Alert! Missing Middle Donors

Missing Middle DonorsTry this fundraising mash-up to close the yawning giving gap you might not even know you have!

Mix these insights on giving patterns of rich vs. middle- and lower-income donors with Sea Change Strategies’ take—The Missing Middle: Neglecting Middle Donors is Costing You Millions—and you get a clear call to action for every fundraiser.

Although these two middles are differently defined—the first based on income level, whereas the Sea Change study probes donors who give from $250 to $900 annually to a single org—there’s just one conclusion: There’s more value in middle donors than we imagined.

Here’s the data and analysis to help you close your organization’s giving gap:

Middle-Income Donors Give MORE of Their Income to Charity than the Wealthy Do

The rich are now giving a much smaller share of their income to charities, while middle–income donors give more, as indicated in 2006 to 2012 income tax data analyzed by the Chronicle:

“Generosity can be measured in many ways, and looking at total dollars donated versus donations in relation to share of income shows how stark the comparisons can be. The wealthiest Americans—those who earned $200,000 or more—reduced the share of their income they gave to charity by 4.6 percent from 2006 to 2012.

Meanwhile, Americans who earned less than $100,000 (including poor and middle-class families with two working adults) donated 4.5 percent more of their income in 2012 than in 2006.”

But Most Middle Donors Aren’t Cultivated…Enough

The Sea Change findings emphasize how just many organizations are missing out on middle donors (donors that give at the middle-level in this case), and the potential value that middle donors have for most nonprofit organizations.

Even more startling is the finding that nonprofits that focus on this group—despite its huge potential—are few and far between. More typically, development staff members specialize in lower dollar direct-marketing fundraising or cultivate high-value major donors.

Here’s your chance to get giving going better than ever before—an opportunity sitting right in front of you! Read this report to learn “8 Habits of Highly Effective Mid-Level Donor Programs.” Then use the 30-day plan provided to close your giving gap.

*The Chronicle’s analysis is based on returns filed by those who itemize deductions, including charitable gifts (these gifts are approximately 80% of total giving).

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Nancy Schwartz on February 3, 2015 in Fundraising: Innovations & Research | 4 comments
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  • Michael Rosen

    Nonprofit organizations seldom invest sufficiently in cultivating and retaining mid-level donors, both donors with mid-level capacity and donors who give at the mid-level but have greater capacity. When treated appropriately, mid-level donors will be a great source of current dollars and a wonderful source of planned gift revenue; some will even graduate to become major donors. Unfortunately, for most organizations, it’s a case of untapped potential.

    Thank you for raising the issue here!

  • Thanks for your note, Michael. Any particular methods to recommend?

  • Michael Rosen

    Nancy, wow, you’ve asked a huge question !?! :-) I have plenty of recommendations. However, I’ll give you a more simplistic answer than you and your readers deserve (sorry), but one that will nevertheless be helpful for folks:

    First, I’m not convinced there is a need for a different strategy, per se, for mid-level v. grassroots v. major gift donors. The key strategy is to be donor centered. Where differences will come into play among donor levels is when it comes to tactics; those will depend on available resources and the potential for increasing lifetime value v. cost.

    Secondly, there are four good books, with tons of useful ideas, that can help folks focus appropriately:

    “Donor Centered Fundraising” by Penelope Burk
    (http://astore.amazon.com/mlinn-20/detail/0968797814)

    “It’s Not Just about the Money” by Richard Perry & Jeff Schreifels
    (http://astore.amazon.com/mlinn-20/detail/1503290972)

    “Relationship Fundraising” by Ken Burnett
    (http://astore.amazon.com/mlinn-20/detail/0787960896)

    “Retention Fundraising” by Roger Craver
    (http://astore.amazon.com/mlinn-20/detail/1889102539)

    Folks can get a sneak peek into Craver’s new book along with my review of it here: http://wp.me/p1h0KY-I0.

    Development professionals need to analyze their database. They need to look at donor retention metrics and lifetime value by donor level. Then, they need to make the case internally for devoting the necessary resources to strengthen relationships. This will require a culture of philanthropy at the organization. With the institutional buy-in, the development professional can begin to develop a plan. However, the plan will only work if the entire organization is willing to adopt the culture of philanthropy that Perry & Schreifels so well describe in their book.

  • Such valuable guidance, Michael. Thanks too for sharing some of your fav resources.

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