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Increasing Donor Retention & Recurring Giving

Donor retention is all about getting the most from your existing pool of supporters. Learn how improving your relationship with your donors can improve your nonprofit's bottom line.



What is Donor Retention?


Donor retention is a term that refers to the number of donors who give to your organization more than once. This measure is very important to nonprofits. A nonprofit that is successful at keeping its existing supporters as active contributors, while also managing to reach new ones, will have steady income and promised growth.


Why Is Improving Donor Retention Important?


An organization spends a lot of time, money and effort in finding supporters and cultivating a relationship with them to turn them into supporters. It is easier and more affordable to keep current donors than it is to get new ones. Once someone has given to your organization, you already know they feel some amount of connection with you and with the cause that you stand for as they’ve made the decision to select you over other nonprofits.


For this reason, nonprofits should be focusing on how to retain and cultivate their donors.


What is Recurring Giving


A major component of donor retention is "Recurring Giving". Recurring giving is the practice of a donor choosing to make a repeating, ongoing donation to a nonprofit organization. Donors who contribute regularly are known as recurring donors. Donations that are given on a regular basis are known as recurring donations or recurring gifts.



How Do Nonprofits Benefit from Recurring Donations?


# Recurring giving provides a reliable revenue stream for nonprofits. Having revenue you can count on helps ensure the sustainability of your nonprofit.


# The lifetime return of a recurring donor is higher than that of a one-time donor. Recurring donors give 5 times more on average than donors who give one time, and the average recurring donor will give for more than two years. While a single donation by a recurring donor may be lower in average, the accumulative effect is higher over time.


# Recurring giving creates a hassle-free experience for your donor, making it more likely that they will continue to support your nonprofit for a longer time.



How Can Your Nonprofit Accept Recurring Donations Online?


By accepting donations through GivingWay, you are automatically accepting recurring donations. Whenever a donor is making a contribution, they choose if they prefer making a one-time donation or a recurring monthly one.


Getting monthly recurring donations with GivingWay
Getting monthly recurring donations with GivingWay

5 Steps to Improve Donor Retention


With all this in mind, it makes sense to put effort in asking your supporters to become recurring donors. It doesn’t take much more work than asking for a one-time donation, however, it may require a shift in your fundraising approach.

When you are recruiting new donors, asking for a one-time donation is the best way to get them on board and familiar with your organization. Once they made that initial gift, your response will determine the nature of your relationship moving forward.


1. Showing Appreciation


Once someone has contributed to your organization, the first thing you should do is to thank them and to welcome them into your organization's family. While this sounds obvious, it can be quite difficult for small nonprofits to keep up with. Using automated emails can be a great solution for this. Do try however to make them seem as personal as possible.


2. Ongoing Communication


Make it a habit to send regular updates to your donors, letting them know what the organizations is up to. Send them photos and videos of your activity, greeting on holidays and birthdays, and notify them about your activities.


You can also keep your donors in the loop by inviting them to follow you on social media. Remember however, that social media has a low reach and not all your followers actually see your updates. If you want to be sure that your updates are received try emails, text/WhatsApp messages and updates on your organization's page.


If your supporter contributed to a specific campaign, be sure to let them know, how this campaign is advancing, how you spent the money and what was the donor's impact to this.


Remember, while it is important to update your supporters, you do not want to make them feel spammed. A monthly or even quarterly update should be enough to keep you on their mind.


3. Ask for recurring donations.


This sounds obvious, but the fact is, many nonprofits don’t ask their supporters to sign up for monthly giving.

As part of your communication with you donors be sure to ask directly "will you consider becoming a monthly supporter?"


 
Did you know? GivingWay automatically sends thank you emails and asks for recurring donations on your behalf! Learn more
 

4. Keep your donors involved in various ways


Even after donating to you one time, not all of your supporters will be keen on making it a regular arrangement. This doesn't mean you should stop approaching them. There are many ways your supporters can keep on helping you that don't involve them opening their wallet.


For example, ask them to help you with an online task you need help with, like technical help with your website, editing a video or teaching an online class. You can also ask them to help you share your posts with their network or create a peer-2-peer fundraiser. By keeping your supporters engaged with your nonprofit, not only are they helping you with these tasks, but they are also getting more familiar with your organization which can create solidarity and lead to more financial support in the future.


Keep your donors involved in various ways like volunteering online
Keep your donors involved in various ways like volunteering online

5. Measure


Finally, If you want to improve your donor retention, you should define your starting point and the goal you want to achieve. By measuring the changes of your donor retention rate throughout time, you can understand if your communication efforts are effective.


To calculate your yearly donor retention rate:


- Add up the number of donors who gave to you in one 12-month period

- Separately, add up the number of donors from that same group who made a donation in the following year.

- Then, divide year two by year one.


So for example, if in 2020 you had 100 donors, and of them 11 donated again in 2021, then your retention rate for this year is 11/100, which is 11%.

You can calculate this on different time intervals of course (monthly, quarterly etc.).


By measuring your retention rate regularly and comparing it to previous results you will be easily able to tell if your efforts to improve donor retention are bearing fruit.


Treatment of Recurring Donors


Once you "recruited" your recurring donor, don't forget about them and don't treat them like any other donors. These are your strongest supporters and you want to be a able to craft messages that are especially for them.


Be sure to segment your communications for recurring donors by putting them on a separate email list from your other email subscribers. For example, since they’re already donating on a monthly basis, you don’t want to send them more asks to become a recurring donor. Your main goal with recurring donors is to continue to nurture that relationship so they stick.



Signup box to givingway


Bottom line


The more recurring donors you attract, the more sustainable your nonprofit will be. Since it’s much easier to retain an existing donor than to attract a new one, you need to be communicating well with your supporters to keep them engaged.


 

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