As a Nonprofit financial solution provider, we understand the unique challenges faced by nonprofit organizations, and they go well beyond accounting.
The most challenging? Keeping a reliable, recurring stream of donors. In recent years, nonprofits have shifted from operational-driven strategies to impact-driven strategies. Donors have made themselves clear: They’re in it to make a difference.
So how can you, as a nonprofit with a mission, loudly and clearly demonstrate the impact your donors are making?
We discovered a great article written by Roger Caver on GuideStar and wanted to share it with you.
“The days of the seemingly infinite pool of new donors available to quickly and inexpensively replace those who have stopped their support are long gone. Today, as more and more donors abandon ship, the cost of replacing them has grown so great as to be no longer affordable for most nonprofits.
In my book, Retention Fundraising, I provide a comprehensive strategy for holding onto your donors for life. In the space I have here, let me simply highlight four questions always lurking in your donor’s mind and which need to be answered if you hope to inspire loyalty.
DO YOU UNDERSTAND HOW I FEEL?
For nearly thirty years the commercial world has understood the importance of a customer’s attitude and has spent literally billions of dollars in understanding how to drive customers toward greater loyalty and commitment. The result? According to Bloomerang.co, the commercial world enjoys customer retention rates approaching 90 percent. The national average of nonprofit retention rates is only 41 percent. The lesson is that understanding how donors feel about your organization and what role they want you to play in their lives is the starting point for improving retention rates.
CAN YOU HELP ME MAKE A DIFFERENCE?
In every donor’s mind there resides a subconscious question: How does this organization best enable me to make the difference I want to make? This is why it’s so important to discover which of the experiences you’re providing are seen as positive or negative. To put it another way, to improve your retention rate, you have to understand what job the donor is hiring you for. You can’t infer it by segmenting your donor base by demographics or by past giving behavior. The best way to discover which experiences matter and which don’t is to ask. And the best way to ask the donor is with a survey custom tailored to your organization.
DO YOU KNOW HOW TO STRENGTHEN MY COMMITMENT?
If you really want to improve the commitment of your donors, and retain them for years, you must understand which of your actions are building loyalty. In a DonorVoice study of more than 250 organizations, donors were asked to rate 32 organizational factors in terms of their importance to them. Among the most influential were: The donor perceives the organization is effective in carrying out its mission; the donor receives timely thank-yous; the donor receives opportunities to make his or her views known; the donor is given the feeling that he or she is part of an important cause; and the donor receives information showing who is being helped.
CAN I TRUST YOU?
Often it’s the little things that cause you to lose donors. Gifts that go unthanked. Requests for information that aren’t heeded. A telephone call not answered promptly, or worse yet, dealt with by a rude of unknowledgeable representative. Consistency and reliability are essential pillars of strong relationships. If donors can rely on your—organization to be responsive—whether responsive means updating a change of address, effectively answering an inquiry, or consistently stating your mission—you’ll win their trust and loyalty. If you fail, you’ll lose them. It’s that simple.
Is donor retention the problem our organizations are most interested in fixing? I’d argue that the answer is categorically “No!” Deep down I suspect most experienced fundraisers—particularly direct response fundraisers—believe that acquisition is a lot easier than retention. They simply don’t buy the adage that it’s easier to keep a donor than to find a new one.
And, in truth, donor acquisition IS still easier than retention. Not less expensive, not more valuable, but easier. Retention requires time to analyze and measure. Time to improve donor experiences. Time to test and evaluate improvements. A lot more time compared to the very short-term tactics and measurement involved in acquisition.
Surveying your donors’ attitudes, creating effective messages, providing good donor service—these combined activities require considerable effort and planning. Regrettably, few organizations have either the stomach or the resolve to implement them.”
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