donor retention

The Simplest Donor Retention Tip of All Time

Donor retention is an important topic for nonprofits for one very simple reason; it costs a lot more money to acquire a new donor than it does to retain an existing one. Despite this well-known fact, nonprofits of all sizes continue to struggle mightily on the retention front. By some accounts a full 70 percent of first-time givers don’t make a follow up gift in the second year.

This high attrition rate leads to a rather vicious cycle. As the organization continues to churn out large numbers of one-time donors, it pours more and more money into acquiring new ones to make up for the losses. Because of the higher cost of acquiring these new donors, this approach leads to inefficiency in the overall fundraising operation, and ultimately, less money for the mission.

Of course, many organizations do take donor retention very seriously and, as happens with all things in life, there are some that are doing a far better job than others at solving the donor retention puzzle. But what exactly are the tactics that these organizations are using to keep donors beyond the first gift?

What is Donor Retention All About?

Donor retention is, fundamentally, a practice in relationship building, and like any other relationship, the donor-nonprofit relationship goes through different phases as it evolves. In the early stages, before significant rapport has been built, it is at a higher risk of fizzling out. Just like a bad first date will not lead to a second one, a sub-par first impression on a new donor will not lead to a follow up donation. To address the risk of losing these nascent relationships, a nonprofit really has one major tool to work with—its ability to effectively communicate.

Effective communication is about more than just sending a generic thank you note though. Relationships aren’t just built on communication; they are built on contextualized communication. In other words, how you communicate with someone depends upon the information you have about that person and the experiences you’ve shared with them in the past. You wouldn’t give private details about your personal life to a new acquaintance right? In the same vein, the way you communicate with a donor will be informed by what you know about that donor and the prior history you have shared.

The problem with new donors is that they’re new. There isn’t a lot of information to provide context for a nonprofit as it’s crafting the initial follow up message. Oftentimes this results in generic thank you messages that leave first-time donors uninspired.

The Simplest Way to Improve Donor Retention

Well, as you probably guessed based on the title of this post, there is a simple way to learn more about your new donors to help improve your retention efforts. All you have to do is ask them to share their reasons for giving!

You can see on Action Against Hunger’s donation form above that the organization has included a dialogue box inviting donors to share why they are giving. Of course, a donor isn’t required to fill this out, but a lot of them do. As this information streams in from AAH’s donors, it’s collected in the organization’s backend reports for the development staff to view

When a new donor includes a comment about his or her motivation, AAH’s staff is able to do more than just follow up with a generic thank you. They are able to reference the personalized information in the follow up message. This level of context and personalization can make a dramatic difference to new donor retention rates. Start the relationship off on the right foot by letting donors know your organization is listening and that you care.

Experimenting with Your Ask

Always provide an outlet for your donors to express themselves when they makes gifts. And use the proper fundraising software so you can take things even further.

Experiment with different, custom questions in your checkout experience, and adjust your follow up processes at a more granular level. For example, add a list for donors to choose which of your programs they feel most passionately about. When donors select their interests, you can create separate thank you messages that specifically touch on their areas of interest.

More than Just a Transaction

All of this is pretty simple stuff really. Donors are people and, like all people, they want to feel heard and valued. By integrating feedback mechanisms into your donation experience you can give donors the opportunity to express themselves. The insight you gain into their motivations and interests from this feedback is invaluable.

It allows you to respond to donors in targeted and personalized ways. The personal nature of the follow up shows your donors that you truly care about them as people. It shows them that they are more than just a transaction to you. Strong promotion of that sentiment is, truly, the simplest way to improve your donor retention efforts.


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