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  • TOPIC: Blogs, Donor Relations, Fundraising, Fundraising Strategy, Nonprofit Marketing Posted August 15, 2013 by

    The Donor Attrition Survival Guide

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    It can be a scary world out there!

     

    Some nonprofits are losing as many as 90% of their first time donors on an annual basis. And the average across all types of donors isn’t much better, with about 59% of annual givers dropping off the radar each year. [1] It’s not an exaggeration to say that hemorrhaging donors is pretty much the norm at this point.

     

    If this rather bleak picture sounds familiar to you, take heart! We’ve compiled the essential donor attrition survival guide to help you hang on to more of your precious supporters.

     

    1. Get Serious About Thank You’s

     

    Let’s start with the basics. You won’t stem the rising tide of donor attrition at your nonprofit unless you get serious about thanking supporters. This means taking a personalized and multi-channeled approach to saying thank you. And that’s not saying thank you and then asking for another gift; it’s just saying thank you.

     

    We’ve mentioned before how a simple 2-minute thank you phone call can breed a persisting sense of loyalty. But even if you can’t possibly reach every donor by phone, you need to be doing more than firing off auto-receipts. Send personalized letters with sticky notes from staff or board members, send short personal email follow ups, do whatever you can (within reason) to make your donors feel appreciated.  It’s imperative that they get the message from the get-go that they are MUCH more to you than just the other party on the end of a financial transaction.

     

    In general, you should seriously ask yourself if you are devoting as much time and attention to coming up with ways to say thank you as you are devoting to acquisition campaigns. If you spend all of this time on campaigns used to bring in donors, why wouldn’t you spend a comparable amount of time developing plans to keep those donors around?

     

     

    2. Be Mindful of Channels

     

    When it comes to donor follow up, context matters. As you are coming up with ideas for how to thank new donors, consider how those people became donors in the first place. Did they donate to a peer-to-peer fundraiser? Did they respond to a direct mail appeal? Did they respond to an appeal about one program in particular? Etc. etc.

     

    The context of how you acquired the donor may very well impact how you choose to follow up with that donor. Take, for example,  “third party donors,” which are donors you acquire through fundraising pages setup by existing supporters. In this context, it will most often be the case that your organization is receiving the contribution because of the person doing the asking (and not because of the independent appeal of your mission). In this situation, a softer follow up plan that references the personal connection to the fundraiser is probably better than a more direct approach.

     

    3. Become Systematic about Retention

     

    In order to make sure you aren’t letting donors slip through the cracks, you need to do more than resolve to follow up with them. You need to create a plan and get buy in from the people that will execute that plan.

     

    A good way to start thinking about structuring a donor follow up program is by dividing donors into different buckets based on channel/type and the amount given. This allows you to think about each group of donors on a more individualized basis. You may, for example, want to spend more time crafting a thank you strategy for your “major donors” as they’ve committed more resources to your organization. Also, don’t forget to create separate categories for your recurring donors and your fundraisers; you’ll want to make sure that you create tailored communications for each of these two types of supporter.

     

    4. Start with a Stickier Ask

     

    One way to look at the donor attrition problem is to ask: how can I keep more of my one-time donors? Another way to approach the challenge, however, is to ask: how can I convert more of my first time givers into monthly donors right off the bat?

     

    Monthly donors have significantly higher retention rates than their one-time counterparts do. A study of 70 organizations from M+R Strategic Services showed that 70% of monthly donors were retained after a full year. This 70% retention rate also squares with the findings of the 2011 Fundraising Effectiveness Project put out by AFP. On the other side of the equation, however, the 2011 AFP study showed that the retention rate for new one-time givers was an anemic 27%. Clearly, the more donors you can acquire right into a monthly giving program, the better you’ll be at combatting donor attrition.

     

    With the 2013 Millennial Impact Report showing that 52% of Millennnials are open to the idea of monthly giving, direct acquisition of younger donors into a monthly giving program may be a particularly attractive strategy for nonprofits to explore.

     

     

    5. Weave in the Story of Your Impact

     

    As a donor there are few experiences more frustrating than feeling like you’ve just sent a gift into a black hole. Preventing your donors from having this experience starts by developing a proactive thank you strategy (as mentioned above), but it doesn’t end there. You also need to be continuously telling the story of your organization’s impact. This allows you to show the donor how his or her gift is making a difference. And it also allows the donor to learn more about the true heart of your organization—your programs.

     

    As you think about telling the story of your impact to donors, keep in mind that taking a multi-pronged approach will probably be most effective. Here are some of the different ways you can communicate impact to donors:

     

    Tell them how their funds were used- Charity: water does this brilliantly. They send a report back to each donor showing them exactly which water project their funds went to. Obviously this introduces accounting and operational challenges, but if you can pull it off there’s nothing better.

     

    Tell impact stories in your newsletter- Sending a regular newsletter that prominently highlights stories of how your organization is putting money to use will help donors connect the dots between their giving and programmatic progress.

     

    Provide quarterly or annual updates- Every so often it’s nice to show your donors the macroscopic view of what’s going on at your nonprofit. Sending out a detailed report that dives into the numbers and the larger context of the problem you’re addressing can help focus donors’ view on how you’re moving the needle forward at a broader level.

     

    Highlight individual impact stories often- We recently pointed out how some nonprofits are using video to communicate their impact; video is a great way to really show the difference you are making on the ground. The more you can make your impact personal and tangible to donors, the more that they’re going to feel that their contributions are making a difference.

     

    You can obviously get creative with how you communicate your impact to your donors; the main takeaway is to make sure you are telling this story consistently! The more that you can reinforce the sense of progress, the more that donors will connect their act of giving to what they ultimately care about- progress towards your mission.

     

    6. Create Feedback Loops

     

    It’s easy to stagnate if you fail to solicit feedback on your current performance. That’s why it’s a good idea to periodically reach out to pools of donors (both ones that you’ve retained over time and one’s that you’ve lost) to ask how you’re doing.

     

    Just call some people up and have some quick conversations. Ask them what they like about your organization, what they’d like to see change, and why they either stopped or continued giving. Offering a token gift to people willing to take the call is  a good way to boost participation and to make sure you can get enough people on the phone to get meaningful feedback.

     

    When you get on the phone with someone make it totally clear that you aren’t asking for money, just honest feedback. People will be impressed and, more importantly, you’ll gain valuable insight into how donors are perceiving your organization and its current communications. This will empower you to make tweaks going forward to improve your retention efforts.

     

    At the end of the day there’s no silver bullet that will allow you to stop donor attrition in its tracks, but there are steps you can take! If you’re not already doing all of the above, you’ve got a great place to start. If you’re in the development world and you’ve come across other effective retention strategies, please share them with us in the comments or tweet them to us @stayclassysd!

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    [1] Fundraising Effectiveness Project, 2011

     

    Photo Credit: Flickr User HarshLight

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