Donor Retention: Gone with the Wind?
“Gone with the Wind” is a 1939 American epic-historical-romance film adapted from Margaret Mitchell’s Pulitzer Prize–winning 1937 novel of the same name. It was produced by David O. Selznick of Selznick International Pictures and directed by Victor Fleming. Set in the 19th century American South with a backdrop of the American Civil War and Reconstruction era, the story is about life and culture at a specific time and place that is now “gone with the wind.” It is gone forever and part of history.
When adjusted for ticket-price inflation, this movie it is still the most successful in box office history for domestic grosses. The film is regarded as one of the greatest films of all time. Millions of people have either read the novel or seen the film.
How does this movie relate to the nonprofit sector? The fact is all of us work extremely hard to cultivate, solicit and secure donors but have trouble retaining these donors, a large percentage of them “gone with the wind” each year. What do experts have to say about donor retention?
In "One Thing Most Nonprofits Stink at (Donor Retention) and How You Can Change It in 2014," Frank Barry said nearly three of four new donors leave and never come back. He also included his fellow peers’ thoughts on how to improve donor retention:
- Marc A. Pitman, The Fundraising Coach: Create systems to deepen relationships with donors.
- Simone P. Joyaux, Joyaux Associates: Respect your donors and commit to the premise that donors matter.
- Shanon Doolittle, Doogooder: Treat your donors with kindness and caring.
- Pamela Grow, PamelaGrow.com: Thank donors well and promptly, and tell stories to them.
- John Haydon, "Facebook Marketing for Dummies" author: Make your donors feel like they are the most important people in the world.
- Nancy E. Schwartz, GettingAttention.org: Respect donors’ wants and needs.
- Harvey McKinnon, Harvey McKinnon and Associates: Be loyal to your donors.
According to Bloomerang, a major company based in Indianapolis that studies donor retention, donor retention is a measure of how many donors continue to donate to your organization. New donors are costly to attract, and it is more cost-effective to retain your donor pool each year. Bloomerang noted that to survive today, nonprofits need to focus on ways to keep both new and existing donors coming back year after year. Using the following example, the company explained how to calculate your donor-retention rate:
If 1,000 donors gave to your organization in 2011 and 400 of those made a donation in 2012, your donor-retention rate would be 40 percent and donor-attrition rate 60 percent.
In Bloomerang's overview of donor retention, Dr. Adrian Sargeant, Robert F. Hartsook Professor of Fundraising at the Lilly Family School of Philanthropy at Indiana University, commented on where things stand today, explaining that the donor-retention landscape is going from bad to worse in nonprofits. This means nonprofits have to spend a great deal of money on acquisition just to break even.
Sargeant noted that donors typically cite some of these reasons for no longer donating to a charity:
- Can’t afford donations
- No memory of donating the first time
- Still supporting the cause but in other ways
- Thinking the cause no longer needs the individual’s donation
- Never reminded to give again
- Nonprofit did not inform donor on how it used the donation
- Nonprofit’s communications were inappropriate
- Nonprofit asked for too much money
According to Big Duck, a communications firm that works exclusively with nonprofits, there are five approaches to keeping your donors engaged and retained from year to year.
- Calculate your donor-retention rate and understand the problems that exist.
- Audit your donor communications. Review your messages and make adjustments based upon feedback and results.
- Try new ways to thank donors for their support. Brainstorm ways with your staff to reach donors in new and different ways.
- Get (or re-examine) your systems for managing donor data. Use data to target various donors and to segment communications. Think of new systems to reach donors.
- Ask your donors why they give to your organization. Find out what was behind the first and 10th gift to your organization. Survey and call your donors to see what motivates their giving.
ShiftCharity.com (via a Bloomerang survey) found that 53 percent of donors leave due to the charity’s lack of communications. It said the question of retention is simple. You can retain your donors by talking to them. Talk to them about what they want to talk about and not what you want to say. Donors want to feel good, so tell them things that make them feel good. Donors want to trust the charity they are supporting. Tell them things that will build trust, like noting where and how their money was spent. Donors love to hear stories, so tell stories and liven up your communication vehicles to donors. Your donors are the heroes of the stories.
To face this donor-retention issue, I have tried a variety of methods targeting donors, including looking at best-of-class vehicles, surveys, phone calls, personal letters, handwritten notes, invitations to special events, breakfasts to meet the CEO—the list goes on. The point is: Make every attempt to retain your precious donors. Find out what works for you, and use donors and volunteers to contact other donors. I love the movie “Gone with the Wind,” but do not like gone-with-the-wind donors, and neither should you!
Duke Haddad, Ed.D., CFRE, is currently associate director of development, director of capital campaigns and director of corporate development for The Salvation Army Indiana Division in Indianapolis. He also serves as president of Duke Haddad and Associates LLC and is a freelance instructor for Nonprofit Web Advisor.
He has been a contributing author to NonProfit PRO since 2008.
He received his doctorate degree from West Virginia University with an emphasis on education administration plus a dissertation on donor characteristics. He received a master’s degree from Marshall University with an emphasis on public administration plus a thesis on annual fund analysis. He secured a bachelor’s degree (cum laude) with an emphasis on marketing/management. He has done post graduate work at the University of Louisville.
Duke has received the Fundraising Executive of the Year Award, from the Association of Fundraising Professionals Indiana Chapter. He also was given the Outstanding West Virginian Award, Kentucky Colonel Award and Sagamore of the Wabash Award from the governors of West Virginia, Kentucky and Indiana, respectively, for his many career contributions in the field of philanthropy. He has maintained a Certified Fund Raising Executive (CFRE) designation for three decades.