It’s September. That means three things: fall, school, and football. Oh, and one more: planning for the most important fundraising activity of the year – your year-end appeal.
Are you ready? Have you completed your Donor Retention Data Checklist?
That’s right. Your Donor Retention Data Checklist. Don’t have one? Well now you do!
Donor retention is a problem
Donor retention rates have fallen to 40% per a 2013 AFP / Urban Institute Fundraising Effectiveness Survey Report. Just 7 years ago, retention rates were closer to 50%. What’s going on?
The problem is bigger than donor retention. Brand loyalty – to use the consumer marketing term – is suffering across all industries. Technology, social media and the changing buying habits of a new generation have put business-to-consumer relationships under assault.
Choices are more prevalent than ever. Attention spans are shorter than ever. Loyalty suffers. Last year Forbes asked “Is Brand Loyalty Dying a Slow and Painful Death?” Not much has been changing for the better.
In fact, if my hunch is correct, donor retention is only going to become more problematic. Why? The Chronicle of Philanthropy headlines the problem this week in its lead fundraising article, “Is Raising Visibility a Waste of Time?” Converting large numbers of one-time donors attracted to a charity due to unusual, if not unique, fundraising techniques will further dampen retention numbers.
Donor retention is more important than ever
Despite the negative industry-wide trends, donor retention is more important than ever. You can’t save the nonprofit industry, but you can save your organization. Retention rates matter.
Did you know that improving donor retention by just 10% can double the lifetime value of the donors in your database? Skeptical? Bloomerang does the math.
Your 7-step donor retention DATA checklist
I put that all important word “DATA” in caps because data is the key to retention. Here’s your checklist. Act on as many of these as you can.
1. Know your numbers. Let’s start with the obvious. Calculate your current donor retention rate. Then determine the impact and value to your organization by improving your retention rate by 3%, 5%, or even 10%. Work the numbers into your fundraising plan. Be sure to measure your results at the end of your annual appeal. Need help with your donor retention math? DonorTrends offers this simple snapshot. By the way, your numbers won’t be accurate if your data isn’t clean.
2. Strategy and data alignment. Make sure your fundraising strategy prioritizes donor retention. Are there specific action items to retain donors? Are those actions supported by your outreach efforts and technologies? And do you have the right donor data to support those outreach efforts and populate that technology?
3. Data hygiene. When was the last time your data was cleaned, normalized, de-duped, appended? If any of those terms sound foreign, then that answers your question. Remember, data is like a 5-year old boy – nobody will keep it clean except its parents. Clean it now, and develop a plan to keep it clean.
4. Review your data inputs. Donor data enters your organization in many ways. Through your website. In the mail. At events. Via forms. Over the phone. How many different people process that data? And are they all properly trained? Check all of your data inputs. Are they capturing the data you need in order to execute your fundraising plan? If not, modify them – immediately.
5. Lapsed donor outreach. Many organizations measure donor retention not just year-to-year but also every two years. This helps to put an emphasis on lapsed or “skip” givers. Donors who have not given in a year are not lost, but your messaging is losing them. Segment and target these donors with a different, new message. And the more you can learn about your lapsed donors in advance, the better. There are many ways to append your data, from your website forms to polls and surveys to data brokers.
6. Know how to communicate with your donors. You know how you want to reach your donors. But do you know how they want to be reached? This is a very specific, but very important data question. Are you tracking whether your donors want to be solicited once a year or multiple times? Do they want direct mail, email, a phone call, or a combination? Do they want more options or ways to give? These are the meta-data questions of giving. Track them in your database.
7. Track thank you’s. It sounds like the obvious, doesn’t it? You would be surprised how many nonprofits do not track thank you data. If you ask, they will tell you that they always send out thank you letters or note, but they don’t track it in their donor database. Track it. And hold someone accountable for it.
Donor retention is a problem. Nonprofit CRM solutions like Bloomerang recognize the problem and are built to prioritize donor retention. That’s great.
But donor retention is also a data problem.
Improving your nonprofit’s donor retention rate can be worth tens or hundreds of thousands of dollars a year. Tackle the data and you will improve your fundraising results. I hope our 7-step Donor Retention Checklist helps.