The Ultimate Guide Annual Fund Campaigns

Every year, your nonprofit organization faces unique fundraising challenges. One of the biggest is maintaining the growth of your annual fund, or the dedicated revenue set aside for covering essential operational expenses.

Annual giving campaigns are some of the most challenging fundraising projects an institution will take on. Although they are an integral part of fundraising for institutions of all shapes and sizes, finding the right donors for your annual fund can be tricky.

Are you looking to give new life to your nonprofit’s next annual giving campaign? Then it’s time to take a second look at how your organization raises money for its annual fund. In this extensive guide, we’ll go over some of the basics of annual giving, the ideal breakdown of your annual fund, the role software can play in your annual fund campaign, and some fundamental annual giving best practices.

Annual Giving Basics

One of the key benefits of your nonprofit’s annual fund is that it’s flexible. Because these gifts are unrestricted, they can be allocated to any project your organization deems appropriate. However, it’s not just your annual fund that offers diverse benefits to your nonprofit: annual giving (i.e., the fundraising efforts associated with your annual fund campaign) also provides unique opportunities for your organization.

Let’s take a look at the many ways that annual giving can be leveraged to both grow your annual fund as well as strengthen your nonprofit’s community.

Cover Operational Costs

The core function of annual giving is to cover operational costs for your nonprofit. These include payroll expenses, the mortgage on your headquarters, utilities, and other financial obligations. With the money from your annual fund, your organization is empowered to focus on fundraising for other projects with more targeted goals.

Supplement Other Campaigns

In addition to enabling your nonprofit to keep its lights on, your annual fund can also be used to supplement other fundraising efforts. If you fall short of your fundraising goals in other campaigns, your team can tap into your annual fund as a way to bridge the gap. Because annual giving is unrestricted, there’s no limit to where these gifts can be allocated.

Secure Long-Term Support

Outside of the initial gifts that your nonprofit receives from annual giving, the process of fundraising for your annual fund should also be seen as a vehicle for securing long-term donors for your nonprofit. As you acquire annual fund donors, put in the necessary steps to ensure that you can call on these contributors for their support in the future.

Get to Know your Annual Fund’s Donors

Since one of the core benefits of annual giving is that it helps your nonprofit build a more reliable donor base, it’s important that you take the time to get to know the key types of donors that you should focus on stewarding. With the right practices in place, you’ll be able to leverage your annual giving campaigns to grow your giving community for years to come.

Consider these three donor personae your nonprofit should focus on as you raise money for your annual fund campaign.

New Donors

Throughout your nonprofit’s next annual giving campaign, it’s crucial to acquire new donors for your organization. If your team simply sources donors from your existing group of supporters, you risk donor burnout, or overextending your key supporters until they are unable, unwilling, or uninterested in donating to your nonprofit again this year. You want to build a sustainable community of supporters.

Recurring Donors

One of the most important types of donors for long-term fundraising success is the recurring donor. This is the person who returns campaign after campaign to give to your organization. One of the best ways to make your annual fund sustain itself is to promote recurring gifts to donors. When you receive a gift, make it convenient for donors to opt into setting up recurring donations to your nonprofit.

Upgraded Donors

Finally, your annual fund campaign can be an excellent vehicle for upgrading donors when they give to your organization. Your nonprofit can market practices like recurring donations or solicit major gifts from individuals with a proven history of support for your cause. Because the success of your annual fund depends on sustainability, finding the right donors to upgrade should be one of your core priorities.

Appeal to Annual Giving Prospects

Making a strong appeal to donors during annual giving is crucial to securing the gifts you need to reach your fundraising goals. Not only that, but by making a strong case for individuals to get involved with your organization, you can also lay the right groundwork for long-term support. Since one of the most important parts of annual giving is making lasting connections with constituents, making the right appeal can’t be left as an afterthought.

Consider some of these ways your nonprofit can strengthen your annual giving appeals in your next campaign.

Personalize Your Appeal

You never want your constituents to feel like your annual fund campaign appeal could be addressed to anyone. Whether you’re making the appeal in person or in writing, personalize it by addressing your supporters by name, referencing their history with your organization, and how their individual impact is meaningful to your cause.

Show Your Thanks

The quickest way to derail your annual fund appeal is to extend your ask before thanking donors for their last gift. It’s always a good idea to send your thank-you messages immediately after receiving a gift, but be sure to open letters to past givers with another message of thanks. Reference their giving history and emphasize how much your organization could benefit from a similar gift.

Tell a Great Story

Another way to make your annual appeal stand out is to use storytelling strategies to make it more compelling for your audience. You might feature testimonials from individuals you serve to attest to your organization’s impact, or you can tell the history of your nonprofit to highlight how you affect your community.

Follow Up

Be sure to follow up with individuals after you extend your annual giving appeals. Some people will need to be approached for a gift several times throughout the year before they donate, and you don’t want to miss out on a gift simply because the person couldn’t give at that time. Many factors affect a person’s willingness to donate and it’s always worth approaching them again to cover your bases.

Breaking Down Your Annual Fund Campaign Goal

One of the biggest mistakes nonprofits can make when raising money for their annual fund campaign is failing to put as much effort into the planning process as they would when fundraising for more targeted projects (like a capital campaign). In fact, it’s just as important to plan out your gifts and how you’ll acquire them as you would for any other campaign.

Let’s review one of the central components of planning out your annual fund’s gifts: the gift breakdown.

Major Gifts

Acquiring major gifts is one of the central challenges of any campaign, but it can be even more difficult for annual fund campaigns, in which you need to convince major donors to contribute large, unrestricted sums to your organization. However, major gifts are absolutely crucial to reaching your annual fund’s goal and should account for at least 60% of all the money you raise.

Mid-Range Gifts

The intermediate giving level of your annual fund’s gift breakdown is where you’ll receive the middle 20% of gifts to your campaign. Gifts in this range should cover 15-25% of your annual fund’s overall goal. Despite being in the mid-range of your gift breakdown, these will still be larger than the average donation to your nonprofit during this campaign.

Lower-Level Gifts

Somewhat counterintuitively, the bottom 70% of all donations account for the lowest tier in your annual fund’s gift breakdown. These should account for 15%-25% of your overall fundraising goal and will likely be the entry point to your organization for most new donors. Just as you would with a capital campaign, for example, your team should plot out this breakdown with a gift range chart.

Setting an Annual Fund Goal

Knowing what kinds of gifts you’ll require from donors is ultimately dependent upon the fundraising goal your nonprofit sets for the annual fund campaign. It can be tempting to set a very ambitious benchmark for your annual giving goal but at this stage, it’s important to let the realities of your organization shape the final goal your team sets for the campaign.

Take into account some of these important goal-setting strategies when agreeing upon an annual fund campaign goal.

Don’t Let the Tail Wag the Dog

One of the biggest mistakes you can make in any campaign is setting your fundraising goal to be the amount of money you want to raise, as opposed to the sum that you are prepared to raise. When it comes to your annual fund, base your goal on your proven track record of success. Typically, a multiple of your last annual fund campaign is a realistic benchmark; or, research goals of comparable organizations.

Develop a Preliminary Goal

As your nonprofit lays the groundwork for your next annual fund campaign, an important step in the process is developing a preliminary fundraising goal. This means that your team will start off with a working goal that is subject to change before your campaign kicks off. During the planning process, you can determine whether or not you have the necessary resources in line to make it a reality.

Finalize it with a Feasibility Study

Feasibility studies aren’t just for capital campaigns. In fact, your nonprofit should hold a feasibility study phase as you finalize your fundraising goal for your annual fund. In these studies, your team can bring on a fundraising consultant to help determine the attainability of your preliminary fundraising goal. Before your campaign kicks off, you can then set a final goal based on the findings of your study.

Get Closer to your Annual Giving Goal

Setting an attainable annual fund campaign goal is one thing. Actually, reaching it? That’s a whole different story. As your annual fundraising calendar progresses, there are several strategies your team can take to ensure that your fundraising progress keeps pace with any internal and external roadblocks you might encounter along the way.

Consider implementing these annual giving goal-reaching tactics as your campaign goes on.

Fundraising Check-In

Throughout the year, check in on your annual fund campaign’s progress. Prior to the campaign’s launch, set periodic check-in goals for your fundraising progress as well as donor acquisition, major gifts fundraising, and other important metrics. This way, if you need to correct course you’ll be able to do so before the campaign ends.

Year-End Appeals

The year-end giving season is the perfect time to make one last fundraising push for your annual fund campaign. Over a quarter of all giving takes place between Thanksgiving and Christmas. If your nonprofit finds itself falling short of your annual giving goal, leverage this year-end fundraising boom to reach the finish line.

Corporate Giving

Many nonprofits overlook the impact that corporate giving can have on their campaigns. Every year, millions of dollars of corporate philanthropy are left unclaimed by nonprofits like yours. Your team should have a strategy in place for soliciting corporate gifts for your annual fund, including stewarding matching gifts from prospects.

Online Giving Strategies for Annual Fund Campaigns

The key to making your annual fund campaign a huge success? Enable online giving for your supporters. By adopting customizable online giving forms for your nonprofit, you can make it easy for supporters to give whenever and wherever it’s most convenient for them. The easier it is for your supporters to make their donation, to more likely they’ll extend a gift to your organization.

Take a look at some of the ways your nonprofit can leverage online giving forms to boost donations to your annual fund.

Customize Your Giving Forms

When setting up your annual fund campaign’s online giving forms, be sure to customize them to your organization’s identity and needs. This means that in addition to showcasing your logo, branded colors, photos, and videos, your online giving forms should feature fields to enable recurring giving, suggest gift sizes, join subscription lists, and more.

Analyze Valuable Data

One of the benefits of adopting online giving forms is that you can analyze the data associated with them to improve your annual fund campaign’s strategy moving forward. For example, you can track click-through rates on links and monitor keyword hashtags on social media as a way to analyze engagement levels with your nonprofit’s annual fund campaign online.

Optimize Forms for Mobile

Perhaps the most important part of setting up your annual fund’s online giving forms is optimizing these pages for mobile devices. The fact is that most of your supporters will visit your online giving forms through their phones or tablets. If your donation pages aren’t optimized for devices like these, this could make it less likely that they’ll complete their gift.

Connect Donors to your Annual Fund’s Online Giving Form

It’s not enough for your nonprofit to develop online giving forms for your annual fund campaign: you need to use the right communications tools to get that form out there to your desired donors. Luckily, there are many ways your team can make valuable connections with your supporters while empowering them to participate in annual giving for your organization.

Check out some of these useful channels in which you can share your online giving forms with supporters of your annual fund campaign.

Email

By placing a donate button in your email communications with supporters, your team can link out to your desktop and mobile optimized giving forms. Seamlessly integrate this button into your regular emails to constituents, and you’ve already made giving to your annual fund as simple as just a few clicks.

Text-to-Donate

Did you know that you can share your online giving form with supporters via text? Text out your branded short link or text-to-donate keyword and instantly your supporters will be sent to your mobile-optimized giving form. The average text message is opened within three minutes of it being sent, making text giving one of the fastest fundraising methods out there for annual giving.

Direct Mail

Not all of your supporters are tech-savvy, and not everyone is subscribed to your email and text message lists. However, you can still steer supporters toward your giving forms using direct mail methods. Simply add a QR code that links to your annual fund’s giving form, print your text-to-donate keyword, or share your branded short link, and individuals will have the tools they need to make an online gift.