Growing Philanthropy In the United States, published by Blackbaud and authored by Adrian Sargeant, the Robert F. Hartsook Chair in Fundraising at the Center on Philanthropy at Indiana University, and Jen Shang is still as relevant as the day it was written. It has become the gold standard for best practices in donor retention.
I was fortunate to hear Sargeant speak right after the report was published. He covered the art and science of how to keep donors committed, satisfied, and returning year after year. Topics ran the gamut from donor lifetime value to donor retention and loyalty.
Here are my take-aways about how to keep your donors coming back, especially after their first gift.
Why Do They Leave?
Retention is a huge problem for nonprofits. The majority of donors leave after their first gift. The defection curve typically falls off precipitously...up to 50% in the first year.
Sargeant said that improving attrition rates by only 10% can improve the life time value of a donor base up to 200%.
First up are the reasons customers leave in the first place. Sargeant cited these statistics, gleaned from experience in the commercial sector:
- Death - 1% of customers.
- Relocation - 3% of customers.
- Won by competitor - 5% of customers.
- Lower price elsewhere - 9% of customers.
- Unsatisfactory complaint handling - 14% of customers.
- Lack of interest by supplier - 68% of customers.
Although these statistics might not be completely transferable to donors, they are surprisingly close. For instance, we know, according to Sargeant, that donors often cite the following reasons they no longer donate to a particular cause:
- No longer able to afford support
- No memory of ever supporting (more frequent than you might imagine!)
- Still supporting in some other way
- Thinking that the cause no longer needs their support
- Not reminded to give again
- Nonprofit did not inform donor how donations were used
- Nonprofit's communications were inappropriate
- Nonprofit asked for inappropriate sums
What is striking about the list is how many of these items are under the control of the charity itself.
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