Barriers to relationship fundraising in Higher Education

By virtue of my specialism in alumni and supporter experience research, I have the great pleasure of working with universities who either practice relationship fundraising or are well on their way. This is because one of the common behaviours of a relationship fundraiser, as I wrote earlier this year, is seeking to understand audiences through research and regular dialogue.

I have also experienced the darker side of higher education fundraising having undertaken a mystery shopping exercise with 15 UK universities. I was dismayed that so few attempted to welcome me and get to know me – and how many actually managed to cause offence.

It’s fair to say that while some universities are doing great things, several are still struggling to turn the tide of transactional fundraising – or aren’t interested in doing so.

Also, I love my clients very, very much.

Today, timely as ever, Rogare has published another thoughtful report into relationship fundraising. This one focuses on the barriers that exist to implementing a relationship fundraising approach. Cultural issues, no clear definition of what relationship fundraising is, a lack of evidence for increased performance and no agreed way to measure success are the barriers that rang true to me.

Interestingly, universities are mentioned in this report as a potential source of case studies for relationship fundraising with High Net Worth Individuals (HNWIs). This troubles me somewhat, as while I agree that we are fantastic at looking after higher-level donors, many institutions are not off the starting blocks when it comes to their smaller-gift donors. Given relationship fundraising’s origins are with the mass audience, I have a few theories as to why we are encountering this relatively unique barrier to implementing the approach across the board.

Firstly, I suspect that we are not aware we are relationship fundraising when we are looking after our high-level potential and current donors. The lack of a concrete definition aside, we probably feel it’s only logical to look after these people as VIPs given the size of their commitment or potential commitment. We imagine they are accustomed to a certain level of service; we’ll ask them about their needs up front in a gift agreement and be at pains to supply it. We know we’ll likely never provide ‘too much’ stewardship for these people – the sky is the limit, and our time and effort is justified. In other words, we are providing a 5-star service proportional to their 5-star value and not a penny of any donor’s gift is spent on it – the university pays for it gladly given the excellent ROI.

So, when a smaller donor comes along, some fundraisers don’t know where to start. ‘Oh they’ve given a £5 gift? I guess they can have a generic thank-you letter.’ If the level of care is determined in proportion to the size of the gift, not any underlying ethics, then relationship fundraising does not happen at the lower levels.

Secondly, we constantly reinforce how big donors are more important, critical in fact, to what we do. We draw up plans for multi-million-pound campaigns and we conduct feasibility studies (read: qualitative research with HNWIs only) to execute them. While the campaign is in motion, all that matters seems to be reaching that target, a target that incidentally none of our smaller donors are interested in. With that target in mind, a £5/month donor could be a drop in the ocean. I suspect some institutions might think they can afford to lose a few, especially if their research suggests these donors don’t have a large amount of wealth.

Thirdly, I think we suffer more than we admit from a lack of expertise and education in mass fundraising theory. We don’t have the emotive founding myths of many charities; most of our departments were established because our then VCs needed income diversification. This means that when we started modern HE fundraising we did so with with major gifts rather than grass roots support, and by the time regular giving was added, it was a ‘nice to have’. Our current development directors are therefore more likely to be from a major gift fundraising background and this may mean they are less confident becoming involved with regular giving programmes to the degree that would be required to lead cultural change in this area (if indeed, they felt this was important) – or they may outsource it to an agency who has these skills. If the regular giving manager is also from a marketing background and has not studied the nuances of selling the donor experience rather than a product, this would further compound the problem.

I completely appreciate this is not true for all institutions and I mean no disrespect to regular giving managers and development directors who care deeply about the alumni and donor experience, have done the research and who are making great things happen for all donors. However, the barriers are very real for other HE fundraisers and need to be discussed and addressed for change to occur.

Let me know you thoughts.

5 thoughts on “Barriers to relationship fundraising in Higher Education

  1. Simon Buttenshaw says:

    Thanks Holly for a thoughful piece as ever.
    In my experience I think you are right that most HE Development Directors are expected to play a hands-on role in securing Major and Principal gifts. But I guess that’s understandable when you consider the proportion raised by these big gifts in HE – a proportion which isn’t typically true of the bigger ‘mainstream’ charities, with their much larger databases and broader mix of fundraising products. In HE, we just don’t have as big a pool to fundraise from as the national charities. This is why initiatives like the benchmarking Rosie and Adrian from More undertake and the CASE Regular Giving Conference are so important to us. By pooling our data and sharing best practice, we are better able to understand our donors.
    As for your point about HE Major Gifts teams using a relationship fundraising approach without realising – you are probably right. If Development Directors looked deeper into theory it would not only make for even better relationships with the top donors, it would result in them being better placed to champion this approach with their Regular Giving teams.

  2. hollypalmerconsulting says:

    Hi Simon – I agree it’s easy to see where the focus on higher level donors has come from, however we really must ensure all donors, regardless of our perceptions of the value of their gift, receive care and consideration. I believe benchmarking to be problematic at the moment given how few institutions are truly relationship fundraising. It can be a powerful way of achieving collective mediocrity if those we compare ourselves to are doing more or less the same things (assuming we know what they’re doing, and not just the broad statistics). At this moment in time, innovation and visionary leadership is what’s required, i.e. real change. A great way to approach this would be to start with getting to know your audiences and finding the key insights that will allow you to create outstanding experiences, perhaps even achieving retention and satisfaction rates that others haven’t dreamed of. There is no substitute for looking at your own audiences and your own institution’s circumstances and thinking creatively, without being limited by what others have been able to do and how they approach their work.

  3. Adrian Beney says:

    Your appreciate I’m an interested party in replying to this comment. But I completely disagree with you about the benefits of benchmarking. Of course any form of comparative analysis can simply result in a sharing of mediocrity. However our Regular Giving project has concentrated on sharing best practice. And how do we know its best practice? Because the numbers say so. Institutions that have taken part in the benchmarking project from the beginning have seen income grow by more than 50%. We’ve been able to investigate where the growth has been and to show institutions that have not experienced the same growth the things they are not doing to grow their programmes. The data has provided encouragement for less developed institutions to invest, and some reality checks for those whose ambition is over optimistic in their context or given their budget.

    • hollypalmerconsulting says:

      Hi Adrian, all good points. It’s a useful tool when used wisely and with lots of contextual information about what’s going on at other institutions beyond the numbers. In my experience, each institution is unique and it pays to take time to understand the context before expecting similar results with similar investment for example. Very few institutions given my own recent research appear to be practicing relationship fundraising with smaller gift donors – what would happen if they did? How exciting would it be to benchmark with these folk?

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