Donor loyalty is in the doldrums. How can we stop it?
Make a plan to keep your donors loyal.
For donor loyalty, what do you need to do? Where do you start? According to Loyalty 3.0 by Rajat Paharia, there are 4 phases as you start to increase your loyalty.
- Plan. First, know where you are. Then identify where you want to be, and how long it’s going to take to get there. More on planning below.
2. Design. What are the components of your donor loyalty program? Email? Thank you notes? Phone calls? Little presents? Are you consciously moving people up a ladder of engagement with your nonprofit? What are the rungs on this ladder? And how will you keep track of these moving pieces?
3. Build. Now that you’ve designed your program, build it. Make that donor retention calendar. Make the communications more donor-centric. Appreciate them. Build appreciation into your week. Have a thank-a-thon. If you’re a national or international nonprofit, have a conference call where they can ask questions of senior leadership. Survey your donors. Find out where they’re falling through the cracks. Get out of the office every week and have coffee with as many donors as you can.
4. Optimize. Now that you’ve got your ladder, how do you track when people fall off? How can you replicate the steps that take people to the top? Can you document each step that they take to get there? Can you automate those steps as much as possible?
So where do you go from here?
Let’s start with planning. Planning consists of:
Identify the problem: in this case-donors are not renewing their support. How many donors, exactly? Don’t be satisfied with percentages. How many donors did you lose in 2012? In 2013? How can you improve those numbers?
Identify your audience: Which donors? Which level will you focus on? When did they last give? And what prompted them to give? Your event? An email ask? A friend? Something else?
Identify the desired audience behaviors: Have them keep donating to you, but also coming to your open house, opening your enewsletter, and telling their friends about you.
Establish your key performance indicators: Not JUST donations but email opens, clickthroughs, numbers of people coming to your events, other?
Create a mission statement: We love our donors and we show it by telling them how we use their donation, calling, emailing, inviting them to our events, and appreciating them in our communications.
Understand the playing field: Donors are not giving because it’s not urgent enough to give to your cause, or you didn’t thank them enough, or they are being asked by other nonprofits more than you. Or all three! So how can you improve these issues? Don’t think you can go from 5% donor retention to 100% donor retention overnight. You need to know how much to expect. More on this below.
Calculate the return on investment. Adrian Sargeant says “a 10% increase in donor retention can increase the lifetime value of your donor database by 200%.”
Sell it to internal stakeholders. Keeping your donors will take way more effort on your part. You’ll have to invest your time in a concerted way. You have to buy or design better thank you notes. Design better, donor centered annual reports. Maybe an email auto-responder series. A database that allows you to track donor touches better. Little presents do cost money. All of this adds up. You’ve got to get the board and your boss on board with your donor retention plan. But if you share Adrian Sargeant’s statistic above…
Understand the donor retention playing field.
For those nonprofit leaders without a fundraising background, why should you invest the time in understanding the playing field?
Because according to Rajat Paharia, builders think better.
What does this mean?
If you’ve never implemented a fundraising campaign, appeal letter or grant proposal, you are going to have unrealistic expectations of your fundraising team. And if you hire someone with no fundraising experience, they will promise things they have no idea how to deliver.
When you don’t have fundraising experience, you don’t know what you don’t know. You design something that isn’t feasible or even possible.
If you gave someone who had experience fundraising the same task, her experience and knowledge of the possible would inform her design of the fundraising program, and you’d end up with something realistic.
She’s not going to tell you that you can retain 50% of donors. She might say, “Let’s reach for 7-10% retention in the next two years.”
Experienced builders are creative within the boundaries of the possible, and they know the boundaries that come with first hand experience.
So for gods sake don’t treat your fundraiser like a wet blanket!
If they say it can’t be done, don’t contradict them! Ask them what is reasonable to expect in a given timeframe.
Research has shown that constraints actually increase creativity rather than decrease it. This means your experienced fundraiser knows the constraints and they will be more creative than someone who has no idea what they’re doing.
What I’ve told you here is enough to start taking action. I’d love to hear what your current donor retention plan consists of.
But if you’re hungry for more, then check out my Keeping Your Donors Course.
If you’d like to learn even more about keeping your donors, get a $20 discount on my course until Friday, March 21st, Secrets of Keeping Your Donors e-course starts March 28th!