In this blog, our experts at Woods Valldata explore how to generate income for a charity through individual giving channels in order to boost your charity’s return on investment. Read on to discover their top tips and advice!
It probably goes without saying, but achieving a good ROI from your charity’s income generation spend is an essential part of fundraising success.
After all, without it, you won’t be able to provide vital services for your beneficiaries or reinvest funds into building bigger, bolder and better fundraising campaigns in the future!
However, with so many fundraising streams to cover (individual giving, major donors giving, corporate giving, philanthropy, legacy giving, grants, community, events, retail...), all of which require considered communications aimed at specific audiences in order to build lasting relationships, it can be difficult to know where to begin!
We’ve therefore collated our knowledge of how to generate income for a charity and would like to share with you five approaches you can take to boost your charity’s income generation and return on investment (with a focus on individual giving as one of the most common fundraising streams)!
Before we begin...
As we know very well here at Woods Valldata, charities come in all different shapes and sizes, and no two are the same. Therefore, it’s worth keeping in mind that some of the approaches here will work for your fundraising strategy better than others – and some may not be quite right altogether.
As a result, the best approach is to test each of these before implementing them completely to see whether there is a significant impact on your programme first.
With that said, let’s get started...
5 key ways to generate more fundraising income and increase your charity’s ROI:
1. Carry out a full data audit
First up, you should assess your greatest asset – your data. Or, perhaps more specifically, your individual giving supporter database!
Before you get into this, ensure that:
- your database is clean and well looked after, with up-to-date and compliant supporter data
- every ask and interaction (financial and non-financial) with a supporter is logged and stored correctly
- you understand and store the preferences for each supporter across all available channels
This way, you will have all the information you need to personalise your communications, make them relevant and effective, and fully understand your supporters' preferences.
Then, you can move on to ask yourself the following questions:
- What supporter segments do you have in place?
- Do your supporters participate in one or more different ways to give (for example, The Wood for Trees State of the Sector Report 2021 found that 88% of supporters only do one form of giving with a charity)?
- When was the last time individual supporters interacted with you? If more than 12 months, why do you think they stopped?
- What channels do supporters use to interact with you? How invested are they with your cause?
- Are there any kinds of supporters you don’t have but would like in your database?
For more helpful insights, consider running a survey with your existing supporter base to better understand their motivations.
From these insights, you can then go on to create more meaningful communications and campaigns that will keep your current individual giving supporters engaged, and even draw new supporters to your charity!
2. Perform a gap analysis
Now that you’ve explored the impact of your current individual giving fundraising streams, it’s time to explore what you might perhaps be missing!
Take a look at your current selection of streams and your supporter types, and ask yourself the following questions:
- Does this selection fulfil the needs of your current supporter base?
- Are there any kinds of individual giving fundraising you don’t currently offer?
- Is the proposition of what you do offer aligned to the kinds of supporters you have?
- Are there any opportunities missed to attract a different kind of supporter?
Even if you have a solid appeals and regular giving programme, consider introducing something different like a raffle or weekly lottery to your strategy.
This can encourage supporters to give in other ways and attract a whole new type of prize-motivated supporter – thus, boosting your income generation and ROI!
3. Review your data and channel strategy
Knowing how to generate income for a charity also means knowing how well your current communication channels are working.
Across your individual giving activities and within each of your products, have a careful think about who you’re contacting, how, and why. Ask yourself the following questions:
- Is there a way to join up the different communications your supporters receive to create an overall “halo effect” for your charity fundraising?
- Are there supporter segments that you’re asking on one product who might respond more favourably elsewhere, or even to more than one ask?
- Does your ask-level effectively balance response and average gift?
- Is the channel you’re using the best one for these communications?
Keep testing different segments across your assorted products, and carefully consider the message you use for them given their profile and history with your charity.
Think about the channel you’re using to communicate with supporters on, too. Use the information you have to create a communications approach that truly resonates with them.
As a result, their respect for your charity will grow, and this will ultimately result in a greater number supporters and increase loyalty!
4. Balance acquisition and retention for the ultimate ROI
The best ROI will be delivered by contacting only the most responsive of supporters for any given campaign!
This way, the cost of contact will be relatively low, and response rates and average gifts will be reasonably high – and, as a result, this will deliver the best ROI.
It’s important to note, however, that this is only a short-term strategy. Over time the number of these supporters will fall and you will not have replaced them with any new supporters.
Therefore, to maintain a healthy programme, you need to balance the cost of acquiring new supporters to your programme along with the cost of keeping them, using the income delivered by your most loyal supporters.
Keep testing new ways of acquiring supporters to find the most responsive approach for both initial gift and repeat giving across your individual giving products and channels, and you’ll be well on your way to success!
5. Consider outsourcing
On the surface, it might seem more cost-effective to work on your income generation strategy and all the methods outlined above entirely in-house. However, this isn’t necessarily always true!
Ask yourself if there’s anything you’re currently doing in-house that takes a disproportionate amount of your team’s time and energy, or that is taking you away from planning new or more targeted campaigns?
Outsourcing to an experienced fundraising services provider like Woods Valldata can free up time, create efficiencies in the process and help create a more positive supporter experience by reducing response times.
As a result, the return on investment you’ll receive will include a bigger and more engaged supporter base, and from that, increased income generation.
With that in mind...
Shall we work together on your charity’s income generation strategy and ROI?
At Woods Valldata, we pride ourselves on helping charities to raise more income to support their unique and transformational causes through our variety of services. In short, we believe that we’re stronger together!
Should you choose to team up with us, we will become an extension of your fundraising team, working on your behalf and anticipating your every need. With this approach, we'll work together to ensure that you achieve your income generation goals and secure an incredible return on investment.
To learn more about how we can achieve these amazing outcomes together, book your free consultation with us today...
