Starting Over… Again and Again and Again!
If you’re devoting a majority of your development efforts on acquiring new donors instead of retaining the ones you already have, you need to consider an important statistic:
Of all the 1st-time donors you bring in, you can expect to lose 80% of them. Sound painful? Of course it does. If you think about the time and financial resources you spent on getting those new donors, you might actually find that you’re worse off than you thought you were.
At Rescigno’s, we suggest to our clients that they focus more of their efforts on keeping their current donors, especially those who have given multiple times.
The fact is that if you can get a 2nd gift from a donor, the chances of that donor becoming a repeat or loyal donor triple.
If you’re wondering whether retention rates matter, they do—a lot.
If you have a 40% retention rate, that means that you’re losing donors at a 60% rate (donor attrition).
To make the point even more clearly, an organization that starts out with 10,000 donors in one fiscal year, can statistically be expected to lose 6,000 of them over the next 12 months. Extending that idea out, it means that 6,000 new donors would need to be found just to break even.
Starting over every year means you’re stuck in acquisition hell.
Your best friend when it comes to helping you out of this dilemma is YOUR DATA. Using specific information from your donor database to create segments and send personalized messages is the answer.
What kind of segments? Well, there are many. Here are a few:
Recency-How long have they been giving?
Frequency – How often do they give?
Type – How are they giving?
Amount – How much?
Reason – Why are they giving?
Interests – What topics are they most interested in?
When you think about it, you wouldn’t send out the same birthday message to your friends that you do to family members, would you? Unfortunately though, that’s what many nonprofits do. The same message is sent to every donor, whether that donor has been giving for one or 10 years. That’s crazy!
Talk to us about how we can help you with your donor segmentation strategy.