June 22, 2018
 
Donor Acquisition Is Key to Long-term Nonprofit Well-being

By Robin Cabral

Robin Cabral
It costs more to acquire a new donor than to retain an existing one, but donor acquisition, while costly, has always been and will remain an important component of a nonprofit development program.

Nonprofits in general have been improving donor retention rates, but appear to be lagging behind in acquiring new ones or bringing lapsed ones back into the fold. However, if nonprofits don't focus on donor acquisition, their development program will wither and eventually disappear due to natural attrition among donors.

According to recent findings in the 2018 Fundraising Effectiveness Project, "The warning signs are there – decreasing numbers of new donors and decreasing reactivation rates of lapsed donors."

Most importantly, the research found organizations that focused on gift upgrades, retention, and lapsed donor prevention fare much better than those who didn't. The bottom line is if you want to be ahead of the curve, you need to keep your development program focused on these objectives.

The good news is nonprofits can take immediate, low-cost steps to correct the situation:

1) It is imperative to begin by building donor acquisition programs into your development program.

Develop an actual plan with goals attached. How many new donors will you recruit? How will you recruit them? How much will it cost to recruit them?

2) Finding new donors by profiling your current donors.

These are the type of people you want to find more of. Learn who they are. Survey them. Determine their demographics, their likes, their interest areas, etc.

3) Identify and meet with your current top donors.

The goal is to fully better understand them and to determine what drives their motivation to be part of your cause.

4) Launch an "Introduce a Friend" campaign.

This type of effort focuses your effort on asking current donors to recommend a friend to the organization.

5) Ask your current donors when meeting with them make an introduction.

Ask, "Who else should we be speaking to who MAY have an interest in our organization?"

6) Then, identify lapsed donors.

They are people have given to you in the past but who haven't given in the last 18 to 24 months. We all have a file of lapsed donors. Attempt to recruit them back using highly personalized messaging. If they are top donors, then meet with them personally to determine how and why they lapsed. If they are lower level donors, then send them more personalized messaging.

7) Turn to those on your file who have never given before.

Pull them out and see if you can get some board members, volunteers, or staff to rate each person on interest and capacity. If there is no interest, you can segment these folks out. For those who have interest, determine their capacity. Top-level prospects will require more in-person qualification and cultivation. Lower level donors will receive more direct mail communications based on their known interest areas.

8) From there, start to look externally at who is philanthropic in your community.

Specifically, learn who contribute to organizations focused on areas similar to yours. Consider list exchanges with the organizations those people support.

9) Consider using new online and social media channels to begin to build a prospective interest base.

Add a pop-up on your website to capture email addresses, but give something of value. Social media advertising is another avenue. Once you acquire these donors, use the same channels from which they originated to continue to cultivate the relationship by providing material of value. Don't ask right away, but cultivate just as you would in-person.

10) Based on your profile donor base demographics, consider buying data from external sources for a traditional acquisition campaign.

A good place to start is with as list brokers. Today, sophisticated matching can be done based on your donor profile and demographics to make this method a bit more cost-effective than it has been traditionally.

Finally, you shouldn't single one of these tactics over others, as a comprehensive, growing development program focused on all aspects of the donor pyramid is what will enable you to build a healthy and sustainable development program.

Robin Cabral, principal of Development Consulting Solutions, is a certified fund raising executive who works with mid-sized nonprofits to build capacity and improve fundraising results. Email her at rcabral@developmentconsultingsolutions.com or call 508-685-8899.

June 2018

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