Episode 24: Donor Cycle Series - Stewardship

Welcome to another edition of “Around with Randall”. Your weekly 10 to 12-minute podcast and making your nonprofit more effective for your community. And here is your host, the CEO and founder of Hallett Philanthropy, Randall Hallett. 

Thanks for joining me here on “Around with Randall” today, the fourth and final part of the donor cycle and the thoughts involving how you might steward your donors. We started with qualification then we jumped into the idea of cultivation. Last time, we talked about closing and asking; today about stewardship.

So, let's start as broadly as we can, and then we'll end up with the tactical, as we always try to on the podcast. Number one, stewardship is about at the highest possible level, about two major things. Number one, it's about retention. We would like to have our donors stay with us to give again. We know that it's so much less expensive from a personnel standpoint, as well as from a cost dollar standpoint to maintain donors than try to acquire new ones. So, there's a retention element here. 

The other piece is kind of the accountability legal piece. We think about the responsibilities of stewardship and gift acceptance and its management -- certainly, the idea of the formal acknowledgment, the idea of donor recognition, where it's applicable within your organization and reporting. When I talk about “legal,” I may not be talking exactly about the law, but what policies you have in place that require you as an organization to recognize donors appropriately. AFP, Association for Fundraising Professionals, feels so strongly about this that they have codified this in the bill of donor rights and talking about what the responsibilities of organizations are in regarding how they steward their donors, how they inform them of use. Really what it comes down to is also confirming what the gift agreement or the pledge card says. They're going to do X by giving you resources. You're going to use those resources for Y in the following manner. You want to make sure, obviously it all lines up. It's a very high level. 

Now, if you're an organization that has one, two, or three people dedicated to stewardship, then you have many more options and opportunities to steward at remarkably personal levels. I want to steer away from that group just a little bit and here's why. In a 2018 report, which you can find on donor relations, guru.com, there was a study done about the number of donor relations or in this case, stewardship positions and how organizations viewed them. What they found out is that organizations in times where they have to make decisions about either investment or cutting back. They're actually cutting back on the idea of formalized stewardship positions, which reduces stewardship opportunities. Some stats for you…30% of all nonprofits have $10,000 or less in totality to spend on stewardship, that includes printing, mailing gifts, outreach, and donor recognition. It's not a lot of money depending on the size of your nonprofit. 75% at the time, this is pre-COVID, which obviously I think has had a great effect, but we don't have the numbers for it, however, just anecdotally with clients, I hear this quite a bit. 75% indicated they were going to stay the same or more likely reduce their staff to become more efficient, better ROI and that donor recognition, donor relations, donor stewardship would be an area that would be number one or number two in terms of options to reduce expense. The other part of this is just understanding that most nonprofits are not very big. They're usually one, two, three, four-person shops, which means creating an easy stewardship process is quintessential in doing any stewardship at all. So, if we steer this towards the small shops and there's going to be things that you can take if you have a full stewardship organization or a part of the organization, why do we steward?

We talked about at the opening, the idea of retention, and we talked about the legality or the policies you have, but that's really not the reason stewardship is important and really not what you should be concentrating on. Great stewardship is about emotion, creating the opportunity for the donor to feel, and you want them to feel, in my opinion, five things. They're not detailed. They're somewhat simplistic, but they're essential in connecting the individual, the person, the psychology to what they've wanted to do to make a difference. Let's start at that right there. Did you, can you make a donor feel like they've made a difference? 

Let me give you an example. Think about the difference in someone who writes a $25 check to your organization. The thank-you note comes and says, thank you for your $25, it's tax-deductible as allowed by the law. We're so appreciative and the organization strives to meet food needs in our community. Versus a thank you letter that says your $25 gift fed 10 people or provided 10 meals or provided a family of four food for the day. Which do you think is going to make the person feel like they're making any difference? I have fallen into the trap of creating simplistic thank you letters, recognition letters that go out constantly in a large academic medical center. I look back and wonder how many times did I miss the opportunity to make people feel like they made a difference. Which is frustrating, because my favorite saying, which I say at the end of every podcast, “And then there are those who wondered what happened versus those who are wanting to make something happen”. I reversed them there because we want to tie the people and the effect of what we're doing to the people who make it possible. That's number one. Can I make a difference or how can you show that they've made a difference? 

Number two is can you help them be seen if they want to be? Maybe they just want to see themselves. Maybe they want to see their value. Maybe they want to see them be a part of something bigger than they actually are, or at least what they perceive in their small network.

How do you get someone to look at themselves and see their biggest person, so to speak, the best of themselves? That's all about stewardship. That's about telling people's stories about how they led this effort or how they were involved in this effort, or they were a part of something.

In that same vein, number three, how do you make a donor feel valued? So, a difference, just be seen but be valued. That they're important to you, that their gift to you made the difference between X, Y, and Z. 

Number four, that they're liked. People genuinely go to places and do things for organizations where they feel like they're embraced. When you steward, if you can make them feel like they're liked many times that will make them feel so good that they want to continue with the behavior that allowed that emotion to occur.

The last one, number five is, have you made a connection? I think COVID has taught, in the isolation that for many people, while some people are introverts and some people are extroverts, we all look for connection in different ways at different levels. Can you make people feel connected to you, to your organization, to the outcomes, and to their value set?

So, making a difference, being seen, being valued, being liked, and making a connection…if you can use those emotional five points to think about stewardship, you'll go a long way. What are the tactical pieces? I'm going to aim this a lot at smaller shops because it's got to be easy. Number one quality is more important than quantity. If you have a choice between stewarding 100 people okay or 20 people really well, steward the 20 people. Pick the ones that are going to make the biggest impact. That doesn't mean don't send, thank you letters. That doesn't mean don't follow your gift acceptance policies. I mean, those extra steps, which we're going to talk about here in a second, some tactical things you can do. Quality is more important than quantity.

Remember a couple things, just in terms of technique, templates are incredibly helpful. If you don't have to redesign something all the time, it makes it so much easier to actually put out information. Create a consistent template system. Mail merge is your friend. You can send an immense amount of emails through mail merge. You can send letters via mail merge. You not only can do a mail merge with the salutation, addressee, all of the stuff we think of in a nonprofit solicitation recognition letter, but you can do entire paragraphs via mail merge. There are specific to what they gave to. Use mail merge to your advantage as a time-saver.

One of the things I think that we're not very good at is controlling our calendar. Another tactical -- hey block time every week for stewardship calls or stewardship moments. Again, we're going to talk about nine things you can do that are simple stewardship here in a second, but you have to block the time because there's always something impeding in it. There's always something else to do. If you don't block time to do it, sometimes it falls near the bottom or at the bottom, probably along with qualification calls. Oh, I'll get to it, or we've already gotten their money. That's not how it's best to prioritize what’s really important. Ask for help, if you've got a Board, have them do two thank you notes, personal thank you notes every meeting, and then mail them for them. Do them right when they walk in the room or in a COVID world, get them the notes, have them do it together. I.E. they're all doing their own individual notes, so here's kind of a little bit of peer pressure. It's really important to find other support. Maybe there's another department like a marketing department if you're a little bit larger organization, but a small fundraising shop. Can you go to the marketing department? Say, how can we work together? How can you help me? Maybe you have other volunteers that can find ways of expressing thank you. 

The last is probably the hardest. Learn to let it go. If the organization doesn't put a ton of resources in you can't steward everybody like an organization that has staff with two or three stewardship professionals, donor relations professionals. It's not possible. So you have to do the best you can. Make critical decisions and learn to be okay with doing the best you can. 

What are some tactical pieces? Last piece of our podcast here -- what are some tactical things you can do that can make a difference? This is all about authenticity. It doesn't have to be an award-winning short to be able to be well-received and be impactful. First, thank you calls, scheduled time -- just call people and say, “Hey, I just am calling to say thank you. Second, thank you cards, personally written. Third, “just because” cards, I remember in college, it's kind of funny what sticks with you, that I used to get cards from my Mom and Dad for Columbus Day and all kinds of different holidays. It was just the way my Mom, in particular, and my Father would say, we're thinking of you and we love you. Even though you're 18 or 19 and a male, which we're not the smartest of the two genders here. I didn't understand the impact they had until I was a little older in life, at the time it was all “whatever”, but it made a difference. It made me feel wanted. It made me feel loved. 

Find a crazy way of saying to a donor, you know what…I just want you to know you make a difference and we appreciate you. Personal email, I mentioned this a second ago. You can do a lot of personal email through mail merge, particularly with Outlook. I highly encourage you to use it. It can be simple language, but it can be authentic and genuine, in terms of updates and all kinds of simple communications. You can attach pictures, things that can make people feel like, gosh, I have a better understanding of what I gave to. You can share relevant news in this way. It's not cost-prohibitive at all. My favorite and I think it really came about, more often than not, in COVID was this idea of video updates. Take your iPhone and do it. I want you to have an update or have the physician if you're in healthcare or the educator or social services, show donors what's happening in the moment just for 45-50 seconds. Thank you for making this possible. We worry so much about going overboard in terms of production that we forget that genuineness and authenticity is going to carry the day. Highlight someone if you can. It doesn't have to be in a written publication, highlight someone's generosity, survey your donors. Gosh, because you're vested with us. We'd like to ask your opinion, 6-8 questions, make them feel like they have a vested interest. Finally, if physically possible, an impact report, which is the most time-consuming. But if you're doing some type of endowment or scholarship or something of that nature showing where the money's spent can be critically important.

Stewardship is about emotion. Stewardship is about creating connective tissues between donors and the organization. Stewardship needs to be planned and stewardship has to be authentic. And you need to worry about the quality, not the quantity. 

Just a couple of reminders, as always, the website, www.hallettphilanthropy.com. Don't forget, the blogs are posted there, a couple per week, 90-second reads. You can listen to the podcast there, or you can listen to the podcast downloaded on Apple, Downcast, Spotify, or wherever you get your podcasts. Please leave a review. Please, if you feel appropriate, rate us, subscribe to us, and share it with a friend.

I want to end like I do each week. This is an amazing opportunity professionally, to feel so worthwhile, so good every morning when you get up that you're going to make a difference. I hope you're using these tactics that we talk about each week or two on the podcast or whatever else you're learning to make your organization better. You're making a difference. This is a vocational worthy cause and it's important. I hope that you feel that you are changing people's lives. Don't forget. “Some people make things happen. Some people watch things happen. Then there are those who wondered what happened”. Where people who make things happen for people who are wondering what happened -- that's what nonprofit work is all about. I appreciate your time today. I look forward to seeing you next time on, “Around with Randall”. Don't forget -- Make it a great day!