Executive SummaryBack testing over 2 million donor records showed a strong correlation between specific philanthropy and wealth markers and future philanthropy. Unlike traditional wealth analysis, which has long been the standard for donor prediction in the industry, past philanthropy proved to be a much more accurate indicator of future philanthropy. Wealth, particularly as evidenced by the value of real estate owned by the prospect, correlated with both the inclination to give and the capacity to give. However, stronger predictors of future philanthropy were past giving to the nonprofit, past giving to other nonprofits, political giving, and other factors. Wealth, however, plays a greater role in formulating ask amounts, although philanthropy to other nonprofits is also a significant factor. Formulating an ask amount is a two-step process: determining the prospect’s capacity to give, and analyzing the amount the prospect has given to other nonprofits.
Major Giving DefinedMajor giving can vary by amount and type, depending upon the nonprofit and the need: for a smaller nonprofit, a four-figure donation might be a major gift, while larger organizations may consider six- or seven-figure checks a major donation. Major giving can also vary by type: 1. Annual campaign, a gift given in response to an annual fund-raising campaign 2. Event sponsorship, a gift given to partially or completely sponsor an event 3. Capital campaign, a gift given to support a specific purpose or project, such as a new facility, piece of equipment or program 4. Major gift, a gift not given for the previous three reasons 5. Planned giving, a gift given prior to death (annuity-based) or after death (bequests and other gifts from an estate; can take a variety of forms) This white paper will focus on the first four types of gifts, because the donors and the strategies for identifying them are similar. Planned giving donors, and the markers that identify them, vary greatly from other types of prospects in significant ways. This is not to discount the value of a planned giving campaign: according to Giving USA 2015, bequests totaled $28.13 billion in 2014, or 8% of all charitable donations ($358.38 billion). Of the total amount, individuals gave 72%, foundations 15% and corporations 5%.
Stratification Among Major GiversNonprofit donors fall into three groups based on the amount of donations, which require three different types of engagement strategies:
- Capital and special campaigns
- Major gifts from individuals
- Major grants
- Complex deferred gifts/planned giving