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Grow Donor Lifetime Value With Recurring Donations


By Allison Gauss

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Reading Time: 4 minutes

Big philanthropic gifts get a lot of attention and fanfare. Donations of $10,000, $100,000, or even $1 million can make a huge difference in a nonprofit organization’s operations. Unfortunately, very few people have the financial means to give a large lump sum like this.

But like a 401K or savings account, small, consistent contributions to an organization allow anyone to make a bigger impact than they might think possible. When sustained over the long term, even a very small monthly donation can add up to thousands of dollars in donor lifetime revenue.

Not only does monthly giving tend to increase donors’ annual contributions, over time it can lead to much bigger lifetime donor values. Learn how your nonprofit can tap into this fundraising potential with recurring giving and stewardship.

How One Donor Does More

To see how a small monthly gift can amplify the support of individual donors, consider this hypothetical example. Paul is a 20-something guy who supports The Big Dreams Association. He doesn’t consider himself very involved, but he usually gives $25 twice a year. Paul is just getting started with his career, so even a $100 donation sounds intimidating.

The Big Dreams Association is running a campaign to recruit new monthly donors and sends an appeal to small donors like Paul. The appeal asks him to be a monthly supporter for as little as $10 per month. Paul looks at his monthly budget. He spends $20 a month on TV and movie streaming services and $25 a month on his gym membership. Paul decides that he can definitely afford to give $10 every month to charity.

One year later, Paul has given $120 to The Big Dreams Association. His annual contribution has more than doubled and it all happened with no extra work from him. He doesn’t have to make any big sacrifices to be a monthly donor and he feels good every time he gets the special updates for recurring donors.

A Lifetime of Growth and Support

Beyond increasing donors’ annual contribution, another benefit of recurring giving is that these donors are more likely stick around year over year than one-time donors. Not only does the organization get more this year, they are more likely to continue receiving gifts from this donor next year. Because an individual’s income tends to increase as they enter their 30s and 40s, many young monthly donors will be able to give more in the future.

Consider our small monthly donor, Paul. He doesn’t have a lot of spare cash right now, but over the next decade, his career starts to take off. He gets promoted a couple of times and has more disposable income. The Big Dreams Association periodically asks him if he’s willing to increase his monthly gift, and he does so every few years. Before Paul even turns 40 years old, his monthly gift has grown to $35.

To get an idea of how one small donor’s monthly gift could grow their lifetime donor value, check out this table showing how much Paul gives over the next 10 years. This example illustrates how small monthly donors can have a big impact over time.

recurring donations

By recruiting and retaining Paul as a monthly donor, his annual contribution grew steadily for 10 years. And if The Big Dreams Association continues to engage him, they will have reliable support for years to come.

Growing A Community of Recurring Donors

Recurring giving is an effective method for increasing donors’ annual and lifetime value, but a monthly giving program doesn’t just sprout out of thin air. Treating your monthly giving program as a campaign or special segment of your donor base is vital to attracting and retaining recurring donors.

Here are some tips to kick-start your recurring donations program.

• Give your monthly donors a special title or name. Pencils of Promise calls their recurring giving program Passport.

• Offer exclusive news and content for monthly donors.

• Promote monthly giving like you would any other campaign, through social media, your website, and email.

Your most important strategy for holding onto recurring donors over the years is to make sure they feel appreciated. Just because they only typed in their credit card number once doesn’t mean you should only thank them once. Recognize monthly donors on social media and in your newsletter, or even call them or send a handwritten note. A sincere thank you combined with impact updates will give your most consistent supporters a reason to stick with you for years.

Tap Into Your Monthly Giving Potential

Monthly donation is a great way to turn casual donors into big investors. A small monthly donation is easy to incorporate into one’s budget, but it adds up over time. With cultivation and care, you can grow the monthly gift and multiply annual and lifetime donor value.

Keep Donors Coming Back

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