It’s completely essential for nonprofits to retain as many donors as they’ll. Not solely does retaining donors get monetary savings within the quick time period — it prices round two to 3 instances extra to draw a brand new donor than they may give of their first donation — but it surely additionally boosts their lifetime worth.
Nevertheless, nonprofits struggled to steward new donors in 2023, with the retention fee dropping 2.5% in June of final 12 months.
In 2024, nonprofits are making the most of information to confront main challenges, together with donor acquisition and retention. In NonProfit PRO’s “2024 Nonprofit Management Influence Research,” 36% of nonprofit leaders mentioned their organizations are investing in instruments to make smarter information selections, and 33% mentioned they’re researching donor exercise to reactivate, mobilize or establish related donor profiles.
As you look into information as a instrument to help your group’s donor retention, it’s useful to have steering from the professionals. Right here, two consultants share their insights on how one can use information to optimize donor retention.
Related Knowledge for Donor Retention
In the beginning, that you must know the place you stand in relation to donor retention, mentioned Lauren Sheehan, president of DonorPerfect. Whereas retention charges throughout the business have been dropping, your group seemingly has a distinct fee than what business as an entire is averaging; it may very well be decrease or larger than common.
When you’ve recognized your retention fee, Sheehan mentioned you could set up what she referred to as the perfect donor profile or persona.
“I believe you will need to perceive which donors you are having success at retaining,” she mentioned. “So for those who take the idea of a really perfect buyer profile — that is one thing from the for-profit enterprise area — and create and perceive what your very best donor profile can be, I believe that may be actually useful.”
For this to yield the very best outcomes, you possibly can’t simply have a look at donation information and name it a day. In accordance with Morgan Falor, consulting director at Armanino, you could have a look at total engagement, in addition to what she known as “emotions.” A few of these “emotions” embody:
- Do donors have interaction together with your emails?
- Do they attend your occasions?
- Are they engaged with you on social media?
- Do they volunteer together with your group?
- Are they responding to the case research and affect tales you present them?
- How does their engagement evaluate to earlier years’ engagement (e.g., donation quantity)?
Sheehan added that as a result of donor retention is positively correlated with the variety of donations in a given 12 months, you possibly can have a look at how usually sure donors are giving and steward them to turn out to be month-to-month donors.
“If you happen to’ve acquired some of us which are donating three or 4 instances a 12 months, you possibly can establish them after which put collectively a plan to… ask them to contemplate turning into a month-to-month sustainer,” Sheehan mentioned. “If [that plan] follows go well with, their retention degree ought to go up.”
Accumulating and Managing Knowledge
With regards to managing and assessing your donor information, gaining access to all of it in a single place could make issues simpler. Falor mentioned ensuring your CRM can join together with your social media listening instruments — reminiscent of HubSpot or Hootsuite — can increase your skill to efficiently have interaction donors. While you’re extra related with donors, their retention ranges will seemingly improve.
When you’ve collected information, that you must arrange it in a means that you could perceive. For example, Falor really helpful making a donor warmth map to trace engagement, the place the extra engaged donors are “pink sizzling” and the much less engaged are blue.
“For these ones which are blue — since you’re at all times going to have them — how will we get them again over into perhaps a purple class?” Falor mentioned. “How will we convey them out of that blue? Utilizing that information and monitoring these emotions and simply total engagement together with your group will actually assist that.”
Donor Surveys
One underutilized instrument for accumulating donor information is to place out a donor survey frequently, which will help you phase your donors and implement completely different advertising and fundraising methods.
“If you do not have a donor survey that you just’re doing on an annual foundation, you’re lacking an enormous alternative to have interaction together with your donors, but in addition determining how one can have interaction with them higher in a extra significant means, which can, in flip, drive retention,” Falor mentioned. “So if I am giving to, to illustrate, a Meals on Wheels, as a result of I’m very, very anxious about impoverished seniors… That comes again on my donor survey, tremendous simple to retain me. Inform me all concerning the stuff you are doing for impoverished seniors; you are going to get me to open my pockets each single time.”
Whilst you can change your survey questions from 12 months to 12 months, Falor mentioned you need to embody three normal questions that keep the identical between surveys so you possibly can observe donor sentiments over time and gauge curiosity in your group.
As a result of donors can be a part of at any time of the 12 months, you might be questioning when to ship out your surveys. In accordance with Falor, it’s not essential to ship out your annual survey on a donor-to-donor foundation — say, by sending them the survey one 12 months after their preliminary donation. As an alternative, she recommended selecting one level yearly to launch the survey.
“I do not assume it needs to be a one dimension suits all for each group,” she mentioned. “A finest apply method can be to ship them out proper about… the start [or end] of August. I really feel like youngsters are beginning to return to highschool, individuals are getting off their holidays… You might have time to get that information in earlier than This autumn, GivingTuesday, form of all of the year-end pushes.”
Segmenting to Retain Extra Donors
Keep in mind that donor information is simplest — for donor retention and for different functions — if you phase your donors. When you’ve segmented, Sheehan emphasised the significance of tailoring your retention method based mostly on the teams you’ve created.
“You may need to have a communication plan for a first-time donor, a communication plan for anyone who gave earlier years however hasn’t given this 12 months, or gave final 12 months however hasn’t given this 12 months,” Sheehan defined. “Knowledge helps you phase your database. Then you should utilize that data to place actions into place to both re-engage or preserve these donors engaged in order that they proceed to provide to your group and you may maintain them.”
In accordance with Falor, your nonprofit ought to have not less than three or 4 donor segments. Whereas the default segmentation methodology is to categorize by greenback quantity, there are different methods to phase successfully. For instance, you possibly can phase donors by the 12 months by which they started donating or participating together with your group.
“That basically helps you hone in on, ‘Wow, what we have been doing again then was actually profitable? As a result of these folks, after we first acquired them on and acquired them to that donor degree, they’re nonetheless right here,’” she mentioned.
