Imagine someone asks you, “What is the most important fundraising campaign your organization regularly conducts?”
At first, you might think of a campaign for a specific program or your end-of-year giving campaign. But for many nonprofits, the most critical campaign they run each year is their annual fundraising campaign.
Your annual fundraising campaign, which raises money for your annual fund, is what allows your nonprofit to keep its doors open. The money in this fund covers your essential operational costs and can supplement ongoing campaigns.
But every year, you have to fill your annual fund again, which can be a challenge without a strong strategy.
In this post, we’ll walk through four tips for designing a strategy that will bring your supporters together to give to your annual fund:
- Understand the breakdown of annual giving.
- Set a realistic, flexible goal.
- Conduct a planning and feasibility study.
- Focus on building lasting relationships.
These tips will help you fine-tune your annual fundraising approach, but to truly take your annual fund strategy to the next level, consider working with a fundraising consultant. The right consultant can assess your current annual fund strategy and make recommendations tailored to your organization’s strengths and overarching goals.
Ready to improve how you raise money for your annual fund? Let’s begin!
1. Understand the breakdown of annual giving.
Similar to planning a large-scale campaign, building out your annual fund strategy first requires you to identify what types of gifts you need to solicit and from which supporters.
To get started, consider the typical breakdown of gifts to nonprofit annual fundraising campaigns:
- Major Gifts: Usually major supporters will supply 60% of your target annual fund amount. As you plan your annual fundraising campaign, you’ll likely want to re-evaluate what constitutes a major gift for your organization and then conduct prospect research to identify supporters that can supply those gifts.
- Mid-Range Gifts: Mid-range supporters will supply 15-25% of your target annual fund amount. This category of gifts can be your fall-back tier. For example, if a supporter declines to supply a major gift, it might be effective to ask them if they can give a mid-range gift instead.
- Lower-Level Gifts: Though this tier of giving will supply just 15-25% of your target annual fund amount, you’ll get the most gifts at this level (about 70% of your total annual fund gifts). For many supporters, giving to your annual fund will be their first time interacting with your organization, so ensure you have a strong follow-up strategy in place.
By understanding how annual giving typically breaks down, you can get creative with your appeals to make them more effective. For example, you might identify who your lower-level supporters are and then market easy mobile giving options to them, or encourage your mid-range supporters to boost their gifts’ impact by pursuing matching gift opportunities through their employers.
2. Set a realistic, flexible goal.
Many nonprofits make the mistake of setting annual fundraising goals that they don’t realistically have the capacity to achieve. Falling short of an unrealistic goal is not only discouraging for your team, but it can also damage your organization’s public image.
Work with your fundraising consultant to set a goal that is SMART:
- Specific: Don’t settle for a goal that simply amounts to “Fill our annual fund.” Pinpoint the exact amount of money you’re going to raise.
- Measurable: Measuring the progress toward your goal will allow you to course-correct when needed. Identify how you will measure your progress, including what specific metrics you’ll track your progress with and how often you’ll review them.
- Attainable: When you set your goal, ask yourself, “Does my organization currently have the bandwidth to achieve this goal?” This will help you ensure your goal is attainable. Remember that attainable doesn’t mean inflexible—you can always set a stretch goal after you meet your initial goal.
- Relevant: Your goal should be relevant to your nonprofit’s larger goals. Of course, with an annual fund, you know that the purpose of your goal is to cover your organization’s operating expenses. However, you should make sure to frame your goal in terms of your larger mission and vision.
- Time-Based: When you set your goal, create a time-based plan to reach it. This will help you break your large goal into smaller, more manageable pieces over the course of the year. For example, you might identify how much money you’ll need to raise in the summer versus the busier end-of-year fundraising season.
As you embark on your annual fundraising journey, set an initial goal to start, then work with your fundraising consultant and internal team to refine it. This way, you can determine exactly what needs to happen for you to reach your goal, setting yourself up for success from the beginning.
3. Conduct a planning and feasibility study.
Several months before you launch your annual fund campaign, conduct a planning and feasibility study. This will involve interviewing key stakeholders about your organization and its goals and then using their feedback to refine your goals.
Averill Solutions’ guide to planning and feasibility studies recommends that you work with a fundraising consultant to lead your study. Because a consultant isn’t part of your organization, stakeholders will be more likely to give honest feedback on your campaign in their interview, which means you get a more realistic view of your goals and approach.
After you’ve partnered with a fundraising consultant, prepare for the planning and feasibility study by creating campaign assets like a case for support, gift range chart, and solicitation plan. Your consultant will present these assets to your stakeholders and solicit feedback.
Next, you’ll go over the findings of the study with your consultant. Note that you may have to take some steps to improve your fundraising plan before you implement it, such as taking time to build stronger relationships with supporters and prospects or providing additional fundraising training to your internal team. Be open to receiving your stakeholders’ feedback, and rely on your fundraising consultant to guide you through applying that feedback to make your annual fundraising strategy stronger.
4. Focus on building lasting relationships.
As with any fundraising campaign, your annual fundraiser can quickly become focused on cold, hard numbers instead of the people who support you and those who you serve. Avoid this by infusing your annual fundraising strategy with a people-first approach from the beginning. After all, when it comes to fundraising, what matters most is building and maintaining lasting relationships.
You can ensure that your annual fundraising strategy is putting people first by doing the following:
- Anchoring your campaign in your cause. Annual fundraising campaigns naturally put your organization’s mission first. Demonstrating this to your supporters can help you show them that every gift counts in working toward your larger mission and vision so that they’ll be proud to give to your organization again and again.
- Promoting multiple ways to give and get involved. Every supporter is different and will have different giving preferences. Make your supporters aware of the many ways they can give to your organization, whether that’s joining your membership program, turning a one-time gift into a recurring one, volunteering at your facility, or sharing your organization’s posts on social media.
- Building out a supporter appreciation strategy. After you’ve reached your campaign goal, your work is far from over. It’s time to thank your supporters! According to Kwala, a physical letter can be a great way to show that your nonprofit goes the extra mile in showing gratitude for its supporters. If you opt to write thank-you letters, make sure to address the supporter by name, be specific in what you’re thanking them for, and encourage them to keep up with your organization so they can get involved again. For your major donors, you’ll likely want to consider further recognition, such as inclusion on a donor wall. If your organization doesn’t have an existing physical installation, a virtual donor wall could be a good alternative.
Thanking your supporters and thinking about them as people instead of ATMs is critical to your campaign’s success, as well as the long-term success of your organization, so don’t neglect this important aspect of your annual fund strategy. By prioritizing relationships over dollars, you can ensure that you’ll have support for your mission for years to come.
Filling your annual fund is one of the most important and challenging tasks that your nonprofit faces each year. But by creating an airtight strategy, you can bring in the support you need and make every donation count toward your organization’s sustained success and ability to deliver its mission to your beneficiaries. Good luck!