Presentation to the Lake Superior Fund Raising Executives. Thank you for inviting me to Duluth.

1. Shaping the Development Plan in a Changing Philanthropic Landscape a presentation to the Lake Superior Fund Raising Executives John A. Martin, CFRE MGI Fund-Raising Consulting, Inc. www.mgifundraising.com 1-800-387-9840

2. Begin with a Plan The key to successful fundraising begins with a solid plan, and then working that plan. The presentation will stress not only the need for a diversified approach to fundraising but also the “Tips” involved in shaping the plan to develop a sustainable and competitive development program. www.mgifundraising.com 1-800-387-9840

3. Diversify and explore alternatives Why nonprofit organizations need to diversify their fundraising plans Strategies to create and shape a diversified fundraising plan How to apply different fundraising strategies to fit the needs of different funding sources How to “tweak” the plan and rise “above the clutter” in a competitive and changing fundraising landscape www.mgifundraising.com 1-800-387-9840

4. How did we get here and how do we move forward? Understand the philanthropic marketplace and the environment in which your organization competes Change the Paradigm and adhere to Best Practices Create a Culture of Philanthropy Achieve Brand Pinnacle www.mgifundraising.com 1-800-387-9840

5. 2009 charitable giving Total = $303.75 billion ($ in billions) Source: Giving USA 2010 www.mgifundraising.com 1-800-387-9840

6. 2009 Giving Summary Total giving = $303.75 billion. Decrease of 3.6 percent (-3.2 percent adjusted for inflation). Individuals remain the single most important source. Individuals + charitable bequests = 83 percent of total. Foundation grantmaking = 13 percent of the total. About half of independent, community, and operating foundation giving is from family foundations. Individual + Bequest + Family Foundations = 89 percent. Corporate giving is an estimated 4 percent of the total. www.mgifundraising.com 1-800-387-9840

7. Total giving, 1969–2009 $ in billions Inflation-adjusted dollars Current dollars Recessions in dark gray: 1969–70; 1973–75; 1980; 1981–82; 1990–91; 2001; 2007–2008 www.mgifundraising.com 1-800-387-9840

8. Giving by individuals, 1969–2009 $ in billions Inflation-adjusted dollars Current dollars www.mgifundraising.com 1-800-387-9840

9. Types of recipients of contributions, 2009 Total = $303.75 billion ($ in billions) www.mgifundraising.com 1-800-387-9840

10. 5 Most Popular Causes Americans Support (in billions) Religious or faith based ($100.95 – 33%) Education ($40.01 – 13%) Human Services ($27.08, 9%) Health ($22.46 – 7%) Public Society-Benefit ($22.77 – 8%) 2009 figures, Giving USA 2010 www.mgifundraising.com 1-800-387-9840

11. Changes in giving by recipient organizationCurrent $ Estimated giving increased in subsectors associated with provision of services to those in need. It decreased in subsectors where at least some funds are raised for buildings, endowments, and other long-term purposes. Giving USA estimates growth in giving to: International affairs 6.2 percent Health 3.8 percent Human services 2.3 percent Environment/animals 2.3 percent Declines in giving are estimated for: Religion -0.7 percent Arts, culture and humanities -2.4 percent Education -3.6 percent Public-society benefit -4.6 percent www.mgifundraising.com 1-800-387-9840

12. Where Does Philanthropy Stand? An unstable economy has shaken both non-profits and their donors to the core. Stock holdings have radically declined in value with some companies losing up to 90% of their value. Every company and executive has been affected in some way. www.mgifundraising.com 1-800-387-9840

13. The Past Projects the Future Corporate giving is most immediately affected in an economic downturn: corporate foundations are funded with annual profits. Most corporate foundations have been affected by the economic downturn – the effects will be felt for years to come. Foundation giving tends to scale down over a three year period: giving budgets usually represent a three year rolling average. Individual giving has the greatest resiliency and donors respond in difficult times. www.mgifundraising.com 1-800-387-9840

14. Corporate Giving and Today’s Economy 45% of businesses surveyed in 2009 (Corporate Contributions Report Survey, February 2009) said they had already reduced the amount they plan to donate this year. Another 16% were considering cuts. 35% of companies said they would make fewer grants this year and 21% said the grants they made would be smaller. As they complete their giving budgets for, corporate officials said they were most concerned about financial constraints, the recession and the alignment of their giving with their business’s needs. Among types of gifts, sponsorships of events take the biggest hit, 55% of businesses said they would cut back on that form of giving. www.mgifundraising.com 1-800-387-9840

15. Foundations and the Economy Fewer Foundations Anticipate Decreasing the Number and Size of Grants in 2010. The vast majority of foundations responding to the Foundation Center’s latest “Foundation Giving Forecast Survey” anticipate making no changes in their grantmaking strategies in 2010. In contrast, a year ago close to two-thirds of respondents (63 percent) expected to reduce the number of grants they awarded and/or the size of their grants. Nonetheless, the shares of foundations that anticipate reducing the number and size of their grants in 2010 continue to be larger than the shares that anticipate increases, reflecting continuing repercussions from the economic crisis. www.mgifundraising.com 1-800-387-9840

16. Individual Giving and the Economy Despite the significant downturn in economic conditions in recent years, the percentage of U.S. adults opening their wallets to charitable organizations has hardly diminished. More than four in five Americans continue to say they donated money to a charitable cause or organization in the past 12 months -- now 84%, compared with 87% in December 2005. www.mgifundraising.com 1-800-387-9840

17. Volunteering and the Economy According to the Gallup data, fewer Americans part with their time than their money on behalf of charity groups. Sixty-four percent of Americans currently say they have volunteered their time to a charity in the past 12 months, similar to the 62% recorded in 2005. Americans still prefer to give of their money rather than their time. www.mgifundraising.com 1-800-387-9840

18. Fund Raising Professionals Concerns Keeping professional fund raising staff and volunteers motivated. The impact of reduced endowment income on operating budgets Some foundation officers are more concerned about ensuring the viability of non-profit institutions than launching new initiatives. Institutions are being forced to develop contingency plans in light of possible reductions in philanthropic support. www.mgifundraising.com 1-800-387-9840

19. Fund Raising Professionals Concerns The reluctance of some non-profit leaders (CEOs and trustees) to solicit, or even contact donors right now. The inclination of some non-profit leaders to retrench when the desired approach by experienced professionals should be to move forward strategically. Donors appear to be waiting for the stabilization of the markets to assess the crisis’ impact on their personal holdings. www.mgifundraising.com 1-800-387-9840

20. Current Impact of Economy New donor acquisition from direct mail is down considerably in some institutions. Significant negative impact on some direct mail programs. Some galas and dinners are experiencing 10 – 15% fall off from the previous year. www.mgifundraising.com 1-800-387-9840

21. Strategic Opportunities Despite the economy, there are strategic opportunities to explore. People are more empathetic. The media are listening. Large gifts are more powerful and get more attention. Many people have funds to give. Prospects will come to events, discussions, and site visits. They want to stay informed, even if they can’t respond immediately. www.mgifundraising.com 1-800-387-9840

22. Giving Motivations 81.2% of wealthy donors said they are most motivated to give by the notion of “giving back to the community.” 70.7% gave because they “support the same organizations or causes annually.” 70.4% give because of their “social beliefs.” 48.1% gave because they were asked! www.mgifundraising.com 1-800-387-9840

23. Why People Don’t Give Anymore Nearly 60% of wealthy households who stopped giving to a charitable organization attributed their change in philanthropic behavior to no longer feeling connected to the organization. Merely 14.7% said that they stopped giving because of “lack of finances. 42.3% said they received too frequent solicitations from the organization and 8% felt they weren’t being properly recognized for their donations. www.mgifundraising.com 1-800-387-9840

24. Why People Don’t Give Anymore 70% of donors give to the same organization year after year. In 2007, 38% of donors stopped supporting a charitable organization, with more than one-quarter (26%) of those surveyed discontinuing support for at least two organizations. 19% stopped giving to four or more charities. www.mgifundraising.com 1-800-387-9840

25. Top 5 Reasons Why People Give Because they are asked, or presented a giving opportunity. To give back to their community Compassion for those in need Personally believe in the cause Affected by the cause This is based on an analysis of research in the field of philanthropy – including Indiana University’s Center on Philanthropy, Independent Sector, the University of Pittsburgh and others. www.mgifundraising.com 1-800-387-9840

27. Identify the Box

28. Understand theRole of Each Type of Giving

29. Demonstrate the Way Donors Can Make a Difference Today & In the Futurewww.mgifundraising.com 1-800-387-9840

30. TRADITIONAL DONOR PYRAMID Old Paradigm PLANNED GIFTS MAJOR GIFTS ANNUAL GIFTS SPECIAL EVENTS www.mgifundraising.com 1-800-387-9840

31. Special Events Annual Campaigns Major Capital Campaigns INTEGRATED PROGRAM New Paradigm DONOR Planned & Bequest www.mgifundraising.com 1-800-387-9840

33. More than Dollars, Gifts Reflect Values

34. Expressions of Values Increase Gifts

35. Worthiness based www.mgifundraising.com 1-800-387-9840

37. Finding

38. The right things to say

39. The best way to ask

40. What to ask for & how much

41. Learning the “Secrets” of how to Increase the “Desire” & “Intent” to Givewww.mgifundraising.com 1-800-387-9840

43. Enthusiastic Giving from Leadership & Staff

44. Positive Messages about Giving in Communications

45. Gracious Donor-centered Community

46. Having Fundraising Successwww.mgifundraising.com 1-800-387-9840

48. Trustworthy brands are becoming the donor’s roadmap through a giant worldwide bazaar in which tens of millions of other sellers are trying to lure your donors away

49. Positioning statement – avoid confusing the donor with multiple themes and taglineswww.mgifundraising.com 1-800-387-9840

51. Major Gifts Committee

52. Major Gift Director (Moves Manager)

53. Development Professionals

54. Prospectwww.mgifundraising.com 1-800-387-9840

56. Promote Quality Management

57. Lead Role in Identification, Discovery, Cultivation, & Solicitation of Prospects

58. Motivate Trustees, Directors, Advisory Board, & Volunteer Leadership

59. Promote Interaction & Cooperationwww.mgifundraising.com 1-800-387-9840

60. Key Components of a Development Plan The key components of a development plan are: • development goals • strategies for reaching the goals (preferred, available) • analysis of potential by constituency and by strategy • action plan and timetable for each strategy, with income benchmarks • assignment of responsibilities for strategies and individual solicitations to volunteers, staff, others • marketing needs for each strategy • budget and funding for each strategy www.mgifundraising.com 1-800-387-9840

61. Capital Campaign Planning and the Current Economy Most organizations are in one of three stages of campaigning: Initial planning Just Started Well underway Key issues to be considered Financial Goals Timing Case priorities Prospect Development Gift payment structuring Donor engagement, solicitation and communication strategies. www.mgifundraising.com 1-800-387-9840

62. Should we go/not go? List GO and NO GO considerations: Financing availability Case relevance and urgency Prospect pool capacity Leadership availability Timing Issues www.mgifundraising.com 1-800-387-9840

63. Campaign Planning in this Economy Inclusive Planning Involve most influential trustees and some major donors in your planning activities. Bring your prospects along with you. Include prospects in your campaign planning. www.mgifundraising.com 1-800-387-9840

64. Timing Issues Timing issues to consider: Extended planning phase Longer campaign timetable Flexibility with public kick-off announcement and definitive ending date Urgency of campaign Some campaigns have greater urgency and the case for support in this economy may be more compelling and supportable despite the economic factors www.mgifundraising.com 1-800-387-9840

65. Case Issues Case considerations in this challenging economy: Program support is compelling Building projects dependent on financing Shovel-ready projects are good for economic recovery Endowment is less attractive Challenge and matching gifts strengthen case www.mgifundraising.com 1-800-387-9840

66. Case Issues Some case issues are particularly compelling right now! Public higher education Human rights Wildlife Conservation and climate change Domestic hunger relief Medicine/innovation/science Global health www.mgifundraising.com 1-800-387-9840

67. Well Underway If you are WELL UNDERWAY into a campaign know that: It will take longer You may have to revise your timetable You should reorder priority prospects You may have to revise case statement, emphasizing critical programs and de-emphasizing endowment You might offer to restructure gift payments You should seek multi-year commitments You should always publicize your good news! www.mgifundraising.com 1-800-387-9840

68. General Development Strategies Focus Mission and Case Develop a short-term Action Plan Increase Activity Increase Prospect Research Prioritize Prospects New Gift Structures Include Beneficiaries in Donor engagement www.mgifundraising.com 1-800-387-9840

69. General Development Strategies (Continued) Targeted Requests Publicize New Gifts Challenge Gifts Introduce Payment Flexibility Explore Diversification Motivate Share Philanthropic Information www.mgifundraising.com 1-800-387-9840

70. Tip #1 Reaffirm your mission and continuously remind donors of the impact and urgency of philanthropic support Tell your story in a way that inspires investment despite or because of the challenges presented by the economy www.mgifundraising.com 1-800-387-9840

71. Tip #2 Increase activity including visits and briefings with donors and friends, and consistent communication. Your strategy is to “out hustle the economy” by making more visits and working harder to reach people. Keep your long-term donors close and your new donors even closer.” These visits will tell you three things Who is ready to give Who needs more time and roughly how long what elements of your case resonate among donors. www.mgifundraising.com 1-800-387-9840

72. Tip #3 Develop a short term action plan. Direct contact and visits with top donors Special gatherings and forum (s) among donor and prospect network Create a 2 year development plan Immediate financial priorities Prospect sequencing Support diversification www.mgifundraising.com 1-800-387-9840

73. Tip #4 Stay in touch. Now is the time to intensify cultivation efforts. Make personal calls on prospects and donors, letting them know how important your work is and how your organization is successfully facing current demands and how important they are. Let them know you won’t be calling on them for a gift until a more appropriate time…but you will be coming back. Remember 60% of wealthy households who stopped giving attributed their change in philanthropic behavior to no longer feeling connected to the organization www.mgifundraising.com 1-800-387-9840

74. Tip #5 Retain your current donors as a central strategy www.mgifundraising.com 1-800-387-9840

75. Tip #6 Reactivate your Past Supporters (SYBUNTS) www.mgifundraising.com 1-800-387-9840

76. Tip #7 Monitor shifts in timing and behavior www.mgifundraising.com 1-800-387-9840

77. Tip #8 Correlate Geography and the Economy www.mgifundraising.com 1-800-387-9840

78. Tip #9 Correlate Industry and the Economy www.mgifundraising.com 1-800-387-9840

79. Tip #10 Getting the Right Story for Donor Acquisition. www.mgifundraising.com 1-800-387-9840

80. Use new technologies to tell your story Tip #11 www.mgifundraising.com 1-800-387-9840

81. Tip #12 Use new technology to secure and collect pledges. www.mgifundraising.com 1-800-387-9840

82. Tip #13 Recognize donors. Pay greater attention than ever to the aggressive stewardship of your present donors. Let them know how important they are to you. Work with a small task force (staff and volunteers) to design a detailed and structured program. Put it in writing. How many times can you thank your donors in a year? www.mgifundraising.com 1-800-387-9840

83. Tip #14 Dare to Ask!!! Personal (face to face solicitation – by a carefully selected and well-trained volunteers who have made a financial commitment Campaigns fail raise above the “clutter” because they fail to “ASK”. www.mgifundraising.com 1-800-387-9840

84. John A. Martin, CFRE President and Managing Partner, MGI Fund Raising Consulting, Inc. Direct Line: 612-801-5149 Toll Free: 800-387-9840 Email: martinmgi@cs.com Web Site: www.mgifundraising.com Thank You! www.mgifundraising.com 1-800-387-9840