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7 Strategies to Revolutionize Your Nonprofit Culture to Stop Losing Donors

I hear a lot of complaining about donors.

They should do this:

    • Be more compliant.
    • Not make us work so hard to please them.
    • Treat us like we know what we’re doing.
    • Give just because it’s the ‘right’ thing to do.

They shouldn’t do that:

    • Give any way other than ‘unrestricted.
    • Demand specifics on how their money was spent.
    • Act like they know more than we do.
    • Require reports that take us hours to complete.

What about what YOU should and should not do to build sustainable, fulfilling relationships with your supporters?

I don’t hear enough of “What can we do to delight our donors today?”

I hear too much of “We already sent a thank you; that’s enough, and they shouldn’t expect more.”

Shouldn’t they?

Donors are people first, philanthropists second. And people need to know they’re important to you.

Let me tell you a true story.

A close friend of mine used to complain to me about her husband all the time. Why? Because he didn’t tell her he loved her enough. Understatement of the year.

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How to Rock Donor Thank You Calls

7 Keys to Rock Thank You Calls and Retain More Donors

You’ve got to make donor retention more of a priority to survive and thrive in today’s competitive nonprofit marketplace.

Research shows the average nonprofit in the U.S. loses 81% of donors after the first gift!!!!!

In and out a revolving door is too expensive to be sustainable.

To make matters worse, the probability a donor will make five consecutive gifts is only 10-15%. These numbers are just not sustainable for most organizations. By the time you’ve added a new donor most of your previous new donors are out the door.

And, by the way, did you know donor acquisition costs you money?  Yup. On average, it will cost you $1.00 – $1.25 to bring in a new donor dollar. So… the value of a new donor to your organization is wrapped up in the concept of donor lifetime value. Once you have a new donor, the cost to renew them is much less expensive than the cost to acquire them. Just like in for profit marketing, keeping a current customer is easier than finding a new one.  But… you have to actively engage in customer cultivation and renewal strategies.

If you don’t energetically renew and upgrade donors over time, you may as well never have recruited them.

Allow that to sink in a moment.

Might you effectively be wasting a lot of time, energy and money on acquisition? Could some of your resources be more effectively deployed to donor retention?

I’m going to go out on a limb and wager the answer is a resounding YES.

Do you know what your donor retention rate is? If you do, there’s hope for you to improve it. Read on.

If you don’t, you don’t even know there’s something that needs fixing! Read on.

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Wrong Ways to Woo Nonprofit Donors

trust signWhat do you most need to sustain your nonprofit through thick and thin?

A steady, reliable source of income – natch!

For most nonprofits this means loyal donors.

How do you get them?

Alas, too many nonprofits act as if all they need to do is acquire the donor; then, magically, that donor will stick with them forever.  Sadly, the data shows otherwise. On average only 20% of first-time donors renew; only 43% of all donors renew. And there’s a very good reason this sorry state of affairs exists.

Most nonprofits woo donors the wrong way.

It may not happen all the time. But it happens enough. Too often, in fact.  Does this look at all like the trajectory of how you handle a newly acquired gift?

  • You badger the donor for gifts.
  • When they give, you warehouse them in your database.
  • You then send a form letter (pretending it’s personal because you use their given name and indicate their gift was earmarked for a particular purpose; in reality, most of the time you don’t know them from Adam nor do you try to get to know them beyond what they wrote on the flap of the remit envelope).
  • Next, they get on your newsletter list and receive mass mailings.
  • Before you know it – or know much about them — they’re getting another appeal letter.

There’s a better way.

Actively show donors love and trust. This is the best way to get them to love and trust you, and the two most important aspects of donor loyalty. Relationships that last are reciprocal. Penelope Burk, the queen of donor-centered fundraising, famously found through her research that donors’ number one desire is … please, please “show me that you know me.” If you want donors to trust you and be loyal to you, you have to trust them and be loyal to them.  Simple, yes?  Actually, no.

To earn trust and loyalty takes strategy.  And it takes work. Mark Schaefer makes a brilliant analogy

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10 Strategies to Actively Build Nonprofit Donors Trust

trustTrust defines the credibility and legitimacy not only of your organization, but of the entire social benefit sector. Yet too few organizations make the effort to operationalize this construct into their fundraising and marketing planning.

You should.

Without donor trust and confidence in philanthropy there’s no future for social benefit organizations.

Donor retention guru Professor Adrian Sargeant has spent 20+ years researching the relationship between trust, philanthropy and continued donor commitment. And he has found, unequivocally, that trust is the essential foundation of the philanthropic relationship.

Ignore this at your peril.

Actively Build Donor Trust

The Donor’s Bill of Rights is a great starting point.  But simply using it as a checklist is not enough.  Too transactional. I encourage you to go above and beyond. Because the best predictor of future giving is when people feel good.

You can make giving to you a transformational experience. How? By actualizing what you learn here into a series of multi-step plans for:

  1. Gift Acknowledgement that Satisfies Donors
  2. Donor-Centered Communications that Instill Happiness
  3. Useful Content Marketing that Offers Gifts
  4. Consistent Branding that Instills Confidence
  5. Relationship Fundraising that Creates Meaning and Builds Loyalty

If you take these five steps, I can guarantee you’ll steadily build trust and make donors happy. What I’d like to do now is break these steps down into 10 action strategies. They may seem simple, and they are. But honestly ask yourself if you really do these things? I’m going to guess you could do better. So please read these with an eye to what you might do to make your donor retention plan – what I prefer to call a “donor love and loyalty plan” – more vigorous.

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Donor screening call

Donors Screening Calls? 12 Strategies to Stop Being Defeatist.

Donor screening callHave you ever made a phone call hoping to talk with someone, but instead reached voice mail?

Of course you have!

Does that mean you don’t ever make phone calls?

Of course not!

What do you do?

You leave a message and ask the person to call, email or text you back.

Sometimes they do, sometimes they don’t.

But at least they know you reached out to them. If they want to connect with you, they now have an invitation to do so. And if they know you, and like you, they’re very likely to return your call.

Donors know you. They like you. Otherwise they wouldn’t have made a gift to you.

So why are you, or your board members, so afraid to pick up the phone to thank them?

All the time nonprofits tell me “Asking our board members to make thank you calls won’t work, because people screen their calls these days; they won’t pick up.”

Sometimes they will, sometimes they won’t.

Either way, you’ll have accomplished something important merely by proactively reaching out.

Stop worrying about how your donors will or won’t behave. Instead, worry about how you’re behaving. Or not.

Don’t donors deserve thank you calls?

Of course they do!

Penelope Burk, author of Donor-Centered Fundraising, found 91% of donors said this is their number one preferred method of recognition.

Thank you phone calls, IMHO, are the number one underutilized strategy in your fundraising toolkit.

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Transactional Nonprofit Work vs. Transformational Donor-Led Progress

Transactional Nonprofit Work vs. Transformational Philanthropic Progress

Greg Warner of Market Smart writes a lot about the difference between “work” and “progress.” I appreciate the distinction, both professionally and personally. I think you can use this notion, so I’m going to suggest a way to extend this idea to your nonprofit fundraising.

Warner notes in Why You Should Never Get a Job and Go to Work: “work” is tedious and negative; “progress” is inspiring and positive.

This is about being intentional about where you’re going.

It’s somewhat about perception and desitnation, but I’d argue it’s largely about the journey.

Your journey. Your donor’s journey.

And how everyone feels about the endeavor.

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Girls sharing secrets

5 Secret Nonprofit Donor Retention Action Strategies

Girls sharing secretsGiving is an emotional experience. It deserves an emotional response.

Be human.

Ever notice how sometimes when we put on our work hats we cease to be human? How we somehow morph into little robotic “professionals” and become enamored of jargon?

“Lybnts.” “Sybnts.” “Recaptures.”

Not that those things aren’t important. You need goals and objectives.

And given the dreadful state of donor retention in the U.S. today (and in the U.K and Canada as well), it’s vital you be able to measure how you’re doing. Because growth in giving is a factor not just of how many new donors and dollars you acquire, but also of how many donors and dollars you lose.

If you lose as many current donors as you gain new ones, you’re getting nowhere. Fast.

Treadmills Are Only Good in the Gym

Slow down.

Think about what you’re doing and why. You may need to change your frame of mind.

When you acquire a new donor, is it for that one-time transaction? If so, that’s not a very thoughtful strategy, because it costs more money than you make to acquire new donors. In fact, you likely won’t make back your investment for 18 months or so. You won’t make it back at all if you don’t renew that donor.

Nonprofits, sadly, have been on a non-stop treadmill. Donors in. Donors out. Donors in. Donors out. So… something about just measuring this stuff isn’t really working.

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red rose on imagine tile

What Causes Tribute and Peer-to-Peer Donors to Renew?

red rose on imagine tileOne of my pet peeves as a donor is making a contribution (via a peer-to-peer request or tribute gift in honor or memory) in support of a friend; then receiving nothing but a form receipt.

Some of you may be thinking, “That’s exactly how I like it; now I have no reason to get sucked in as an ongoing donor to this organization.”

Exactly.

Your job as a fundraiser and nonprofit marketer is this: Suck. People. In.

… with the good stuff.

Draw folks to you like bees to honey.

Give them something sweet and irresistible.

A one-time formulaic, “thank you on behalf of the board and staff of XYZ charity for your $50 gift,” won’t seduce or tempt me in any way. It won’t make my heart sing.

If you don’t reach your first-time donor’s heart immediately with something that makes them feel warm and fuzzy, guess what happens? When you come back to them a year from now with an annual giving appeal, they’re highly unlikely to make another donation. They don’t care about you. They car(ed) about their friend.

What Causes Tribute and Peer-to-Peer Donors to Feel Good?

When I give in honor of someone else, to a charity to which they’ve directed me, I tend to feel a little bit good because I did something meaningful to them. But… I don’t feel good because it was meaningful to me.

Unless the charity does something proactive to make their cause resonate with me more directly, I’m not likely to be a repeat donor to this organization.

So don’t kid yourself.

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