Converting Emotional Donors to Monthly Donors
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by Otis Fulton and Katrina VanHuss
Ah, the new donor. A relationship rife with possibility. You've spent a lot of time and resources getting them to say, "yes." Yes, I will feed hungry children; yes, I will cure a terrible disease; yes, I will save animals and the environment; yes, I will save the planet! As psychologist Robert Cialdini famously said, now you've got "your foot in the door." They've been "nudged" to support you, as the behavioral economists put it.
Out of the thousands of organizations a donor could support, the donor chose you. The hardest part is behind. That first gift is the hardest to secure, right?
It's wrong because of what marketing guru Seth Godin calls the prospective donors you're trying to attract — "lazy people in a hurry." Maybe they've decided to donate because of one of your ads that appealed to their emotions. That $45 they sent you (the average first-time donation, according to Bloomerang) gave their brains a shot of happiness chemicals. They got a hit of dopamine and oxytocin, the source of the "giver's glow" neuroscientists talk about.
If you're smart, you know that the real work has begun. Because the hardest donation to get isn't the first, it's the second. All you know from the first gift is that they have some interest in your mission. Whether or not this "first date" gift turns into a real relationship depends on you.
Sustaining (Monthly) Donors
There are lots of good reasons to turn "casual" donors (either those who've contributed one time or annually to get a hit of happiness juice) into monthly donors. First, monthly donors give more, on average — $228 per year compared to $60 per year for non-monthly donors.
Donor retention rates are higher with monthly donors, 70% compared to 40% to 50% for single gift-makers. That adds up. According to Dr. Adrian Sargeant of the Institute for Sustainable Philanthropy, the lifetime value of a monthly donor is about seven times higher than the lifetime value of a single-gift annual donor.
Also, monthly donors are usually the source of charitable bequests. Erica Waasdorp says in her book, "Monthly Giving," 75% of philanthropic bequests come from monthly donors. Monthly donors are seven times more likely to make a charitable bequest than an annual donor.
There are some great secondary benefits to the organization, including lower administrative costs for this group of donors and the big one — predictable income.
What's the key to motivating people to support your organization on a monthly basis? The relationship that you build with them.
How's Our Relationship Going?
The relationship you build with your donors depends on the way you communicate with them. Regarding your communications, all you have to do is become really good at doing two things most nonprofits are lousy at — thanking them and reporting to them how they made a difference in the world.
A typical nonprofit messaging series is as follows:
The organization asks for the donation, thanks the donor for their gift and reports to them on the impact of their donation. Most nonprofits focus on the first component — the ask. Nonprofits that build great relationships with their supporters focus on the other two: saying thanks and reporting on the results of donors' largess.
How do we know this is true? According to the "Attitude, Awareness & Usage Study," the number one reason multiple-year annual donors (giving $250 to $2,500 a year) stopped donating was they weren't "acknowledged for a previous gift." The other reason donors left was a "lack of communication about the use of funds/results of gift (impacts and outcomes)." This leads to a couple of questions to diagnose the strength of your organization's fundraising communications.
First, if you're reading this, chances are your organization doesn't thank your supporters enough. The nonprofit Food for the Poor conducted a market experiment on 50,000 of the organization's top donors. Half received an extra thank-you at the beginning of the year, recognizing their past support. The other 25,000 did not receive this extra thank-you. What happened? Twelve months later, each group had given roughly the same number of gifts. However, the group that received the extra thank-you gave around $450,000 more than the group that didn't. From just one thank-you…
The takeaway? Get better at thanking your supporters; do it quickly and often. Make it as personal as you can.
Second, how are you reporting to your supporters? How are you telling them about all the great strides that have been made for your mission? Here are the three magic words, the key that will unlock reporting in a way that will build your relationship with your donor:
Because of you.
The most successful fundraising nonprofits talk about the donor more than they talk about their organization. "Because of you… (all these great things happened)." There's no "partner with us" language. Does your nonprofit remove cataracts from poor people in Africa? The surgeon just held the scalpel; your donor removed the cataract. It can be difficult for nonprofits to communicate in this way. It requires more "you" than "we/us" in the messaging. A good rule of thumb: Keep the you/us ratio in a message at 3:1. But ultimately, your donor is giving gifts to make something happen. When your communications empower them, it strengthens your relationship.
Finally, people might make that first donation or an annual donation because of your mission, but real commitment to your organization is an attachment to your brand.
Hang with us here, it gets tricky. Once again, it's not about you; it's about them. Donors become committed to your organization as you communicate the difference they are making with their donations. But they can't really be sure what you are doing with their gifts, so trust is a big driver in their connection to your organization.
And that leads us to the single most important thing to remember about your brand: Your brand isn't what people know about your organization; it's what they feel about your organization. And what they feel — trust, community, etc. — is in your hands through how you communicate with them.
So Hey, What About Monthly Donors?
The title of this blog was "Converting Emotional Donors to Monthly Donors." The truth is there are some great resources you can draw on for the nuts and bolts of driving monthly giving. One of our favorites is "How to Create Lifelong Donors Through Monthly Giving," by Harvey McKinnon. It covers important topics like segmenting your list, setting up your online donation page to attract monthly donors and using testimonials from current monthly donors in solicitations.
Increasing monthly donors should be a goal of every nonprofit, for the reasons we list above. But your success in doing so will depend entirely on the relationships you forge with your supporters through your communications. That is where to focus your time. Make an investment in your communications strategy; it will pay off many times over. Without these relationships, you'll be rolling a rock up a hill trying to move supporters to become sustainers.
A fundraiser's No. 1 job is to make donors feel good about supporting the organization. They can tell when you're faking it. But when you really love your donors, the money will follow.
Katrina VanHuss and Otis Fulton have written a book, Dollar Dash, on the psychology of peer-to-peer fundraising. Click here to download the first chapter, courtesy of NonProfit PRO!