Keeping Your New Donors!

Hooray!  Your conversion strategies worked swimmingly and you’ve received a glorious gift from someone who has never given!

No matter the giving level, you can do many things to thank and ultimately, retain this donor:

• Yes, send the standard thank you letter.  Of course you would do this.  Personalize the text of the letter and hand-write a brief note.
• A couple days later, send a hand-written thank you note, that’s personalized and customized
•  Call to thank
• Email a thank you – especially Gen Y or donors without phone numbers, but with emails
• Text a donor, if you have the phone number and a ‘texting relationship’ with the person (or again, Gen Y)
• Send a welcome/thank you email or letter => share how can your donors learn more, or understand your full scope of work, or become more engaged/volunteer
• Invite to a free program/event
• Have a Board Member write a note/make a call of thanks
• Invite to a program milestone
• Invite for a tour
• Invite to volunteer
• Send a thank you card from your recipient/client
• Send photos of people you’ve impacted (or include photos in the welcome thank you email or letter)
• Email or mail a survey; maybe you’re a multi-issue organization and want to find out your donor’s priorities?
• If the gift is above a certain level, invite to an event for free or a lunch with your ED/Chair.

Spread these out a bit – don’t bombard your donor within 12 hours of their contribution. 

But don’t deliberately protract your thank yous over several months.  You can certainly follow up in a few months to invite the donor to a program milestone and include a thanks, but don’t send a welcome email four months later. 

Your touch points several months later are part of recognizing and cultivating, not explicitly thanking.

And, customize your response to the donor’s giving; we immediately reply to online gifts with impactful and personalized thank you emails. 

Yes, we follow up these emails with “standard” thank you letters and hand-written notes, but you were pinged with the donor's contribution, so take a hot second to share your appreciation. 

What Should Be Your Sustainer Program’s Structure?

At Arrowhead Management, we are definitely cheap. 

So, when we talk about incentives for Monthly Sustainers, we’re not talking pricey corporate swag.  Not that winter scarf that even this nonprofit MBA student sported, complete with a Merrill Lynch logo (yes, yes, it was 2006).

Your Sustainers are a valuable group of donors.  They are providing you predictable revenue.  You don’t have to spend variable costs to solicit them.    

Your Sustainers should receive some special attention and perks from you.

Perks can include:

• Opting out from solicitations (except for event invitations)
• Invitation to a special (free) briefing by your CEO/Board Chair
• Receiving a special report – maybe it’s the mid-year update report you send only to major donors 
• Exclusive invitations to your program events/milestones (e.g. graduations)
• Free upgrade to attend VIP Reception at your Gala, if they buy event tickets
• Annual report, if they wouldn’t ordinarily receive it
• Recognize your Sustainers in your annual report/website/email communication
• If you do donor profiles, make sure to highlight one Sustainer
• Thank you calls from board members once a year – particularly if their giving is maybe below the level board members usually call to thank donors

You can highlight some or all these benefits when you’re soliciting new Sustainers.  You might consider reminding current Sustainers if you haven’t told them this or you’re instituting new ideas. 

Don’t spend a lot of money, but incent them to give and to strengthen their connection/knowledge about your work.

Monthly Sustainers

There’s a lot of buzz about donors who give you $15/month on their credit card or EFT.  

Who should be in your sustainer club?

The vast majority of sustainers are annual fund donors.  Remember these 

terrific donors?  They are the 80% of your donors who contribute 20% of your 

revenue. 

These donors are wonderful!  They are the group you source for major gifts.  They’re also a great resource for monthly sustainers.

Yes, of course every organization has a story about a donor who wants to give $1,000/monthly.  But, by and large, your monthly sustainers are annual fund donors.

Even if you’re small, 80% of your donors is still a big number.  Probably not a group you can just “look at” on excel and decide who should be asked.

Let’s say your major gift cut off is $1,000/annually, so your annual fund donors give $0-$999.

We’ve identified a few key segments of annual fund donors likely to become sustainers:

• Lapsed donors who’ve given at least $1,000 in a single year (go back 5 years);
  
• Any event donors who don’t make other gifts;
• Current donors who have given multiple gifts (excluding events) in at least one year in the last 5 years - no matter the individual or total/annual gift size;
• Prospects active on email opens/clicks/social media;
• Seniors on a fixed income - customize the ask to be low amounts;
• Any annual fund donors who've downgraded giving levels over the last couple years;
• Donors who were major donors in the past, but whose levels have dropped (especially if they gave throughout the lean years of 2009-2011)

Depending on your database size and length of existence, you can adjust the time or giving levels on these criteria to get larger or smaller batches of donors. 

Consider soliciting 5-10% of your annual fund donors.  Test, test your messages with sub-groups and then scale up to the full 5%-10% of annual fund donors.

Pyramid of Giving

Ah, the one key principle that all development professionals learned either at their first AFP meeting or within their first week on the job.

The Pyramid of Giving…the idea that a small number of donors contribute the vast majority of your revenues. And, that a large group of donors contribute the rest.

The industry standard is that 20% of your donors give 80% of revenues and 80% of your donors give 20% of your revenue. Your top 20% are Major Donors and your bottom 80% are Annual Fund Donors:

In this sample, 72 donors give $251,903 and 288 donors give $62,976 of the organization’s total revenues.

This pyramid has been skewed somewhat in recent years – as average gifts among all donor levels have shrunk, thanks to the Great Recession – but the principle remains.

This somewhat lumpy proportion is how most healthy companies and nonprofits operate. A few large clients/donors provide the bulk of revenue, yet are balanced with smaller clients who provide valuable and necessary revenue.

It’s important to focus on both giving buckets equally, but differently. At Arrowhead Management, we spend a lot of time working with small and emerging nonprofits to help them maximize their time and resources with annual fund donors, because sometimes, it’s easy to dismiss this group.

In our next blog, we’ll discuss why Annual Fund donors are so important.