What’s Your Donor Retention?

As fundraisers, we often focus far more energy on finding NEW donors rather than retaining the ones we have. We are in constant pursuit of elusive new donors and devising clever ways to get them to notice us. Our boards obsess over “increasing our visibility” and “making sure people know who we are.” Meanwhile, we are hemorrhaging donors who already DO know us and have taken the critical first step of making a gift, often because we aren’t welcoming them into our organization and making their first giving experience with us memorable.

We’ve been talking about donor turnover for a while, but retention data is still abysmal. According to AFP’s Fundraising Effectiveness Project, donor retention rates for new donors have been declining steadily for several years. Overall donor retention hovers between 40-45%, meaning that for every ten donors we had last year, only four of them will give to us again this year. New donor retention is even worse; statistically, of every ten donors that give to you for the first time, only 1 or 2 out of ten will give again.

How do we buck this trend and keep more of our donors? We must work harder for the SECOND gift! We can’t take new donors for granted and just hope/assume/pray that they will give to us again. We have an opportunity to help our donors feel part of something important and remind them that they are part of a larger group of people who share their values and care about our work.

Our long-time client Kino Border Initiative has prioritized strategies for donor retention and has seen steady improvement, from 46% in 2019 to 56% last year. It can be done!

Here are some time-tested tips for improving donor retention:

1.    Monitor your donor retention data!

You can’t tell whether your strategies are working if you don’t know your donor retention data. Most CRMs on the market have built in reports and even clever dashboard widgets that can provide data on overall and new donor retention. Some will even tell you which donors are in danger of lapsing! Track and report on this data, just like you do with dollars raised.

2.    Create a special welcome letter for new donors.

Don’t just use the same general acknowledgement letter … make the first gift feel special! The number one reason that donors report for why they don’t give again is that they didn’t remember making their initial gift in the first place! Shame on us for not making it memorable.

3.    Send a welcome packet to new donors.

Even better than the first-time donor thank-you letter is a welcome packet that provides a little extra information about your organization. Enclose a copy of your most recent newsletter or annual report. Maybe send a sticker or some other small token your new donor can display to show that they are part of your organizational family. Once again, make it memorable! Habitat for Humanity once sent me a small nail as a symbol of welcome. I’ve never forgotten it!

4.    Send a series of new donor welcome emails.

Schedule a series of 2-4 special emails to go out to your new donor over 3-4 weeks. You can let them know that you won’t keep emailing them this frequently, but rather that these emails are a “quick start” to learning more about your important work. This is your opportunity to tell them more about your organization and the impact of their gift. Share stories, use photos and video, and most of all make your donor feel as if they are part of something special.

5.    Personally call new donors to thank and welcome them!

This can be a great task for whoever manages your donor database and creates new accounts for new donors. If they have provided their phone number (you do ask for their phone number, don’t you?), pick up the phone and give them a quick call! Tell them how happy you are that they support your work and provide them with some opportunities to learn more or connect (i.e., “Have you visited our website? Can I add you to our newsletter mailing list? We have an event coming up! I hope to see you there!)

6.    Have board members call and write to thank donors.

Penelope Burke’s extensive donor research revealed that one of the greatest influences on a donor’s decision to give again is having heard from a “volunteer in a leadership position” (that’s you, board members!) A quick call or note from a board member to show appreciation is memorable and can make a real impact on donor retention.

7.    Send an annual mailing to recapture lapsed donors.

The best (and maybe only) time to successfully to recapture a donor that has stopped giving is within 12-18 months of their last gift. If a donor’s giving lapses longer than that, it might be even harder to recapture them than finding a new donor. We recommend a multi-channel appeal sent annually in February to folks who didn’t give last year but have given previously. The goal is to try to recapture as many of those lapsed donors as possible. If you can keep them for another year, they are less likely to lapse in the future.

8.    Convert donors to monthly giving.

The MOST effective donor retention strategy is recurring giving. Monthly donors generally have a 90%+ retention rate, year to year! If you haven’t already created a monthly giving strategy, make that a priority. If you have one, but it is languishing, it is time to refocus and refresh. Promote monthly giving in ALL your channels. You will have a more predictable monthly cash flow and retain more donors over time. 

Have you managed to improve your donor retention rates? Do you have a tip you’d like to share? Let us know what is working for you and you might even get a “Do Gooder Shout Out”!