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Exploring Why Some Pledges Go Unfulfilled

(May 22, 2012) Little data exists for measuring slippage of multiyear pledges to capital or endowment campaigns. A recent survey offers a glimpse at this phenomenon.

The research study is based on an online survey of AFP eWire readers conducted by ME&V Fundraising Advisers.

The primary research goal focused on determining the percentage of uncollected pledges in recent campaigns. Secondary goals included analyzing whether certain types of organizations experience more uncollectible pledges than others, and whether uncollectible pledges are more prevalent in certain parts of the country.

The number of responses was only 28, so results may not be generalizable. However, this small sample begins to provide insight on the percentage of uncollectible pledges a nonprofit might anticipate.

Results:

  • Thirty-eight percent of respondents reported that they collected all or all but 1 percent of their pledges. Sixty-two percent reported that they had 2 percent or more in uncollected pledge payments. Nineteen percent of the latter group reported 10 percent or more in unpaid pledges. Furthermore, 61 percent of campaigns needed to extend their pledge periods for individual fulfillment.
  • The research explored the reasons behind unfulfilled pledges. Forty percent of all uncollected pledges were due to financial hardship; 12 percent reported that the donor moved out of the area; 12 percent reported the death of the donor; and 4 percent reported a death of a family member. Thirty-two percent of respondents did not know why pledges were unpaid.
  • Most of the unpaid pledges are clustered in the “less than $10,000” range.

“Nonprofits must be accountable to their investors, and continued communication is critical to pledge fulfillment,” say study co-authors Dee Vandeventer, CFRE, MA, and Justin Tolan of ME&V Fundraising Advisers. “The giving of a gift is just the beginning of the need for continued information and relationship-building. Extra efforts should be made to communicate with donors who are in danger of not fulfilling their commitments.”

For more results, download the report titled, Uncollected Pledges: What is Normal? (www.meandv.com/pledgefulfillment).



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