Dive Brief:
- A new Fundraising Report Card from MarketSmart detailed fundraising trends in the previous year for a number of sectors, including higher education. The analysis indicated that while only 3.3% of donors gave more than $5,000, 91.8% of the donation revenue came from donations exceeding that amount. The report examined 201 “education organizations" — 98% of which were actually institutions of higher education.
- Higher ed managed to retain 32.22% of donors in 2017 from the previous year, though this was a decrease from their donor retention rate in the prior two years. Of donors who gave for the first time last year, 17.71% gave again this year, a drop from 26.56% in 2016. Among repeat donors, the retention rate was 46.6%.
- Nearly half of donors gave under $100, though this made up a comparatively small percentage of the total donation amount of the education organizations. A representative from MarketSmart said the report card would be dynamic over the course of the next few weeks, with Giving Tuesday and year-end donations likely to significantly affect giving patterns and amounts.
Dive Insight:
Higher ed institutions face a variety of financial challenges on multiple fronts; public universities continue to see state government divestment, while private universities that are overly dependent on tuition are suffering from a decline in tuition revenue, leading to more pressure for development offices to close financial gaps. As schools reach the close of the year and a period of intensive giving punctuated by Giving Tuesday, there are a variety of approaches to increase the chances of a successful donation season.
Melissa Brown, a philanthropy expert who authored a previous report by MarketSmart, said in an earlier Education Dive interview higher ed institutions should consider the frequency of a previous donor in cultivating a new gift, not merely the dollar amount of their previous gifts. Additionally, schools should track digital engagement, though the previous report found that only 22% of the responding institutions currently do this. By considering how often a potential donor is interested in receiving news about the university, advancement officials could predict their willingness to give. Brown also said schools are moving away from using anecdotal evidence based on impressions from school staff or board members. While it may not lead to large gifts this season, schools should continue to cultivate small donors; often, those who give a little will continue to do so when they are in the financial position to give more.
Representatives from prominent foundations reported that they want to give to institutions and organizations that can close racial attainment gaps and promote accessibility and equality among all students, according to a series of interviews with Education Dive earlier this year. Additionally, some foundations have been taking note of “free speech” arguments underway on college campuses and fix their gifts on institutions or organizations which promote it. If colleges and universities are particularly attractive in any of these areas, they could consider tailoring their efforts for funding in the close of this year. Funders also noted that they prefer to give to organizations or groups that can spur systemic change, so schools involved in a consortia or larger collection of institutions may consider making group fundraising pitches for sizable sums. These funders also stressed the importance of being able to see a substantive potential return on investment for their donations, so colleges and universities with positive measures of achievement are in strong shape as they fundraise.
There are also investments colleges and universities can make to help become more successful fundraisers in the future. For example, development offices on college campuses must reconsider how they approach measuring success, and administrators must understand that additional resources for those offices may be necessary. Offering development officers assistance in scheduling meetings so they can spend more time cultivating donors could increase their success rate, as well as having higher ed institutions value and measure the success of a particular office with their rate of gifts, rather than the frequency of meetings with potential donors. Finally, colleges and universities should try to ensure their facilities maintenance, course quality and career services department are at as high a standard as possible; the success rate of their alumni, coupled with their perspective on their college experience, could help to determine the size and frequency of the gifts they give in the future.