts 4. MEMBERS INCLUSION IN CLUB HEAVILY PUBLICIZED a. Names may be inscribed on plaque b. Photo may be included in newsletter 5. BASIC STEPS TO FORM MAJOR GIFT CLUB a. DEVELOP OVERALL FRAMEWORK FOR CLUB b. ENLIST "CHARTER" MEMBERS WHO WILL QUALIFY BY MAKING INITIAL GIFTS AND THEREBY GAIN MORAL AUTHORITY TO RECRUIT OTHER MEMBERS c. RESEARCH PROSPECTS FOR MEMBERSHIP d. PREPARE PROGRAM MATERIALS e. PLAN PROGRAM ACTIVITIES f. CULTIVATE & SOLICIT NEW MEMBERS h. CONTINUE ONGOING PROMOTION OF CLUB TO MAINTAIN ITS ELITE QUALITY ■───────────────────────────PROGRAMS FOR PRIORITY PROSPECTS─────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ XII PUBLIC RELATIONS AND PROMOTION A. WHAT IS PR? FRIEND RAISING! B. GOAL OF ALL PR ACTIVITIES TO CREATE A CLIMATE WHICH WILL MAKE ALL FUND RAISING ACTIVITIES SUCCESSFUL! C. EVALUATING PR OPPORTUNITIES l. A SUCCESSFUL PROGRAM MUST HAVE CLEAR, IDENTIFIABLE GOALS WHICH MUST BE CONTINUALLY EXAMINED BEFORE ANY PROJECT IS UNDERTAKEN! 2. ASK BEFORE EVERY PR OPPORTUNITY: Does this project contribute to the realization of our goals? 3. Too many PR programs are disjointed, opportunity- seeking projects which do NOT contribute to institutional advancement goals! Many are self-serving and for ego satisfaction! D. REMEMBER, PUBLIC RELATIONS BY ITSELF DOES NOT RAISE MONEY! E. THEORY OF EDWARD BERNAYS "Tell them what you have to tell them, then tell them what you want to tell them, then tell them what you told them!" F. PUBLIC RELATIONS CREATES VALIDITY FOR A CAUSE. PR ATTEMPTS TO INFLUENCE ATTITUDES BEFORE THEY BECOME OPINIONS! G. PEOPLE WILL BELIEVE WHAT THEY'RE TOLD...IF IT'S CREDIBLE, FORCEFUL AND PROPERLY DELIVERED! H. PUBLIC RELATIONS IS "THE ENGINEERING OF CONSENT!" ■─────────────────────────────PUBLIC RELATIONS AND PROMOTION────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ I. PR MOTIVATES! J. PR SETS THE STAGE FOR SUCCESSFUL FUND RAISING! K. BE CAREFUL NOT TO TALK TO YOURSELF...OR FOR THE BENEFIT OF THE BOSS! L. REMEMBER, PUBLICITY IS NOT PR! IT IS JUST ONE ELEMENT OF A COMPLETE PR CAMPAIGN! M. PR MEDIA ARE VIRTUALLY LIMITLESS... BROCHURES NEWSLETTERS MAGAZINES PAMPHLETS MONOGRAPHS SPACE ADVERTISING TV NEWSPAPERS EXHIBITS DISPLAYS MAIL INSERTS PACKAGE INSERTS TABLE CARDS PLACE MATS BANNERS SPEAKERS POSTAL IMPRINTS SEMINARS WORKSHOPS INTERVIEWS BILLBOARDS FILMS POSTERS PREMIUMS SCREENINGS SKYWRITING CONTESTS BUTTONS SPECIAL EVENTS use your own imagination... N. PUBLICITY IS A VALUABLE ADJUNCT TO A PROGRAM It keeps your cause and its needs before your constituents. It creates excitement & urgency. It establishes validity. It informs, persuades, motivates and rewards those whose interest is vital to the success of your organization! ■─────────────────────────────PUBLIC RELATIONS AND PROMOTION────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ O. PUBLICITY STRATEGIES ■ Understand the needs of the media. Meet their needs. ■ Develop personal media relationships, before you need to use them! ■ Know your cause well and its key selling points! ■ Learn the rules of newswriting (Read the newspaper!) ■ Clip stories and maintain a file to learn proper styles and to get story ideas! ■ Be absolutely honest in all your media dealings. ■ Be prepared for rejection . ■ Be fair. ■ Be brief. ■ Don't disguise advertising as publicity. ■ Never use pressure. ■ Don't beg. ■ Respect deadlines. ■─────────────────────────────PUBLIC RELATIONS AND PROMOTION────■ FUND RAISING:PRINCIPLES & PRACTICES ■──────────────────────────────────────────────■ XIII PLANNED GIVING PROGRAMS A. PLANNED GIFT PROGRAMS SEEK SUBSTANTIAL GIFTS WHICH INVOLVE A DONOR'S CAPITAL ASSETS RATHER THAN DISPOSABLE INCOME. THEY AFFORD DISTINCTIVE ESTATE PLANNING BENEFITS WHICH ARE MADE POSSIBLE BY GENEROUS PROVISIONS OF THE TAX LAWS. NOTE WELL: NOTWITHSTANDING TAX BENEFITS WHICH MAY INURE TO THE BENEFIT OF A DONOR, PLANNED GIFT PROGRAMS MUST NOT RELY UPON POTENTIAL TAX SAVINGS AS THE BASIS FOR THE CHARITABLE GIFT SOLICITATION! B. IMPLEMENTATION OF AN EFFECTIVE PLANNED GIFT PROGRAM REQUIRES THAT THE DEVELOPMENT STAFF BE KNOWLEDGEABLE OF THE ESTATE PLANNING RAMIFICATIONS OF PLANNED GIFTS. SUCH KNOWLEDGE IS EASILY OBTAINED THROUGH A NUMBER OF PROFESSIONAL SEMINARS AND WORKSHOPS CONDUCTED REGULARLY ON THIS SUBJECT. IT IS NOT ADVISABLE, OR NECESSARY, FOR THE DEVELOPMENT OFFICER IN CHARGE OF THE PLANNED GIFT PROGRAM TO BE AN ATTORNEY OR CPA. C. PLANNED GIFT PROGRAMS REQUIRE CAREFUL IDENTIFICATION OF VIABLE PROSPECTS, ONGOING CULTIVATION OF THESE PROSPECTS AND VERY PERSONAL LEVELS OF GIFT SOLICITATION. IT IS NOT UNUSUAL FOR A LONG PERIOD OF NEGOTIATION AND STUDY TO TAKE PLACE BEFORE A DONOR AGREES TO MAKE A PLANNED GIFT. D. PLANNED GIFT PROGRAMS REQUIRE A VERY SPECIAL COMMITMENT FROM AN ORGANIZATION'S BOARD AND STAFF. E. PLANNED GIFT PROGRAMS ARE USUALLY NOT 'CAMPAIGN' ORIENTED. F. PLANNED GIFT PROGRAMS DO NOT PRODUCE IMMEDIATE RESULTS. IN FACT, IT MAY TAKE YEARS TO SEE THE RESULTS OF A PROGRAM BUT FEW FUND RAISING TECHNIQUES CAN PRODUCE SUCH DYNAMIC RESULTS! G. BEST PROSPECTS FOR PLANNED GIFTS ■ Age 60 or over ■ Already retired or about to retire ■ Diminished family responsibilities ■ Has capital to make large gift ■ Can benefit from tax provisions ■ Unmarried with no close family ties ■ Married couples with no children ■ Married couples with well-to-do children ■ Those who previously made large gifts ■ Those close to your organization (trustees, etc) ■ Those who already made a planned gift H. TYPES OF PLANNED GIFTS ■ BEQUESTS ■ OUTRIGHT GIFTS ■ BARGAIN SALE ■ UNDIVIDED INTEREST ■ REMAINDER DEED ■ CHARITABLE ANNUITY ■ CHARITABLE TRUST ■ POOLED INCOME FUND ■ CHARITABLE REMAINDER UNITRUST ■ LIFE INSURANCE ■ REAL ESTATE ■ GIFTS IN KIND XIV CAMPAIGN ORGANIZATION TIPS Fund raising cannot be an incidental function or implemented as an adjunct to other administrative functions. If an organization has a need for support from the private sector, it must delegate the resources necessary to plan and implement fund raising as an independent administrative function. Once a program is established, the individual responsible for the function must have the full commitment and support of all levels of the organization. Fund raising cannot thrive as an unobtrusive function.It requires overt, active leadership, continuing motivation and involvement of staff, volunteers and board members. The program must continually monitor its constituency to discern changes in attitude as these changes may affect ongoing support. This is the equivalent of market research in the business world. Never presume to know why people do or do not support your cause. Find the reasons and alter campaign strategy when necessary to meet donor needs and interests. Never take support for granted! People do not really owe you anything. You must make giving to your cause a satisfying and rewarding experience for the donor. Don't forget the AFTERSALE! Keep thanking donors AFTER they give and you'll have a friend for a long time! Cultivate and use volunteers effectively. They can be the best emissaries you can have. Make sure everyone who solicits gifts has THE MORAL AUTHORITY they need! (gained by making their own gift FIRST!) Keep your skills sharp by attending seminars, reading, talking to collegaues EPILOGUE Fund raising has been called PRIVATE GIVING FOR THE PUBLIC GOOD. This description is most fitting. Almost from the founding of our country, Americans have shown their willingness to help others by contributing generously to a myriad of causes. Notwithstanding the scope of philanthropic giving in our country, it is necessary to realize that the natural instincts of good people must be nurtured and directed before the act of charitable giving will take place. It doesn't happen by itself! The thousands of men and women who have chosen the noble profession of fund raising are responsible for channeling the good intentions of individuals into the overt actions which last year provided over $114-billion for the public good! Hopefully, this seminar has provided some ideas -- and perhaps motivation -- to help you achieve even greater results for your cause in the years ahead. HOWARD M. SCHWARTZ President Marketing Services Corporation of America #1 Marketing Centre 3157 Madison St. Waukesha, WI 53188 (414) 521-8057 NOTE: The entire proceedings of the fund raising seminar are available on audio cassettes with a l60-page study guide. Other programs available: DIRECT MAIL FOR BUSINESS AND INDUSTRY COMPUTER ASSISTED FUND RAISING IF THIS UNIVERSITY-ON-A-DISK PROGRAM HAS BEEN OF VALUE TO YOU, PLEASE SEND YOUR REGISTRATION FEE OF $25 TO SUPPORT THE DEVELOPMENT OF MORE OF THESE PUBLIC- SERVICE PROGRAMS. THANK YOU.