Why Automatic Monthly Gift Upgrades Are a Bad Idea
A few weeks ago, The New York Times published an article on automatic upgrades of monthly gifts and the number of upset supporters when that happened.
This is scary stuff and could have a very negative impact on other nonprofits looking to grow their monthly donor programs. I’m going to leave politics out and look at that practice as a whole.
Here is my take: Automatic upgrading is a bad idea, period!
There are several reasons:
- It makes for a very bad donor experience.
- It leads to donor complaints and refunds. Why would you ever want to do that?
- You’ll lose more monthly donors.
- It could severely jeopardize all nonprofits.
- It shows a short-term vision and not the long view.
- Your monthly donors are precious, and they deserve better.
- You ultimately will raise less money than if you asked for an upgrade!
You see, I’ve never been a fan of monthly upgrades, and I don’t think you, as an organization, can afford to be a fan either for the exact reasons above.
I’m also not a fan of pre-populating monthly gifts on one-time giving pages. I know it’s what some consultants promote, but I advise against it because it’s all about donor intent and commitment.
If you ask for a monthly gift, you’ll want the donor to be very conscious, alert and intent about making that commitment. You want them to actively choose the amount and frequency, and complete the payment information before they hit submit.
Otherwise, your monthly donor retention rates will drop considerably, no matter what type of cultivation and stewardship practices you implement later to recognize them and keep them giving monthly.
The same applies for monthly donor upgrades. You want the monthly donor to be very aware of what they’re doing. You want them to choose a new monthly amount, complete their payment information and hit submit. You’ll want to immediately confirm that they’ve made a change to their monthly gift.
Ask your donors to help more, and they will! If you do it right, you could expect some 12% of monthly donors to upgrade, and you may even see a higher percentage — not to mention the advantage of getting updated payment information.
Please do not assume your monthly donors want their gift to be automatically increased, no matter what amount. Remember, they are not subscribers!
You might argue, “Yes, but 100% upgrades automatically are so much more than 12%.” Maybe, but do you have a full-time person dealing with complaints, refunds, bad press and who knows what else?
Do you really want to be perceived as a nonprofit treating your donors like ATMs, with the ultimate greedy approach?
Do you really want to be the nonprofit that starts a GDPR-type approach for monthly giving, gets blacklisted by banks and payment processors and gives all fundraisers a bad name?
The New York Times article is yet another alert why we, as nonprofits and fundraisers, need to be very careful. If someone recommends you try automatic upgrades, I recommend running as fast as you can away from that person.
Yes, you need to raise more money, and monthly giving is a great way to bring in more loyal, committed supporters who are going to stay with your organization for a long time. As you know, I’m all for testing new things and approaches, and I applaud you for doing that. But let’s be careful not to let the pendulum swing too far the other way. Ultimately, you’re dealing with people who are supporting you out of the goodness of their hearts.
You’ve worked so hard to bring in your monthly donors. You want to keep them, don’t you? I hope you’re with me in wanting to do the right thing for your nonprofit and for the good of all other nonprofits.
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.