Prospecting on a Budget? Use Nonprofit Advocacy to Build Your List
To build strong, mutually beneficial relationships with supporters, make sure you deploy a diverse mix of engagement opportunities and communications.
For many nonprofits, advocacy serves a crucial role in helping to advance their mission and create lasting change. Used strategically, advocacy (not lobbying) allows 501(c) nonprofit organizations to influence public policy, legislation, tax law, and other external factors that can impact your ability to serve beneficiaries.
Through nonprofit advocacy, you can empower and mobilize constituents to make their voices heard; you can help policymakers better understand problems and potential solutions; and you can build a bridge between government representatives and people directly impacted by their decisions.
But there’s another, often overlooked benefit of advocacy….
Nonprofit advocacy can help provide a necessary and steady stream of new prospects into your fundraising pipeline.
Nonprofit Donor Acquisition — a Tough Sell
It’s not uncommon for nonprofits to spend $100 or more to add a new donor to their house file. That may sound expensive — but with the right fundraising and stewardship strategy, donors can be worth much more over a lifetime. [That’s why it’s important to understand your average donor Lifetime Value (LTV).]
Of course, convincing board members that donor acquisition is essential is often a tough sell.
When budgets are tight, prospecting is typically one of the first expenses to be cut. Even in the best cases, successful prospecting can be difficult and slow to show return on investment (ROI). Rental lists are expensive. And cold leads can be difficult to convert because they may not know your organization.
Despite the challenges, prospecting is vital to the financial health of your nonprofit. Without adding new donors, your organization’s house file will collapse.
The Math of Donor Retention
The impact of donor retention is undeniable. For most nonprofits, the vast majority of donors will stop giving over time. Assuming a constant annual donor retention rate of 45.5% [Source: 2018 Fundraising Effectiveness Survey Report], a nonprofit starting with 1,000 donors will see virtually all of its financial supporters (96%) lapse within just five years.
Example of Donor Retention at a Rate of 45.5%
Year 1: 1000 donors
Year 2: 455 donors
Year 3: 207 donors
Year 4: 94 donors
Year 5: 42 donors
Granted, this is an oversimplified example. Donor retention rates differ by giving level, organization, and cause — and there are several variables that can impact renewal. Nevertheless, it illustrates a reality that every nonprofit must face: If you don’t proactively replace lapsed donors, your donor pool will shrink significantly over time.
Advocacy to the Rescue
By leveraging advocacy, you can find pre-qualified prospects who align with your organization’s work and values. Effective advocacy campaigns can help you attract people who might not be ready to give money but are eager to sign a petition or take some other meaningful action to show they’re on your side.
Advocacy opportunities give people the chance to try out a relationship with your nonprofit and see how they like it. Provided you respect that relationship and give them ways to engage on issues they care about, you can transform them from complete strangers into warm prospects for future fundraising.
Down the line, activist donors can become some of your most important donors. Their relationship with your nonprofit is rooted in taking action, so they tend to be loyal supporters who are quick to respond and slow to leave.
Let’s review some ways you can use advocacy to cultivate donors, boost fundraising, and have a bigger positive impact:
1. Boost Response to Your Fundraising Appeals
Pairing advocacy with a fundraising ask in an appeal will often increase donations over having a fundraising ask alone.
For example, we recently wrote and designed a direct mail appeal for an environmental nonprofit. The case for support focused on the importance of preserving fresh water wells from salt water contamination. We asked recipients to take two actions: First, sign a letter to the governor asking for his commitment to protect fresh water, and; Second, make a donation to the organization to continue its work.
Both the response rate and average gift size from this mailing handily beat the control. And this is not an isolated example. In our experience, pairing advocacy with fundraising almost always boosts response. In addition, those who complete the advocacy action but don’t make a donation become supporters whom you can follow up with at a later date. In fact, we did just that in the preceding example and the response from that segment was even better than expected.
2. Be Ready to Leverage Rapid Response Fundraising
Whatever your mission is, there will be events that draw eyes to your nonprofit and the work you do. It could be a natural disaster, an election, a court ruling, an anniversary, the death of a founder, a national month of awareness for your cause, or something else. Some of these events will be forecastable, others not. Either way, you want to be ready to leverage rapid response fundraising when people are looking to give.
Despite its name, the key to success in rapid response fundraising is being prepared. Yes, that means being able to stand up campaigns at a moment’s notice. But it also means planning ahead. Evergreen, always-on advocacy campaigns can pull supporters into your orbit and keep them engaged so they’re ready to take action when something happens and you ask for their support.
Additionally, rapid response events are a great opportunity to convert prospects into actual donors. These events cut through the noise and the numbness of everyday life. If you’ve done the work to build your list of prospects, you can message to these folks at a time when they are in a heightened emotional state about the work you do.
3. Create a Lasting Bond with Donors
Not all fundraising is asking for money. Donors are partners in your work. Therefore, a good portion of your messaging should serve a stewardship function. Presenting ongoing advocacy opportunities to donors (not just prospects) helps them feel like they are an active part of your organization’s solution.
It may seem counterintuitive, but advocacy is a way to give back to donors. You’re providing a vehicle for them to make a difference that they can’t access on their own. Assuming you follow-up afterwards and let them know the impact of their actions, advocacy can help bond you and your donors more closely than almost anything else you can do.
To put it simply, adding advocacy opportunities boosts your donor value proposition and reinforces positive perceptions about your nonprofit with those who care most about your cause.
4. Inspire Donors via a Collective Effort
For many nonprofits, their work is centered on righting some wrong in the world. However, to individual supporters, a lack of progress on an issue — whether social, economic, or political — can feel discouraging over time. It’s easy to conclude that one person can’t make a difference. This feeling may also translate to giving: “What impact can I (and my donation) really have?”
By using advocacy, your nonprofit can present the opportunity to join a collective effort that is at once inspiring and empowering. You can set the bar for meaningful impact and do it in a way that provides instant gratification and a sense of community to supporters who are yearning for progress.
While leveraging advocacy should not be a nonprofit’s sole prospecting strategy, it offers many nonprofits a cost-effective way to attract pre-qualified leads. It also helps illustrate to existing donors their value as a true partner in your mission. Review your advocacy strategy using these tips to help you identify how you can build a strong internal list of fundraising prospects, boost donor retention, and strengthen your organization so you can make a bigger difference in the world.