Rosie, Rebecca and Adrian with the IoF Insight in Fundraising Award
Regular Giving? Go where the money is
by Rosie Dale - 24 June 2015
Anyone who knows me knows I’ve spent a big chunk of my life trying to persuade more alumni to make gifts to their university.
They’ll also know that I really dislike donor participation as a metric, a strategic objective, a comparator or a key performance indicator. The reasons against it are lengthy, but essentially it all boils down to the fact that focusing on donor participation – the proportion of your addressable alumni who give – can often drive institutions to focus on numbers not money, percentages rather than impact, proportions rather than lifetime value – quantity not quality. I could go on, but this is not a blog about the disadvantages of donor participation. Instead it’s a piece about my recent and surprising obsession with some donor participation data and what it shows us.
This data comes from the award-winning More Partnership Regular Giving Benchmarking – a project now in its fifth year which has taken the regular giving data of 31 universities (1) and crunched and sliced it to reveal strategically important comparative insights into higher education regular giving programmes in the UK and Ireland.
It has helped a number of participants to focus on donor loyalty, proved that direct debits with end dates decrease donor retention and uncovered that we are generally better at retaining modest donors rather than those who give more.
But the data that I have become recently obsessed with is age-related donor participation. This took donor data from Benchmarking participants, calculated the proportion of all alumni who had made a gift in the last ten years and plotted it against their age. And what it showed, although not surprising, should help us focus our attention on what (and who) is important. Because, when you put all the data from all institutions together, this data uncovered that older people are more likely to give.
Now I know that this is a potentially disappointing finding. Every fundraiser knows that older people are more likely to give, right? But do we know how much more likely? And are we actually using this in our regular giving asking strategies?
Our findings showed that on average alumni over 60 years old are more than five times more likely to have made a gift than those under 60. Only 3% of alumni under 60 had made a gift compared to 16% of alumni over 60.
And for a number of universities where there had been more consistent asking, participation for the over 60s was between 25-35% – that’s a quarter to a third of all over 60-year olds who are making gifts to their university.
So why are these findings important and why should knowing that older people are more likely to give matter?
Because these findings are not unique to our sector – other research into charitable giving also shows that most charities find it hard to get younger people to give too. For many charities, 50-year olds are their ‘young donors’.
For example, research carried out by CAF and the University of Bristol in 2012 found that, “more than half of all donations to charity in the UK (52 per cent) come from the over-60s. The over-60s are…more than twice as likely to give to charity as the under-30s. Older people are typically more generous than younger people…The over-60s are now more than six times more generous than the under-30s”.
So we are not alone. And by looking at the data in this way we can see that the people who we might expect to give (based on national behaviours) are in fact doing so. At certain institutions, anyway, but not at all of them.
And this is where this data really gives us some comparative insight. Because when you compare age-related donor participation across institutions it varies hugely; even though it is a much fairer comparator than the overall donor participation metric we are all used to. This is because comparing how people in their particular age groups give, across different institutions, takes out much of the variability in the size and shape of alumni populations across different universities.
Which brings me to the potentially controversial bit. Why is it that at one University a quarter of their 60-year olds have given but at another only 5% have? Is one 60-year old alumnus that much different from another who went to a similar university in terms of how likely they might be to give to their alma mater?
Now of course they might have had different experiences, some might have been more involved in the life of the institution, some are certainly wealthier than others and all these things will of course make a difference. But by and large the most significant factors determining whether someone will give (or not) is how well and how often they have been asked and what they have been asked to give to. And it is this that mostly accounts for these differences.
So if I were looking at a participation rate of 5% amongst 60-year olds at a particular university, rather than conclude that their alumni are not minded to give, I would probably rejoice and think about all the abundance of ripe fruit there would still be to pick if we just focused on the over 60s a little more, or tried a more compelling case for support, or made more than one ask in a year, or had the budget to do so.
But of course all of this doesn’t mean that we shouldn’t bother asking our younger alumni at all, although it does mean that we might need to rethink how we balance the resource, time and money that we spend on different populations.
As I was writing this I was reminded of a great blog post. by Jeff Brooks who suggests fundraisers should spend 90% of their time on people born before 1965 (i.e. those over 50). I think he makes a good point (although I’ve never come across an institution which prioritises its asking or resource allocation in this way, I’m a little tempted to try it).
But I know what you are going to say. If we neglect our young alumni now, then they won’t give when they are older. Failing to ask them now will mean that a culture of giving will not be instilled in the ever-growing “younger bottom” of our alumni body.
Perhaps this is true. But in our current resource constrained world we have to make choices. And right now what many regular giving programmes need to do is grow so that they can bring more donors on board, raise more money, find more prospects and raise confidence internally – leading to more investment. And the best way to do that is to do what the bank robber Willie Sutton did: go where the money is. Ask older people because on average they are more than five times more likely to give than younger people.
There is much in the media at present about charities allegedly hounding elderly people for donations. Of course we are not suggesting that universities should do this. On the contrary. But we do know that older people are more likely, and indeed more willing, to give to charities, including universities. Since prospective donors are alumni, their age is generally known and most universities do not call alumni over a certain age. And few, if any, universities have the budget to make the quantity of asks which some other charities do.
1. This year, participants included 11 members of the Russell Group and nine other universities – seven from the UK and two from Ireland.