Understanding Nonprofit Donor Churn: Part 1

March 9, 2016
5 minutes

Understanding Nonprofit Donor Churn: Part 1

As is often the case, most nonprofits try to pinpoint a donor leaving as a culmination of things that led to a tipping point that stopped them from making any further donations. Maybe it was another nonprofit that does the same thing but came across as more “worthy” to the donor. Or perhaps it was a lack of communication with the donor or personalized messaging. While on the surface those answers help, the real answer can be a bit more complicated than that.

First, Understand the Behavior of Your Donor.

What motivates your donors to give to your nonprofit?

Presentations made to donors about how many people have been helped carry less weight overall than donors’ perceptions, knowing or feeling that their donation made a significant contribution to your cause. 

They would really like to hear about what they are accomplishing through their donations to your organization. 

This observation is, in fact, drawn from research into what the most common reasons are that donors will contribute to a nonprofit. Some reasons though would be outside your sphere of influence, which would make it harder to bring back certain donors. For example:

  • The specific tastes, passions, and preferences of a donor, brought on by their particular life experience.
  • The personal or professional background of a donor may be what influences the choice of beneficiary they will pick.

There are, though, a couple of key reasons donors reported on in the study that you can work with.

  • The perception of competence the nonprofit shows to the donor about how they use the donation wisely.
  • The desire of a donor to have a personal impact made through their contribution. For instance, a donor knowing that their contribution will be “drowned out” by other donors.

These donors above will only continue to donate, knowing that:

  1. They can see you use all funds efficiently.
  2. The donor sees proof that their donation creates an impact on the nonprofit’s cause.

What Stops Donors from Repeated Giving?

Most often, a single interaction that was not good is not enough to stop a repeat donor. It is most often after a series of events (over a period of time) that will cause the donor to eventually give up and leave. Let’s take a look at the journey of a donor.

The pre-churn moment

Donors will give to your nonprofit with the expectation that what they sent will make a specific impact. Even after announcing you’ve helped over 3000 families with the donations received, the donor may be looking to see how their specific donation helped.

A root cause

Perhaps the thank you email the donor receives is not personalized. It does not mention anything specific to their donation except that the email includes the receipt for their donation.

Final straw

The next communication or email they end up receiving isn’t related to how their contribution helped, but another ‘ask’ for donations. The donor still has no insight into how they helped. The donor is triggered into leaving.

The post-churn moment

The donor has stopped by now with no notice to the nonprofit. The root cause was never looked into or addressed with the donor. Yet you continue to send communications. This justifies in the donor’s mind that the decision they made to leave was correct.

At any point in time, your nonprofit could have interceded to ensure the donor felt as if they were a valued member of the organization. 

The following were the most common accounts of why donors stopped giving to nonprofit missions. In short, they felt the nonprofit organization did not need them:

  • No thank you received for the donation
  • No information received on how the money would be or was used
  • No recollection of donating to your mission
  • No longer able to afford donations to your cause.

Understanding Why Your Donors Don’t Come Back.

It is one thing to understand how a donor left; it is a completely different thing though to know why they left.

The data can only tell you so much.

Generally, the information received from a first-time donor isn’t enough to really nail down a reason for donor churn. To get better data, this requires you to go deeper. Obtaining actionable data means looking at donor complaints, recommendations, feedback, and compliments.

Always ask for feedback from your donor when appropriate.

  • Ask new or existing donors for their feedback.
  • Reach out to lapsed donors. You will need to define what a lapsed donor is for the nonprofit. For example, it may be a donor who hasn’t donated in the past year or two, or it may be a donor who has recently opted out of the monthly giving program.

Final Thoughts

As is most often, it is more a series of events that will lead a donor to stop giving than just a one-off event. Part 2 of this series will address what to do to win back your donor.

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