The Space Between Campaigns: The Pause That Refreshes
Jennifer Z. Wood
I love nothing more than a campaign kick-off, a special event, or a strategy meeting – basically any excuse to joyously proclaim, “Wheels up!” After all, this is where the magic happens, right? This is where we make the connections between grateful patients and projects, reveal the vision of a physician’s ground-breaking research or have our big ask answered with a resounding YES.
But what about the in-between times? Rather than delegate them to “other” or “ordinary,” making them extraordinary is what will keep your team’s morale high and turnover rates low. Here’s a huge opportunity in a veritable sea of extraordinary options when you want to give your foundation or fundraising staff rewarding, smaller scale projects that mesh with your health care organization’s mission and contribute to the bottom line.
An Extraordinary Opportunity: Redemption
Congratulations! The capital campaign or major gifts initiative is a success! Your team surpassed the pledge goal, and while you are all thrilled, your team may be feeling slightly awkward as you slow your pace. The truth is, while you may no longer be actively soliciting donors, a campaign continues as pledges are being fulfilled. Before you go back to ‘business as usual,” consider some key strategies to maximizing the all-important pledge collection. As a successful capital campaign or major gifts initiative winds up, channel this last bit of saved energy and freed up time to the successful redemption of pledges – thus ensuring that the culmination of months (even years!) of hard work is (literally and figuratively) paid off.
Here are some extraordinary considerations:
- Design an effective pledge redemption plan.
- Implement a pledge redemption plan that includes the organization’s President/Chief Executive, the financial officer and a volunteer-led Continuation or Pledge Redemption committee.
- Schedule careful report monitoring (monthly, quarterly, semi-annual and annually).
- Remain diligent when following up on late pledge payments.
- Celebrate and share your progress.
Assess the Situation
A major campaign is not a “one size fits all” endeavor, and a redemption plan is no different. You will find donors vary on how they prefer to make pledge payments and standard methods for pledge redemption may not be best for your specific situation. Knowing your own community’s quirks, its culture and what truly motivates your donors will help you keep them engaged over a three- to five-year period. Regardless of the type of environment you’re in, your donors will certainly appreciate convenient options for pledge payments that make the most sense for them.
That being said, standard industry practice is to receive approximately 10% of the funds when you secure the pledge, with about 30% of the fund being collected by the end of the active solicitation period (assuming 18 months of active solicitation with a five-year pledge payment period). Redeeming the remaining balance of 70% of the pledge depends upon a successful Continuation Phase or Pledge Redemption Phase.
Organizations with effective pledge redemption plans can expect to collect 90-95% of the amount pledged (or even higher, if they are very thorough) throughout the pledge payment period. This will happen only with teamwork, communication between committee members, diligence and businesslike follow-up, careful monitoring of accounts and, of course, open and frequent communication to the donors.
Assemble Your Extraordinary Team (Get to the Finish Line Strong!)
How do you implement this plan? Whether a fundraising department at a small nonprofit or a foundation office at a large health care system, the method should be the same – form a Continuation or Pledge Redemption Committee – a group created to function throughout the pledge payment period. Usually about five to 10 people are selected for the committee, depending on the amount of donor touches needed. Begin by recruiting volunteers who worked on the campaign – the most successful merit initial consideration. It is important to keep in mind that the nature of this committee requires tactful and courteous people who can perform the delicate task of reminding delinquent donors of their commitment in a friendly, pleasant and completely private manner. The committee meets once a month to receive and review a report of pledge payment progress provided by the organization’s financial officer. The report should include the aggregate of all monies received to date, the amount received during the most recent report period and a listing of all delinquent pledges. Other than this monitoring function, the committee will communicate with donors who have fallen behind in their payments in order to revive regular payments or arrange a new payment schedule, and then relay the progress of pledge redemption with the fundraising staff.
Nuts and Bolts (Boring, but Important!)
It is important for the organization to ensure that “Statement of Account” (not ‘bills’) notices are sent promptly within the first two or three days of each month. Such dependable action will foster a habitual behavior in donors, and you will routinely see payments as scheduled. Ideally, designate a single telephone line or extension as a “Donor Hotline” for donors to call with questions or changes during the statement-payment-posting cycle. If possible, donors should get the same person at the pledge redemption office every time they call and receive prompt and courteous treatment. Follow-up written confirmation of these calls should also be prompt and detail the specific action taken. These recommendations will help ensure donors pay on time, pay off their pledges and, sometimes, send in additional funds.
Most organizations have some type of fundraising software that will facilitate the pledge redemption, posting and recording. This significantly reduces the time and labor required to service the donor base. Consider placing a brief update with an eye-catching photo periodically in the statements of all donors, which details their account activity to date, updates them on the campaign and funds collected to date, explains progress with the project and thanks them for their continued commitment. Records of these correspondences can usually be linked to each donor’s account.
Segment Your Donors (Segmentation will Save You!)
Just as all hospitals and markets are not the same, neither are your campaign donors. Your next step will be to determine how to keep your donors engaged over a multi-year redemption period. You will find that once pledge collection is underway, your donors will fall into several different categories. Let’s start with the most challenging one first.
Late Payment or Delinquent Donors: When a pledge account falls into arrears, think of your patients and of this situation as an illness — the sooner it’s diagnosed, the better the chances for recuperation. As a rule, all delinquent accounts should be discussed by the Continuation Committee before any action is taken. Why? Because there may be personal or family problems that someone on the committee is aware of, they may have retired and moved out of state or have not received your mailed statements. Make an incorrect assumption, and you could do damage to the relationship. On an annual basis, the Finance Office should revise pledge expectations and write off delinquent accounts, after confirming such action with the fundraising office.
Special attention should be paid to pledges of $25,000 and above. Donors of $25,000 or more who fall in arrears should be investigated more closely and followed up with personally. A friendly phone call or note from the president or executive director of the organization or a member of the committee will often make the difference with a significant donor.
On-Schedule Donors: Don’t forget to keep your regularly paying donors engaged as well, especially if your campaign is long term. Email on a weekly basis, thanking your donors for their support and updating them on total funds collected to date. Mail a letter during the holidays, letting them know how grateful you are for their support. Valentines are also an easy way to show your love and appreciation.
Paid-In-Full or One-Time Gifts: Just like your regularly paying donors, don’t neglect those angel donors who have their pledges paid in full or who may have given a one-time gift to the campaign. A common best practice is to send out a thank you letter immediately upon a donor’s fulfillment of his or her pledge. You also might want to reach out to them one year later, asking to consider making another gift. This will not only have a positive impact on stewardship but will also offset unredeemed pledges.
The most effective way to guarantee a paid pledge is to show your donors the fruits of the campaign. Share project progress updates every step of the way and celebrate milestones in your pledge redemption. This motivates donors to continue working toward fulfilling their pledge with enthusiasm.
Good cultivation of donors begins with good communication. Carefully prepared announcements focusing on the campaign case, progress to date and other relevant developments will be an effective way to keep in communication with donors and prospects. The development and marketing office should publish and distribute regular announcements and releases to members, the public and the media.
It is also important to recognize that each donor is now an investor in the future of the organization. An important element of effective pledge redemption is to recognize this and to implement a comprehensive plan for continued donor cultivation. While the consistent distribution of statements to donors is the beginning of good redemption, it is not, by itself, enough to meet your needs. The “Statement of Account” alone will not facilitate redemption. To redeem the highest percentage of pledges, it will be necessary to consistently communicate with donors regarding the progress, activities and benefits provided by campaign.
The bottom line: donors are most motivated by the impact that their gift will have. Authentic donor engagement and continuous campaign promotion will not only instill confidence that their pledge is helping to further your project’s mission, but also this project’s completion will be a source of pride for your entire community. Ride that wave of positivity and don’t forget to be awesome!