Donors are the lifeline of any nonprofit organization. From supporting fundraising campaigns to volunteering and peer-to-peer fundraising, donors empower nonprofits to advance their mission. However, donors don’t start off as avid champions of your cause. After they make their first gift, your nonprofit has to make an active effort to steward these donors and grow strong relationships and loyalty.
In fact, it’s estimated that only about 20% of first-time donors make a second gift to an organization. The cost of constantly acquiring new donors can far exceed the dollars they give, making it more difficult for your nonprofit to grow its annual fundraising and see progress in its goals. To avoid leaving money on the table, your nonprofit needs to develop a robust donor stewardship plan.
Donor stewardship helps your donors feel appreciated and emotionally connected to your organization, prompting them to give more frequently and boost their giving levels over time. By growing your donor retention rate, you’ll gain access to a reliable pipeline of committed donors eager to see your nonprofit flourish.
In this guide, we’ll explore everything you need to know about donor stewardship, including:
With a dedicated donor stewardship plan, you’ll be in a great position to turn first-time donors into loyal supporters, ultimately allowing your nonprofit to meet and exceed its fundraising goals. Before we jump into building the perfect donor stewardship plan for your nonprofit, let’s cover the ins and outs of what donor stewardship is.
Frequently Asked Questions about Donor Stewardship
What is donor stewardship?
Donor stewardship refers to the efforts of nonprofits to deepen their relationships with supporters over time through systematic outreach.
This stewardship process begins as soon as donors submit a gift for the first time and involves a combination of targeted communications and relationship-building tactics to immerse donors in your mission. An effective donor stewardship plan helps donors feel valued, understand the impact of their gifts and feel passionate about the growth of your organization.
The best donor stewardship plans are integrated, meaning your nonprofit should interact with donors across a variety of relevant platforms and communications methods. With multiple touchpoints, your nonprofit can consistently engage all types of donors and build authentic connections that will last for years.
Why is donor stewardship important for retention?
Donor stewardship directly impacts the number of repeat donors your nonprofit is able to keep each year. When donors receive consistent communications from your organization and feel emotionally connected to your cause, they’re more likely to give again, improving your retention rate and donor lifetime value. With a higher donor retention rate, your nonprofit will earn more revenue to push your goals and strategic plan forward.
Let’s consider this in relation to donor acquisition. New donors likely have a basic familiarity with your cause, but don’t have an established relationship with your organization just yet that would prompt them to give more. This causes the all-too-common problem of nonprofits expending more resources to continuously acquire new donors instead of investing time and energy into keeping the supporters they already have.
Focusing on donor retention is more beneficial for your organization for a number of key reasons:
- Acquiring new donors involves spending your hard-earned funds on direct mailings, prospect research and other acquisition methods, all of which can end up costing you more than the revenue you’ll earn from new donors.
- Donors who have already given to your organization have a connection to your mission. You don’t need to sway them to support your cause; instead, you simply need to build on this relationship to encourage further donations down the road.
- When donors give to your organization, you’ll have their contact information stored in your CRM. This makes continued outreach easier, allowing you to consistently engage with newly acquired donors and turn them into avid supporters of your cause.
By taking the time to effectively steward donors, you can guide your supporters up the giving ladder to bigger (and more frequent) gifts.
What is the donor pyramid?
The donor pyramid outlines the different giving levels of your donors, from first-time and recurring donors to major donors. By understanding how your nonprofit’s supporters fit into these different engagement levels, you can better steward them up the pyramid and upgrade their giving amounts and frequency.
Let’s take a closer look at what each of these giving levels mean:
- First-time donors. Your first-time donors already have some interest in your mission. Whether they’ve donated $10 or $100, your nonprofit needs to immediately take action to show them you value their contributions and demonstrate how the funds will be used to power your mission.
- Recurring donors. Recurring donors have given to your nonprofit multiple times and you can count on their support on an ongoing basis. There are many ways to categorize your recurring donors, from monthly to quarterly and annual donors. Among your recurring donors, you will likely have donors from a range of different giving amounts, so you might choose to divide your recurring giving group into additional segments.
- Planned donors. Typically, planned gifts are a part of a donor’s financial or estate plans and will be given to a nonprofit once the donor passes away. Along with major gifts, planned gifts are the most significant contributions your nonprofit will receive.
- Major donors. Major donors are at the top of your donor pyramid and give the largest gifts. Every nonprofit will set their own definition for what type of gift constitutes a major gift. For example, one organization might consider $10,000 to be the threshold for a major gift, while another would consider $100,000 to constitute the smallest major gift.
The arrangement of these giving levels and the parameters for each may differ based on your nonprofit’s goals, size and audience. As you create your donor pyramid, draw insights from your CRM so you can define your giving levels based on up-to-date donor data. You can always change the model of your pyramid to fit your organization’s needs.
Once you’ve clearly defined your donor groups, you can create unique strategies for each giving level to steward donors to the next step of the pyramid.
How does stewardship fit into the donor cultivation cycle?
The donor cultivation cycle is the process of identifying prospective donors, requesting a gift and stewarding them towards increasing their generosity and impact. Let’s take a closer look at how the donor cultivation cycle works and donor stewardship’s role in turning one-time donors into recurring contributors to your mission.
The donor cultivation cycle starts by identifying prospective donors. There are several strategies you can implement to quickly identify potential supporters. A few of these include:
- Prospect research: This refers to the process of identifying potential major donors for your nonprofit and can help you take a more focused approach to securing major gifts, recurring gifts, corporate giving, capital campaign contributions, and more.
- Multichannel marketing: You can leverage multiple channels at once to maximize your reach and find donors faster. This includes social media, email campaigns, and content marketing to promote your cause. Consider your target audience when deciding between platforms. For instance, studies show older generations respond well to Facebook digital marketing tactics like long-form content and livestreams.
- Board member interaction: Make use of your board members’ connections to introduce your organization to potential donors. Hold regular board meetings to discuss potential leads and plan networking events to assist in prospect identification. If you work as a team, you’ll be much more likely to see progress.
By taking these steps, you can pinpoint new opportunities and take the next step to cultivate new prospects — qualification.
Qualification involves narrowing down your list of potential donors so you can prioritize the prospects who are most likely to give to your organization. Here are a few characteristics to look for when assessing a prospect’s suitability to your cause:
- Engagement indicators: These refer to any previous interactions a prospect has had with your organization, such as event attendance, newsletter sign-ups, content interaction, or volunteer experience. They indicate that a prospect has shown interest and would be more likely to offer financial support.
- Affinity markers: If a prospect does not have detailed previous engagement indicators, it can be helpful to refer to affinity markers to discover if your nonprofit would align with their values and interests. Markers such as political involvement, connection with your current donor network, and involvement with similar organizations can be telling information for qualifying prospects.
- Capacity markers: A prospect may be interested in giving but not have the means to do so. This is where capacity markers come in. Real estate ownership, stock holdings, and business affiliations all indicate whether a donor is in a financial position to give to your organization.
To find this information, consult tools like your nonprofit CRM or donor database, federal records of stock transactions and political contributions, and social networks.
You can also hire a fundraising consultant to streamline the process and provide valuable prospect insights. They will guide you through a detailed research and identification strategy designed to reenergize your outreach and provide continuous growth.
Before you can jump into requesting a donation from a prospective donor, your nonprofit needs to form the basic building blocks for a long-term relationship. This will make the transition to a donation request much smoother and more relevant. To make sure your prospects are familiar with your organization, provide the following opportunities:
- Education and engagement: Offer prospects opportunities to learn more about your mission, impact, and vision. This could include educational materials, beneficiary videos, and workshops highlighting your core projects.
- Personalized communication: Use previous data to tailor your communications based on the individual’s interests. For example, if a prospect attended a recent event, you could follow up with an email thanking them and offering additional related resources.
- Volunteer opportunities: Volunteering is a hands-on educational experience that can add meaning to a prospect’s relationship with your nonprofit. Invite prospects to join local volunteer efforts to get to know your cause in a more personal way.
By practicing these strategies, you can take your existing relationships to the next level, enabling you to adequately set the stage for solicitation.
It’s important to continually prioritize cultivating relationships even after you’ve made a request. Doing this will not only increase donor retention, but also create a memorable, positive experience for your donors.
Once you’ve taken the time to get to know your prospects and vice versa, your nonprofit can make its first ask. Here are a few key solicitation elements to consider:
- Specificity: Keep your donation requests as clear as possible to highlight the difference a contribution will make. Provide concrete examples such as “A gift of X amount will provide X families food and clothing for X months”.
- Emotional appeals: Use thoughtful, but emotionally charged language to convey a donor’s ability to create an impact. Beneficiary success stories can be helpful to indicate how transformative a donation can be.
- Matching gift contributions: Corporate giving opportunities such as matching gifts and volunteer grants are worth highlighting within your solicitation materials as they can effectively double the impact of a supporter’s donation and volunteer time.
Within your solicitation request, don’t forget to include information for further communication or questions, should they come up. This way, your prospects will know who to contact to get their questions answered quickly.
If your request resonates with donors and they give to your nonprofit, the donor stewardship process can begin! At this point, your nonprofit should follow these steps to guide your stewardship approach:
- Send a thank you message: Immediately express your appreciation for a donor’s gift and role in your mission. Use a hand-written message or an auto-generated charity eCard to make them feel valued and pave the way for a lasting relationship.
- Carry out pre-defined stewardship strategies: Refer to your donor’s giving amount and interests to kickstart your pre-defined stewardship plans for individualized relationship-building.
Now that you understand the basics of donor stewardship, let’s dive into how your nonprofit can create a strong donor stewardship plan.
How to Create a Donor Stewardship Plan
A dedicated donor stewardship plan can help your nonprofit identify best practices for stewarding all types of donors and effectively moving your supporters up the donor pyramid. By compiling your strategies into a single resource, your nonprofit’s team will have a straightforward guide to building authentic relationships and inspiring donors to increase their impact.
The essential steps of creating a donor stewardship plan include:
1. Nail down your donor stewardship goals
The first step in your donor stewardship plan is to clearly define your goals. If you broadly set an objective to grow your donor base, you won’t have a concrete way to put your goal into action and measure your progress. This is where the SMART (specific, measurable, achievable, relevant and time-based) goal-setting model can help.
Let’s say that your nonprofit wants to grow its major gift fundraising. Using the SMART goal-setting method, you can turn this desire into a plan of action:
- Specific: Our nonprofit will increase communication touchpoints and engagement with mid-level donors in order to successfully steward them to the next giving level.
- Measurable: We will aim to identify and cultivate relationships with at least 20 prospective major donors within the next six months and grow our total major gift fundraising by 20% at the end of the fiscal year.
- Achievable: In the last fiscal year, we increased our total major gift fundraising by 10% when we stewarded 10 new major donors. A 20% increase in major gift fundraising seems attainable.
- Relevant: An increase in major gift fundraising and number of major donors will increase our total revenue, bringing us closer to achieving our mission.
- Time-based: We will start reaching out to prospective major donors next week and review our progress at the end of each month.
Other common goals your nonprofit can set for your donor stewardship plan include:
- Growing your donor retention rate by a certain percentage on a quarterly or yearly basis
- Increasing the number of monthly donors
- Setting up more one-on-one meetings with prospective and current major donors
- Converting a certain number of first-time donors into recurring donors by the year’s end
With clear goals for your stewardship program, your nonprofit will be able to foster accountability across your team, measure your progress and make adjustments in your strategies as needed to set your organization up for success.
2. Segment your donors
If you’re a medium or large nonprofit, it’s nearly impossible for your nonprofit to reach out to each donor personally. To maximize efficiency and steward multiple supporters at once, your organization needs to segment your donors based on factors relevant to your nonprofit’s goals.
For example, you might choose to segment your supporters based on:
- Donation amount: Knowing the average gift size your donors give can help you determine their willingness and capacity to upgrade their giving amount.
- Donation frequency: Understanding how frequently your donors give to your cause (whether it’s on a monthly, quarterly or annual basis) can help you develop a communication schedule that will most appeal to them.
- Donation recency: Donors who just gave to your cause might not be as receptive to a donation request that comes just a few days after. Use recency to plan out the best times to solicit gifts.
- Engagement level: Factors such as how often your donors attend your events and whether they volunteer can help you learn more about their interests, allowing you to tailor your communication and engagement opportunities around them.
- Communication preferences: Some donors may want to hear from you on all channels, from text messaging and email to social media, while others might prefer a letter in the mail. Survey your supporters to learn about their communication preferences.
- Demographics: Details like age or location might be helpful to keep in mind in your stewardship activities.
By categorizing your donors into groups based on shared characteristics, you can create highly authentic communications and engagement experiences that align with donors’ interests and are likely to inspire action. Plus, segmenting your database will help you pay special attention to certain donor groups that need more recognition and engagement in order to move up to the next giving level.
3. Hire a fundraising consultant
Donor stewardship touches on all aspects of your nonprofit, from your marketing and communication methods to your fundraising strategy. In order to make a stewardship plan that makes the most sense for your nonprofit’s current state and will reenergize your operations, work with an expert fundraising consultant.
A nonprofit fundraising consultant can bring a fresh perspective to your stewardship strategy. They’ll evaluate your existing donor engagement efforts without bias and support you in leveraging your unique mission and culture to bridge authentic relationships with donors. Here are a few key ways a consultant can take your donor stewardship plan to the next level:
- Survey stakeholders: A consultant can help secure valuable input and feedback about your current donor stewardship approach from the individuals who play an important role in your organization’s success, including your major donors, board members, volunteers and staff.
- Assess your infrastructure: By taking a deep dive into your organization’s infrastructure and processes, a consultant can determine the resources you need to enhance your donor stewardship plan. For example, if your nonprofit is working with a limited database where you can’t readily segment your supporters, your consultant might suggest upgrading your CRM. A consultant can also help to improve your staff and board management approach so everyone on your team has a clear understanding of how to support your fundraising strategy.
- Determine next steps and key performance indicators (KPIs): After your consultant has reflected on your existing operations, they’ll share and synthesize everything they learned and offer actionable steps to elevate your donor stewardship plan, including relevant metrics to measure and improve upon.
Work with a seasoned nonprofit consulting firm that has experience creating strong donor stewardship plans so you can hone your strategies and create the best outcome for your organization.
4. Create donor engagement activities
As part of your integrated donor stewardship plan, you’ll need to come up with outreach and communication strategies across multiple channels to keep donors engaged. Your nonprofit likely already sends an automated thank-you note to every donor as soon as they give, but to truly steward them, you’ll need to carry out a variety of engagement strategies that help supporters feel appreciated and emotionally connected to your mission.
There are many examples of donor stewardship activities your nonprofit can leverage (and at minimal costs), including:
- Shout-outs in your weekly or monthly email newsletter
- Spotlights on your social media platforms
- A handwritten thank-you letter from leadership
- An email acknowledging important anniversaries and dates, such as donors’ birthdays or anniversaries of their first donation
- An invitation to a topic-focused luncheon
- A day-in-the life program that allows donors to shadow volunteers or staff
- Inclusion in your donor club with accompanying community-building events
As you get to know your donors, you can tailor your stewardship activities to their specific interests in your organization. This will make your outreach more relevant, increasing the likelihood that your supporters will want to upgrade their contributions.
For example, let’s say a donor is particularly passionate about your nonprofit’s cat rescue program. With this information in mind, you might provide weekly updates about how your program is making a positive difference in reducing cat homelessness and combating overpopulation through spay and neuter initiatives. You could also invite the donor to an exclusive tour of your rescue facility so they can see how their donation is making a difference (and why their continuous support is so important).
5. Develop a stewardship matrix
Once you’ve brainstormed stewardship activities for your supporters, you’re ready to develop a strategic donor stewardship calendar, known as a stewardship matrix. A stewardship matrix maps out your different outreach strategies and when you’ll execute them. You can also divide your stewardship activities by different donor segments, dedicating higher-impact engagement strategies for donors who give in larger amounts.
Let’s take a look at a sample donor stewardship schedule based on donation amounts:
By establishing a clear timeline and determining the point-person for each engagement activity, your nonprofit will have a straightforward guide to follow as soon as donors submit their first gift. Ensure each member of your team, from your board members to your marketing staff, understands their role in pushing donors up the giving ladder and enhancing their commitment to your organization.
6. Reflect and offer opportunities for feedback
As you implement your donor stewardship plan, it’s important that you actively track your KPIs and determine whether you’re making progress towards reaching your donor stewardship goals. If you’re not on target to hitting your ideal retention rate or growing your major donor program, your nonprofit will need to reevaluate its strategies and determine how you can optimize your stewardship approach for better results.
One of the best ways to check in on your donor stewardship plan and create opportunities for improvement is by gathering feedback from your donors. You don’t have to guess how your donors want to hear from you and what information they want to receive! Instead, ask them directly by:
- Sending our donor surveys
- Calling donors
- Setting up in-person meetings (reserve this option for your high-impact donors)
This is where a fundraising consultant can be a huge asset to your organization. Bringing in an outside expert can help you collect objective information from your major and planned donors and turn these insights into a plan of action for strengthening your stewardship program. Plus, donors will feel flattered that you reached out for their points of view, contributing to your relationship-building efforts.
Along with your external stakeholders, it’s equally important to collect feedback from your nonprofit’s internal team. Your consultant can help lead informational interviews with your donor stewardship team, asking key questions like:
- What challenges have you run into when stewarding donors?
- Do you feel like you have enough donor data to guide your stewardship efforts?
- What systems or processes are in place to track your stewardship efforts?
By collecting the insights from both your internal and external stakeholders, your nonprofit can turn ideas into actionable steps for growth. Your donor stewardship plan will likely evolve as your nonprofit scales, so it’s important to revisit your strategies and refine your matrix on an annual basis.
A strong donor stewardship plan can help your nonprofit boost its retention rate, save costs and ultimately bring in more revenue to power your mission. Whether you want to grow your major gift fundraising or attract more donors to your monthly giving program, a dedicated stewardship guide will help you navigate donors up the giving ladder to more impactful gifts.
Partner with an expert nonprofit consultant like Aly Sterling Philanthropy to build out a stewardship plan that makes sense for your nonprofit’s current state. Aly Sterling Philanthropy has extensive experience in reenergizing nonprofits’ fundraising strategies for greater results, pushing organizations closer to achieving their mission.
For more information about connecting with your donors and elevating your fundraising strategy, check out these helpful additional resources:
- Build Your Fundraising Strategy from the Ground Up. In order for your donor stewardship plan to succeed, your nonprofit needs to build out a strong fundraising strategy. Explore this guide to creating a well-designed fundraising plan from the ground up.
- Nonprofit Feasibility Studies: 9 Tips to Maximize Results. If your nonprofit plans to run a capital campaign in the near future, you’ll need to start with a feasibility study and building strong relationships with your major donors to secure their support. Use these top tips to run a well-designed feasibility study.
- Donor Engagement: The Complete Guide + 9 Strategies. Donor stewardship requires planning and executing exciting activities that make donors more enthusiastic about your mission. Explore additional donor engagement tactics you can use in your stewardship plan.