Put a Stop to Donor Drain

Put a Stop to Donor Drain

September 29, 2011 by jga_admin

by Andy Canada

 

There are many steps an organization must take to build and maintain a loyal and sustainable donor base, and perhaps the most important and often overlooked is retaining your existing donors.
 

Not only is putting a stop to donor attrition important, it also pays dividends, according to a recent report from the Fundraising Effectiveness Project (FEP), a joint effort by AFP and the Center for Nonprofits and Philanthropy at the Urban Institute. The 2011 Fundraising Effectiveness Survey Report shows that for every $5.35 gained in new gifts by an organization in 2010, $5.54 was lost from the organizations current donors not renewing, resulting in an average net loss of 1.9%. Though the study did show improvement from 2009 to 2010, donor attrition is still a challenge that nonprofits need to address.
 

As we have all heard many times, it is more cost effective to retain and motivate your current donors than it is to attract new first time donors to your organization. However, often current donors are taken for granted as organizations go out searching for a new group of potential donors. Attracting new donors to your organization should never overshadow stewardship to your current donors.
 

Turnover of donors increases your overall fundraising costs and inhibits growth. With increased turnover, organizations struggle to build long term and sustainable relationships with donors, move donors to higher giving levels, or build a major gift pipeline for the future.
 

Here are some steps to assist in donor retention:

  1. Focus on thanking your donors within 48-72 hours after they make their gift. Let them know the gift has arrived safely and that you appreciate their support.
  2. Personalize your communications. Utilize your database system send personalized letters and notes.
  3. Periodically touch base with your donors. A personal call is great but an email providing an update on the organization is also effective. Allow them to feel engaged with the organization.
  4. Personally visit to say thank you whenever possible.
  5. Explain how their gift has made an impact.

 
These are basic steps but they do require an investment of time and coordination from your organization. But, current donor relationships are an asset well worth the investment.