Need help with your mission and fundraising pitch? Don’t worry, you’re not alone. Donor attrition and low engagement are tough issues for nonprofits. Including a fundraising pipeline in your nonprofit’s strategic planning is crucial. Read on to discover what a fundraising pipeline is and how it can help your organization get more donors and raise more funds.
Fundraising pipelines give you a detailed plan to reach out to donors and ask for support. Whether you’re setting up a major donor program or trying to keep your current donors happy, a donor pipeline can educate your team on what donors want and how to best communicate and engage with them. Ready to dive in and learn about the steps needed to create a fundraising pipeline and how it can help you create lasting donor relationships and increase your fundraising success?
A fundraising pipeline is a detailed plan you can use with all donors. This pipeline helps you understand what your donors want and how much they can contribute. With this information, you can understand how much donors might give and make a plan to communicate and engage with them in the future.
Most nonprofits focus on fundraising from major donors, but you can create pipelines for all types of donors. First, figure out what your organization wants to achieve in the short and long term. Why are you building a fundraising pipeline? There are a few reasons, such as:
Now that you know what your organization wants, let’s get real about what you can actually accomplish. Just a heads up, there might be a few things that could throw a wrench in your plans, like:
Before we dive into the stages of fundraising, remember that you get to decide who your ideal donors are, how to allocate their donations, and the best way to reach out to them.
A fundraising pipeline is a structured approach to cultivating and stewarding donor relationships. It consists of four key stages: prospecting, cultivating, soliciting, and stewardship.
Adding these four stages to your fundraising goals helps you engage donors better and increases your chances of successful fundraising.
The first step is finding potential donors. When it comes to major donors, you might need different software to check their wealth. This software can help identify potential major donors who may be interested in your organization’s mission and have the financial capabilities to make significant donations.
These screening tools can also reveal donors’ gift history, interests, political affiliations, and more. The great thing about this software is that it can help you find donors you don’t know, and it might even tell you about your current donors.
For example, there might be someone who always donates $1,000 or more at your yearly gala. If you haven’t done your research and built a relationship with this donor, you might not realize that they have a business in town and can give a lot more, both as an individual donor and a corporate sponsor. This is why prospecting is super important.
Once you’ve done some prospecting, you can start building relationships with potential and current donors. The best way to do this is by segmenting them into groups of similar donors and building a team to connect with each. There’s no rule about how to categorize donors, but it’s important to figure out what makes them important to your nonprofit and how you’ll reach out to them.
Can you spare staff or volunteers to spend time and money on building a major donor program? These donors require a lot of time and effort, so you’ll need someone in your team who is completely dedicated to them.
Other donor groups may be easier to connect with and can give you a bigger bang for your buck. Recurring donors are an excellent example of this. If you have a few events that engage donors to give regularly to your nonprofit, you may be in the best position to form a team to communicate with these donors. Your time may be best spent segmenting donors based on their interests and turning their annual donations into monthly gifts.
The easiest donors to cultivate are the ones who already know and are interested in your organization. When you’re prospecting, you may find gifts they’ve given to other organizations. Now is the time to find out what compelled them to act and why they gave elsewhere. Do a little digging into your competitors’ donor communications to see how they relate to donors.
See what they’ve done that you can replicate. It’s entirely acceptable to draw inspiration from organizations, just make sure you’re adapting those ideas so they’re your own! When you’re creating your donation campaigns, use real-life stories from your donors and personalize your communications to connect more with individuals.
Pro Tip: Nonprofit Networks are an excellent source of resources and ideas from other nonprofits. Nonprofit networks can help you find grants, learn about trends, build your board and staff, and more.
When you are ready to make the ask you must ensure you’re prepared. Crafting strong appeals can be tough, but if you’ve already worked on your donor pipeline, it’ll be easier.
When soliciting major donors, you’ll want to create a detailed proposal that lays out how their gift will directly and indirectly impact your beneficiaries and the community. Don’t forget to keep their personal goals and connection to your mission in mind. Once you’ve created the proposal, you need to find a way to meet up with them and ask in person. If anyone has a personal connection with the donor, now is the perfect opportunity to get them involved.
Donors, big or small, need personalized communication. Knowing which donors will respond best to your requests is important when reaching out to them. For example, it’s probably not a good idea to ask someone without kids for school supply funding. If you do, just make sure you explain the costs of these supplies and why they’re needed. This information is not as obvious as you may think.
It’s crucial to have a donation process that fits the donor’s needs. Donors usually prefer giving online, but make sure they know your online system is secure. With Donorbox, nonprofits get secure tools to keep donor credit card info safe, like fraud protection, secure tokens, and two-factor authentication.
Other donors may require different donation processes, such as planned giving with stocks, trusts, retirement funds, etc. Regardless, it’s important to let donors know the different ways they can give.
Pro Tip: Many of your donors may be unaware of how giving monthly recurring donations can increase their support and help the cause. We’ve written an article that details the difference between memberships and recurring gifts and how to communicate the benefits of each.
Just because they donated once doesn’t mean you can ignore your relationship with them. That is unless you want it to be one and done. Stewardship is arguably the most meaningful step in the donation pipeline.
After you receive the gift, you’re legally required to send an acknowledgment, but it’s best to acknowledge the gift more than once. Don’t just send the same letter, but find ways to keep the donor engaged.
Donors really appreciate it when you reach out with impact reports through newsletters, personal emails, or even phone calls. These impact reports need to show how donors’ gifts have made a difference in people’s lives.
Another aspect of stewardship is getting feedback from donors. Figure out how to gauge donor satisfaction. You can do this by talking one-on-one, doing focus groups, or using surveys. Donors want recognition for more than their donation, so this step is crucial. They want to know you’re listening to them and that they have a meaningful impact on your organization as a whole.
Find more opportunities for them to get involved with your cause. Volunteering at events, at your facility, and online through peer-to-peer campaigns gives donors a sense that they are part of the community. Volunteering is an excellent way to further engage with donors and develop a ladder to long-term involvement within the organization.
Don’t fall into these pitfalls when building your fundraising pipeline.
The first and most obvious is a lack of planning. Planning is a must before prospecting and soliciting. After all, if you don’t understand what your organization needs and how you’ll use donors’ gifts, you are setting yourself up for failure.
Misunderstanding your donors is similar to a lack of planning, but has more to do with the prospecting stage. When researching your current and prospective donors, remember to segment them based on their interests, financial ability, and your nonprofit’s needs.
Knowing where each donor fits in your nonprofit helps you create plans and messages that connect with each donor. Make sure to track every interaction donors have with your organization – it’s a big deal. After communication goes out, track and store this information in your organization’s database. This keeps all team members in the loop with the donor pipeline.
Donor retention is key to maintaining your donor pipeline. Donors won’t stick around if all you send is a receipt or thank-you letter. Constant personal contact is essential for donor retention.
Your efforts to find and connect with these donors should make this a breeze. Don’t forget to ask donors for feedback and keep tabs on which appeals and programs they respond to. Then, find ways to get them even more interested in what your nonprofit is doing.
Donor communications should have a call to action. If you don’t give donors a clear next step, they won’t do anything. Don’t forget, no asking means no gift.
Donor fatigue often leads to losing donors. Donors don’t want to be treated like an ATM. These are individuals with their own lives, interests, and passions. As a nonprofit, you must find diverse ways to reach and connect with donors. This includes different ways to campaign and engage with your donors. Try different appeals and offer various opportunities for involvement and fun that don’t involve asking for a gift.
Pro Tip: If you want to connect with donors on a personal level, ask for their expertise. If you’re struggling with unique ways to reach out to donors, why not send a survey or call them to see what they suggest? Their answers may surprise you.
If nonprofits aren’t transparent with donors, they’re more likely to fail. Trust is key for nonprofits to thrive in the long run, and being transparent is how you build that trust. Find ways to keep your donors in the loop about what you’re doing on the ground. Let donors see the impact of their gifts by sharing detailed reports, stories, and videos from beneficiaries.
Send regular surveys and other outreach tools to remind donors that their feedback is essential and that they are being listened to.
If you plan your fundraising pipeline well, you’ll get to know your donors and how they fit in with your organization. If you follow the donor pipeline, it’ll make each step easier and help you build solid donor relationships.
As you move from prospecting and cultivating donors to soliciting and stewarding their gifts, we hope the tips and strategies we’ve shared can help you develop a successful fundraising pipeline and healthy fundraising strategies for years to come.
Donorbox prides itself on sharing resources and quick tips for nonprofits and fundraising professionals on donor management, solicitation, and more. Our peer-to-peer fundraising, quick donate, and brainstorming worksheets are here to increase your fundraising success and strengthen relationships with your donors.
Kristine Ensor is a freelance writer with over a decade of experience working with local and international nonprofits. As a nonprofit professional she has specialized in fundraising, marketing, event planning, volunteer management, and board development.
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Kristine Ensor