Like any profession, fundraising has its own jargon. For example, what is the difference between a fundraising program and method? Some believe major gifts is a program, others feel it is a method while many think it is a number. In my view, there are four basic fundraising programs: Annual Giving, Major Gifts, Planned Giving and Campaigns and a number of methods.
Annual Giving Program Annual Giving includes gifts that can be replicated within a one-year period and can include one-time, monthly or even pledged gifts - if the pledge is completed within a year. The purpose of an Annual Giving Program is to ensure a not-for-profit organization (organization) can financially continue its operations to achieve its Mission by serving the clientele for which it was created. Operations can vary from organization to organization, but in general includes: administration/overhead, programs to meet the needs of its clientele, low cost equipment and/or projects and research. How often have we heard from well intentioned donors: “I will give but do not want my money going to overhead.” Without overhead an organization cannot exist! The base for well managed Annual Giving Programs should include donors who have given repeatedly for a number of years because the organization has built good relationships by stewarding them well. On average an organization loses between 15-20% of its annual donors each year, so continual donor acquisition is critical.
Major Gifts Program Major gifts are not a number. The amount of a major gift depends on an organization’s sector and size. For example, some large charitable institutions believe a major gift is $10,000 and higher; while a major gift for a small agency could be $500, or less. For example, given their size and scope, institutions in the health sector will attract larger major gifts than a neighbourhood social service agency. Major gift programs fund relatively large new initiatives that donors understand require a greater investment. Individual gifts from donors that alone can fund a new program, project or facility are referred to as Transformative Major Gifts. Most major donors have built a positive relationship with an organization and understand its Mission by initially and repeatedly giving to its Annual Giving Program.
Planned Giving Program (or if you prefer Gift Planning) Planned Giving comprises many giving vehicles. In Canada these include:
• Bequests in a Will
• Gifts of property
• Gifts of Life Insurance
• Tribute Gifts
• Gift Annuities
• Endowed Gifts of cash, and
• Charitable Remainder Trusts.
These gifts provide financial stability for an organization’s administration and programs so it can continue to meet its Mission well into the future. Most planned gifts are known ahead of time by organizations who build strong relationships through good stewardship with their donors, who more than likely made their first gift through Annual Giving.
Campaigns Campaigns are created to raise funds in addition to on-going programs. When campaigns are implemented, it is imperative that they are conducted in a way to create additional funds; not lessen established annual giving, major gifts and planned giving goals.
Some campaigns can be conducted within one year, that could align with an Annual Giving Program; but most campaigns are conducted over a longer period of time. The current trend is many campaigns are taking longer, anywhere from 3 to 10 years to complete.
Campaigns can also be comprehensive. Comprehensive campaigns are those that raise additional funds and include the amounts raised annually through annual gifts, major gifts and planned giving. For example, many large hospital and university campaigns conducted over a long time period are usually comprehensive.
Campaigns are very effective at attracting new donors. This occurs because new donors are most commonly asked and influenced to give by donor volunteers already vested in an organization. Campaigns are focused on major giving conducted within a specific time frame.
Conclusion Annual Giving is most important because it is through this program the vast majority of donors initially give.
Fundraising methods will be outlined in the next article in this series.
Since 1974, Dr. Hallett has worked in the not-for-profit charitable sector. In 1981 Bill graduated with a PhD in Physical Education & Recreation from the University of Alberta. He is one of only a handful of Canadians to hold the Advanced Certified Fund Raising Executive (ACFRE) designation. Raising Executive (ACFRE) designation. Bill joined the YMCA in Peterborough Ontario in 1979. In 1987 he joined the staff of the YMCA of Greater Toronto. From 1997 to 2000 he developed his own full-service fundraising practice. In 2000 Bill joined The Hospital for Sick Children Foundation as its Chief Development Officer and led the development team that raised over $125 million during his three-year contract. In July 2003 he returned to his consulting practice fulltime. As a fundraising consultant Bill has been involved in the development of many other fundraising programs, feasibility and planning studies, capital campaigns for numerous clients. In 1993 he became the founding President of the current Association of Fundraising Professionals (AFP) Greater Toronto Chapter, following which he served on AFP’s International Board, later becoming the first Canadian to be elected to its Executive. He was a founding Board member of the Canadian Association of Gift Planners (CAGP), the national organization in Canada that promotes planned giving. In 2003, the Toronto Chapter of AFP selected Bill as its Outstanding Fundraising Executive. From January 2007 to December 2008 Bill served as the Chair of the AFP Canada Council.