Stuck in the middle

Stuck in the middle?

Five key questions every fundraiser should ask before starting a mid-value donor program.

Why Mid Value should be Top of your priority list.

I first managed a Mid Value program in 2007 at the NSPCC in the UK.  An extensive piece of research on Mid Value donors had just been published and Mid Value programs seemed to be the next big thing.

But, despite clear evidence of the value of these supporters, many programs seemed to struggle or fail to get off the ground.  I’ve worked on several Mid Value programs since then. Whilst I’ve got a lot right, I’ve also made some mistakes along the way.   Here are some of the questions I wished I’d asked when I was starting out… and the answers I wished I’d had.

Do I really need a Mid Value Program?

If you’ve got a successful Individual Giving program, with a diverse portfolio of offers supported by a broad mix channels, you may not see the immediate need to add a Mid Value program.   But don’t wait until things get difficult.

If you’re budgeting for growth or even to maintain net revenue in your appeals program, you have limited options to achieve this. We’ve all seen response rates on Mail Acquisition fall over the last few years. If you’ve recruited heavily during that time, you’ll know you’re exhausting your mailing universe. Moving to rolling, small volume acquisition activity can help, but there’s absolutely no point in recruiting new donors if you’ve not got activity in place to maximise value from your existing supporter base.

And don’t make the mistake of thinking a Mid Value program is only for the largest charities.  Smaller organisations have several advantages when it comes to Mid Value. Smaller teams can mean increased flexibility, speedier implementation and fewer barriers to change.

From a donor perspective, Mid Value supporters are often keen to include a smaller/newer organisation amongst their giving portfolio if it aligns with their interests and values. And, whilst their gifts many be modest at the start, with proper stewardship and clear demonstration of impact, there’s potential for Mid Value supporters to significantly increase the impact of your organisation.

And a final reminder on this.  Your donors are not just yours. Sector benchmarking has consistently shown that most charitable givers have a portfolio of organisations they support. If the other charities within your donor’s portfolio are investing in improvements to their Mid Value stewardship and you aren’t, the comparison will not be favourable. Whilst you may not fall out of the portfolio entirely, you certainly won’t be first in line when it comes to increasing their gift.

Who should I include in my Mid Value Program?

In my experience, this is where a lot of programs come unstuck.  And it’s often due to internal, organisational issues that have nothing to do with your supporters.

At the simplest level, your Mid Value donors are the ones that sit at the top of your Appeal Program but aren’t quite at the level of a Major Donor for your organisation.  Recent research in the Australian charity market indicates a gift of between $500 and $5,000 a year, but I’d suggest not being too rigid. The decision about who to select for your program will differ by organisation, based on your average gifts, prompt strategy and the sophistication of your stewardship activity.

Start by looking at highest ever individual gifts, rather than average gift. I’d also suggest concentrating on cash givers ahead of regular giver in the first instance.  A single gift of $1,000 is a clearer indicator of Mid Value potential than a monthly gift of $100.

Remember, the important thing here is capacity to give rather than actual gift value to date. The only way to know if your supporters could give more is by wealth screening. It’s worth the investment if you’re prepared to act on the information it uncovers. I’d suggest including any supporters that are flagged regardless of previous giving to date. Some supporters will ‘test’ your organisation with smaller gifts. Give them a fantastic experience and you may be surprised at the uplift in gift value.

If you don’t have many donors giving at a Mid Value level, don’t assume it’s because they can’t. It might just be that you’ve never asked them properly. Try adding an outlying prompt to your next appeal eg:  $50, $100 or even a gift of $2,340. The amount must have a specific link back to your proposition, but don’t be too concerned about how high it is. A true mid value donor won’t flinch if you’ve clearly articulated the impact the gift will have.

But make sure you’re basing your decision on your data. Ideally, get someone independent to check your thinking.  Despite your best intentions, your decisions will be influenced by considerations about internal structure that have nothing to do with your supporter experience. Imposing arbitrary value cut-offs to dictate which donors are stewarded by which teams, regardless of resource or expertise, can stop a program before it even gets started.

When you’re happy with your selection, trial it for 12 months and then re-assess. You may need to adjust your criteria. You may need to remove un-responsive donors. If you’ve wealth screened your base, you may need to add some supporters that have given small or low amounts previously but have capacity to give more.

Do I need to create a completely new program?

No. In fact, trying to run a Mid Value program separately from other individual giving activity will likely put too big a strain on your resources, leading to poor implementation.

Whilst Mid Value donors may have slightly differing needs and expectations of the charities they support, the fundamentals of effective fundraising remain the same.   If you have an excellent case study for your Tax Appeal, there is absolutely no need to find another, different one for your Mid Value donor segment.

It’s much more efficient and realistic to look at ways of enhancing your existing individual giving program than starting from scratch. For your mailings, consider additional ‘insider’ lifts and updates, handwritten notes, hyper-personalised content. Hand address the outer. Use a stamp. A real stamp. Every single time. Create your Mid Value content first and then your standard value content. That way you know you’re concentrating your efforts on the most valuable segment.

Research suggest that Mid Value donors are more responsive to rational content. That doesn’t mean no emotion but, in the case of a mail appeal, it does mean a different approach for the letter. A few Mid Value variables won’t cut it.

Make sure you include your Mid Value donors in any survey activity and use every communication as a chance to uncover information about donor motivation and values. A word of caution here. Be diligent in recording any information given and reflecting these back in every communication you send. A Mid Value donor will be far less forgiving if information already given is mis-recorded or repeatedly asked for.

Remember too, there’s no set and forget approach to stewardship that will work for this supporter group. They demand transparency and relevance. Share your successes as an organisation, but also your failures (and what you’ve learnt and will now do differently).

Does a Mid Value gift need to be designated?

There’s no doubt that building a fundraising proposition around a specific project and designating gifts is an extremely effective way of soliciting higher value gifts.

If you have the opportunity to make a specific ask to this group, then you should. Even if it’s just for initial Mid Value ask.

However, this might not be possible or appropriate for your organisation.  Look for the middle ground. For example, if you have distinct, broader areas that require funding, then being able to offer a choice between them can work well. And remember, always offer a ‘where the need is greatest’ option. If you have secured a donor’s trust, then they may be happy for you to decide where the impact

Much more important than gift designation is your ability to clearly articulate your need and the impact of the donor’s gift on the beneficiary.  If your Organisation lacks a clearly articulated Vision and Mission, then you’ll need to work that out first.

What does success look like?

Before you start, set clear KPI’s for your program. These should include uplift rates and forecast increase in average gift.  Where activity is shared across the programs, spend the time to correctly apportion costs, so you can be sure you’re calculating ROI accurately. Don’t expect immediate results. You need to commit to a 12-month test period to get a true sense of performance.

It can be tempting to view a Mid Value program as a prospect pool for Major Gifts prospects. While a few may migrate upwards and others will present themselves as Bequest Prospects, neither of these outcomes should be KPIs for the program. A Mid Value program must be judged its own merits and not as a feeding program for other areas of fundraising.

A Mid Value program can be an important addition to your fundraising portfolio, but you need to go all in. No half measures. Get some expert help. Allocate enough time, resource and budget and you won’t be disappointed.