To thank or acknowledge…
You’ve just received a check in the mail, or a gift online. What happens next?
Hopefully you’ve taken a moment to congratulate yourself for building the relationship with this individual that moved them to want to be part of your mission.
Then what happens?
Do you enter information from the check into your CRM, and churn out an acknowledgement as required by the IRS?
Do you send the check off to accounting to enter into your accounting software and deposit into the bank?
Do you place it in a safe or a drawer and think “I will take care of this later” ?
Technically, you can absolutely fire off an acknowledgement letter and call it a day. If you want to get really technical, the IRS only requires that you send acknowledgements to donors who have given $250 or more in a calendar year, which may reduce the number of letters you need to send.
A gift acknowledgment is a piece of correspondence that recognizes that a gift was received, and has information (such as the date the gift was received, the organization’s EIN, and the amount received) that the donor can use for tax purposes. It is a box to be checked.
Don’t get me wrong, acknowledgments are important. Timeliness of sending acknowledgements is key as well - donors who receive an acknowledgement that is sent within 48 hours of the organization receiving the gift are 4 times more likely to give again (according to Candid/GuideStar). Having a good system in place for sending acknowledgements is key to retaining donors. I know that when I send a donation to an organization, I am reassured to know that it was seen by a human and put to good use.
Here is an example of a system for generating acknowledgement letters in a timely way:
Donation is received by staff member, scanned or copied. Actual payment goes to accounting, copy is marked with GL code and any other notes for data entry.
Copy goes immediately to the staff member responsible for data entry. This staff member enters data and generates acknowledgement letters from a template in the CRM (these might be done in batches, if more than one donation arrives in a day).
Once letters are generated, they are signed by the appropriate person and put into the mail.
Note that most online giving portals have the ability to generate an acknowledgment letter from a template that is automatically sent once the donation is processed online.
An acknowledgment letter or email is important, but doesn’t always do the work of bringing the donor closer to the organization, or fostering a deeper relationship with them. To do this, an organization would want to think about how they are stewarding the donor as well.
Ideally, a stewardship contact would follow the acknowledgement letter. I have found stewardship that includes the following to be pretty effective:
Some type of personal touch; a handwritten note, phone call or personal email.
A mention of something that the organization knows and appreciates about the donor - they always support a particular program, they have been a supporter for many years, they are an alumnus of the program, you will see them at an upcoming event, etc.
A photo or other imagery to show the impact the donor is having with their gift.
Where acknowledgements are fairly rote and routine, and assigned to one or more individuals on staff, stewardship can be done by anyone in the organization - including volunteers. Gathering good data in your CRM makes it particularly effective to show the donor that you understand their motivations and interests.
And yes, you can combine acknowledgement and stewardship. Adding a handwritten note on the letter, including a story of impact in the body of the receipt, including an insert or note in the envelope. However, I also recommend having a plan for additional stewardship to follow, even if it is a few weeks later.
What are your approaches to acknowledgment and stewardship? Have you implemented any stewardship processes that are particularly effective?
