…getting the second gift from a first-time donor!

Don’t believe me? Check out the latest data on donor retention from the Fundraising Effectiveness Project.

According to their latest survey, only 19% of first-time donors are retained. However, if you can get a second gift from them, their retention rates more than triple to 63%.

2015-first-vs-repeat-trans

Last year’s survey (which covered calendar year 2013) found that first-time donor retention was only 23%, which means this problem is getting worse.

The simple strategy of concentrating on getting the second gift is often ignored, treated too lightly or dismissed as not being as important as acquiring new donors by most charities.

Why?

One of the most commons reasons a specific strategy has not been developed for most organizations is erroneously thinking repeat donors will happen on their own without extra effort.

Hint: this is not the case!

Secondly, the majority of charities are not even aware of their donor retention rate, so to them, no problem even exists.

Third, many charities do not have anyone on staff trained to know how to develop and execute a strategy to properly nurture first time donors.

How can the situation be radically improved?

I think it’s important to first understand why donors stop giving.

According to a study by the IU School of Philanthropy, here are a few reasons lapsed donors gave for not renewing their gifts:

  • Thought the charity did not need them (5% of respondents)
  • No information on how monies were used (8% respondents)
  • No memory of supporting (9% respondents)
  • Never thanked for donating (13% respondents)
  • Poor service or communication (18% respondents)

More than 50% of these lapsed donors were the victims of poor donor communications.

Simply put, a first-time donor communications strategy must be created and executed over time!

What should this strategy consist of? Look no further than a study by Donor Voice. They asked a group of nonprofit’s to ask their loyal donors to rank, by order of importance, a list of 32 reasons why they keep giving to the organization. Here are the top seven:

  1. Donor perceives your organization to be effective in trying to achieve its mission.
  2. Donor knows what to expect from your organization with each interaction.
  3. Donor receives timely a thank you.
  4. Donor receives opportunities to make his or her views known.
  5. Donor is given the feeling that he or she is part of an important cause.
  6. Donor feels his or her involvement is appreciated.
  7. Donor receives information showing who is being helped.

If you can achieve these seven items, your chances of getting that second gift will rise exponentially!

One Final Hint

Separate your first-time donors into multiple groups based upon gift amount, prior engagement with your organization, (like volunteering), existing relationships with other donors and gift source. Sit down with your team or with a mentor or a communication consultant to create a communication strategy with multiple steps for each group.

As you execute the above strategies, monitor the results for each group as well as your overall retention.  Your strategies will need to be fine tuned over time to include new communication avenues like social media and texting.

Over the first few years, your fine-tuning and continued execution should move the percentage of first time donors becoming repeat donors up significantly. The effect on your overall fundraising results should be spectacular!

How does your nonprofit steward first-time donors? Let me know in the comments below!

Guide to Loving Lapsed Donors

Jay Love

Jay Love

Co-Founder & Chief Relationship Officer at Bloomerang
A 30+ veteran of the nonprofit software industry, Jay Love co-founded Bloomerang in 2012. He currently serves on the board of the Center on Philanthropy at Indiana University and is the past AFP Ethics Committee Chairman.
Jay Love