How Can You Calculate If Your Monthly Donor Program Is Growing?
People ask me this question a lot: “My monthly donors only make up 3 percent (or fill in another percentage) of my donors. Is that good? What’s the percentage I should strive for?” The answer is: “It depends!” Let’s look at a few different scenarios:
- If you have 100,000 donors who have made a gift in the past year and 3 percent of them are sustainers, it’s not bad. That’s 3,000 donors giving you between $24 and $35 a month—or between $864,000 and $1,260,000. You should have the potential of growing.
- If you have 10,000 donors who have made a gift in the past year and 3 percent are giving monthly, that’s 300 donors and annual revenue between $86,400 and $126,000.
- If you have 1,000 donors, which 3 percent become sustainers, you’re looking at annual gifts of $8,640 and $12,600 on average.
In all three scenarios, I’d first say: “Congratulations! You’ve started and you’re well on your way to grow.” The more donors you have, the more potential you have. It does depend a bit on the types of donors though. (For example if 50,000 of your 100,000 donors come from an event, they may not be that easy to convert to give monthly. I’d certainly recommend you try, but it’s more difficult than asking donors who support your direct mail and online appeals with a gift.
Based upon the most recent statistics from the “2018 Blackbaud Luminate Online Benchmark Report,” the industry percentage of sustainer revenue from total revenue is 10.87 percent.
In other words, from all online giving from Luminate Online clients, sustainers make up almost 11 percent. So, if you compare your 3 percent to that almost 11 percent, it looks like you may be running behind.
But, do not get too hung up on that percentage. What’s much more important is your coverage ratio.
The formula: Number of Acquired + reactivated sustainers ÷ the # of lapsed sustainers.
Let’s look at this example: 50 Acquired + 10 Reactivated = 60 ÷ 50 lapsed sustainers = 1.2 . Your program is growing, but barely!
Growing your annual sustainer revenue is a combination of bringing in new sustainers and keeping the ones you have with all your might!
So before you get too focused on comparing yourself to that industry average of 10.87 percent, what does your coverage ratio look like for your sustainers? Do you have the processes in place to keep the ones you have? What are you doing to bring sustainers back? Spend some time to verify everything is working correctly. And once you know it is, you’ll be ready to really grow to the next highest level, with coverage ratios of 1.2 and higher.
And if you do, you’ll get to and beat that industry average and your annual sustainer revenue will grow higher and higher.
Erica Waasdorp is one of the leading experts on monthly giving. She is the president of A Direct Solution, a company serving nonprofit organizations with fundraising and direct marketing needs, with a focus on monthly giving and appeals. She authored "Monthly Giving: The Sleeping Giant" and "Monthly Giving Made Easy." She regularly blogs and presents on fundraising, appeals and monthly giving — in person and through webinars. She is happy to answer any questions you may have about this great way of improving retention rates for your donors.
Erica has over 30 years of experience in nonprofits and direct response. She helped the nonprofits she works with raise millions of dollars through monthly giving programs. She is also very actively supports organizations with annual fund planning and execution, ranging from copywriting, creative, lists, print and mail execution.
When she’s not working or writing, Erica can be found on the golf course (she’s a straight shooter) or quietly reading a book. And if there’s an event with a live band, she and her husband, Patrick, can be found on the dance floor. She also loves watching British drama on PBS. Erica and Patrick have two step sons and a cat, Mientje.