7 Easy Steps to Drive Donor Retention for the Long Haul

7 Easy Steps to Drive Donor Retention for the Long Haul

By: Shawn Olds

Only 20% of first time donors ever donate a second time. Now, without a constant stream of new donors to fill those gaps, how do you ever reach your goal?

The truth is. Fundraising is hard work, and acquiring donors who will stick around is one thing that oftentimes keeps nonprofit professionals up at night. While charitable giving overall has gone up since the beginning of the pandemic, organizations are not retaining these new donors and are losing money because of it. According to the Fundraising Effectiveness Project, acquiring a new donor costs $1.25 just to raise $1, while the typical cost to raise the same amount from a current donor is just .20 cents! So it’s time to look at donor acquisition, and donor retention for that matter, through a new lens in the hope of more effective and efficient fundraising.

Your prospect’s affinity for your mission is of utmost importance when it comes to their potential for a lifetime of giving. Sure, your donors have a certain “look” about them. They have similar demographic attributes, but deep down these attributes are just a surface level look at who your donors really are. Tapping into their interests, and real affinity is what drives your donors to give for the first time, and give again. So, let’s tap into 7 easy steps that will help you acquire and retain your donors for the long haul.

Step 1: Define Your Goals

You should always begin with the end in mind. What I mean by this is: set an actual goal and make it measurable. Take into account your fiscal year and determine what number will help your mission thrive. Begin with the overall donation amount. Whether it’s $5,000 or $500,000, you will be making moves to ensure you reach that goal at the end of your fiscal year. From there think about other goals that you would want to measure to ensure you reach that overall goal. For example, you can set goals for donor retention, average donor growth, and rate of donation growth. You see, by beginning with the end in mind, meeting your fundraising goals and working toward your nonprofit mission becomes much more attainable.

Step 2: Determine Where You Are Now

After determining where you need to be, you must understand where you currently stand. Take a look at how your organization performed during the last fiscal year. If you received the same number of donations this year, would you achieve your goal? If not, how do you plan to fill those gaps? If so, how could you meet a reach goal this year? By understanding where you want to be and where you currently are, you are able to better make next steps with confidence to aid your organization in closing the gaps in your fundraising.

Step 3: Find Prospects Who Care

To achieve your goal, even a reach goal, your organization needs to find prospective donors that care about your mission. Oftentimes, development and fundraising teams dedicate their time to prospect research to accomplish this task. They look into information like demographics, wealth, and past nonprofit work to determine who could possibly be interested in giving to their organization. The truth is, this is a time consuming process and often far more costly than anyone wants to admit. This is where you might want to look into purchasing or renting donor prospect lists from list buying services that are privacy compliant and are able to deliver affinity-driven donor prospects. By doing this, you can find many more prospective donors that have an affinity for your cause and, in turn, greater chance at converting into lifetime donors.

Step 4: Get to Know Your Prospective Donors

Once you’ve compiled a list of people you know will be interested in giving to your cause, you should dive even deeper into understanding what will speak to them. Whether you are planning an annual gala, a direct mail campaign, or using another outreach method, this is key to sending the right message to the right person, and ultimately winning over that prospect’s heart - and gift.

As you get to know your prospects, ensure that you are looking at the true affinity of your donors. Demographics and intent details are great, but without knowing the affinity of your prospective donors, you could easily be misguided by the next steps you should take. Get down to the nitty gritty of who these people are by expanding on affinity and defining things like their preferred way to be contacted, their interests, and their giving potential. The more you know about your prospects, the more successful your campaign will be at achieving your goals and furthering your mission.

Step 5: Plan Your Asks and Segment

All prospective donors are not alike….some have the ability to give at a single high-value gift, while others can give more frequently at smaller amounts. So it becomes imperative that you know the appropriate ask amount for each individual to achieve the best results.

The best way to prepare for the big A-S-K is by grouping your list of prospects by ask amount. Think of a giving table or donor pyramid. Segment your donors by gift level (i.e. $0-$25, $26-$50, etc.) to determine which group of individuals should receive which messaging. Then, define the unique message received by each prospect to ensure that it resonates and yields a greater return. Not only does this ensure they are being asked for a gift within their means, but also, that you reach them in the way they are most likely to consume your message and act - be it direct mail, a phone call, social media advertising or another preferred method.

Step 6: Perform Targeted Outreach

Once you have your ready-to-give donor prospects segmented, you need to consider how you are going to perform your outreach. All the usual suspects are great ways to reach donors, be it direct mail, through events, or even a simple phone call. But digital advertising has come to the forefront for nonprofit fundraisers, and it is allowing them to reach their prospects better and with more targeted messaging than ever before. This kind of advertising allows organizations to be more intentional about their audience and share their mission with people most likely to make a donation. Even better, you can choose where your audience sees these ads. Social media, banner ads on websites, and even advertising on streaming services, such as Netflix, are fresh options available to nonprofits allowing them to attract new donors where they always are.

Step 7: Track Outcomes and Measure Success

Remember those goals we talked about a few minutes ago? Well it’s time for you to see if you’ve reached them, if you haven’t, and how to improve next time.

This can be as simple as a spreadsheet or as complex as hiring a service to get real-time conversion data from your campaign. Either way, measuring your campaign results and knowing the fruits of your labor is of utmost importance so you understand what worked, and what didn’t, for this campaign. From there, it will allow you to make conscious changes and improve outcomes over time.

Implementing each of these steps into your overall fundraising strategy will help grow the donations of your current donors, reduce wasted campaign spending, and increase your acquisition of prospects who are destined to stick around. Pair this with the knowledge you have about your individual donors, and you will certainly reach a fundraiser’s nirvana.

About the Author:

Shawn Olds is a technology and communications thought leader serving as the CEO for boodleAI, an AI-powered solution closing the gaps in fundraising by delivering ethically-sourced, highly-qualified prospects who act just like your dream donors. He is a military veteran and current Civilian Aide to the Secretary of the Army. Shawn has found ample success in both private and government sectors and continues to dedicate his time to supporting nonprofit organizations and their missions. Shawn holds a BS in Computer Science from the US Military Academy, an MBA from the Kellogg School of Management, and JD from the Northwestern School of Law.