You put a lot of time, energy, and money into acquiring new donors. So it’s frustrating when the majority of them give just once or twice and never again.
It’s not uncommon these days to find yourself fighting a continuous uphill battle of acquiring donors who never really feel connected to your nonprofit and leave after just a few gifts.
According to the Fundraising Effectiveness Project’s Q2 2019 Fundraising Report, new donor acquisition is down -9.5% so far this year. Blackbaud’s most recent Charitable Giving Report shows the downward trend in nonprofit donor retention rates has reached shocking new lows:
• Donor retention rate for offline donors dropped to 29%
• Donor retention rate for online donors fell to 22%
How is this possible?
We all know there are myriad reasons why donors don’t renew their support. Perhaps your case for support is weak. Maybe your donor value proposition just isn’t compelling enough. A lack of authentic urgency is another reason donors may be slow to respond to renewal asks, if they respond at all.
On top of all these considerations, donors also have more charitable opportunities now than ever before. The Internet has streamlined donor access to nearly every charitable organization. And the process of making a one-time gift is often as simple as replying to a text message.
All of these factors contribute to donor attrition. Some, like donor value proposition, require a deep-dive into your program in order to evaluate whether they are problem areas. But improving donor stewardship is one crucial focus area where nonprofit organizations can make an immediate impact on donor retention.
The key to an effective donor stewardship strategy is communicating authentic appreciation for your donor’s role in helping you make an impact — and repeating that message again and again.
These days, it’s not enough to simply thank your donor at the end of an appeal. To stand out, your organization must make donors feel truly special.
For example, imagine you made a relatively small gift of $25 to a homeless shelter. How would you feel if you then received the following handwritten note?
Thank you for your contribution! Your gift of $25 made it possible to feed lunch to 10 families last week! You are a hero to them — and to us!
Such a note is simple and concise, yet extremely effective. And when it’s part of a robust stewardship strategy, your donors will come to feel like they are a vital part of an important cause — and that feeling will emotionally bond them very closely to your nonprofit.
The Donor’s Perspective
Let’s drill down and examine what a donor thinks and feels when you communicate your appreciation for their actions.
“I am seen.”
At its most basic level, your stewardship message tells the donor that you’ve noticed them. They’re no longer just a face in the crowd; they are someone. Acknowledging your donors as individuals and saying “Thank you” lets them know that regardless of the size of their gift, they are not anonymous. They matter as people and their contribution matters to those you serve. And they will be more likely to repeat the action (i.e. making a gift) that got them noticed.
“I am valued.”
More than being seen, donors want to feel valued. For a donor, feeling valued is a validation of their self-worth and their decision to give. They were asked for a contribution, and they responded positively. Did they do the right thing or did they make a mistake? Do they have “donor’s remorse?” Saying “Thank You” reassures the donor that s/he made the right call and remains in their psyche the next time they’re thinking about making a gift.
“I am liked.”
Being appreciated goes along with being liked. When we like a person or an organization, we want to believe that they would like us too if they got to know us. Your message of appreciation tells the donor they are a friend to the organization and worthy of personal attention.
“We have a connection.”
Feeling appreciated strengthens the bond between people. What we’re really talking about here is developing a two-way relationship with the donor. When a donor makes a gift and you go out of your way to acknowledge and thank them, they understand that they’re more than a financial resource. On the other hand, if the donor doesn’t hear from you again until the next time you ask for a gift, you risk the relationship feeling predatory and one-sided.
“I made a difference.”
With many donors, a message that conveys their positive impact is even more important than a message of thanks. It deepens a sense of meaning in their lives. By communicating to the donor how their gift was used to help others, you enable them to fulfill their own mission or values through their support of your nonprofit. Their donation becomes a part of their legacy and the mark they leave on the world.
“When I make a contribution, I feel like a donor. When you tell me how my gift is being used, I feel like a philanthropist.”
Your Stewardship Strategy
When creating a stewardship strategy that will make your donors feel special and help your nonprofit stand out, consider the following recommendations.
1. At minimum, always send a thank you message immediately for every donation you receive. If a donor gives online, try to send both an e-mail thanks and a note via direct mail. The goal of these messages is to communicate appreciation for the donor and their role in the good work you do. And by communicating via mail with online donors, you increase the likelihood of converting them to multi-year donors willing to engage across multiple channels.
2. Over and over again, remind donors that you appreciate them and they are making a positive impact. The good feelings a donor gets from your initial thank you letter may not last long. In order for gratitude to be effective, it has to be repeated. Find ways to communicate with donors several times throughout the year when you’re not asking for money. Examples include: Periodic newsletters that emphasize donor impact, invitations to see the work you do firsthand, social media posts that update them on your progress and victories, and moving personal stories of impact on beneficiaries.
3. Recognize top donors with special attention from the development director, CEO/president/executive director, or a board member. Donors who warrant such attention could be long-time donors, major gift donors, or even just special friends of the organization. Whatever your criteria is, take the time to give these people a little extra love. This can be as simple as making a personal phone call or sending them a handwritten thank you note.
4. Share your successes, framed by how donors helped you achieve them. Donors give to your nonprofit because they believe you provide them with the opportunity to make an impact they can’t make anywhere else. If they stop believing this, they will likely stop giving. So be generous with progress reports and updates. It won’t come off as bragging when the focus is on the donor.
5. Communicate gratitude from those who have actually benefited from your nonprofit’s programs. Remember that hypothetical $25 donation you made that helped to feed ten homeless families? How cool would it be if you received a thank you card from one of those families? Or if you were invited to volunteer in the kitchen and meet the people you’re helping?
6. Be creative. Appreciation and donor stewardship don’t have to look any particular way. There are many aspects of your organization that are different or even unique when compared to your donors’ lives or even other nonprofits. Your donors like this about you, so show it off. Invite them to participate in aspects of your work that are very different from their regular lives. Give them an insider’s perspective on the kind of positive impact your nonprofit makes thanks to their generosity.
Ongoing donor stewardship moves organizations from transactional fundraising to transformational fundraising. By expanding your communication with donors beyond requests for money, you help them see their gifts as a valuable investment in bringing about change on a scale that one person couldn’t hope to accomplish alone.
Make a stewardship plan today, or revise yours if you already have one. Remember to be authentic and creative in your messaging. And, most importantly, communicate your appreciation consistently and often.