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5 Ways to Validate Giving Decisions and Drive Retention

 

Not so fast, 2013. We have some unfinished business with 2012. For most nonprofit organizations, we know that giving in the last month of the year is disproportionately high, especially for the online channel when a third of the year’s gifts are made. This volume brings a substantial stream of first-time donors to nonprofits en masse.

As a nonprofit, what steps will you take in 2013 to retain and grow these new relationships?

The odds are unfortunately against us. The 2011 donorCentrics™ Internet and Multichannel Giving Benchmarking Report tells us that 70 percent of new donors will never give again. However, with a retention strategy focused on these fresh-faced friends, we have an opportunity to exceed the average and capitalize on an early opportunity in the new year.

In this article, I detail five of the most effective retention strategies in use by nonprofits. While these tactics are appropriate for your new donors drawn from year-end giving, they’re equally effective (and important) for less visible everyday donors giving throughout the year. How well are you doing? Where can you do a better job in the year ahead?

1. Consider That First Gift an Acquisition Gift

First time donors are qualified leads. By giving to your organization, the donor has shown propensity and interest in supporting your organization. Now it’s up to you to invest and build the relationship.

There’s not much of an investment argument here, as the value proposition for retaining donors is so much greater than finding new ones. Ensure that a budget and plan are set aside for first-time donor conversion. Consider this the start of a conversation on the way to optimizing lifetime value of your new friend.

2. Listen to What Your New Donor is Telling You

That first gift holds great insights. What data from this gift is of most interest to you? I find first gift amount, billing city/state and solicitation campaign to be incredibly meaningful in helping to hone in on a new constituent messaging strategy.

For example, in a new email campaign targeted to all new online constituents, The ALS Association tailors its call to action distinctly for general online donors versus tribute donors by introducing tribute donors to their personal fundraising program, called Community of Hope.

The program enables anyone to create an honor/memorial fund as a tribute to a loved one with ALS (commonly known as Lou Gehrig's Disease). This initial introduction to the program is the first step in a streamlined strategy to cultivate one-time tribute donors into becoming personal fundraising champions.

Giving channel, of course, is also incredibly telling in helping to determine follow-up communication. Online acquired donors, for instance, generally have poor online retention; we know that a multichannel communication strategy will be important. In contrast, offline acquired donors are far less likely to cross the multichannel bridge and a single channel communication strategy may be appropriate.

All of these learnings—from that single first gift—are meaningful for dialogue, subsequent messaging and targeting.

3. Thank Your Donor

Now that we have a hot lead on our hands and we know a bit more about him or her, let’s put our best foot forward with a timely thank you acknowledgement of the first gift given.

According to the Nonprofit Donor Engagement Benchmark Report produced by Charity Dynamics and NTEN, 21 percent of donors say they were never thanked for a gift. Perhaps these organizations confused delivering a tax receipt with an indelible acknowledgement showcasing the impact that the contribution has made.

Goodwill Industries International’s website features a patent-pending donation impact calculator that allows donors to translate goods donations into real-world programs impact. In donating six pairs of blue jeans at my local Goodwill, I’m told that my gift is worth a 46-minute financial planning class for services recipient Candace Cameron to teach her how to clear debt and start saving. Now that’s stewardship! This offers immediate validation for a donor who has completed a giving decision.

You can’t say thank you enough. Even if you sent an acknowledgement for donations made in 2012, send a follow up to donors this month to share gratitude, let them know how the year wrapped up for your organization and advise them of your 2013 plans. It’s the equivalent of giving a gift to a friend or family member at a party and having them say thank you when they open the gift, and then receiving a follow-up note in the mail.

4. Engage Relevantly

Beyond a simple acknowledgement, continue to communicate with your constituent with the insights learned from the initial gift. Many nonprofits struggle here as constituent insight from a Development activity may not readily be available to Marketing or Communications teams responsible for stewardship messaging.

Challenge all teams within your organization to tailor message content based on donor program interest and affinity. Localization can help to communicate services available from a national organization within the donor’s community. For a health-related organization, relationship to a disease can help to highlight research breakthroughs or study opportunities.

The Crohn's & Colitis Foundation of America (CCFA), for instance, will be launching a “Welcome Series” trigger-based email campaign in early 2013. It is to designed to embrace new constituents joining the email file. CCFA will disseminate the most important facts about the organization to new constituents over several weeks.

These drip-style campaigns are highly relevant because they are tied to the recency of an action taken. Our research tells us that open rates can fall as much as 50 percent within the first three months of joining an online file. Get to your constituents while you can.

The Nonprofit Donor Engagement Benchmark Report shows that a nonprofit’s website is the top choice for donors learning about their favorite charity, followed by email and Facebook. Consider your appropriate channel mix to deliver highly relevant engagement. What role would direct mail or follow up volunteer phone calls play?

5. Convert to the Next Stage of Giving

Relevant engagement establishes a conversation and dialogue with new donors. Now we’re ready to use what we know to convert these constituents with that second, follow-up gift by driving action and response for the best program suited to this donor’s needs or affinity.

This “next stage of giving” could be a renewal gift, or an upgrade or graduation to a monthly or mid-level giving program, with the job made easier by each of the communication and stewardship steps taken since the first gift was given.

While you may be in the midst of executing your 2013 fundraising strategy, now is the perfect time to evaluate your retention strategy with new 2012 year-end donors. Identity your first-time donors today and commit to holding on to them through next year.

Matthew Mielcarek is Vice President of Consulting at Charity Dynamics.

Thumbnail image created by Charity Dynamics and NTEN Nonprofit Technology Network.

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Matthew Mielcarek

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Matthew Mielcarek is a contributor to Software Advice.

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