As was mentioned in the blog post on GG+A’s Major Gift Code, predictive analytics is about developing profiles of the characteristics good donors exhibit and then using those profiles to identify constituents that exhibit similar characteristics. Predictive analytics can be used to identify prospects that are likely to make a certain type of gift, such as a major gift or planned gift, or a gift to a specific department, such as Medicine or Athletics. GG+A’s Annual Giving Code is designed to specifically look at the potential for increasing recurring annual gifts.
The Annual Giving Code rates each constituent on an ascending numeric scale (1-6) with a corresponding suggested giving level. The Annual Giving Code is derived by:
- Identifying a current annual giving level for each prospect based on the prospect’s lifetime and recent giving to the organization.
- Using relationship, participation, demographic, behavioral and lifestyle information to determine whether the constituent should be targeted for an upgrade to the next gift level.
The Annual Giving Model is designed to be conservative and will only recommend that donors be upgraded one level from their actual giving history. For example, if a constituent is initially defined as a 4 ($500 – $999) based on previous giving, he or she will either remain a 4 or be identified for potential upgrade to a 3 ($1,000 – $2,499). This constituent would not be identified for upgrade to a 1 ($5,000) or 2 ($2,500 – $4,999).
Once each constituent has an Annual Giving Code, one can quantify the opportunity to increase annual giving. In the example below, there is the potential to increase annual giving by $254,109, if 10% of the underperforming constituents are upgraded to the minimum suggested giving level of $5,000.
|Annual Giving Code||1
|Total Number of Constituents||2,208|
|Donors Below Level||817|
|Average Largest Giving Year||$1,901|
|10% of Donors Upgraded||82|
The same methodology that is used to derive GG+A’s Annual Giving Code can be applied to develop a customized roadmap to upgrade your constituents. The grid below was developed for an organization that had 7 annual giving levels and it identifies 2,910 constituents for upgrade.