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NCPG Study
Suggests Marketing Strategies
In last month’s issue of
Give & Take, we initially examined a new survey commissioned
by the National Committee on Planned Giving that sheds light on
several aspects of planned gifts. We learned about what kind of
planned gifts donors are making and why they make them. (See www.sharpenet.com
for last month’s article.)
This month we delve further
into what the survey findings might mean for gift planners as
they devise marketing strategies for the future.
Bequest marketing efforts
paying off
When it comes to informing
donors about bequests, charitable organizations and institutions
appear to be doing a good job. In fact, according to the survey,
more donors (34%) say they first learned about charitable bequests
directly from the charitable organization’s published materials
than from any other source. Recommendations from advisors were
mentioned in only 21% of the responses.
Bequest marketing efforts
over the years are apparently working. Bequests were the most
popular planned gift among the donors in the survey. Many donors
seem to be reading and reacting to brochures, booklets, newsletters,
and other materials on wills and bequests sent to them by charitable
organizations. This would suggest those organizations with established
bequest marketing programs should continue to communicate with
donors on the benefits of bequest giving. Organizations and institutions
that do not currently have active bequest communication efforts
would be wise to make efforts periodically to get their “hat in
the ring.” Bequest giving accounted for $15.6 billion in charitable
dollars in 1999 and was the fastest growing source of gift income
for higher education (bequest income grew 22% as opposed to an
11% increase for other forms of giving).
Another benefit of continuing
bequest awareness efforts through mailings, ads, and articles
is that it does not require a great deal of the gift planner’s
time and energy. Preparation of marketing materials can largely
be outsourced, leaving the gift planner with more time to devote
to develop relationships with donors and other efforts that require
his/her professional expertise. Mailings should include response
devices that allow donors to reveal that a bequest has been planned
or is being considered or to request more information on bequests
and estate planning from the charitable organization. Responses
may then lead to further contact with highly motivated donors,
and the gift planner can then assist them with their specific
questions and concerns.
Still more to do
The study revealed that
less than half (42%) of responding households have wills. But
it also found that 57% of respondents are considering making a
will and 14% are considering including a charitable bequest in
their plans. What do these statistics mean for gift planners?
First of all, since over half of households do not yet have a
will, gift planners must see this in a positive light as a great
opportunity to tap a potential growth market. Charitable organizations
and institutions should perhaps increase their efforts to promote
estate planning education among constituents. Without a will there
can be no charitable bequest, so communications that encourage
planning can be key in increasing charitable bequest income in
upcoming years.
Building rapport with
advisors
Unlike bequest donors who
said they relied on a charity ’s published materials to inform
them regarding the gift they decided to make, 51% of charitable
remainder trust (CRT) donors said they learned of this plan from
their legal or financial advisor. A substantial number (26% of
CRT donors), however, reported learning about the gift from the
charity’s publications.
While some organizations
may need to review or establish communication efforts to educate
donors and friends about CRTs, the survey findings confirm the
fact that it is very reasonable for a gift like a CRT to be initiated
by a donor’s personal advisor. Most CRTs are funded in larger
amounts, have more complex tax consequences, involve asset management
issues, and may therefore flow more naturally out of contact with
advisors.
The survey suggests that
where CRTs are concerned, communicating and forming alliances
with the legal and financial professionals in your area who may
be involved with potential CRT donors as their clients may be
a high priority activity. This is especially true of organizations
that enjoy a substantial geographic concentration of donors where
it is more likely they are interacting with a relatively small
number of advisors who are readily accessible.
The focus should be on building
personal relationships and communicating the mission of your organization.
Some nonprofits have programs designed to educate advisors. This
may be a good approach in some instances, but generally advisors
have multiple sources of information regarding charitable gift
planning and may, in any event, not consider your charity to be
a natural source of educational materials devoted to highly technical
matters. In many cases, the best way to communicate with local
advisors may be to send them the same materials being sent to
donors along with a note explaining that one or more of their
clients may be receiving this and you are sending it to them as
a courtesy. Oftentimes, the advisors may know little more than
the donors and may be more likely to read something that they
believe their clients may read and lead to questions from them.
Advisors routinely make
donors aware of their right to retain the option to change the
beneficiary of a charitable remainder trust. The NCPG study revealed
that 70% of CRT donors have, in fact, reserved that right. For
this reason, it can be important when working with advisors to
make sure they understand that full recognition of gifts may not
be available where remainders are revocable. It can be helpful
for advisors to understand this. Remember, too, that a single
CRT can have multiple beneficiaries and that it is important to
remind donors that they can support your organizations and others
through a portion of a CRT remainder.
A gender gap?
The NCPG study shows that
while more women leave charitable bequests, CRTs are more likely
to be created by men. To some extent, differences in life expectancies
and social norms among older Americans may be driving these results.
In the case of married couples, for example, in most instances
wills leave most if not everything to the surviving spouse. Since
many more women survive their spouses than vice versa, it is not
surprising that more women are including charitable dispositions
in their wills as they become the spouse responsible for the ultimate
distribution of the property accumulated during their marriage.
In the case of CRTs, they
tend to be entered into by couples in the age range where men
have been the primary breadwinner and manager of family assets.
With the aging of the baby boomers, these patterns may be expected
to change. With more
multiple marriages among baby boomers and more women with independent
careers and asset holdings, we can perhaps expect the “gender
gap ” to narrow in the case of bequests and CRTs. With spouses
holding more independent assets, the first spouse to die may be
more likely to leave bequests to charity rather than everything
to the surviving spouse. More women may be expected to use their
assets to create charitable remainder trusts, as well.
The differences in gender
patterns among today’s older generation should be taken into account
in marketing planned gifts, while gradually altering marketing
approaches as the next generation of seniors begins to dominate
the gift planning scene.
The future is bright
As we begin a new year,
now may be an excellent time to review your marketing efforts
and take steps to employ approaches that educate and motivate
donors, as well as those professionals who may assisting them
with their plans. Consistent, ongoing communication and cultivation
of your constituents and their advisors will be the key to success
in both major and planned gift development efforts in the future.
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