3 Things You Can Do Now in Response to Current Fundraising Trends

By Chip Grizzard

But how do we do that? The first step is to recognize how important an issue this is. According to the 2014 Nonprofit Communications Trends report, only 16 percent of nonprofit communications directors named donor retention as a top communication goal for 2014.

OK — so now that you've made it a priority, what's next?

First, acquire better quality donors who will make second gifts. The secret here is in new metrics, list selection and gift-array strategies. Acquisition is no longer about a transaction, but about starting a new relationship. That means our metrics need to change from response rate and cost to second-gift conversion percent and lifetime value.

Recently, we reviewed a case study in which a client was proud that it saved $50,000 in lower costs for one year's acquisition campaign. But in reality, it cost the organization $500,000 over five years because the quality of donors it acquired had a lower second-gift conversion and lower average gift.

Second, make stewardship a priority. I'm not talking about a thank-you letter, though that is a good start — and amazingly 25 percent of organizations don't do this basic step. Your donor felt good when she donated; this is the time to affirm, report and inspire.

Use pictures, send links to videos, place phone calls and make a pledge to get rid of that boring letter that you use month after month. And while there is much debate on whether your acknowledgment should include an ask, always include a reply envelope. Acknowledgments can be a very large source of revenue even if you never ask for a gift.

As leading fundraising academic Adrian Sargeant's research shows, an increase in retention of 10 basis points can improve a donor's lifetime value by as much as 200 percent. That is real money!