You don’t have to be Nostradamus to predict that 2016 is going to be a tough year for fundraising. In particular, as the impacts of greater regulation and a hostile press are gradually absorbed, it is almost certainly going to become even harder to recruit new supporters for the great majority of non profits.
So we are inevitably going to see a greater focus by charities on retaining the donors they have. This is a good thing. One of the minor mysteries of the third sector is the vast disparity between the resources and attention devoted to acquiring new supporters compared to those focused on developing existing relationships. As a consequence we see an enormous issue of donor churn.
According to the US Association of Fundraising Professionals*, only 26% of donors making a single gift to a charity give again (figures for the UK aren’t available but will be similar). Retention for so called “committed” givers is better but not by all that much. The best figures we have for the retention of face to face donors** indicates that less than 40% of people signing up to direct debits are still giving after 12 months.
Charities in the UK are therefore spending tens, probably hundreds of mullions of pounds to acquire “donors” who don’t give again. Even small improvements in donor retention rates have a huge impact, it has been calculated*** that a 10% improvement in year on year retention doubles donor lifetime values.
So why are the retention programmes of so many UK charities effectively non-existent? Collective insanity surely cannot be the answer? Well not for everyone…
Whatever the reasons retention has had such a low priority, this will surely change now. But, saying the issue is important and allocating resources and attention to it, is just the start of the journey.
Because actually significantly improving supporter retention rates isn’t at all straightforward. Possibly this is why the subject has been neglected. There isn’t a magic bullet or all that many easy wins (there are some). An effective donor retention programme is multi-layered, has a number of elements and needs to be applied in a structured, systematic way.
Donor retention needs to be rethought by charities. It can’t be a bolt on to an existing programme. It cannot exist in a separate silo from supporter acquisition. It can’t be reduced to a supporter magazine or an upgrade programme. It needs to be owned at a senior level and to run through the entire fundraising and communications culture of an organisation. It needs, in short, to sit at the heart of every fundraising activity.
So 2016 is the year to make engaging and keeping donors your no 1 priority. In the next post, I’ll share some thoughts on how to make this work in practice.
Oh and happy New Year.
** PFRA 2013 DARS survey
*** Sarjeant & Jay 2004