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Fewer than one in three U.S. colleges and universities received a publicly-announced million-dollar donation between 2000 and 2012. The institutions that did shared some characteristics, such as long presidential tenure, national ranking and institutional age.
These were some findings from a study “Million Dollar Ready,” released by the Indiana University Lilly Family School of Philanthropy and consultants Johnson Grossnickle and Associates. The report studied 1,449 colleges and universities that received gifts of more than $1 million. There were 10,501 such gifts made between 2000 and 2012, for a total value of more than $90 billion.
Higher education institutions with presidents in office since 2000 had the highest number of million-dollar donations, about 18 percent more than institutions with shorter presidential tenure. “Case studies suggest that a president’s ability to articulate a powerful vision and connect it to donors’ motivations will have a profound effect on million-dollar-gift success,” wrote the report’s authors. Board giving is also indicative of million-dollar gifts. The study found that “a board that doubles its average giving can drive a 5 percent increase in the number of million-dollar gifts received by the institution.”
Institutions ranked by U.S. News & World Report in 2000 received 61 percent more large gifts and a 156 percent increase in their value between 2000 and 2012, according to the study. About 9 percent of the 1,449 institutions included in the study were ranked in 2000.
The older the university, the more likely it would receive large gifts. Organizations founded before 1900 (51 percent of the institutions) received 13 percent more than those launched between 1900 and 1950 (26 percent of the institutions), and 12 percent more than those founded after 1950 (23 percent of the institutions. The total value of gifts was 16 percent higher than the medium-aged institutions, though there was no difference between the oldest and youngest universities.
Colleges and universities that value their faculty and staff receive more large gifts. The amount spent on employees (salary, benefits, etc.) is directly correlated to the number of million-dollar gifts received, and institutions with a large percentage of its faculty tenured receive more and higher million-dollar-plus gifts. A 10 percent increase in tenured faculty translates to a 0.4 percent increase in the number of large gifts and a 1 percent increase in their value.
Dollars attract dollars, the study found. A 10 percent increase in endowment size correlated to a slight increase in the number of large gifts and their value, 0.15 percent and 0.35 percent respectively. For every $100 million increase in assets, the value of large gifts increased by 1 percent. Government funding also played a role: a 10 percent increase in government funding equaled a 0.2 percent increase in the number of million-dollar gifts and a 0.5 percent increase in their value.
Doctoral and research universities, 19 percent of the sample, garnered 76 percent more million-dollar gifts than other types of schools, and the gifts were 214 percent higher than other types. Liberal arts schools (12 percent of the institutions studied) also saw higher levels than the aggregate, at 30 percent more gifts and 37 percent higher. Historically black colleges and universities (3 percent of the sample) received 20 percent fewer gifts, and those gifts were worth 45 percent less.
Finally, location matters. Rural schools received 11 percent fewer large gifts, and their value was 26 percent lower than others. But institutions in the Western region of the United States saw 27 percent more gifts than the total sample, with a 70 percent increase in value, and schools in the south saw 24 percent more gifts with a 43 percent higher value.
Congressional negotiators announced a framework for a new 2014 and 2015 budget deal with important implications for nonprofits. We have some of the emerging details here.
Congressional negotiators announced a framework for a new 2014 and 2015 budget deal with important implications for nonprofits. We have some of the emerging details here.
As I listened to a webinar hosted by Grantmakers in the Arts (GIA) on its report Annual Research on Support for Arts and Culture, I was relatively unsurprised to hear from Steven Lawrence of the Foundation Center that their research found the largest share of arts grants went to the performing arts (36.8 percent) and museums (27.6 percent).
These findings are consistent with those from NCRP’s Fusing Arts, Culture and Social Change, a report for arts and culture funders from the High Impact Strategies for Philanthropy series, by veteran arts and culture strategic planner, program developer and fundraiser Holly Sidford. Sidford noted that while only 2 percent of arts and culture nonprofits have budgets greater than $5 million, they receive 55 percent of grants, contributions and gifts.
What might lie at the root of this significant imbalance in the distribution of funding for arts and artists?
Frances Kunreuther, co-director of the Building Movement Project has a great blog post that is directly related to Sidford’s findings and possible explanations. She states that the philanthropic jargon we all use and the impact it has on how we implement our work has tangible implications for the communities and organizations we seek to help. She highlights a once fashionable term that resonates with her (and me): ”the ecology of organizations.“
In Real Results: Why Strategic Philanthropy is Social Justice Philanthropy, Kevin Laskowski and I noted that large organizations can and do play an important role in the nonprofit ecosystem, but they account for the majority of funds received across different issues. Smaller nonprofits, often grassroots organizations, are more attuned to the complex web of problems that our communities face. This under-resourcing and funding imbalance leads to both an important perspective being lost in the decision-making process as well as lost opportunities to effect lasting change. Kunreuther says essentially the same:
“Small groups and local efforts had an important place in the ecology frame; but it didn’t exclude larger or more geographically diverse formations. And it assumed that not every group lived forever, that new groups would sprout up, and that ideas came from those closest to the community but that cross pollination made those ideas stronger.”
She also writes that local organizations are no longer valued as they once were – either for the knowledge they bring to the table or as laboratories for testing out new ideas. The knowledge from communities and the organizations that serve them are frequently predetermined by national level organizations. Put differently, an entire sphere of extremely relevant knowledge is marginalized and there is an opportunity lost to have more impact.
Kunreuther also highlights that while still performing important work, larger organizations can overshadow local, community-based groups, which often have important relationships and knowledge of the constituency that we seek to serve or organize. Local affiliates of larger groups can be constrained by top-down solutions that do not reflect the needs of local communities.
Lastly, she posits that there is a presumption that grassroots groups simply lack the skills and knowledge to develop their own solutions to pressing needs or contribute to the knowledge base.
Highlighting the role of money and power in these three problematic areas, she also notes that sometimes national organizations do provide the necessary capacity building for local groups to perform their work but that this happens less often than one would hope.
Regardless of issue focus, grantmakers would do well to consider the research and commentary highlighted here when developing strategy. It is important to reiterate that none of the research contends that larger organizations do not play a valuable role in the nonprofit ecosystem; rather, the point is that we miss out on an entire subset of our ecosystem when we marginalize local organizations and the community perspective. As Kunreuther says: “Without support of the local community efforts, going to scale can be like an invasive species killing off and taking over what is there and forgetting that there was once beauty in a system that has now gone to seed.”
Does your foundation consider the range of organizations comprising our nonprofit ecosystem when developing strategy? Have you engaged in self-reflection about the relevance of community perspectives in developing solutions? We’d love to hear from you.
Have you reached a dead end in your search for a nonprofit job? If this describes your current predicament, you should check out our newest featured position: Executive Director at Back Bay Mission in Biloxi, Miss.
The chosen candidate for this position will serve as the visible spokesperson of the Mission as well as oversee management and financial accountability of the organization and its 13 member staff. Effective representation of the mission to constituencies of the Mississippi Gulf Coast and in the United Church of Christ is also essential to be successful as the organization’s Executive Director.
Other requirements for this job include:
- Outstanding leadership qualities, with the ability to set priorities, generate constructive change, and motivate investment in ministry of staff and donors.
- Good business sense with the ability to plan, monitor and evaluate budgets and programs.
- Strong management skills with the ability to recruit, supervise, evaluate, motivate, and retain a top-notch staff.
- Exceptional oral and written communication skills.
- Excellent interpersonal skills with the ability to build rapport with all constituents.
- Ability to manage multiple projects and responsibilities simultaneously.
- Strong computer skills including proficiency in MS Office applications.
Resumes and cover letters can be sent to the Search Committee Chair, David Yochum at email@example.com by Feb. 15, 2014. More information can be found by reading the full job description on the NPT Jobs Career Center.
Shiloh Stark, chief digital officer at Amnesty International (AI) in Washington, D.C., was unhappy six months ago when he looked at the organization’s website traffic from mobile devices. There were an impressive number of visitors from mobile users but the visitors who made a gift through their donation page were considerably fewer.
“The primary thing we saw was our mobile traffic rate was up but our mobile conversion rate was down,” said Stark. “These were trends that were important to our future campaigns.” They got to work on creating an improved donation page.
The problem of low conversion rates of mobile users is hardly unique to AI. According to a study by London-based Open Fundraising, while 20 percent of donations made online in the past year were via mobile devices, more than 50 percent of potential donors never got to the point where they could make the gift simply because it took too long.
And according to Dale Knoop, founder and CEO at fundraising firm Raz Mobile in Kansas City, Mo., it’s vital for nonprofits to make sure donation pages are mobile optimized given the ever-increasing use of mobile technology
The word “optimized” is important here. A lot of organizations talk about being mobile friendly. It is more important to be mobile optimized. What’s the difference? It comes down to usability.
Elisa Cheng, senior director of design and implementation at Zuri Group in Bend, Ore., which was instrumental in the AI transition, said that the most common reason for donor abandonment is content being too wide for the mobile screen. This requires users to scroll horizontally to see all of the text, and can lead to action items being too small for fingers to easily click.
“Form fields need to be big, the form itself should have a vertical layout with the labels for each field on top of the input box, not next to it,” said Cheng.
“When someone wants to make a gift, you have to help them right away,” said Knoop. “If people can’t see what to do next, that’s not really a fulfillment action. The longer it takes, the closer you are towards abandonment.” Abandonment isn’t limited to specific age groups. Whether a Baby Boomer or a Millennial, donors are going to drop off if the process takes too long.
“Easy is easy no matter what age you are,” said Knoop, who stressed that mobile donors are usually driven by impulse. You’ll likely lose the donor if you aren’t able to take advantage of that impulse in the first few minutes, Knoop said. “A lot of this is on the organization to look at what the donor is doing during that one minute they are compelled to make a donation.”
This is where Knoop’s idea of a mobile optimized landing page comes into play. Rather than just updating your donation page to make it more readable on a mobile device, he suggested streamlining it to make the experience as quick as possible.
“Speed matters in a mobile setting because you are on the go,” said Knoop. This is backed up from statistics from online retailer Amazon, which reported that an increase of just 100 milliseconds (ms) in response time on its site translated to a 1 percent reduction in sales. Knoop said the same logic applies to fundraising. In this case, if the process takes more than a minute, you are likely going to lose the donor.
Laura Quinn, executive director at technology nonprofit Idealware in Portland, Maine, agreed that nonprofit managers need to look to optimization to create an effective landing page for mobile donors. With more fundraising campaigns originating through email, Quinn said that you will have to assume that many of the people who read the message will be doing so on a mobile device.
Quinn said that the first thing an organization should do when looking into a third-party vendor is to make sure they have a “responsive form,” meaning that it adjusts to the screen size of the mobile device. After that, it’s all about making the process as fast as possible for donors. This means you should only ask for information that is relevant to the donation (i.e., name, contact information, and donation amount).
Quinn also suggested making it possible for the system to store the donor’s setting so, if they want to give again they don’t have to re-enter their information.
“Even tiny changes can have a big impact on the success of your landing page,” said Quinn.
This point was made abundantly clear to Stark and his colleagues at AI after they conducted some A/B tests on their landing page. By sending different versions of the same page to donors via email, they were able to see how changes impacted conversion rates. For example, when they increased the size of their text on one version of the landing page, they had an 11 percent greater conversion rate than the version with smaller text.
Stark also found a noticeable difference in conversion rate based on the type of gift they were asking of the donor. “The interesting thing we found was that users are less comfortable making a sustaining gift,” explained Stark, who noted that despite the lower conversion rate, monthly gift requests produced a greater value donation. Specifically, the conversion rate was about 34 percent less while the value (when calculated to include the 12-month value of each monthly gift) was 50 percent more.
The changes Stark and his team made included asking only for “transactional” related information. “We only ask them for what they came to the page to do,” said Stark. They also made the contents of the page change depending on the type of device being used. The results were an overwhelming success. According to Stark, the conversion rate from fundraising emails increased 91 percent from the previous year, including a 242-percent increase from mobile devices. The results were a surprise, even to Stark.
“At first I thought the dramatic increase in conversion rates might be due to a reporting glitch, so I cross referenced them against our email click data to make sure our reporting systems were producing similar results,” said Stark. “I attribute the improvement in conversions to enhancements in our forms, donors who are more comfortable making gifts on mobile devices, and to a more effective email strategy that prioritizes making more relevant and targeted donation asks.”
All of this is not to say that donors never drop-off when they use a desktop-based donation page. In fact, according to Cheng, the average conversion rate for desktop donation pages are the same as mobile: 50 percent. She also said some of the same techniques to improve conversion rates for mobile users can be used for PCs. For instance, Cheng recommended having donors enter credit card information first. “As a user, getting your credit card out and entering the number is the hard part. The sooner a user does this before seeing the rest of the form questions, the more likely they are to submit,” she said.
Cheng also said that changing the text of your donate button from “submit” to “give now” has shown to have a positive impact.
The fact that the conversion rates are exactly the same speaks volumes about what donors think about donation forms, said Cheng.
“Most forms online today are not optimized for mobile use so the fact that conversion rates are still around 50 percent means that users may not have as high of expectations for how forms will work on their mobile devices,” said Cheng. As Internet usage on mobile devices increases, this expectation is only going to increase. As expectations increase, it is going to be more and more important to make sure your forms are meeting those expectations, she said.
“Folks have to be savvy,” said Stark. “The kind of changes we have described can make a difference but it’s important to look at two things: Results will be specific to your change, and it’s important to pay attention to statistical results you are seeing.”