retention
This article is excerpted from Retention Fundraising: The Art and Science of Keeping Your Donors for Life, by Roger M. Craver. For more information about the book, click here. Also available in eBook format.

Here are three quick, easy, and inexpensive steps you can implement immediately to improve donor retention.

Say “thank you” quickly and personally

If you want a higher retention rate, saying thank you is a prime starting point for signaling to the donor, “You matter to our organization. Your gift counts and makes a difference.”

In chapter 16 of Retention Fundraising we saw that promptly and personally thanking donors is one of the top seven key drivers of commitment. It’s also one of the easiest holes to fix in your leaky retention bucket.

To begin with, you’ll be miles ahead of your competition if you even bother to thank your donors. Over the years, survey after donor survey has shown that as many as 60 percent of nonprofits don’t even bother to acknowledge or thank their donors.

Is it any wonder that at least 13 percent of donors who defect attribute their reason for leaving to the fact that they never were thanked?

Volumes have been written about the importance of effective and timely thank-yous. A great resource with plenty of examples is Lisa Sargent’s Thank You Letter Clinic appearing on the Showcase of Fundraising Innovation and Inspiration (http://www.sofii.org/article/how-to-write-a-better-thank-you-letter-and-why-it-matters).

Here are the questions Lisa suggests you ask about your gift acknowledgment and thank-you process:

How soon after a gift is received do we send a thank-you letter?

Do we note the amount of the donation?

For gift memberships, do we send notices to both the giver and the receiver?

Do we recognize long-term and repeat donors? If not, is our system capable of this?

What kind of donor feedback have we received on thank yous?

It’s not enough that thank-yous in one form or another are sent in a timely fashion. The quality of those messages matter. They must convey genuine appreciation and also show the impact of the gift, assuring donors that their gifts are making a difference. In short, a generic computer-generated thank-you letter, even if mailed the day the gift is received, is inadequate.

Pick up the phone

A decade ago Penelope Burk in her book Donor-Centered Fundraising (2003, Burk & Associates Ltd) noted that personally telephoning new donors improved first-year revenue retention by some 40 percent.

Years later Chuck Longfield, founder of Target Analytics and Blackbaud’s chief scientist, conducted a large test to confirm this.

Here’s what Chuck found:

Simply calling and thanking new donors resulted in approximately 40 percent more revenue in the following year.

Even leaving a thank-you message increased giving, but less than the 40 percent increase from those who were directly reached. (Chuck has since done more testing and determined that it’s worth calling back at least once more before leaving a voice mail.)

A proper thank-you sets the stage for what many consider to be the critical factor in predicting longer-term retention—the second gift.

The sooner you thank a new donor the sooner you can ask for the next gift. Don’t let what I call the “artificial barrier of good taste and dignity” stand in your way. That is, resist the notion drilled into us since childhood that somehow it’s impolite to ask again so soon.

If you’re looking for a canary in the coal mine test on how you’re doing on retention, the percentage of second gifts you receive from new or first-time donors is probably the quickest, most reliable sign.

If you can significantly increase the number of second gifts you’ll also see a significant increase in retention rates and growth in the lifetime value of your donors.

Put more money into retention—today

It has always struck me as strange that we budget tens of thousands of dollars—even millions—on acquisition while completely ignoring any allocation of funds for retention.

Take for example a proper investment in what we just discussed—the thank-you process. The fact that so many organizations view their acknowledgment/thank-you/welcome efforts as a cost rather than an essential part of the process of acquiring and retaining a new donor makes absolutely no sense.

A donor whose first contribution is ignored or improperly acknowledged is likely headed for the exit. The chances of him or her making a second gift are vastly diminished. From the very start, we have failed in the essential first step of relationship building—establishing a feeling of reliability on the donor’s part. And as we’ve seen, without the twin pillars of reliability and consistency, the essential ingredient for retention—trust—is missing.

The same is true for other essential functions. Activities such as donor service—the proper and careful recording of names and addresses, the prompt attention to inquiries and complaints, a skilled and friendly representative at the other end of the service center’s phone line.

If an organization is willing to invest $50 to acquire a $25 dollar donor, why wouldn’t it budget at least an additional $5 or $6 to make certain that new donor is properly thanked and welcomed with her or his name spelled properly? Why not spend the money to phone and thank these first-year donors, thus assuring 40 percent more income from them next year?

Investing in retention is so important that as a matter of practice I recommend that the cost for properly placing new donors on the right road to solid retention be built into the acquisition costs at the outset.

The Wall Street Journal described him as “an assassin of all things right-wing.” The American Association of Political Consultants placed him in their Hall of Fame, and the Direct Marketing Association gave him their Lifetime Achievement Award. Roger Craver is, in fact, a disruptor and challenger of the status quo. A pioneer in direct response fundraising in the 60’s, telemarketing in the ’70s, online information services in the ’80s, multi-channel fundraising and communication in the ’90s, and donor-designed strategies today, he brings an experienced and critical eye to the greatest problem faced by today’s nonprofits: donor retention. Roger helped launch some of the household names in the nonprofit advocacy sector: Common Cause, Greenpeace, the National Organization for Women, World Wildlife Fund, Habitat for Humanity, and Amnesty International. He helped revitalize and grow older organizations—the ACLU, the NAACP, Sierra Club, Wilderness Society, League of Women Voters, Heifer Project International, and Planned Parenthood.