How do you measure the connection between alumni engagement and alumni giving?
Last month, we attended the 2018 AGB Foundation Leadership Forum in Los Angeles. We sought to continue our research and connect with institutions that may be interested in more effective approaches to regional outreach. On January 22nd, we hosted a breakfast session with a dozen advancement executives in the field, where we discussed our most recent research findings, how to build regional strategies, and ALUMinate services as a shared-resources model. Read on to discover the essential lessons we gleaned from our time at the Forum.
Insight #1: Few Universities Have Data-driven Regional Strategies
We made a point of asking our advancement colleagues, “How would you describe your regional alumni strategy?”
The most common response we received was, “Strategy? I’m not sure. But let me tell you about our events…”
Events can be part of a regional strategy, but can’t comprise the strategy itself.(See our recent two-part post for a more in depth investigation into how to build a regional event program.) When we started talking about having a comprehensive regional engagement strategy during the breakfast session, one of the key challenges quickly revealed itself: there is no industry standard of excellence for measuring the effectiveness of alumni events.
Another challenge is that the activities of the alumni association or alumni relations team frequently are not coordinated with the efforts of the advancement officers, even when both groups are housed under a single organization.
Practitioners know the purposes of events and can measure those purposes (although our research shows that a considerable number of institutions are still working on that step). As far as purposes, institutions hold alumni events to:
-Build community (measuring this one can be a bit more nebulous!)
-Raise money for a cause or initiative
But the relationship between successful alumni events and greater giving can be murky at best. Institutions that put in the effort can identify correlations, but causality is difficult to prove (though, we believe, not impossible).
Here are tough questions, related to event effectiveness, raised during the breakfast session that can serve as a way to jumpstart a discussion with your team as you develop and hone your regional strategy.
-What does good look like when it comes to events and regional engagement overall?
-How do you measure success on the alumni engagement side? How do you figure out how that success leads to philanthropic engagement?
-Instead of starting with a smattering of events and hoping prospects show up, how do we identify the types of events that donors want to attend?
-What event caused a certain gift? How do we pinpoint that kind of moment?
A majority of conference attendees we spoke to suggested that they’d welcome significant changes and shake-ups in their approach to advancement and alumni outreach if those changes have big impacts on regional engagement and giving.
Insight #2: Community College Students: Forgotten Island of Complex Alumni?
One of the first conversations we had at the Forum was with a practitioner from a community college on the East Coast. She told us, “I think a lot of people forget about community colleges and their alumni when discussing the state of advancement in higher education.” She also brought up the fact that graduates of two-year colleges may not identify as alumni of that institution, even though they are.
This lack of identification may stem from the fact that two-year colleges often struggle with how to categorize and treat their graduates. Is an alumnus “someone who earned an associate degree? a guy who took a class once?” Lee Gardner raises this question in his article, “Community Colleges Could Benefit From Better Alumni Outreach, Survey Finds.” Gardner concludes that various community colleges will answer the question of who counts as an alumnus differently.
Giving rates show that community college alumni themselves aren’t quite sure they identify with their two-year experience. According to the 2016 CASE white paper, “Benchmarking Alumni Relations in Community Colleges,” in 2015, the percentage of community college alumni who donated was less than 1%.
What can we learn from this? Even if your institution is not a two-year college, this serves as a reminder that many alumni were nontraditional students who may have taken the community college path to your four-year institution. Trying to keep the whole story and the entire lifecycle of an alum in mind when designing events and programs for them is challenging, yet integral. An institution’s regional strategy should be comprehensive, as should the list of constituents served.
Do you work for a two-year institution with a significant alumni population in Chicago? We can help. Contact us today to learn how.
Insight #3: Mind the Gap: Unique Challenges in the Middle
One topic that came up during the breakfast session was the difficulty practitioners have engaging prospective donors with giving potential rated between $10,000 and $100,000, which we will affectionately refer to as the “gap.” We know annual giving programs target the range below the gap, while principal gift officers and regional gift officers at larger universities typically are assigned donor prospects above the gap.
As a guide to understanding the challenge, let’s look at the fiscal year 2016 fundraising report from the Michigan State University. Based on the published results, the breakdown of the $272 million raised during the year is as follows:
Michigan State is a good proxy for the giving trends at other institutions where the “big” money comes from a small group of donors (as other studies show). But as our analysis of Michigan State indicates, about 12% of the total raised came from the gap. This 12% very likely consisted of 1,000 separate gifts—even if we consider that Michigan State probably also received 50,000 or so gifts below $5 and many non-cash donations below $10,000.
How can this specific group of donors (the “gap”) best be engaged and cultivated? Major gift officers generally have a compensation level in the $75,000-$100,000 range (plus benefits, travel and other direct costs), and regional gift officers command even higher pay. To achieve an acceptable return on a gift officer’s cost, most of their attention has traditionally been directed towards cultivating mainly the major gift prospects.
But isn’t today’s gap donor tomorrow’s major donor? Given gift officer turnover, playing the long game of cultivating a prospective six-figure donor over 3, 5 or 7 years doesn’t necessarily play well during the officer’s annual performance review. But we’d be curious to see a histogram of this MSU data that shows the giving patterns of the 346 major gift donors plotted against:
-their ages (x axis), and
-size of each gift (y axis) during their lifetimes.
Our bet is it shows that today’s gap donor may grow into a major gift prospect. Consistent and meaningful engagement of this group is essential to generating even greater levels of support from them in the future.
Based on our research, we’ve compiled a list of tips to help you serve this diverse prospect group:
-Be open to new data-driven approaches and build assessment into every stage of your strategy. For instance, plotting the gifts (as described above) for all 346 major gift donors and mapping those gifts against past cultivation and engagement efforts may reveal common patterns and insights that will help inform advancement strategy going forward.
-Seek to understand the whole life background, experiences and traits of your alumni. Do patterns emerge?
-Leverage the importance of storytelling and brainstorm how to integrate it into your branding. For example, can you effectively share your donor’s story with a prospect group who will closely relate to their journey?
-Note the changing trends and needs of young prospects, including:
*How driven your alumni are to give to specific causes over organizations. It may be more effective to invite them to fund 10 partial scholarships than to ask them to contribute $25,000 to the college.
*How most aspects of their lives, including their giving habits, are influenced by social media
*How much responsiveness and transparency they expect
*How their interest in affinity and diversity are growing
*How most don’t seek a passive role when giving
We hope you found these insights helpful as you continue to think about your regional strategy. Whether you’re trying to come up with a comprehensive strategy, crafting your institutional story, or capturing prospects in the “gap,” we can help! Call us today to learn more at 877-325-ALUM (2586).