[ASK AN EXPERT] What Are Top Tips To Retain First-Time Donors?

Our Ask An Expert series features real questions answered by Claire Axelrad, J.D., CFRE, our very own Fundraising Coach, also known as Charity Clairity. Today’s question comes from a nonprofit employee who wants tips to improve first-time donor retention:

Dear Charity Clairity,

What tips would you give to a small to medium-size shop to improve first-time donor retention? Alas, we’re right on parallel with the Fundraising Effectiveness Project data and are losing roughly 8 out of 10 new donors. This isn’t sustainable, of course, but I don’t want to dial back on our acquisition efforts. What can I do to make the ROI better?

— Losing Too Many New Donors

Dear Losing Too Many New Donors,

You’re right to call this out as a problem, and you’re not alone. Even though donor attrition has been abysmal for over a decade, too few nonprofits are engaging in the best practices proven to improve results.

If you ask well, you may get one gift. If you thank well, you may get a lifetime of gifts. Thank you kickstarts the relationship-building process. Without it, you just have one stand-alone transaction.

Here are 10 first-time donor retention tips that channel gratitude

1. Call first-time donors immediately and thank them. Assign this to a personable administrative assistant, your annual giving manager, or a volunteer.  Just make sure it happens promptly (48 hours is ideal), and make a record that the call was made (this will enable you to track whether donors who are called renew and upgrade at higher levels than those who are not called). Learn more about what to say on these calls (and messages left) here.
2. Send new donors a great thank you letter.I believe every donor deserves a real letter. With a real, hand-written signature. Not a receipt. Not a pre-printed card. See what constitutes “great” here.
3. Send new online donors an additional thank you by mail. Don’t just send them an automated email response. Even donors who give online should get something in the mail, especially if this is their first gift. Retention for new online donors can be poor, so anything you can do to encourage a bond with your cause may help retention and increase your fundraising results. A mailed thank-you letter is likely to be saved, put up on the fridge, or given a special place on the bulletin board. It “sticks” in a way an emailed thank you just doesn’t.
4. Send new donors a welcome packet or welcome email series. Include volunteer opportunities, invitations to free events, and at least one heart-warming story about, or thank you from, someone their gift helps.
5. Invite new donors to non-ask events. Schedule tours of your facility or get folks together at a board member’s home or office for socializing and a short Q&A. Or ask folks to serve as a focus group to give advice on programs or products (you don’t have to take the advice; it’s just nice to show folks you value them for more than just their wallets). Whatever you do, make sure someone follows up to see if your donor has any additional questions or ideas.
6. Invite new donors to become volunteers. This can be either in direct service or as a committee member.  For newbies this can be a great opportunity to simply showcase the depth and breadth of your services. They may be amazed you have so many involvement opportunities!
7. Develop systems to ensure new donors get thanked more than once. You absolutely don’t want them to think you cared only about that one gift. Build a relationship. Encourage them to subscribe to your newsletter, and always thank supporters there. Send something at the end of the year (it can be through email, a postcard, or an insert in some other mailing all donors receive) that once again welcomes them to your ‘family’ or ‘community’ and lets them know what their gift helped make possible.
8. 30 days after the first thank-you letter, send a warm, quick impact reminder like a text, an email with a video or heartwarming photo, or a postcard reiterating how much their first gift was appreciated.
9. In the next quarter, send them a thank you from someone who was helped (e.g., a client, student, parent, etc.). You can get creative and have the thank you come from an animal, painting, or tree!
10. A month before the anniversary of their first gift send them an impact piece describing how their gift was used. Depending on how many new donors you have, and whether you operate on a calendar or fiscal year, you could alternatively send a year-end thank-you letter to all donors at the same time.

If you’re small, and thinking it’s too expensive or time-consuming to thank first-time, small dollar donors this way, think again. When you’re small, you need every single donor to stick with you. And you never know. Plenty of organizations have received six, seven figure bequests from supporters who were low-level donors or volunteers. So, prioritize the thank you process.

TRUE STORY: I once worked with a client who was balking at sending thank-you letters to their small and online donors, let alone sending them a follow-up postcard or making a phone call. They thought it was overkill and, besides, their staff didn’t have time, but they only had 200 total donors. I could write and send postcards to every single one of their donors in a single evening (this could speak to why they have so few of them). If you’re small you have even more reason to treat every donor as precious!

If you’re larger, determine which donors are “must call” vs. “nice to call.” Perhaps you truly don’t have the bandwidth to thank everyone this way, but you certainly could select a subset of your best prospects among first-timers.

NOTE: According to Mal Warwick, author of Revolution in the Mailbox: Your Guide to Successful Direct Mail Fundraising, research indicates new donors of $15 or less are difficult to convert. On the other end of the spectrum, donors of $50 or more typically have the highest conversion rate. Warwick’s data suggests a high correlation between the level of the donor’s initial gift and the likelihood that donor will still actively support you more than a year later. If your organization has a limited marketing budget, you can use this to determine who receives additional follow up and who doesn’t. You also have a great opportunity to test whether those who receive more attention convert or upgrade at a higher level than those who do not receive this attention. If you do this, remember to take a random sampling (e.g. every fifth donor). A year later you can see if this group renewed at a higher percentage or dollar rate. If so, you can then justify putting more resources into this next year. Interesting stuff!

Channel an attitude of gratitude and I guarantee you’ll lose fewer donors next year!

— Charity Clairity (Please use a pseudonym if you prefer to be anonymous when you submit your own question, like “Losing Too Many New Donors” did.)

How do you channel gratitude to first-time donors? Please let us know in the comments below.