What Is Donor Qualification? Major Gifts Fundraising Fundamentals

Well done! You’ve identified some potential major donors!

Maybe.

You think.

Well, you’re pretty sure.

About some of them.

But you don’t really know if a potential major donor is worth adding to a gift officer’s caseload until you qualify them. Donor qualification is the pivotal step that happens between identification and the rest of the process that leads to the donation of a major gift.

And if you listen to many fundraising consultants, coaches, and other companies out there trying to help you raise more money, you’ll make several costly mistakes if you perform donor qualification the ‘traditional’ way. I call it the traditional way because it seems like just about everyone else parrots it. But it’s not the most effective way.

In fact, Veritus Group says that up to 75% of gift officer caseloads are filled with non-responsive people. That’s pretty bad. And if that’s true, and if numbers like that are the result of typical donor qualification methods, clearly something isn’t working.

Done well, donor qualification should result in nearly every supporter added to your caseloads being very likely to make an actual major gift. Using MarketSmart’s approach, this is what our clients are experiencing.

What Is Donor Qualification?

Donor qualification is the process of determining if the potential major donors you found during the identification phase should be added to a gift officer’s caseload and prepared for ongoing and more personal engagement.

Donor identification alone isn’t enough to put someone in a caseload. You need more information than the preliminary data you uncovered during that stage. The purpose of qualification is to unearth that information.

Why You Should Care about Donor Qualification

Donor qualification matters a great deal – and not just to your organization. It also matters to your donors, though they may not express it in these terms.

Why? Because qualification is really about efficiency. Your other donors – all of them, including low-dollar and mid-level donors – have given money to your organization because they trust you to use it well and carry out your mission. They care about that mission, so they partnered with you.

When you don’t qualify your major donors efficiently or effectively, what is the result?

Tons and tons of wasted time.

You’re calling and reaching out to people who don’t want to hear from you, or who don’t have the money to make a major gift. You’re devoting time and money trying to follow up with people who can’t or won’t make a major gift anytime soon.

That’s inefficient. It’s a poor use of your donor dollars.

Donor qualification matters because it means your gift officers spend more of their time working with people who actually can and probably will make gifts.

How Does Donor Qualification Work?

The most effective donor qualification process seeks to address five core issues for the donor. This is the most critical part of this entire article.

Do not miss this.

If you don’t have all five of these boxes checked for a donor, they are not yet qualified enough to be added to a gift officer’s caseload. Four out of five isn’t good enough.

We at MarketSmart call this ‘preliminary qualification.’ After that comes ‘complete qualification, which we’ll discuss in a future article.

Here are the five components of preliminary donor qualification, in no particular order:

1. Powerful emotional reasons why donor might give

Donors might give $50 for all sorts of reasons, and not think much about it a year later. But a donor who gives $25,000? Most people giving at that and higher levels will be thinking about it the rest of their lives. Few people will give money at the major gift level without very powerful and emotional reasons driving them to do it.

If you cannot identify, describe, and engage a donor regarding their motives for giving, they aren’t yet qualified for major gifts. You should not be trying to schedule meetings with them or even add them to a gift officer’s caseload.

2. Engagement level with your organization

Few people will give a major gift to an organization they know little about. It just doesn’t make sense in the minds of pretty much everyone. A qualified major donor is someone who has a good history with your organization.

And again, if you conduct the donor identification stage correctly, you already know some of their history. Have they volunteered? Donated in the past? Been a monthly donor? Advocated for you in some way? Led fundraising or peer-to-peer campaigns?

People give major gifts to organizations they have been involved with in some way.

There should be no strangers in your gift officer caseloads.

3. Wealth capacity

Here’s the one most other fundraising consultants fixate on, to the unwise exclusion of others on this list.

Obviously, a potential major donor must have the wealth capacity to make a major gift. But determining wealth capacity is not as easy as it might seem. Wealth screeners are notoriously unreliable and outdated. You can’t just look up the donor’s address to see if they live in a wealthy neighborhood, own a business, work high up in a corporation, or appear to live a wealthy lifestyle based on their social media accounts.

They could be doing all that while still deep in debt. They might have just lost a ton of money in the stock market. They might have sudden medical debt. They might be getting laid off or fired next month. They might be sending three kids to ritzy private colleges. There are all sorts of reasons that type of information goes out of date, and it can happen fast.

You must determine if a potential donor has the actual capacity to make a transformational gift before adding them to a caseload.

4. Timing in their life

This one is critical. A donor may have capacity but the timing isn’t right. They might be preparing to pay for their kids’ college. They might be planning a big move or a job change. They might be caring for an aging relative. Again – capacity alone isn’t enough. If the timing is wrong, then they won’t give the gift they are capable of giving, and you need to wait.

5. Signaled interest in hearing from you

This is the one that doesn’t show up anywhere else that we’ve seen, but it’s the primary reason why 75% of people on caseloads ignore your outreach calls.

They just don’t want to hear from you.

There can be all sorts of reasons why, but the fact is, if they haven’t given you permission to talk to them on the phone, let alone in person, then they aren’t qualified to give major gifts.

You must get permission to reach out, before reaching out.

When Should You Begin Donor Qualification?

Qualification should begin after a potential major donor has been identified. See the first entry in our Fundraising Fundamentals series on donor identification for more on how to do that.

In other words, after you have collected a list of names and some sort of contact information, with some basic information about each donor that tells you they may have the potential to give big gifts, you are ready to begin qualifying them.

You do NOT begin donor qualification as you prepare to meet with a potential donor in person, though many other consultants talk about qualification in these terms. That’s a flawed approach. You also don’t conduct prospect research and then begin donor qualification. These are one and the same. Prospect research is part of qualification.

If you’ve waited until a meeting has been scheduled to begin qualification, you’re doing it in an inefficient manner and setting yourself up for disappointment.

How to Qualify Major Donors

Right now, you might be wondering how you’re supposed to do all this.

If wealth screeners and RFM data aren’t reliable, if we don’t know the prospect’s motives for giving, if we don’t know if now is the best time for them to give, and if they haven’t given permission for you to reach out – how do you obtain all this?

Even more daunting, how do you obtain it efficiently – so you don’t waste too much time or money?

The answer is to use fundraising automation. And this is why fundraising automation is changing the major gifts fundraising industry for good, and forever.

It is possible to automate nearly all your donor qualification communications.

Read that again. It’s true.

With fundraising automation, you can use permission-based email communications to interact with potential donors on their terms and within their timelines and preferences. They share information when they’re ready. And the automation software tracks and stores it.

Over time, you will be collecting information around all five preliminary donor qualification attributes, and you’ll be doing it without your gift officers having to spend any time communicating or tracking any of this data. No more prospect research. The automation gets it from the donors themselves.

Want to learn more?

Watch a video and learn how our engagement fundraising system automates donor qualification.

Common Donor Qualification Mistakes

In the identification phase, you have begun to interact with your potential donors. You should at least have their email address and have sent them some information. You should have some records of their prior levels of engagement with your organization. You know how to reach them.

Here are some common mistakes, many of which get repeated on popular fundraising blogs:

Calling the donor too early

If all you’ve done is identification and a little prospect research, you aren’t ready to be making phone outreach to the prospect, let alone asking for a meeting. They aren’t ready for that.

Reach out too early, and the prospect will just put up walls. Not because they aren’t open to a gift someday. But because it’s too early. They need more email interaction and other forms of engagement. Automation is the best way to work this through.

Nearly every other fundraising blog seems to think qualification happens over the phone.

This is false.

Qualification begins well before that, and is best accomplished with email, and perhaps SMS and maybe social media instant messaging. Part of donor qualification is getting permission to call the donor in the first place. So you can’t qualify them on the phone. The phone call may be when you get permission for an in-person meeting.

Overlooking major barriers to major giving

Giving a major gift isn’t just a simple act of writing a check. This is a major life decision. Until you know the prospect is ready to have a serious conversation about this, you’re going to come across like a salesperson trying to persuade or pressure them to do something they’re not ready for.

For many, this is a family decision, not just one person. You might be talking to one half of one couple. But what about both sets of their parents, assuming they’re still living? What about children and grandchildren? What about other relatives? Business ventures? Goals and unfulfilled dreams?

You can’t ignore or overlook these sorts of things just because the person is “rich.”

Undervaluing key giving factors for potential donors

Too many organizations ignore the timing in the donor’s life. There is too much focus on wealth capacity and related metrics like recent gifts and total prior gifts.

If a person isn’t feeling motivated to give a big gift – to your organization – it doesn’t matter how big their bank account is. If the person’s life is a mess, or they’re stressed, or angry, or disillusioned, or just busy with other things, they’re not ready to give a major gift.

All these factors affect a person’s decision to give a gift.

Try to press through these without grasping their significance, and you risk settling for a much smaller gift, at best. At worst, the donor will start ignoring you. It’s very hard to rebuild a relationship once they’ve started tuning you out.

Not asking for permission

Getting permission matters more than anything else on this list, in our experience. This is how you show the donor you respect them.

“Would it be okay if someone from our organization calls you?”

“Would you be interested in talking with someone about this on the phone?”

Using our engagement fundraising system, asking questions like these happens automatically. You will know a donor has given permission for outreach, because the system will tell you. And you’ll have the email records and survey data to prove it.

But even without automation, you can ask questions like this very easily. You just have to do it.

Disqualifying donors too easily

One fundraising blog suggests disqualifying donors if they won’t be able to give within 1-2 years.

This is terrible advice. They’re essentially telling you to give up on people if they’re not ready to give very soon. But this is why timing is one of the five preliminary donor qualification requirements.

If the timing isn’t right, you don’t give up on them! You keep engaging with them and staying in touch until the timing IS right. It might be five years later. It might be ten years. But if you stay in touch that whole time – using fundraising automation so it doesn’t burden your team – then you’ll still be there years later when they are ready to make a big gift.

Use Software Automation for Efficient Donor Qualification

As you’ve seen, you will have far more success with donor qualification, and with far less effort, time, or cost required from your team, if you use fundraising automation.

You can learn more with this video and see how MarketSmart enables you to scale up donor qualification that engages far more people than you could do if humans had to run it all.

You can also schedule a demo and see how our Engagement Fundraising software works.