6 Traits of Relationship-Building Nonprofits + 4 Most Effective Ways to Retain Donors

Your donors have bad days too. Learn to be a friend.

Donor retention has continued to plummet every year for the past seven years.  It’s really, truly an awful problem. For some unknown reason, all that hard work you put into acquiring new donors is, seemingly, being wasted. Why?

I recently asked folks what ONE word they would use to sum up what is needed to transform donor loyalty. I received some interesting answers and thought I’d share them with you, along with my comments, here. First, let me remind you of my own Big Secret — the one principle I’ve found that makes the greatest difference to long-term, sustainable fundraising success:

1.EMPATHY.

Here, again, is my rationale:

Let’s face it: Sometimes your donor doesn’t want to give what you asked them for. Or they don’t want to continue giving at all. Do you just give up? No! Obviously they cared about what you do at some point, so what’s making them feel differently now? Maybe it’s something you can fix. Maybe not. You want to find out.

But you don’t want to do so in the context of what appears like arguing with your donor. You don’t even want to think in argumentative terms. Trust me; it will come out in the tone of your voice or your body language. “What do you mean you can’t afford to do this right now? I know you just took a very expensive vacation! You’ve clearly got the resources. You’re just being stingy.” Don’t set up your conversation as a finger pointing session. Don’t make your donor feel bad.

Your mission is to understand your donors. To care about them. To honor them.

Get inside your donors’ heads. This is the key to donor-centered fundraising. Use whatever empathy you can muster. And use the words “feel” and “felt” and “found”. These words are all about demonstrating empathy. “I feel your pain.” “I’ve felt that way myself.” “I’ve found that… (then you offer your donor an alternative way to think about the situation). In other words, whenever your donor raises an objection to giving at any particular point in time you show them empathy (you can find some specific examples in my original post.)

Okay, now let’s see what wisdom other folks offered (and many thanks to everyone who weighed in):

2. APPRECIATION

Appreciation is a good one. It has some empathy wrapped into it. “I appreciate how you feel.” “I appreciate your situation.” “I appreciate your values.” Appreciation means recognition — and that’s the foundation of showing your donors you know them.

3. TRANSPARENCY

Transparency is important, of course. But if all other charities are also transparent, how will your organization stand out in the mind of the donor? I think a word that is “key” to retaining your donors through thick and thin has to be something to do with building a personal relationship. Showing your donor you’re not hiding anything is just the beginning of getting them to listen. Showing your donor that you know them gets them to continue listening.

4. IMPACT

Ah… another important word to keep your donor’s ears open. The reader offering this word suggested that “impact” is more important than “relationship” because “it doesn’t matter how great the relationship is now … if I can’t show the donor that their money is creating an impact, there won’t be much relationship for long… they will stop funding me … even if they like me.” This is a terrific point!

5. OPPORTUNITY

What better gift to offer your donor than an opportunity to make a difference? I always tell reluctant fundraisers this: Why wouldn’t you offer others an opportunity to join with you doing something that makes you feel so wonderful? You’d share the opportunity to go see a great new movie… or dine at a trendy new restaurant… wouldn’t you? Stop being so stingy with the opportunities already!

6. SYMBIOTIC

An interesting choice. I assume the reader offering this word meant that both the organization and the donor benefit from the relationship. Interestingly, there are symbiotic relationships where this is not the case. Parasites, for example, have a symbiotic relationship with their hosts, but only the parasite benefits. Don’t become a parasite. If you want gifts you must give them.

Speaking of giving gifts to your donors, the very first gift should be a prompt, personal thank you.

If you don’t have a dynamic, strategic donor acknowledgment and retention program in place you’re on the road to ruin.

Yes, you heard me.

The 2013 Fundraising Effectiveness Project Survey (which tracked 2,840 American nonprofits) released on September 16, 2013 revealed that charities are losing donors faster than they can find them. Here’s the deal: Every 100 donors gained in 2012 was offset by 105 in lost donors through attrition — a net gain of negative -5. (for organizations raising less than $100,000/year it was negative -13.5%)!

More than 7 out of 10 new donors were lost.

From all donors, total attrition was 61%.

Holey moley! This is some bad mojo.

You can increase the lifetime value of your donors by 200% if you just increase retention 10%! How?

4 Effective Ways to Get Rid of Bad Mojo; Get a Gratitude Culture That Retains Donors

1. Stop paying lip service to donor retention when it comes to the 80% of your supporters who aren’t major donors. Many, many bequests come from folks who shock the heck out of their beneficiaries. One charity I worked for got one to the tune of $4.2 million – from someone who’d never made more than a $10 gift.. So put that in your ‘these-donors-are not –worth-stewarding’ pipe and smoke it!
2. Recognize that if you don’t steward your donors, others will. Bottom-of-the pyramid donors are becoming top-of-the-pyramid donors – elsewhere.The trend is for donors to give larger gifts to fewer charities.  That means all the ‘bridesmaids’ (the charities to which your donor is not engaged –the ones that don’t make your donor’s “Top 5 – 10″ list) are going to be bleeding. So the fact that your competition is doing a super-duper job with stewardship is going to hurt you more than it did in the past (when almost no one bothered with stewardship). In other words, the fact that many nonprofits today are actually paying attention to retention could be resulting in more attrition for you (their competitor).
3. Embrace the fact that the digital revolution ended business as you knew it. What worked before doesn’t work as well anymore. You’ve got to layer on new strategies that meet folks where they are; yet you’ve got the same number of hours in the day, and a lot more things to do with that time. How to handle this increased workload effectively so that you stay competitive? The solution is probably to allocate more resources to fundraising and marketing.  Which is why, as Dan Palotta has been preaching, nonprofits need to get more comfortable with higher overheads. Spend more on fundraising. Put enough boots on the ground to become effective at building relationships.
4. Last but not least – and the easiest thing you can do RIGHT AWAY — thank your donors more. Cultivate an attitude of gratitude organization-wide.  Don’t fall for the canard that over-solicitation is the problem. The problem is only-solicitation. Do unto your donors as you would have them do unto you.  Get to know them. Become friends. Give them something of value. Not just once a year, but regularly. Stay in touch. Become a part of the family.  Then, and only then, will they decide to become part of yours.

Everything I’ve learned about donor acknowledgement over the years, all tucked it into one handy no-nonsense guide on the practice of gratitude.

Get Your Gratitude On

Want to keep more donors? My Attitude of Gratitude Guide will help you! You get 75 full pages jam-packed with the theory and practice of gratitude, one of the most effective yet least effectively utilized donor retention strategies. Plus it includes the Creative Ways to Thank Your Donors E-Book. Learn how to spread your gratitude around. It will come right back to you, I promise.  Grab your Guide here.

Image courtesy of Freedigitalphotos.net.