Mon, August 10 2015

Dig Into Your Donor Database

Barbara O'Reilly's avatar

Founder, Windmill Hill Consulting

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Filed under:   Fundraising essentials • Recurring Giving •

Editor’s Note: This post comes from Barbara O’Reilly, founder of Windmill Hill Consulting. We’re excited to partner with Barbara so she can share her extensive knowledge of strategic development planning and donor-focused fundraising with the Network for Good community!

The Giving USA 2015 Annual Report on Philanthropy, released in July, announced that charitable giving, while growing steadily over the past five years, has reached its highest level since the Great Recession—an increase of 7.1% over 2013 totals. Donors of all kinds—individuals, foundations, and corporations—are back, baby! They have recovered from the economic setback of 2008 and are feeling more confident than ever to invest in charitable causes across the country.

The future has never looked better for the nonprofit sector, right? After all, the study shows that more donors than ever are making gifts. You may be wondering how to start building your donor base to welcome these new donors to your mission. “If only more donors knew about us, just think how much more money we would be raising” may very well be crossing your mind right now. As tempting a thought as this may be, the truth is that the grass is not greener with a whole new set of donors. It’s greener exactly wherever you are watering it.

Renewing Donors Chart

Let’s drill this down a little bit further: 43%. That’s the median donor retention rate that the Fundraising Effectiveness Project (FEP) calculated from the 2012–13 fundraising results of its survey respondents. This means that, on average, many organizations are losing almost 60% of their donors each year. Why? Many reasons. Some, like changes in personal circumstances, are out of the control of any organization. On the other hand, according to the 2014 Burk Donor Survey, nearly 50% of respondents cited reasons like over solicitation, overhead costs, and the lack of demonstrated impact as influencing their decision to stop giving. These lie squarely in the hands of how organizations communicate with and to their donors.

The solution to this attrition issue isn’t getting new donors. Quite the contrary. Getting new donors is:

  • Expensive: Raising $1 costs anywhere from $.25 to $1.50.
  • Inefficient: It has a very low ROI ($1).*
  • A short-term solution: Only 23% of first-time donors ever give a second gift.

That seems like an awful lot of work to nearly break even or incur a slight loss each year. On the other hand, it is worth looking at how to grow and retain the 64% of loyal donors who have been supporting you over multiple years. After all, fundraising costs to raise $1 from renewals are very low ($.20 to $.25), and these donors offer the highest ROI ($4).*

First, identify your donors’ behaviors.

What are the past giving levels of your donors’ gifts? By comparing gifts over the past few years within levels such as $1 to $499, $500 to $999, $1,000 to $2,499, and so forth, you’ll be able to see where you’ve had the greatest growth and losses. What is your own donor retention rate, both generally and for first-time donors? What is the average gift rate for each of the years you are comparing? Knowing these data points can ground how you solicit your donors in a way that will encourage growth. For example, you may want to focus on donors within a certain gift range to tailor higher asks. You might also segment a group of lapsed donors or higher-level donors and personalize outreach to them by phone, mail, and in-person communications.

Second, understand who your donors are.

Which donors have given for multiple years? Who previously supported you but has lapsed? Identify the top 50 to 100 of your longest donors, your largest donors over their lifetime, and newest donors (with a particular eye to those who made large first-time gifts) last year and this year. If you have the resources, it’s helpful to run capacity screening of these three groups to understand where there is greater gift potential. In starting or expanding your major gifts program, these are the donors who will comprise your major gift pipeline. They rarely bounce around from organization to organization. Your next major gift will likely come from one of these donors who has capacity and has supported you for a long time (and not giving at particularly high levels) and may also have been a volunteer. It’s important to get to know this group to understand what motivates their giving and interest in your organization.

Third, consider how you communicate with your donors.

These current and lapsed donors already know you and are more likely to give more generously if you ask and demonstrate your impact. If we think back to Penelope Burk’s survey results, two of the three top reasons donors stop giving are tied to an organization’s impact and effectiveness. More than ever, donors want to understand how their gift is making a difference in your work. They are giving through you to address a societal need that has meaning for them. Is their gift helping you make a difference? Bring them closer to your work by sharing a personal story of a beneficiary, a measurable accomplishment, or a plan to solve a seemingly intractable problem. As you qualify the major gift potential for those top 50 to100 donors you identified earlier, your ultimate goal is to build meaningful relationships so it naturally leads to sustained and increased support. Get to know their motivations, interests, and philanthropic goals. Use this information to lead your discussions about investments in your work. Remember, it’s not about you.

Tied closely with programmatic impact is how effectively your organization operates through costs for program delivery and administration. You don’t necessarily want to skimp on administrative expenses to seem “lean and mean” when it compromises—and even hinders—your ability to scale, deepen, or improve the quality of your work. Without unrestricted operating support, which includes enough funding for your fundraising efforts and staff, you can’t deliver and grow the services of your organization. Build that message about capacity into your donor outreach. Do your donors come away with a strong understanding of what you do, your plans for the future, and why their continued support (unrestricted and restricted) is important?

Finally, using the green grass analogy, after you’ve watered and fed your grass with your current donors, it’s still important to plant seeds for the next pipeline of donors. These aren’t the names you rent from mail houses. They can be, but as you saw from an earlier statistic, that’s not a cost-effective solution in the long run. The potential new donors I’m suggesting are people who self-identify in some way. Perhaps you find them through a sign-up on your website or a visitor book if prospective donors can visit your facilities. They can and should also be from the networks of your board and other volunteer leaders. Adding even 10 new names a month can yield up to 120 new donors—if you communicate with and engage them through a relationship model as described above.

How can you make the grass you’re standing on greener? By grounding your fundraising approaches on a good understanding of your donors’ giving patterns and interests, creating strategic communications that invite donors into your work, and planting seeds for new supporters in the future. This will strengthen all of your fundraising—annual fund, major gifts, planned giving, and events—and create opportunities for donors to partner with you in bigger and better ways.

*From the 2013 DMA’s Response Rate Report

Barbara O’Reilly, Principal and Founder of Windmill Hill Consulting, has more than twenty years of fundraising experience at major non-profit organizations including Harvard University, the National Trust for Historic Preservation, Oxford University in England, and the American Red Cross.

Barbara helps non-profit organizations create impactful donor-focused relationships through strategic development planning and coordination of annual funds, capital campaigns, individual and institutional major gifts, and donor engagement.

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Fri, August 07 2015

Bring-’Em-Close Welcome Packs

Nancy Schwartz's avatar

Nonprofit Marketing Expert

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Filed under:   Marketing essentials •

I just donated to your organization for the very first time. So what kind of welcome am I going to get?

Will you respond ASAP with a quick, impersonal email and never be heard from again? Or will I receive that generic email or letter a few weeks or even months later, when I’ve totally moved on, and that’s the last I hear from you—until you ask me for more money?

I think you see what I mean.

There’s nothing I hear more of from you than complaints about donor drain. You’re not alone. Donor attrition is a perennial struggle for most nonprofits, despite the fact that retention rates are slowly rising.

But there is a proven, doable path to plugging this deadly donor drain.

Just imagine your organization welcomes me like this:

  • I receive a brief, warm, conversational thank you email within a few hours of my donation. It’s from an individual, who “signs” it.
  • Within the next week or two, I receive a warm, personalized (beyond just my name in the salutation), and in-depth welcome pack.
    • Format is not set in stone, but hard copy can be effective for baby boomers and beyond.
    • Your executive director or a program staffer tells me how my donation is going to make a difference.
    • You also share a clear, easy to remember and repeat story of one or two of the organization’s clients or beneficiaries, and I get to know them a bit more via their photo.
  • I get your organization and start to feel like part of the family.
  • I’m pleased to be appreciated, respected, and making a difference.

You can do it, too!

No matter how small your new donor’s gift, making this early post-thanks communication warm, personal, and motivational (to do more—volunteer, participate, give again—at least in time) is key. It becomes the first step across the bridge to donor retention.

This welcome pack from the Stickley Museum gets five stars.

Stickley Museum Welcome Pack

Take the welcome pack I received following my family’s recent donation experience to the Stickley Museum. The museum is just 30 minutes away and, as the home and workshop of arts and crafts movement designer Gustav Stickley, a place we’d been meaning to visit for years.

We finally got there, arriving just in time for a walking tour (free with admission). We quickly computed that we could join for the price of family admission plus $10 or so. I have to say that both the place and the folks who ran it—mostly volunteers—took us, and we joined.

I thought that was that. I never expected to hear much again from the museum. It’s a tiny organization with just a couple staff members. So I was delighted to receive a juicy welcome pack in the mail a week later. The pack included:

  • A hand-signed thank you/welcome letter from the acting executive director, telling me the difference my donation is going to make. I’m a sucker for real ink.
  • An overview of member benefits, most of which I wasn’t aware of and generated an “a-ha.”
  • A listing of upcoming walking tours on a range of topics I had no idea the museum would address. Who knew this place was even more interesting than I thought?
  • The most recent newsletter, 12 pages in full color. Don’t get stuck there. Yours can be four pages if that’s more doable. The point is to showcase the range of your organization’s impact via words and graphics, and to put varied opportunities for further engagement in front of your new donor.
  • A brief invitation to volunteer with a couple of specific, ultra-short-term opportunities. Finally, an organization that tries to get me more involved at the moment I’m still paying attention. I’m in love!

Take a hard look at the Stickley Museum’s welcome pack components. What’s relevant to your new donors? What else would you add? What’s not a fit?

Shape your welcome pack to your donors’ wants and habits, including format, contents, tone, look, and feel. Do it right, and it’ll feel like a welcoming hug from a newish friend or family member. There’s nothing better!

Tell us: Does your donor welcome pack—traditional or not—bring new donors close? Please share your tips in the comments section.

More on Welcome Packs

With refreshing practicality, Nancy Schwartz rolls up her sleeves to help nonprofits develop and implement strategies to build strong relationships that inspire key supporters to action. She shares her deep nonprofit marketing insights—and passion—through consulting, speaking, and her popular blog and e-news at

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Wed, August 05 2015

The Quick and Dirty Guide to A/B Testing Your Donation Page

Caryn Stein's avatar

VP, Communications and Content, Network for Good

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Filed under:   Fundraising essentials •

Your landing pages are important, and your donation pages are no exception. Do you ever wish you could know which messages, suggested donation amounts, or photos are the best at inspiring your donors to give?

Enter A/B testing.

Although testing might seem a little scary if you’ve not done it, there are simple tests you can perform to ensure you’re getting the most out of your online donation pages. Basic A/B testing helps you decide which images, calls to action, and suggested donation amounts perform best by comparing the effectiveness of two versions of your donation page.

Here’s how it works: a randomly selected half of your audience is served one form (the control), and the other half gets another form (the test). The test version has just one variable changed: the layout, image, copy, or headings.

Over time, monitor which donation page has the higher completion rate, calculated as follows: number of donations divided by the number of people who landed on your page.

Not so scary after all, right? Here’s a simple step-by-step guide from my friend (and super-smart fundraising pro) Alia McKee of Sea Change Strategies:

  1. Set up a control donation page.
  2. Decide which variable you want to test (see “What to Test” below).
  3. Set up a second donation page with that variable changed.
  4. Make both pages live and drive traffic to both forms. (You can split your email list and include a different page in each email.)
  5. Track completion rates across both pages, calculated by the number of donations divided by the number of people who landed on the form.
  6. Monitor your results (depending on the traffic to your pages, your test may need to run for a longer period of time).
  7. Check your results with a statistical significance calculator like this one.*
  8. The winner of this test becomes your control.
  9. Now, start the process all over again to get even smarter. Test another variable against your new control to learn what elements improve your conversion rate and lead to more donations.

* What’s a statistically significant result? This just means that you can rest assured that your results did not occur purely by chance.

When to Test

The best time to test is when you think you’ll get a significant amount of traffic to your donation page. These moments might include:

  1. A specific email campaign.
  2. In December, when a majority of online giving occurs.
  3. A high-profile event or during media attention

Higher traffic volumes mean you’ll have a better chance that you will get statistically significant results. If you have low traffic volume, you must test for a longer period of time to get significant results.

What to Test

So, what should you test? Here are a few ideas that typically yield useful insights:

  1. Photos: Does a puppy beat a kitten?
  2. Layout: Does a one-column form beat a two-column form?
  3. Testimonials: Does a testimonial from another donor increase completion rates?
  4. Donation amounts: Does a lower suggested donation amount increase completion rates?
  5. Copy: Does shorter intro copy beat longer intro copy?
  6. Premiums: Will offering a thank you gift increase completions?

What Not to Test

On the flip side, there are a few things that aren’t worth the effort. Here are a few tests you can avoid:

  1. More than one variable at a time: you won’t know which element made the difference.
  2. Elements that are outside your nonprofit’s branding: this different experience will likely cause donors to be confused, affecting your completion rates.
  3. Images that are too similar: it’s unlikely this will have significant results, and therefore not worth your time.
  4. Copy that is too similar in tone and length: your donors likely won’t notice the nuance.

How to Read Your Results

  1. After a period of time, run your results through the significance calculator. If you have statistically significant results, you can name the winner and move on to another test.
  2. If you don’t have a statistically significant winner, keep the test live for few more weeks to collect more data.
  3. If you still don’t have a statistically significant winner (and this sometimes happens), try testing a different variable.
The Ultimate Donation Page Guide

Now is the time to start thinking about testing your pages, if you’re not in the habit of doing so already. If you can work in a few tests in the next few months, you’ll be in prime shape to greet an onslaught of donors come December. What do you plan to test? Let me know what you’re testing in the comments and share your results!

Want more tips on improving your donation pages? Grab a copy of the Ultimate Donation Page Guide!

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Tue, August 04 2015

Nonprofit Love: A Music Playlist to Inspire You

Liz Ragland's avatar

Senior Content and Marketing Associate, Network for Good

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Filed under:   Fun stuff •

Sometimes nonprofit fundraisers and marketers need to take a deep breath and then...rock out. Ok maybe not "rock out," but listening to music can help spark creativity, help you relax, or pump you up.

I reached out to some of my nonprofit friends on Twitter and asked them what they listen to at work to get them "in the zone." You can see who contributed song ideas in this Storify.

The responses were varied: some prefer quiet background music, others want something a little more groovy or fast paced. Whatever your music tastes might be, I think you'll enjoy the playlist we crafted just for you!

Ladies and gentlemen, meet the Nonprofit Love playlist. Thanks to everyone who answered my call for suggestions!

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Fri, July 31 2015

What Your Social Fundraising Campaign Is Missing

Caryn Stein's avatar

VP, Communications and Content, Network for Good

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Filed under:   Social Fundraising •

Hands In

Social fundraising can help even the smallest organizations spread their message and attract new donors. These peer-driven campaigns tap into the networks of your supporters allowing you to expand your reach beyond your list.

But the real power of turning your donors into fundraisers is not just about the multiplier effect. It's about harnessing the personal stories and passion of those who care about your work. A generic copy and paste doesn't begin to realize the full potential of a social fundraising campaign powered by testimonials, personal experiences, and emotion of individual fundraisers.

The ultimate success of your campaign hinges on one key factor: personality.

If your P2P campaign is missing this element, you're not just missing the opportunity to create something magical, you're missing out on donations.

So, how do you ensure your peer fundraising campaigns have the kind of personality that will make others take notice and be inspired to act? Here are three ideas:

  • Let go, just a little. It can feel a bit scary to let go of your message, but remember: letting your fundraisers share their own passion, in their own words, is a powerful thing. This is the kind of authenticity you can’t come up with all by yourself, especially when your goal is to reach the friends and family of your supporters, who will be moved by such a personal message. In most cases, their message in their words holds the most influence.

  • Stories beget stories. Once people start sharing their personal experiences, it often inspires others to do the same. To get the ball rolling, ask a few of your staff, volunteers, or beneficiaries to share their stories in writing, photos, or video to stoke the emotions that will draw out the passion in your donors turned fundraisers. Connect them to why they gave in the first place.

  • Give a nudge. Quite simply, if you want people to include their stories, you gotta ask. Seems obvious, but your fundraisers will need a little guidance and encouragement. Give them a few prompts or templates to work from, but remember to allow (and push) for creativity and personality. Your online fundraising tools should give your fundraisers plenty of opportunity to make their message their own.

Want to learn how the right social fundraising software can help your supporters tell their story and share their passion? Schedule a demo and see our software in action!

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