During a recent webinar, someone asked me a question. His finance people told him: “For $5 a month, it’s really not worth the effort. The finance charges are killing us.”
This is another one of these monthly donor myths I’d like to debunk right away.
My answer of course was this: “Yes, offering the $5 a month option to donors is totally worth it!”
Here are 10 reasons why:
- You’re truly showing donor care. No gift is too small. Your donor can make a difference with an amount that’s most comfortable for them.
- You can upgrade small monthly donors to higher levels within the year. And if you do it right, one third of your monthly givers will indeed upgrade.
- Even small monthly donors can leave you in their will. A small animal rescue that’s just starting out with its monthly donors already got a $195,000 bequest from one of its small monthly donors.
- Recruitment fees for monthly donor fees are minimal. If you have an email system and you have an online donation page, you can generate monthly donors.
- The finance fees are not that high. Typically, it is 3 percent of the monthly gift plus perhaps a fee of $0.30 each. So for a $5 gift, that’s $0.45, which means you still keep $4.55, according to my calculations.
- If you annualize the value of that small monthly donor, it’s going to be $60 before fees—$54.60 after fees. Nothing to sneeze at.
- Many online systems allow the donor to pay for the fees, and some 70 percent of donors do this. You’ll end up with the full amount, so it’s a non-issue.
- The average monthly donor is $24 a month, so the $5-a-month givers are really more the outliers.
- Your response rate will go up if you ask for a lower amount. Make it easy on your donor to understand how they can make a difference with different amount options, and your donors will determine what they can afford. That’s the gift they’ll make, and that’s the gift you should be grateful for.
- Typical monthly donors stay with you for five to seven years, and sometimes even longer. Just think the loyalty factor here.
We’d all want people to make $1,000-plus gifts, but that’s just not reality. Would you stop asking donors to give gifts online just because of credit card fees? Just think, fees are now $30.30.
Of course, you’d encourage your donor to make their gift in any way possible, right? You wouldn’t do your job as a fundraiser otherwise.
Having worked with nonprofits and growing their monthly donor programs over the past 25-plus years, I’ve learned that we fundraisers sometimes have to push back a little bit to our finance folks.
Perhaps sharing this saying may be helpful. I grew up with the phrase: “Don’t look a gift horse in the mouth!” This means: Don’t’ find fault with something that has been received as a gift or favor.
Your donor is willing to make a commitment for many years. Will you deprive him or her of that joy because you’re afraid to give up a few pennies? You could be giving up a lot of future funds because of that mindset.
