September 23, 2017
 
Easy Methods to Reduce Donor Attrition and Increase Loyalty

By Stephen Hitchcock

Donor loyalty makes your nonprofit more financially stable, cuts the costs of finding new donors, and increases your chance of receiving a major gift or bequest. By adopting a few simple, low-cost methods, your organization can nurture current donors and increase their loyalty.

Nurturing donor loyalty is especially critical when organizations are struggling to acquire new donors and keep old ones. Every donor you lose—no matter at what giving level—creates more financial instability for your organization.

Today, response rates are down exactly at a time when paper and postage costs keep climbing. Your organization may also be facing sharp drops in giving from major donors who have taken a beating in the stock market.

Conversely, increasing the loyalty of your donors produces huge benefits. The longer a donor keeps giving to you, the more likely that you will receive a major gift if that individual receives a windfall (or his children finish college). Donors who stay with you year after year are also more likely to leave a charitable bequest to your organization.

How can you achieve this blissful relationship with your donors?
  • Send a thank-you note as quickly as possible. For most donors, the greatest motivation for giving is a sense that their contributions are appreciated – and make a difference.

  • Get the new donors on your newsletter mailing list right away – or send the most recent copy in a special mailing. Loyal donors feel they are well informed about organizations they support.

  • Call your new donors and invite them to become monthly donors. Automatic gifts through electronic funds transfer or credit card transactions create a group of donors with almost zero attrition.

  • Keep your names and addresses as clean as possible. Change-of-address (COA) processing should be a regular part of your mailing plan (and NCOA is required if you want to get postal discounts). If your mailings stop reaching donors, then they can’t give to you!

  • Encourage donors to use an 800-phone number or a dedicated email address to let you know about changes of address.

  • Survey your donors; ask them for their advice and suggestions. You’ll find out some things you may want to correct. Just as important, your donors will feel more involved and engaged with your organization.

  • Be sure to have enough mailings in your schedule. At the most mundane level, mailing frequently enough will provide you with corrected addresses as your donors move. At a substantive level, more mailings give your donors more opportunities to contribute and keep them from lapsing.

  • Make it as easy as possible for donors to make contributions at your website. For some groups, the home page is now the donation page. More and more individuals respond to mailings or newsletters by making an immediate gift online.

  • Even if you’re not a membership organization, you’ll want to have a “renewal series” of anywhere from three to nine mailings. The message that “It’s time to renew your annual support (or membership)” wins hands-down against any other philanthropic proposition. Individuals don’t want to let their support lapse or become inactive.

  • Let your donors know that you haven’t heard from them. It’s always startling to hear and read from individuals who say, “I didn’t realize that it had been so long since I’ve given.” A simple letter that starts, “I’m writing to you because our records indicate your last gift of $50 was in May 2006. If we’ve missed a recent gift, please let us know.”
As you implement some or all of these activities, be realistic in your expectations. Even the best organizations experience donor attrition. In any given year, 20%–25% of individuals who gave to you last year won’t make a gift again this year. If your organization is acquiring or attracting a lot of new donors, then this attrition rate can be 30%-40%.

Less than half (and sometimes as few as a third) of those who make an initial first gift go on to make a second gift. This is the fundraiser’s challenge. However, of those that make a second gift, two-thirds to three-quarters will go on to make many more gifts.

So focus on gifts and donors by investing time and energy—and perhaps some of your expense budget—on these strategies and watch your donor attrition rate fall.

Stephen Hitchcock is the author of Open Immediately: Straight Talk on Direct Mail Fundraising – What Works, What Doesn’t and Why, available from Emerson & Church Publishers.

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