Guest Post by Jay Love, Co-Founder and current Chief Relationship Officer at Bloomerang
As a nonprofit professional, there are a few ways that you can leverage data to support your organization’s retention efforts. These strategies fall under two primary umbrellas: how you’ll use donor data and how you’ll use organizational data.
Donor data is all about relationship-building. When you use the information you know about your supporters, you can develop connections with them. You can personalize your outreach to each supporter, appealing directly to their needs and desires to convince them to give and give again.
Organizational data can help identify gaps in your nonprofit’s strategy. If supporters are leaving for specific reasons, you can strategically address those issues and fill the gaps. This is an internal view of your nonprofit that can give you ideas on how you can streamline your strategies to better reach your goals.
In this guide, we’ll explore each of these types of data and various strategies for how your organization can leverage data to enhance your donor retention.
Donor retention is important to nonprofit fundraising strategies and is the key to unlocking additional revenue for organizations. As Bloomerang’s retention guide explains, “Nonprofits with a low donor retention rate need to continually acquire new donors or larger gifts to keep up.” Meanwhile, high retention rates lead to lower acquisition costs and higher gift amounts.
Let’s dive deeper into the types of data available to nonprofit organizations and how they can help improve your retention rate.
Donor Data
In your nonprofit’s donor database, you should actively collect data about each of your supporters, organize it in individualized donor profiles, and leverage it to form personalized connections with your supporters.
Here are some strategies that we recommend employing when it comes to your organization’s use of donor data:
Collect donor contact information
Contact information is the most basic data that nonprofits need to collect from their donors. Without this data, it’s next to impossible to reach out to supporters and continue engaging them in the future.
As a nonprofit professional, you know the importance of collecting supporter contact information. But keep in mind that you might need to collect more than just your supporters’ email addresses to get in touch with them. In fact, we recommend trying to get in touch using several different platforms, including:
Email. Email is often the backbone of nonprofit communications strategies, so you will need to leverage this platform to reach your supporters.
Phone calls. Bloomerang’s study shows that donors who did not receive a phone call after their first donation were retained at around a 33% rate. Meanwhile, those who received a single phone call were retained at 41% and those who received more than one were retained at 58%.
Social media. Ask your supporters if they’ll opt into messaging on Facebook or other platforms, so that you can take one-on-one conversations onto these social networks.
Direct mail. Physical letters pair well with digital strategies, increasing brand awareness and creating a more memorable experience for your supporters.
When you reach out via these various marketing platforms, you can invite supporters to further engage with you in person as well. Don’t forget that you don’t only have to communicate at a distance. Invite supporters to meetings or to attend events so that you can have face-to-face conversations with them, especially with your major supporters.
Segment your supporters
Some of the data you’ll receive about your supporters will relate specifically to their interests, values, and engagement with your organization. From this data, you can segment your supporters to create a more relevant experience for them in conversation with your organization.
For instance, you might decide to segment your supporters based on their past engagement with your organization, such as separate segments for donors versus volunteers. Let’s consider the following examples of outreach to each of these groups. We’ll use the example of encouraging supporters to research their eligibility for corporate philanthropy programs:
Dear Lizzy,
Thank you so much for your continued support of the Build-a-Home organization. Your contribution of time and energy spent building houses has helped three new families find a place to live.
But did you know that your time could make an even greater difference for these families? If you’re eligible for a volunteer grant, your employer might offer a financial contribution to the mission without requiring anything more from you! Click here to research your eligibility and to grow your impact.
As you can see, this type of template is well designed for volunteers, but would not be an impactful message for your donors to see. Meanwhile, you might send your donors a different type of message, such as the one below:
Dear Timmy,
Thank you so much for your continued support of the Build-a-Home organization. Your contribution of $100 helped obtain the piping and supplies to install running water in two homes, providing this valuable resource for the families who just moved in.
But did you know that your gift could make an even greater difference for these families? If you’re eligible for a matched gift, your employer might offer another financial contribution to the mission in response to your generous gift. Click here to check your eligibility for these programs and grow your impact.
As you can see, segmentation creates a more relevant outreach strategy to connect with nonprofit supporters.
Many organizations make the mistake of trying to lump together their various segments. We refer to this as “seglumping” when you might address a group of supporters as such:
Whether you recently gave money, volunteered, or attended one of our events, thank you!
Compare this statement to those above and put yourself in your supporters’ shoes. Which would make you feel more welcomed and acknowledged by your organization? Use the data that you’ve collected about your supporters and leverage it for differentiating your supporters and making them feel unique, not “seglumping” them together.
Leverage personalized engagement data
Segmenting your supporters is one way to make messages resonate due to relevance. The other way to make them compelling for your audience is by personalizing supporter messages as much as possible.
Use the personal data you collect about your supporters to show them that they’re not just one member in a crowd—they’re a unique and special supporter who deserves your individualized attention. For example, when you craft a message, you might decide to include information such as:
The supporter’s preferred name
The last campaign they contributed to
The most recent event they attended
An interest you know they have related to your mission
The impact of their most recent gift
The last advocacy campaign they participated in
Much of this information can be automated to be included on your communication templates. However, be careful when you automate this information. The last thing you want is for the automation to malfunction so that your supporters receive a message with the salutation “Dear %%valued supporter%%.” This can actually harm your relationships more than help them.
Be sure you’ve built out your marketing strategy manually and optimized the process without automation before adding this valuable resource into your strategy.
Organizational Data
As we mentioned, you can leverage individual donor data to build individual relationships with your supporters. Organizational data can be used for a slightly different purpose.
When you collect organization-wide data from your various campaigns and interactions, you can determine what internal strategies you should employ to appeal to your supporter base as a whole.
One of the great opportunities that accompanies organizational data is that you can determine the reasons why supporters stop giving to your organization and address those reasons. Bloomerang’s donor appreciation guide provides the following graphic showing the industry-wide reasons that supporters might stop giving to organizations like yours:
By tracking your own campaign and marketing metrics, you can compare your organization to these industry-wide metrics, determining where your strategies are weakest. Then, you can address those weaknesses, creating a stronger, more holistic outreach approach.
We recommend reviewing metrics such as your campaign success rate, donor lifetime value, and average engagement rate to start.
Campaign Success Rates
Which of your nonprofit’s campaigns produce the most revenue for your organization? Is it your annual auction? Your peer-to-peer campaign? Your Giving Day celebration? Year-end fundraising?
By tracking the revenue from each of your fundraising campaigns, you can determine which ones are the most impactful for your organization. From here, you can:
Improve your top-performing campaigns. These are the campaigns that your supporters are most interested and engaged in. Make sure you look for opportunities to improve those campaigns and maximize that engagement for continuous improvement. For example, if your annual gala brings in the highest ROI for your organization, send out a survey after the event to determine any opportunities for improvement, whether it be the food, auction items, or other elements.
Determine next steps for under-performing campaigns. For some underperforming campaigns, you may determine that it’s not worth it to continue hosting them in the future. For others, you might just need to determine the best ways to improve the campaigns to make them more impactful and effective in the future. For example, you may discover that your website donation page underperforms for mobile visitors and decide to conduct A/B testing for new mobile designs to improve the resource.
When analyzing the success of your various fundraising campaigns, be sure to consider the return on investment of your campaigns in addition to the raw revenue generated.
By analyzing these metrics, you can determine ways that you can improve your wide-scale strategies, appealing to a large number of your supporters at once. This will create a better experience overall and encourage people to continue coming back to your campaigns.
Donor Lifetime Value
Your donor lifetime value is the metric that estimates the amount of money donors contribute to your organization over the course of their lifetime as supporters. You can break this down further into different segments at your organization, such as the lifetime value of your major donors, mid-tier supporters, and low-level donors.
As your donor retention rate increases, this value will grow. For one, the longer a donor gives to your organization, the more they’ll give over time. Plus, when donors give over time, they’re more likely to increase their gift size to your mission.
Therefore, donor lifetime value is a great way to see the impact retention is having for your organization and to determine if it’s making a difference.
In a previous section, we reviewed the reasons that supporters stop their contributions. You can address any and all of these to help increase retention and ultimately your lifetime value of supporters. Consider the following stats from that graphic:
8% of donors stopped giving because they didn’t know how the money was used. When you address this issue and explain the direct impact of their donations, supporters are more likely to stick around.
9% of donors stopped giving because they had no memory of supporting. When organizations don’t have adequate follow up after contributions, supporters are likely to forget about them. This leads to more one-time donations and a lower average lifetime value.
13% of donors stopped giving because they were never thanked. Appreciation is important and helps donors feel good about their contributions. Giving supporters the appreciation they deserve helps them feel warm and fuzzy inside, increasing the likelihood they’ll give again. Therefore, simply saying “thank you” can greatly increase their value with your nonprofit.
As you can see, the average donor lifetime value shows how well you’re keeping supporters around and the importance of encouraging them to continue giving. If you increase retention, but your lifetime value doesn’t increase, there is something amiss in your strategy.
Average Engagement Rate
The path to increasing your donor retention is not to pester them for donations over and over again. Increasing your number of asks could make your supporters feel like they’re ATMs for your nonprofit, actually harming your relationship with them.
Instead, you should vary the interaction and engagement opportunities you provide for your supporters. Then, track the average engagement rate. When you have a donor database that measures this engagement rate for you, this metric becomes much easier to keep front-of-mind.
A holistic approach to supporter relationships increases their commitment to your cause and their likelihood to continue contributing. For instance, volunteers on average give 10 times more than other supporters.
To increase the engagement of your supporters, provide additional opportunities for them to get involved with your organization, such as:
Participating in volunteer opportunities
Taking part in advocacy campaigns
Attending stewardship events
Reading educational resources
Having conversations with your team
Sharing campaigns on social platforms
Raising funds for your organization in a P2P campaign
In addition to strengthening the commitment of your supporters, increasing your engagement rate can also boost the number of major gift prospects at your nonprofit. Major prospects are those with high engagement rates and high capacity to give. By increasing one of these factors among your supporters, you’ll increase your prospects for major and mid-tier support as well.
Data plays a major role at your nonprofit. From understanding donor data and improving relationships to understanding organizational data that can help you improve your strategies, you can use hard metrics to help support your nonprofit’s donor retention efforts and amplify fundraising.
These takeaways should give you some insight and ideas for how your nonprofit can use the data you have collected. However, before you can do that, you will need to make sure all information you have on hand is well organized, which is where an effective donor database comes into play.
Make sure you can track both donor and organizational data in your database for a centralized location of information and an easy resource for improving your retention rate.
About the Author:
Jay Love, Co-Founder and current Chief Relationship Officer at Bloomerang, has served this sector for 33 years and is considered the most well-known senior statesman whose advice is sought constantly.
Prior to Bloomerang, he was the CEO and Co-Founder of eTapestry for 11 years, which at the time was the leading SaaS technology company serving the charity sector. Jay and his team grew the company to more than 10,000 nonprofit clients, charting a decade of record growth.
Jay is a graduate of Butler University with a B.S. in Business Administration. Over the years, he has given more than 2,500 speeches around the world for the charity sector and is often the voice of new technology for fundraisers.