The Greatest Idea for Retaining and Upgrading Donors

Every charity wants more money from donors. If only existing donors would write larger checks, become monthly supporters, make a major gift, and/or commit to a planned gift, there would be less pressure on the fundraising staff and the organization would be able to do more to fulfill its mission.

But, how can you raise more from your donors if they do not stick around?

Nationally, the median nonprofit organization finds that its donor retention rate is just 43 percent! Among first-time donors, the retention rate is an obscenely low 23 percent! (The stats come from the AFP Fundraising Effectiveness Project.)

Donor Retention 20013-14The good news is that if you can increase your nonprofit organization’s donor retention rate by just ten percentage points, you could see an increase of up to 200 percent in donor lifetime value, according to researcher Dr. Adrian Sargeant. In other words, if you retain more donors, they will increase their giving and some will even encourage others to support your organization as well.

Unfortunately, increasing your donor retention rate won’t happen all by itself. You need to make it happen. So, what is the simplest, most effective tactic for accomplishing this?

Telephone by laerpel via FlickrDo you see that shiny box on your desk? It’s probably black with some flashing lights, and it’s plugged into the wall. It’s a telephone. Pick it up and call your donors to thank them for their support. While you’re at it, find out why they support your organization.

Yes, it really is that simple. CALL YOUR DONORS!

Multiple research studies have proven that thank-you calls are a powerful donor retention tactic. For example, Penelope Burk, in her book Donor Centered Fundraising, reports:

•  95 percent of study donors stated they would appreciate a thank-you call within a day or two of the organization receiving their donation.

•  85 percent said such a thank-you call would influence them to give again.

•  84 percent said they would definitely or probably give a larger gift.

Burk went on to report, when donors were tracked after 14 months, the group that received a thank-you call gave 42 percent more on average compared to similar donors who did not receive a thank-you call. During the renewal cycle, those who received a thank-you call were 39 percent more likely to renew their support.

Here are some tips to make your thank-you calls effective:

•  Have the highest-ranking person(s) possible make the calls. If you can get your board members to call donors, particularly upper-level donors, so much the better.

•  Look at how many of your donors you have the staff and volunteer leadership resources to call. Then, look at how many new and renewing donors your organization secures each month. Working from the largest donors to the smallest, determine which donors you will call or arrange to have called based on the amount of resources that can be devoted to the effort. Ideally, you will at least call all donors of $250 or more. If budget resources permit, include all other donors in a periodic thank-you phone program staffed by volunteers or paid callers.

•  Call donors within three days of receiving a donation. After two attempts on different days at different times, you can leave a voice-mail message thanking the donor.

•  When contacting a donor, let her know you received her gift, thank her for her donation and for caring, briefly let her know how her contribution will be used, find out what part of your organization’s mission or which program(s) inspires her to support your organization, and gather additional information such as email address. Have talking points, not a script. Keep it brief. Listen more than you speak.

•  Record all relevant information so it can be used later. For example, if you work for an animal welfare agency, a donor might tell you he supports your organization because it rescues pit bulls. In that case, do not send this donor a report or appeal based on your cat-spaying program. Instead, future communications should focus on pit bulls, while you might briefly reference your agency’s other efforts.

•  Provide your donor with a name and phone number she can contact with any questions or comments in the future.

Not all fundraising ideas are simple. Fortunately, enhancing your donor retention rate and raising significantly more money is easy. All you have to do is pick up the telephone and call your donors. If you do that, you’ll stand out, in a good way, from virtually all the other organizations your donors are supporting.

Calling donors helps to engage them. Engaging donors builds relationships. Building relationships with donors leads to higher retention rates and greater likelihood of upgraded giving.

Okay, now that you’ve read my post, go call a donor.

Seriously. I encourage you, implore you, plead with you, beg you, beseech you to call your donors. Make that human-to-human contact. If you already call some donors to thank them, call more. If you’re already calling all of your donors, congratulations! Let me know how you’re doing it and the impact you’re having.

So, are you willing to commit to calling more of your donors to thank them? If so, please let me know in the comments section below. If you don’t, you’re just going to make me sad.

That’s what Michael Rosen says… What do you say?

41 Responses to “The Greatest Idea for Retaining and Upgrading Donors”

  1. As always, I like what you have to say and how you say it. Retention is really hard – but some of these ideas might just work. Thanks so much for sharing. Hope you are still on the way to full recovery!

    • Lyn, thank you for your kind comment. I particularly appreciate your concern about my health situation. I can happily report that my recent blood test came back in the normal range and that my CT Scan was clear. This all means that I remain in remission. Each week, I gain more strength. A couple of weeks ago, I even traveled to New York to work with a client. Progress! I’m still far from normal, but I’m gradually getting there. This year is off to an infinitely better start than last year!

  2. Michael,

    Once again, you show how much we think alike. Donor stewardship and retention are the most effective ways to increase giving, yet so many in our sector spend more time and money seeking new donors than keeping those they already have. You provide some sage and practical advice for your readers. Bravo.

    • Richard, thank you for sharing your thoughts. I have a question: If donor attrition is such a massive problem (and it has been for decades), and if some of the solutions are so simple, why does the nonprofit sector continue to do such a lousy job of properly caring for donors? I just don’t get it.

  3. Thanks for this, Michael. Something so simple, that can have such huge impact. I know we agree about focusing on donors to keep them around!

    • Mary, thank you for your kind comment! Just between you and me :-), I have to confess that my first draft contained a few expletives that I had to go back and edit out. The donor retention problem is serious. The solution, at least in part, is so simple. It makes me a bit crazy that more organizations do not take care of the easy things that will keep donors happy, especially after working so hard to get the gift in the first place. I appreciate you for being someone who always encourages nonprofit folks to be donor-centric.

  4. I agree with this article. Thanks for sharing. Gratitude and a simple thank you have meaning for donors. Also, asking for their thoughts and opinions on initiatives and projects.

  5. Michael,

    Your article is quite timely, I was in conversation with folks yesterday about the need to interact personally after we listened to an AFP Web/Audio-Conference, what better way than to reach out to donors personally through a phone call as your articulate article suggests. It seems that some folks can’t get their hands around how powerful that phone call can be to the donor. Many times when I have called folks they are amazed that I reached out to them.The personal touch is powerful! I have also made it a point to call on donors who have made a planned gift at various times during the year to say hello and thank them,long after they have made a commitment to the organization.

    Enjoyed your piece and will pass it on to the folks I met with yesterday. I am very happy that your are progressing well! Look forward to reading your next book.

    • Gary, thank you for your thoughtful comment. I’m glad to know, though not surprised, that my post resonated with you. I’m honored to know you’ll be sharing my article with others.

      We receive and provide good news, bad news, and personal information over the phone. It is a truly personal medium. When we use the phone to thank donors, we’re communicating through an intensely personal medium. That’s partly why thank-you calls are so powerful.

      I’m also glad you’re looking forward to my next book. I’ve begun to work on it. And I already have an idea for the third. In addition to the fundraising books, I have two ideas for books related to my successful battle with cancer. I’m not sure when I’ll be doing all of this writing, but it will be fun.

  6. Michael – For that day after Cyber Monday we did a Thankathon….the donors were very receptive and even surprised that all we were doing was to call and say thank you. On the Martin Luther King, Jr,, Day of Service we utilized Stockton student volunteers to make several hundred phone calls, address 90+ bequest related post cards, and 150+ handwritten thank you notes. The phone ironically is the way to get through all the clutter and chatter. Plus everyone has caller ID so if they are answering the phone when you call that is a great thing…

    • Patrick, thank you for sharing your own story. I applaud your efforts to reach-out to donors in a personal way, including via the phone. The fact that donors were surprised to hear from your organization with just a thank-you message rather than an appeal underscores why thank-you calls are so powerful: They’re unexpected. One reason thank-you calls are unexpected is that so few organizations place such calls. That means the organizations that do make the effort will really stand-out in a positive way.

  7. Actually Burk never tested her theory beyond the thank you call test. Was it the thank you call or was it the fact it was something different? The reality is that relationships need creativity to keep from going stale. Thank yous are a minimum expectation. Organizations would be well served to experiment with many different tactics that surprise their donor. From experience and data I can tell you that surprising donors with experiences beyond their minimum expectations is what is key to creating retention. I would use real caution listening to data regarding retention from folks with no track record of achieving it. Our sector needs real competence on this issue because of how expensive our traditional model has become. You’ve referenced the acquisition retention numbers, that roi has to be addressed.

    • Jay, thank you for sharing your thoughts. Burk’s research shows that a thank-you call has a significant, positive impact on donor retention and average gift amount. Yet, you criticize her for not going further with her research. Look, we have to start somewhere. No one is suggesting that organizations should only make thank-you calls to retain and upgrade donors. Burk and I are only saying that thank-you calls are a powerful tool that should be used and, unfortunately, seldom is. Properly thanking donors (see my previous posts about thank-you letters and handwritten notes), is low-hanging fruit. It’s easy and inexpensive to thank donors in a meaningful way. Yes, there are many other things that nonprofits can do to build the relationship with donors; I’ve addressed some of these things in previous posts. And yes, ROI for acquisition is important to track (particularly over a multi-year period); I’ve also addressed that in previous posts.

      If your point is that organizations need to properly thank donors and pleasantly surprise them in meaningful ways in order to build strong relationships, you’ll find we are in full agreement. I would also add, as I have in previous posts, that organizations must look for creative ways to engage and involve donors. It’s all about building strong relationships.

  8. Michael,

    I am neither criticizing or praising. I’m stating a fact, that’s all. Burk proved that when a nonprofit does something different their renewals increase. The exercise was a thank you call. I increased donor retention 285% with no thank you calls, but personal thank yous and then a bunch of engagement strategies. I appreciate starting someplace. If I am in St Louis and want to get to San Francisco I guess I have started even if I’m heading towards Boston. However that will significantly extend my time to reach my desired goal. This epidemic needs more than incremental motion. I raise the issue from deep experience, and a passion to see our sector excel not take baby steps. It is too important for our work

    • Jay, that’s fine. You don’t need to praise Burk; I will. Your metaphor is off-base. A more accurate flying metaphor would be having your start in Philadelphia with a flight to St. Louis in order to connect to fly on to San Francisco. To suggest that thank-you calls are in anyway a move in the wrong direction is misguided and flies in the face of the evidence. Again, yes, there are other things that organizations should be doing. I invite you, and others, to share specific, evidence-based suggestions.

  9. I completely agree with you! I am new to the profession and to my organization and I have started calling new donors every month. Not only is it an easy thing to do, but it is so rewarding to hear their surprise that I have called and their interest in sharing their connection to our organization. I’m excited to see how these calls will make a difference in our donors.

    • Joanne, thank you for commenting and sharing your insight.

      Welcome to the nonprofit sector!

      I’m pleased to hear that your donors are happily surprised to hear from you. Not only are your calls having a positive impact that will likely lead to a stronger donor-retention rate, you also have an opportunity to learn why the person is supporting your organization so that you can more effectively target future stewardship and appeal communications accordingly. Brava!

  10. I read your brilliant piece on Giving Tuesday and your math was impeccable. I assumed you had little time for analysis that was incomplete. Suggesting how people might behave requires a longitudinal study in order to be evidence based. It’s physics really, pointed out by Nobel Prize winner Heisenberg, specifically his uncertainty principle. The study you reference in this piece is not longitudinal, and per Heisenberg can not be evidence based. If you are at AFP stop by our booth, I will share significant evidenced based strategies that have increased retention. Would be great to meet in person.

    • Jay, while you have advanced the Heisenberg definition of “evidence based” research, I must point out for my readers that many other professional definitions exist. I use the term to differentiate research-based practice from practice based solely on one’s own experiences, known as experiential practice. Research can be qualitative or quantitative. It can be a short-term study or long-term, longitudinal. However, while often quite useful, research does not have to be longitudinal in order to provide valuable evidence-based insights.

      I look forward to seeing you in Baltimore for the AFP International Fundraising Conference.

  11. Michael, I have been calling donors for years. I have a list of “standard questions”. I also create more personal questions. Two questions that stand out. 1) If a donor asked for a report in the recent past, I will ask if he received it and if he has any questions. 2) If the recent gift is a big increase, I will ask what led to such a nice gift.

    • Bill, thank you for sharing your insights. I suspect that your donors appreciate hearing from you and having the chance to share their thoughts. How do you decide which donors to call? Do you look at gift size, frequency, some combination, or other criteria? As you have already discovered, it’s through the personal touch that we can build a relationship. I applaud your efforts.


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