By Jen Pendleton, vice-president, Aly Sterling Philanthropy
At the core of many nonprofits’ fundraising strategy is the goal to acquire new donors.
Why? Because finding more donors just seems like the right thing to do.
It feels good to share in your annual report that you’ve spread the word about your cause to new people and convinced them to donate.
As a matter of fact, the phrase “we need to find more donors” is one of the most common things I hear spoken around board tables. This is because donor acquisition numbers have somehow become the standard by which we judge fundraising success. And while donor acquisition is vital for the sake of your donor pipeline, it’s not necessarily the best way (or the easiest way) to raise more money.
Instead, you should focus heavily on retaining and upgrading the donors that you have.
Why? Because you worked so hard to get them in the first place! These donors have already said, ‘Yes’ and dig your cause.
In many ways they are the path to improved engagement and larger donations. It takes less time and fewer resources to keep these donors and move them up the giving pyramid.
As a consultant, I also hear from donors who wonder why the organizations they love 1) don’t ask them for more support or 2) engage them in ways to learn more about their interests.
So how can your organization build a solid strategy around this?
Know your annual donor retention rate
Your annual donor retention rate is defined just as you would imagine: It’s the measurement of donors who support your organization, year after year.
Understanding and improving your annual donor retention rate are keys to your nonprofit’s long-term strategy. This is because organizations with higher retention rates tend to have stronger donor bases, which can equate to steadier income streams and a larger pool of people who are invested in your mission. When the opportunity arises to support a capital campaign or other major gift effort, these are the people who will step forward because they are already familiar with and committed to your mission.
Donor retention relies on focused donor stewardship
Whether part of a campaign or your annual strategy, upgrading your donors’ level of giving is one of the most efficient moves in the fundraising process.
What would happen to your bottom line if you moved every one of your $25 donors to $50? What about just half of them? No doubt it would have a significant effect on your income.
That’s why your nonprofit needs to focus on stewarding gifts from the engaged prospects already in your database. The last thing you want is to lose these supporters to an “out-of-sight, out-of-mind” approach from your organization.
The same goes for major gifts. These gifts don’t come out of thin air! It’s rare that a generous stranger will swoop in from nowhere to write a large check as their first donation.
In order to steward their interest and investment, contact your donors regularly with opportunities that are not focused on giving. For instance, tell them about upcoming events, volunteer opportunities and in-kind donation needs. Or, learn why they supported your organization in the first place by placing a quick thank-you call for their gift or asking them to meet you for a cup of coffee.
By keeping donors apprised of your organization’s impact and encouraging more ways to connect, you can encourage their commitment to your mission – both personal and financial – and help ensure it will continue to grow.
It’s helpful to think of repeat donors as reliable, committed friends of your organization. When you cultivate a two-way, mutually-beneficial relationship, they will be there for you in good times and bad – providing necessary support and perspective for your mission.
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