In 2019, individuals contributed $352.87 BILLION to US nonprofits.
Yet, according to the Fundraising Effectiveness Project, we’re losing donors in droves:
• Only 43% of all donors renew their gift.
• Only 21% of new donors renew their gift.
• For every 100 donors acquired, 105 are lost to attrition (YIKES!).
• Every $100 gained was offset by $93 in losses.
• The average dollar retention is just 47%.
Donor and dollar retention rates have averaged below 50% for well over a decade. That’s not even an “F”!
Are you ready to get off the Donor Treadmill?
The #1 reason people give is because they’re asked.
The #1 reason they stop giving is because they feel their gift no longer matters.
What’s the secret to retaining donors?
Building and deepening our relationships with them!
How much time do you spend on donor relations?
Investing in relationship-building will help your donors say YES more often and will lead to larger gifts. Here are two ways that will help you build and deepen relationships with your donors:
1. Understand that your donors have needs. Donors have a deep desire to make the world a better place, and to do so in a very specific way. We all operate out of self-interest and we all have different interests. For example, my cousin and I both lost our Moms to cancer. I do not support cancer organizations, but she cannot do enough for them. It’s not good or bad, it’s just how we’re wired.
When we receive a gift from a donor, it’s a direct extension of their desire to make a difference in the world. They’re trying to help the people/animals/environmental cause our organization serves, but can’t do it on their own. This is why they hand us their hard-earned money.
One way to strengthen our relationship with donors is to treat their contribution like a gift. Because it really IS a gift. A treasure. Your donor could have kept that money, spent it on something else, or donated it to another nonprofit. Let’s make sure we receive and respond to it with true, heartfelt gratitude!
2. Recognize that donors need to be acknowledged; seen; understood. Giving is an emotional experience and deserves an emotional response. Like I mentioned in my last blog, charitable giving is different from buying a t-shirt, so we need to treat it differently.
Donors don’t want to be treated like just another shopper at Walmart – they need to know that they matter to you; to the cause. That they’re making a difference. That you appreciate their participation. Nothing squashes those good feelings a donor has after making a gift (which, by the way, releases dopamine – the happy chemical – in our brain!) than a generic, three-sentence thank you letter, sent weeks after the gift was received.
According to Penelope Burk (if you don’t know who she is, check her out, she’s totally got her finger on the pulse of donors in the US and Canada: https://www.burksblog.com/ !):
“Every research study I have conducted over the past twenty years, donors have said that, more than anything else, information about what past contributions have achieved is the thing that motivates their desire to give again and give more generously.”
I know you’re busy. BUT – staying on the treadmill is exhausting and demoralizing. Taking the time to personalize your thank you letters is going to make your donors feel seen and understood. This, in turn, means they’re more likely to stick around, which will improve your retention rate! It also means you’re more likely to see improved lifetime giving rates.
This is one of the reasons I love annual donor surveys! Surveys allow you to capture important and meaningful information about your donors, which can then be put to use in your solicitation and thank you efforts. Given today’s mail merge capacities, there’s really no reason you can’t adopt a more personal touch and speak directly to each donor.
The other thing I love to do with my clients is create what I call Story Postcards. On the front, there’s a photo of a beneficiary (please be sure to obtain permission in the form of a signed waiver, and give them enough time to change their mind!). On the back, there’s a brief before/after story of the transformation that took place, as well as a place for the donor’s address. We create 4 different stories and create/order the cards from Vistaprint. These are a HUGE hit with donors, and they’re relatively inexpensive to create! It’s a great way to demonstrate what a donor’s contribution has achieved.
Taking time to build and strengthen relationships pays off – both in the short run and over the course of a donor’s lifetime. Implement these tips with your spring appeal (you’re sending one out, right?) and watch your retention rates increase, while your stress level decreases!
Feel free to reach out if you’ve got questions — I’m here to answer them!