Incredibly Practical Tips, Considerations, and Reflections for Marketing, Cultivation, and Getting Gifts in a Complex Development Office
By Debra Ashton
This is an article about things I have learned working at four charities between the years 1978 and 2000. The lessons I have learned are mostly from making mistakes–some more costly than others–from making assumptions that were proven to be false, and by engaging in activities or tasks that, on reflection, were wasteful, unproductive, and sometimes even stupid.
To be successful running a planned giving program, you need many skills. First, you need a thorough understanding of U.S. tax law and a solid knowledge of the myriad ways donors can arrange their support of your organization. Second, you need to understand how to accept, administer and dispose of the gifts. All of these skills can be learned from conferences and workshops. However, you also need a set of skills that dont seem to be taught anywhere. These are the skills you learn by being in your job. Unfortunately, it takes years to figure them out and much time, money, and resources will have been wasted. In addition, the toll taken emotionally when things arent going well is immeasurable. How many of you reading this article have a constant knot in your stomach because you:
1) have too much to do and dont know how you are going to do it,
2) dont have enough money in your budget to do what you want,
3) are not meeting your fund raising expectations,
4) bring work home constantly because you are overwhelmed, or
5) enter every performance review with a sense of dread?
If you are running a planned giving program, either in a small shop, large shop, or a one-person shop, in a centralized or decentralized development office, in a local or national charity, there is something here for you. If you are a for-profit professional engaged in law, brokerage, life insurance, estate planning, or other for-profit work, consider this article to be a preview of coming attractions. At some point, as so many others have done, you may switch from the for-profit world to the non-profit world. I did in 1978 when I moved from being an administrator in a trust department to being the Director of Planned Giving at WGBH, Bostons public television station. That shift began with no knowledge of the kinds of things I will cover in this article. As a result, I can look back over my non-profit career and identify things I wish I knew in the beginning.
Setting the Stage for this Article
In the first part of this article, I will point out the complexity of the role of Director of Planned Giving. As I proceed, I will build layers of additional complexity, which, if they arent acknowledged with a plan to deal with them, will result in miserable failure and unhappiness in your job. Then, I will pick apart other tasks or activities commonly practiced by planned giving officers so as to show you a more productive way and why. In the end, you will have many ways to reshape your planned giving program, save money, get that knot out of your stomach, and work in harmony with your colleagues. If you follow the advice in this article, you will raise more money, spend less in doing so, and be happier in your role running a planned giving program.
So, lets begin with a few facts about the culture of your development office. Although you sometimes feel it is so, your planned giving program does not operate in a vacuum. If it does, and if your program forever circles the rest of the development effort but is never fully integrated, then part of the problem might be you. More on that later.
Every development office is different in its culture, sophistication, and expectations. If you dont work within the accepted structures or rules, you will encounter many troublesome situations, mostly as unpleasant surprises. But, dont be fooled. Once you learn the culture of one development office, you cannot assume it will be the same at your next job. And, if you are from the for-profit sector intending to make a move into the non-profit world, you will undergo culture shock in an extreme way and encounter protocol you cannot imagine.
Orientation of a Planned Giving Department
There are two models for a planned giving department. Depending on which model applies to your job, your life will be very different.
Model #1 The Planned Giving Office operates as a service to assist other staff with planned giving proposals and illustrations but does not have assigned prospects of its own.
This is the kind of model I only wish I had worked in all those years. Why? Because you never have to be a fund raiser at all. You dont have the stress of finding prospects, convincing them to visit with you, cultivating them so that they trust you, and eventually bringing them to a point where you can present a proposal to actually get a yes or a no. Planned giving staff who are in the business of assisting their colleagues to close gifts have a wonderful job since they respond to situations, but dont have to develop situations themselves.
Model #2 The Planned Giving Office has its own set of assigned prospects; it may be responsible for a geographic region; plus it helps anyone else in the department including the President, trustees, major gift officers, and even annual giving staff who encounter planned giving situations.
This latter model describes the job most common to those reading this article. It is a tough job. You must raise money on your own, make appointments on your own, present proposals on your own, take road trips for several days at a time, develop marketing activities, and perform up to certain dollar goals each year.
Considerations that Affect your Sanity
If you are working in Model #2, then you have some serious issues with which to deal. These issues relate to how you spend your time and how you set priorities. If you are not careful and highly disciplined, you can easily lose your focus, wasting both time and money.
Part of the difficulty in running a planned giving program is the fact that you must spend time on many different levels of prospects or donors. Unlike major gifts officers who generally have a portfolio of prospects considered to be highly rated for gift potential, planned giving officers have a mixed bag of prospects. Therefore, if you are not careful, you will whittle away your time on those who are not worth the trouble. In addition, you must be mindful of territorial issues especially as it relates to your marketing and follow up with people who respond to your marketing initiatives. Lets examine the kinds of categories of prospects assigned to the planned giving officer.
Prospects Assigned to the Planned Giving Officer
Planned Giving officers have six categories of prospects. Here are the categories:
1) People in the life income plans. This includes not only substantial charitable remainder trust donors but also the dead beats in the pooled income fund. You know who Im talking about .donors who gave $5,000 once a long time ago and will never give again. Are you still visiting these people? If so, you are wasting your time.
2) People in the bequest program. The problem with these people is that they dont count in your totals at all. Although your boss is extremely happy when you announce a bequest distribution, you dont get credit in your totals for visits to bequest prospects.
3) Highly-rated prospects. These people are valid prospects for you. They are the kind of people who could transform your organization with a very significant gift if only they were motivated to do so.
4) Regional prospects. If you work for an organization with a national constituency, then you may have a region assigned to you and be required to visit your region three to five times per year. Arranging three to four visits per day for several days in a row is difficult, but Ill give you some tips about this a little later.
5) People responding to a mailing or ad. Later in the article, I will address many issues to help make your marketing more productive.
6) People attending an estate planning seminar. The people who attend your planned giving seminars also attend seminars by every other stock broker and financial planning firm. Why? Because they get a free lunch and because they are trying to get free advice. However, these people are not necessarily prospects for you at all.
A few comments about the above six categories are in order. In spite of the fact that you may feel compelled to steward all of the people listed above, the reality is that you cant and you shouldnt. In order to be more productive, you must evaluate the entire group of individuals attached to the planned giving department. One by one, identify those who are truly capable of making a substantial gift, say $100,000 or more. Depending on the size of the organization or the sophistication of your development efforts, you could possibly lower the cut-off to $50,000, but I wouldnt go lower than that.
Instead of stewarding those $5,000 one-time life income donors, hand them over to the annual giving staff. They are not worth your time. They are worth somebodys time, but not yours.
If you are doing your job properly, you should end up with three categories of prospects. One third of your prospects should be well along in cultivation and are ready to be asked for a gift. One third of your prospects should be in stewardship after having made a gift. One hopes that with good stewardship, these past donors will be ready to give again after an appropriate amount of time passes. The final one third of your prospects are what I call new discoveries. The new discoveries got on your list from various sources and activities. Some are qualified inquiries from your marketing initiatives. Some may have being identified through research or screenings. In all cases, however, they dont have a relationship with you or with the organization yet. They need to be worked on, evaluated, and rated for gift potential.
I suppose some of you reading this advice will think it is mean or callous of me to suggest that you stop spending time on those $5,000 donors. However, what was considered a big gift 20 years ago is now essentially an annual giving level today. The stakes are very high, with many organizations announcing billion dollar campaigns. Given the competition and the increasingly larger goals, it is ridiculous for the director of planned giving to be working on $5,000 gifts. If you do the right things, the smaller gifts will happen on their own. And, let me clarify something. If one of those $5,000 donors has the capacity to make a $100,000 gift, then, by all means, put them on your high priority list. Otherwise, drop them.
After evaluating your own priorities and prospects, you need to consider how you intend to coordinate your work with the rest of the organization. Complicating your life as the planned giving director is the fact that you are not the only one with prospects assignments.
Other People Who Have Prospects
– President, Executive Director, trustees;
– Vice President for Development, Development Director;
– Principle, major gifts, leadership gifts officers;
– Other planned giving officers;
– Annual giving officers;
– Others like department heads or program directors who interact with the constituency.
When you consider that other members of the organization also have prospect assignments, the way you handle your marketing initiatives is important. Here are some considerations:
1) Are you allowed to mail planned giving materials to everybody or are some donors off limits? In some organizations, the trustees may be coded for no-mail. In other organizations, the highest rated prospects or donors may be off limits for direct mail. The problem here is that those people most likely to benefit from a creative tax-related gift are excluded from receiving information that could truly be of interest to them. Know the rules early on, especially when you change jobs. If you happen to be in an organization that excludes trustees from planned giving mailings, there is one thing you can try. Ask your boss if he or she would do a cover letter to the trustees so that you can send your mailing to them as an example of what the planned giving program is doing. Most often, trustees are excluded from receiving direct mail to prevent them from being annoyed with so-called junk mail.
2) If you receive a reply card from a prospect assigned to one of your colleagues, what do you do? Would you simply interact with the donor or would you turn the reply card over to your colleague? Would the two of you go on a visit together? What do you do if you receive a reply card about gift annuities from someone assigned to the President and you already know that the prospect is being targeted soon for an outright gift?
There are no black and white answers to the above questions. However, you should discuss with your colleagues how such cases should be handled in order that you can work in harmony with the rest of the staff.
Another level of difficulty arises when you work in a decentralized development operation. Generally, planned giving is run out of the central office, but there may be development staff assigned to various units of the institution. This model could exist in a university or in an organization with field offices around the country. Under this structure, there are important territorial issues to work out.
For example, when I became Director of Planned Giving for Boston University, there were 15 schools and colleges, all of which had a development officer based at the school level. It wasnt obvious to me, and nobody told me, that the Deans of each school controlled access to their respective alumni populations. As a result my first bequest mailing created quite a stir because I didnt get permission to access the different populations.
Later, I learned that I had to negotiate for the rights to access each of the 15 populations. This is rather bizarre. At first, my objective was to run 15 separate planned giving programs, a lofty and unwieldy proposition. If you are working in a central office and are attempting to run simultaneous activities for multiple units, you will quickly realize three things.
1) Some populations have greater gift potential than others.
2) Some development staff are more experienced than others.
3) Some development staff are willing to collaborate with you while others are not.
In my case, I spent enormous amounts of time trying to educate these 15 development officers about planned giving because I felt obligated to treat them all equally. Unfortunately, it took me two years to figure out the three inevitable truths listed above. So, after many false starts, frustrations and turf battles, I decided to set some priorities.
Instead of forcing planning giving on all 15, I picked 5 with whom I could work productively and get the best results. You may find yourself in the same predicament, managing multiple units within the institution and pulling your hair out because you are still treating them all as equals. This is one example of why your life may be chaos. If you find yourself in a decentralized organization, be smarter than I was. Evaluate early on where your efforts will be most successful. Dont worry about the others. When they see the results of your work with their counterparts, they will come to you when they are ready.
There are other complications for planned giving when you work in a decentralized structure. Here are just a few:
1) To whom should reply cards be addressed? You?The other development officer?
2) Who should follow up with the prospect?
3) Who needs to know if you receive a reply card or inquiry?
4) Whose budget pays for the mailing, the travel, or the visit?
Bear in mind that you cannot establish one policy to serve all. In some cases, you will want the other development officer to make the follow-up call. In other cases, you will prefer to do it yourself. If you try to use a cookie-cutter approach, you will waste lot of time and money and become very frustrated.
Considerations for getting the most from your mailings
Once you have negotiated the rules with the right people and you are clear on the populations to which you have access, be smarter about the mailings and marketing initiatives you plan.
Planned giving officers have several problems on a chronic basis. With so much to do, they find it difficult to keep up with the volume of reply cards flowing in from a marketing initiative. At first, planned giving officers greet the few cards that trickle in following a mailing with excitement. But, it doesnt take long for stacks of cards to pile up. Each inquiry requires quite a bit of time and the compounded effect of many cards becomes a burden. Sometimes, in order to clean out the back log, planned giving officers do a form letter. This is all wrong.
Many people dont remember sending the card. Many people dont need the kind of arrangement they have asked about. A form letter is a quick way to clean out the back log, but it is not the best way to get a gift. It is too passive.
In my seminars, I typically introduce this topic to the audience by asking the question, How long is appropriate to keep a repy card before you through it away? Surprisingly, this question results in a lot of nervous laughter and it points out to me that reply cards are a big sore spot for planned giving officers. It doesnt need to be that way.
Targeting
Most planned giving officers waste money because they dont target their message narrowly enough. If you send 10,000 or 20,000 pieces of direct mail, you will undoubtedly receive lots of inquiries, no matter what topic you choose to cover. But, youre back to the problem described above ..too many inquiries to follow up by phone in a timely fashion.
The quality of inquiries is more important than the quantity. Let me give you an example of narrow targeting. Presumably, your data base allows you to keep seasonal addresses for your donors or constituents. What can be said about people with a seasonal address? First, if the person has a seasonal address, the individual has at least a certain level of financial security. Second, most people with seasonal addresses eventually sell the main residence and retire to the seasonal address. This population is very specific. What can you do with it? Well, you can order a list of everyone who has a seasonal address in order to do a mailing about gifts of real estate. If you get only five responses, you can be reasonably certain they are highly qualified inquiries.
Another population to target would be donors who have ever made a gift of appreciated securities. It might be a small fraction of your donor base, but this would be a perfect population for a letter about gift annuities or charitable remainder trusts. If you narrow this further by sorting for age, your target market is even more controlled.
Just remember that more is not always better. You can save money and get more gifts if you are smarter at planning your mailings.
Staggering Your Mailings
There might be times when you want to send many thousands of letters on one topic. The way you can get control of the process rather than having it control you is by staggering the drop dates. Instead of sending 20,000 pieces of mail on one day, ask your mailing house to mail 2,000 per week for 10 weeks. In this way, you will be able to keep up with your follow-up calls; you wont get an unwieldy back log of inquiries; and youll be able to speak with everyone by phone instead of resorting to your form letter strategy.
Coordinating Mailing with Travel
Many planned giving officers travel for several days at a time on a road trip. The challenge is to fill your itinerary with three to four visits for every day of the trip. If youre like me, it is always difficult to do that because the demands of the office are all-consuming. I suspect that you have been known to place a name on your itinerary with a comment like to be confirmed even though you havent called the individual yet. You probably have a big knot in your stomach before every trip simply because time ran out to fill your dance card adequately.
You can get control of this problem by planning a direct mail piece about 6 weeks in advance to the place youre headed. By doing so, your follow up call to the inquiries is much more productive. You can say, What a coincidence! I happen to be coming to your city next month. Why dont I send you some information and we can get together to discuss it when Im there?
All of a sudden, your trips will be full of visits instead of to be confirmed, your direct mail will result in actual visits, and youll be closing more gifts.
Considerations for Following up Inquiries
Earlier, I mentioned that sending a form letter is not an effective way to follow up inquiries. By using a form letter, you are more likely to accomplish the following than you are to get a gift:
1) Send information that is inappropriate for the needs of the donor;
2) Send an illustration that is either too large or too small;
3) Miss out on connecting personally with the donor;
4) Waste time on somebody who is not really a prospect at all;
5) Send an illustration with one beneficiary when it should have been for two.
When you have too many inquiries at one time, you are inevitably forced to use a form letter. But, if you adapt your planning to incorporate the ideas mentioned earlier, you will have fewer inquires and you will have the time to respond by phone to each and every one.
The first phone call is important, but many people assume too much from the reply card. If you receive a reply card about charitable gift annuities, you probably begin by discussing charitable gift annuities. This is wrong. I can think of many instances during which a conversation with a prospect revealed information resulting in my completely shifting gears. In some cases, it was obvious that the donor simply didnt need more income. Thus, I suggested an outright gift instead. In other cases, the asset being considered for the particular gift was inappropriate.
When you make that first phone call to the prospect, you should encourage the donor to talk to you. Dont make the mistake of doing all the talking. After introducing yourself and acknowledging that you have received a reply card inquiring about a particular topic, ask the donor questions like these:
1) What prompted you to return this reply card?
2) What was it about this idea (gift vehicle) that interested you?
3) If I prepared an illustration for you, what size example should I use?
4) If you were to make this kind of gift, what assets would you use ..cash, appreciated securities, real estate, etc.
5) Do you have any particular timetable for considering this gift?
6) Have you done this kind of thing with any other charitable organization?
7) It just so happens that Im coming to your city next month. Perhaps I could stop by for a visit.
Consider for a moment the difference in substance from sending a form letter when compared to the kind of letter you could send following a conversation resulting from the above kinds of questions.
Considerations for Choosing the Content of Your Direct Mail
Over the years, I have come to some conclusions about why certain things work and others do not work nearly as well. This ties in to my earlier topic of targeting, but Im approaching the topic now from a different angle.
Presumably, you agree with me that narrowing your target population would not only lower the numbers of pieces mailed, thus, saving you money, but would also simultaneously increase the quality of inquiries. There is another reason for targeting your message quite narrowly.
After many, many years of trying different things at four different charities, here are rules that make sense to me:
1) Dont confuse the donor with too much information.
2) Do not focus on what the charity needs.
3) Focus on how the particular topic can solve the donors problems.
My theory is that if people have too many options, they will do nothing simply because they dont have enough time or expertise to figure out which plan is best. Think for a minute about cellular phone companies as an analogy. What would you do if you received a brochure that described the calling plan rules and costs for AT&T, MCI, Sprint, Cingular, and Comcast? In order to evaluate whether your current plan is more or less expensive than the others, you would have to review your own calling patterns. Do you call in-state or out of state? What time of day do you use the phone most often? Are you calling other people who are also in the same plan or not? Do you need multiple phones for family members? Do you get charged for roaming or not? Do you want night and weekend minutes? Its a mess. As a result, my guess is that you would throw the brochure away and stick with your current plan. You cant possibly find the time to evaluate your options.
I believe that this same principle applies to planned giving mailings. If you send a brochure that covers every way to make a life income gift, you would need to cover pooled income funds, charitable gift annuities, deferred gift annuities, charitable remainder trusts (several versions), all of which have particular applications depending on the age, assets, and goals of the donor.
If a prospect receives a mailing that has too much information, he or she will most likely do nothing. It is too much work to sort it all out, especially when these topics are foreign to most people in the first place.
Instead, I recommend narrowing the target population to a specific group and mailing one simply-explained concept to them. Give them a chance to review one idea to which they can easily say, Yes, this could benefit me. or No, this does not benefit me. On the bottom line, the only goal of a direct mail initiative is to entice the recipient to contact you. From there, the conversation mentioned earlier during your first phone call drives the discussion.
On point #2, if you are targeting your planned giving mailings properly, you dont have to explain to the recipient why you need gifts. Planned giving mailings ought to be going to existing constituents or donors. These people already know who you are. You dont have to beat them over the head.
Donors procrastinate on planning because they dont know what to do to solve their problems. Many dont know that they have problems. If you can show how a particular kind of gift solves one or more problems, then you are more likely to receive a reply card.
Marketing Your Bequest Program
Every organization should have a bequest program not only because bequests can provide enormous resources to a charity, but also because it is the one thing anyone can do, even those in a one-person shop who cant find the time to do much other substantial planned giving.
On this topic, I have several tips that will help you with your future marketing. The first tip relates to the timing of bequest mailings and results from the following fact: People revise their wills prior to taking a trip that involves crossing a major body of water. Therefore, my advice is to do a bequest mailing annually in February. Dont do it in the last quarter of the year because that is the time to focus on year-end tax-related gifts. Dont do it in January because people are dealing with the aftermath of the holidays. By February, they are ready to do other things, especially starting the process of updating their wills in anticipation of a summer vacation. In addition, if you plan a legacy society event in the spring, you can get new members early in the year and boost your attendance.
The second tip results from the fact that 75% of the people who provide for a charity in their estate plan never tell the charity. What does this mean for the content of your mailing? It means that you should always include legally correct bequest language in your materials. Many people will use the language, even if they dont tell you. Most important is that you give it to them whenever you do a bequest mailing.
Finally, when you do a bequest mailing, dont ask for too much information or you will receive a very small response. When I was at Wheaton College, I printed a nifty form that requested a lot of information including the name, size of bequest, type of asset, actual wording of the bequest, restrictions, donors attorney, etc. I even asked for a copy of the will. I didnt realize that people would be reluctant to provide so much detailed information in response to a mailing. Not one response came back and I learned and expensive lesson.
Remember that there are only two purposes for a bequest mailing. The first is to identify people who have already included your organization in their estate plans. The second is to identify people who would like information on how to include your organization in their estate plans. Once you learn of a bequest intention, you can add the name to your legacy society and you can begin the process of building a relationship with the donor. Eventually, you can ask for the details once you have built the trust that is so important to this process.
Summary
Without question, there is a lot of stress in running a planned giving program. However, a good deal of the stress can be eliminated by turning off your automatic pilot and stepping back to review how you are operating.
The key points I tried to make include:
1) Discuss the rules on how you and your colleagues need to coordinate so that you dont alienate yourself from the rest of the staff.
2) Dont use a cookie-cutter approach to work with others. Adjust your actions based on the individuals and their capacity to work effectively and collaboratively with you. Work with decentralized staff selectively.
3) Get smarter about planning your mailings. Target a narrow market and send less mail. Keep the message simple. Send direct mail to cities you intend to visit six weeks in advance. For larger mailings, stagger the drop dates so that you can easily call every inquiry by phone. Stop doing the form letter response.
4) Evaluate your prospects so that you are working on those with the greatest gift potential. Wean yourself off the $5,000 donors.
If you adapt the way you work, you will spend less money, get more gifts, and you will get that chronic knot out of your stomach.
Debra Ashton is author of The Complete Guide to Planned Giving, now in its Revised Third Edition. For more information about Debras book, please visit www.debraashton.com