Your Got-It-All Donor Retention To-Do List

May 24, 2020
7 minutes

Keeping donors around for years can be a real challenge for nonprofits. In fact, the Fundraising Report Card reports that the average donor retention rate for nonprofits is 35%. Every nonprofit has to face the reality of their donor retention at some point—improving donor retention is the gateway to building a larger donor base and raising more money. Plus, by retaining more of your current donors, your nonprofit will be able to save money on acquisition costs for new donors. Saving money while raising more money? Sounds like a winning recipe to us!

So... if retaining donors is so valuable, why aren’t more fundraising offices prioritizing it? The truth is donor retention is a robust and sometimes complex problem to solve. It’s not just about showering donors with gratitude, it’s also about fixing the leaks contributing to your donor retention problem.

We’ve put together this donor retention to do list to help you assess the state of your nonprofit’s donor retention and start taking action to fix it.

Calculate your donor retention rate

As with most things in fundraising, you need to know your baseline metric. That means you need to calculate your donor retention rate. To calculate this number, you’re going to need to pull two numbers from your fundraising CRM.

First, pull the total number of donors who gave in 2017.

Next, pull the number of donors who gave in 2017 and gave again in 2018. Or 2018 and 2019. Or, basically your last full fiscal year and the year before it. (wave if you're reading this in 2175!)

To calculate your donor retention rate, divide the number of donors from the most recent year by the number of donors in the previous year and multiply by 100. Voila! That’s your donor retention rate.

Here it is for all y'all that need to see it in numbers: (2019/2018) x 100. (...think we wrote that right? We're writers, not math-ers.)

Dig into your data

Now you’ve got your retention rate in hand, start to dig into your data to look at the sources of your organization’s retention problems. Start by looking through some of the records of donors who gave in 2017, but didn't give again in 2018. If they primarily received communication by email, are they still subscribed to your email list? Has their email address bounced? If you communicated with some of those donors by snail mail, do you have the correct address for them? These are practical considerations that can impact your donor retention rate.

Of course, there's gonna be some portion of donors you have correct contact information for, but who stopped giving for some other reason. This is the segment for which you’ll want to test strategies and tactics for winning them back. *squints and rubs hands together*

Improve your donor experience

Looking retrospectively at donors you’ve lost and figuring out how to win some of them back is one facet of donor retention. The other facet is looking forward to figure out how to keep more of the new donors your nonprofit receives. Much of the strategy for this piece is about the donor experience as it relates to stewardship. Here are some considerations:

  • What happens immediately after a donor makes a gift online? Are they redirected to a thank you page? Do they receive a thank you email?
  • What happens when your organization receives a gift in the mail from a donor? How quickly is a thank you letter sent out?
  • For online and offline donors, what do they recieve in the 1 to 2 weeks following their donation? What do they receive 1 month after making their donation?

Go through your follow up process for online and offline donors to document the kind of touchpoints they receive from your organization. If certain donor segments receive some touchpoints but other segments do not, are you seeing any differences in retention and giving behavior between the segments? Asking this question can lead you down the path of what’s working in your stewardship and acknowledgement process.

Strategically make asks

Your nonprofit likely has a few fundraising appeals each year that go out to every donor in your donor database. Awesome! One extra step you can take for some of these appeals (especially ones at year-end) is to look through your donor data to see which donors have not yet made a gift in this fiscal year. You may want to send them an appeal with slightly different copy, or you may want to plan a follow up ask (or two!) during the campaign.

If you’re feeling Extra Fancy, you could also target this segment of donors with online ads through Facebook, Instagram, or Google.

Integrate fundraising and communications

Asking is just one part of the fundraising equation. Your organization also cultivates donors throughout the year through various communications you send out. This could include newsletters, social media posts, press releases, OpEds, and more. If your nonprofit has separate fundraising and communications teams, bring your heads together to see if there’s a way to develop some communications strategy that supports donor retention. If you’re a one-person fundraising and communications team, you can still do this. Finding some points of alignment between fundraising and communications is key!

Word of advice: Wine can help during this step. Ask us how we know.

We’ve got more tips for integrating fundraising and communications into your donor retention strategy.

Test, test, and test again

We’ve alluded to testing strategies for winning back lapsed donors already. It’s also important to test strategies and tactics for keeping donors in the first place. Here are some examples of retention strategies you can test.

  • Making thank you phone calls to donors. You can test whether or not a phone call impacts giving.
  • Impact updates and stories. You can test whether or not sending an update impacts giving, as well as the frequency of sending updates.
  • Personalized stewardship touch points. You can test different types of stewardship touch points, including things like mission-driven gifts or even an out-of-the-blue thank you.
  • Giving circles or giving clubs. You can test whether offering this kind of “status” impacts donor retention.

Fundraising friend, we know donor retention can be one of the toughest fundraising nuts to crack. By following the suggestions in this donor retention to do list, you can get your nonprofit on the path to figuring it out. Persistence and consistency are your friend when it comes to donor retention!

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