written by Jessica Browning, Principal & Executive Vice President
A recent study by the Fundraising Effectiveness Project (FEP) found that the overall 2020 donor retention rate was 43.6%—and less than one in five donors who gave for the first time in 2019 to a charity didn’t give to the same charity last year (2020).
Over time, the impact of this statistic is devastating. Consider a nonprofit with 1,000 donors. Even if the organization beats the national average and maintains a 50% retention rate, its donor base would fall to 500 in year two. After five years, the organization would have only 62 donors left.
While we constantly need to be looking at ways to expand our donor base, the study notes one of the best strategies for increasing net fundraising gains is to reduce donor losses. In other words, it is more efficient to work at keeping your friends than trying to find new ones.
While that sounds easy in theory, what does it look like in practice? Here are some practical tips we have found work best for building relationships and keeping your friends:
One. Don’t start any communication with “Dear Friend/Donor/Supporter.” Your CRM, or even a simple spreadsheet, will allow you to personalize the greeting in a mail merge with the click of a button.
Two. Allow your donors to choose how often and by what method you communicate with them. This prevents them from feeling deluged by requests from you across multiple media channels.
Three. Pick up the phone to thank donors. One study showed that donors who were called by a board member to thank them within 24 hours of receipt gave 39% more than donors who weren’t called. After 14 months, donors who had been called were giving 42% more than those who weren’t (Burk, 2003).
Four. Can’t call? Make sure your donors are sent a personalized thank you letter within 48 hours. Remember tip #1!
Five. Let donors know how their gift made a difference. Make sure your communications are specific and meaningful – “your gift allowed us to buy 50 books for the library” rather than “your support helps us to serve the community.”
Six. Invite donors into your organization – host personal tours, lectures, socials, and volunteer orientations just for donors. Create opportunities for them to interact with your key leadership on a one-to-one basis.
Seven. Solicit candid feedback from your donors. So few organizations take the time to initiate such dialogue; as a result, you will stand out from the crowd. Give donors the opportunity to tell you how well you are carrying out your mission, communicating, and stewarding them. Find out why they have chosen to support you and what is important to their decision to continue that support. Then, listen to what they have said.
Yes, these steps take time and organizational commitment, but this investment is often a better use of resources than always chasing new donors. As your interactions with donors become more individualized, they will feel increasingly engaged and appreciated. In the near future when they face a decision to stay or go, they are more likely to stay with you—their friend.
Now is also the time to focus on the tried-and-true fundamentals of fundraising—building relationships, treating your donors as investors, being transparent, and sharing meaningful impacts. Give your donors an opportunity to be part of your future.
About the Author
Jessica Browning, MBA is Principal and EVP of the Winkler Group, a capital campaign and strategic planning firm headquartered in Charleston, South Carolina. A former member of the Giving USA Editorial Review Board, Ms. Browning has a B.A. from Duke University and an M.B.A. and M.A. from the College of William & Mary.
References
Burk, P. (2003). Donor centered fund-raising. Cygnus Applied Research.
Fundraising Effectiveness Project. (2021, March). Quarterly Fundraising Report: Year-to-date nonprofit sector trends 01/01/2020-12/31/2020. AFP Foundation for Philanthropy. https://afpglobal.org/fepreports
