Monthly donor retention is probably the biggest challenge for nonprofits. In my nearly 30 years of monthly giving experience, I’ve seen three big reasons for this:
Nobody feels responsible for tracking monthly donor dropouts and attrition (a fancier word for dropout percentage).
Believe it or not, while you think this may be more rampant in a bigger organization, it’s also a problem in smaller organizations. Unless someone is completely responsible for the monthly giving program and tracks all the trends in monthly donors’ life stages, it’s going to be tough to really grow your monthly donor program.
If I look back at a recurring benchmark study Brady Josephson of NextAfter did a few years ago, 47% of nonprofits did not follow up when the card expired. Wow, that’s almost half of your program! You’ve already lost the race.
The dropout follow-up process is not written down.
Why is this important? You need to know what your system does or can do when you get the information that a monthly donor’s card expires (some systems provide you this before it happens). If you have a credit card updater, add that to the mix. In addition, you need to specify and write down what you or someone in your organization should do when a card does expire.
This may sound silly and simplistic, but it’s amazing as to how much you learn by taking just a few moments to write things down. And taking reason No. 1 into consideration, sometimes it’s not clear whose job it is to follow up, so nothing happens. Not to mention that this process should be a task that is done consistently every month. I get it — fundraisers are busy, but if it’s written down and it’s part of someone’s job to follow up, it will get done. And I’ve written about this before: calculate the annual value at risk of the monthly donors you follow up on and the save rate, and you’ll be much more motivated. Because it all adds up.
Nonprofits feel like they’re naggers.
They often think: “If the donor didn’t contact us to give their updated credit card information, they probably don’t want to continue.” Not true.
Just think about it: Donors are busy, so when they get their new credit card in the mail, they sign it, stick it in their wallet and then go on to the next activity. Unless you contact them and remind them that they need to provide you with the updated information, they’re not necessarily going to do this on their own. That doesn’t mean they don’t care, they’re just busy.
I recommend you approach a monthly donor payment problem reminder as a courtesy to the donor. Send them a friendly, personal email with a link to an update page and a phone number to call. Call them, and leave them a voice message. Send them a letter. And if they don’t respond at first, just send them a friendly follow-up. Remember, donors are busy.
Ultimately, donors want to support you. They want to help. Monthly donors are no different. So do them a favor, follow up and prevent them from dropping out. That’s how you grow.
This article was originally posted by NonProfit Pro Today on August 17, 2020.
