There are many ways to measure the performance of a donor program. Gross and net revenue, the number of active donors and their corresponding lifetime values all are critical. But the rise of donor attrition is one insidious statistic that, if ignored, will rob a new donor program of needed growth and put a mature program on a plateau.
Newsletters, especially of the online variety, allow fundraisers to build and maintain relationships with stakeholders long before they even think about anteing up the greenbacks. Donors and prospects alike can now get engaged more often, and with more personal relevance — making it easier and more cost effective for nonprofits to forge links with individuals primed for giving.
If Sir Isaac Newton had been a fundraiser, his first law might have read: “A donor at rest tends to stay at rest, and a donor who contributes regularly tends to keep contributing.”
But most nonprofit organizations defy Newton’s Law. Today, most contributors sporadically give small amounts and respond infrequently. They force charities into expensive searches for new low-dollar donors to compensate for the unpredictable contribution stream.
Many organizations that have poorly performing files are not adequately investing in new lists, resulting in meager prospect-response rates and low new-donor retention rates, writes Margaret Guellich, CFRE, senior director of development for the American Life League, in her new booklet, “Reviving Your Donor File: Prescription for a Healthy Direct Marketing Plan.” The booklet recently was released as the fourth in the Association of Fundraising Professionals’ Ready Reference Series.
Randomness: “Having no specific pattern, purpose or objective.” Could there be another word that strikes greater dread in the hearts of nonprofit fundraisers? Sure, it’s nice to get that unexpected, random gift. But how — HOW, you fret — do you get that person to give again... and again... and... ?
Fundraisers who think that donors to a capital campaign wouldn’t be interested in supporting their organization otherwise often are missing out on a valuable funding source. Development personnel are finding that, like the old adage says, all ships do, indeed, rise with the tide.
There’s a reason many charities are reluctant to engage in techniques to upgrade their donors — or fail to do so altogether. Call it the “fear factor.”
They’re afraid donors will get irritated and stop sending gifts. They’re afraid a donor will give the upgrade letter to a board member and complain about the “pressure.”
Be not afraid. I bring you tidings of great joy. Fact: It has never been proven by any reliable statistical measurement that reasonable upgrading techniques will result in a substantial attrition of the donor file.
Donor and member attrition is an eternal challenge in fundraising. But in the past three years, the problem has magnified to the point that it’s causing hardships for some of even the largest nonprofit organizations.