Turn Donors into Lifetime Donors with Three-Part Strategy
Complement stewardship with prospecting, relationship cultivation
Filling the pipeline of agency supporters is a critical requirement of philanthropic health. We all know the value and importance of stewardship. It pays the highest return on investment. But, the simple reality is that, for human-serving organizations, very few donors become lifetime donors. They relocate to new communities, develop new interests, and pass away. Our nonprofit organizations do not have the same psychological hold on donors that is seen among schools and colleges, hospitals, and faith-based organizations.
An informal poll of colleagues suggests that an annual loss of 10-20 percent of donors is the norm. This includes one-time donors and event attendees. Thus, while many of us already require our organizations to have robust stewardship efforts, we must focus equally on our strategic thinking around creating cultivation opportunities, prospecting, and researching donors.
Liz Mason, my colleague at Alliance for Children and Families member Children’s Aid and Family Services, Paramus, N.J., summed it up well in a recent conversation, “We must constantly replenish the pipeline, we need to bring in the next generation, learn to appeal to prospects based on their interests and values, and begin to communicate in different ways. For example, email is rarely used now by the under 30s.”
Len Iaquinta, an Alliance Resource Development Solutions (RDS) Committee member and Alliance board member, shared the following, “The percentage of lost donors varies with the organization and industry. Even at a university, replacement is vital. As alumni age, they give fewer current gifts, arrange estate gifts, and ultimately die.”
Len went on to note that rules of thumb vary by authority; however, for most nonprofits, the donor life cycle is three to five years. Some research suggests that great stewardship extends this significantly. So, the formula he recommends is a combination of great stewardship, emotionally and intellectually compelling solicitation, storytelling, and continual prospecting through multiple means, including referrals from donors, volunteers, and friends; list exchange and rentals; special events; social media; and other media channels.
Creating opportunities to engage new constituents is important. The research demonstrates that most new donors are introduced through another donor or a personal relationship with a volunteer or staff member. Thus, engaging our staff, volunteers, and board members as mission ambassadors to carry our message to new audiences is critically important. It is easy and comfortable to do, as long as we share the skills and take the time to teach.
The RDS committee offers an online fund development curriculum that addresses engaging board members as mission ambassadors.1 Members of the RDS Committee, including myself, are happy to discuss the training process with you and offer advice as you engage board members.
Although most volunteers would prefer to have a root canal rather than solicit a donation, talking, with pride, about the impact of the agency among friends, associates, and family can truly be fun and even self-energizing. But, make sure you provide them with the skills and the stories. These ambassadors need to be supported and engaged by the senior staff of the agency. Note that I did not write senior development staff. In order to have effective and powerful stories for our ambassadors, there needs to be buy in and support from the entire leadership team.
Special Events Done Right
A successful and fun tactic shared by Jocelyn Mourning of Alliance member The Family Conservancy, Kansas City, Kan., is easy to replicate and quite rewarding.
“Since they say the best sources for new donor prospects are current donors and friends, we decided to host an event that encouraged current friends, including our advisory board, to reengage and reenergize around our mission and impact. It also helped to cultivate new prospects. We invited some long-time supporters to act as ambassadors to younger community members, as well as those less exposed to our mission and agency. Our hope is that this acts as the cultivation step for the new guests and as a referral opportunity for both groups. We want this to serve as the first ‘ask’ for those new folks and perhaps they will continue to attend events and eventually become significant donors and serve on our board or advisory board in the future,” says Jocelyn.
One of the greatest losses of donor possibility is the failure to engage event attendees in the organization’s mission. Equally problematic is the failure to have specific follow-up strategies in place before the event. As we all know, events are an expensive way to raise money, but they are dynamite in positioning and engaging new community members. They may also create significant publicity opportunities. It is important to know why you’re hosting one and particularly important to have a plan for following up with attendees after the event. Don’t waste valuable engagement opportunities.
The Difference a Donation Makes
Kevin Cook of Alliance member ANDRUS, Yonkers, N.Y., confirmed the experience of many agencies in the engagement of event attendees, “I agree that being on the lookout for new donors is a constant. I’m betting that 20 percent or more of our donors come through special events and we’ve not been totally successful at engaging them further.”
One method he is employing this year is distributing a brief report that features anecdotes about the children served by the program featured at last fall’s gala dinner. Four months after dozens of guests raised their hands in a charity auction for that specific program, they’ll be able to read about how their generous gifts are making a difference for those children.
“Our hope is that the report will strengthen the ‘one-time relationship’ we began at the gala and lead to continued engagement,” he adds.
Values Serve as Philanthropic Platform
Development is a line of business for mission-based charitable agencies. Without the subsidizing business of philanthropy, we are unable to sustain service to meet the needs of vulnerable children and families. (1) Cultivation and prospecting are expensive compared to stewardship. But, if you fail to include it in your development plan, you put your long-term mission commitments at great peril.
For most of us, philanthropy will be the only line of business for which revenue greatly exceeds expense. I am proud of that reality and even more proud of all of the staff, volunteers, and board members within the Alliance network who go into our communities carrying the values of our missions and the tremendous impact of our work. Let’s help them do it.
We, as a sector, are truly driven by our values and expertise in engaging communities in weaving a caring fabric of the many threads that bind us together. We are not simply defined by our tax status. We are the voluntary sector—and that is the essence of our philanthropic platform.