Retain Your Donors From the Start

My sister is always a topic when I teach.  As I tell the participants of the workshops I lead, she and I are mirror images of each other.  I live on the west coast; she lives on the east.  I am a blonde while she is brunette, though when we were young, the opposite was true. .  I have always had to work for a living ; she has been “retired” for as long as I’ve known her. I work at nonprofits; she has frequently been on nonprofit boards.  My work is about fundraising and she is a major donor. Much of what I know about fundraising, I actually learned from her. One of those things is how important it is to cherish each and every donor.  You just don’t know what lurks behind that $75 gift.

While much of my sister’s generosity is the result of friends being on this or that board, quite often she finds something that piques her interest. And she will send in a gift.  A small one--$75, $150, never more than $250.  How an organization treats its smaller donors matters to her.  “If I’m only as important as the size of my gift, I’m not sure I want to be involved,” she’s told me, even as she acknowledges that time constraints make it difficult for nonprofits to give much personal attention to lower level donors.

I’ve always advocated—and when I was a fundraiser followed my own advice—that loyal donors are worthy of attention.  We all know Einstein’s definition of insanity (doing the same thing over and over again and expecting a different outcome).  So, if you send a direct mail appeal and get a gift, then send a thank you and a year later, send a second appeal ad nauseum, it would be insane to think that the gift amount will be significantly different.  However, if after a few years, you reached out to that donor in a different, more personal way, you may find that you end up with a larger gift.  At the very worst, you’ll always have that regular donor, and donor retention rates as dismal as they are, that’s nothing to sense at.

That last thought suddenly hit me between the eyes.  Every year, the Fundraising Effectiveness Project tells us that for every new dollar raised in the nonprofit sector, at least a dollar is lost.  Other studies have shown that more than half of first time annual donors never become a second time donor to the organization.  Shouldn’t we take note?

If I were a front-line fundraiser, I would make a big deal out of every first time donor—regardless of size.  In addition to the normal thank you acknowledging the gift, I would make sure they got a second thank you from me, and maybe even a third one from a board member.  This would do more than just make a first time donor feel good—it would also make the board member feel good and would in some cases actually begin the long, slow process of turning your board members into fundraisers.  Saying thank you is easier—and more pleasurable—than asking for a gift.

I wouldn’t necessarily do these additional letters right away.  I might let a few months go by—but each time, I would make sure that the point of the letter is to welcome them to our family of supporters, and let them know how important their generosity is.  And I would want to make sure that they know what kind of things they are supporting.

With my thank you, I might offer a tour or the opportunity to receive special information such as a report, a study, information packaged in a special way.  I wouldn’t send the information, I would want them to request it just as they would have to request the tour.  Those (admittedly few) who will, are qualifying themselves as future loyal donors, volunteers, perhaps a major donor.  And just reaching out to a loyal annual donor in a different way may guarantee that they stay loyal, making a special effort with first time donors will go a long way to ensuring they become second time donors.  And although you may not make quite as big a deal for a repeat small gift, a “thanks for coming back,” is an effort worth taking.  Loyal donors are your likely larger givers.  That is worth the effort.  But so is the fact that if you keep a donor for five years, the odds are you have a lifetime supporter.  And over their life, even a small donor can make a mighty impact.

Janet Levine works with nonprofits, helping them to increase their fundraising capacity.  Learn more at http://janetlevineconsulting.com.  While there, sign up for the free newsletter and give her a call to find out how she can help you and your organization become better, more effective at fundraising.