Fri, April 27 2007
Filed under: Fundraising essentials •
My favorite Donor Power blog has a great post about new data showing a dip in donors. As Jeff points out, Target is saying:
... revenue for the entire year of 2006 grew a median 0.7% over 2005. Median donor counts are down 2.8% from 2004 to 2006, and have fallen a cumulative 1.4% over the past five years. This appears to be due not only to declines in new donor acquisition, which is down 6.7% over the last two years, but also to declines in both first-year and multi-year retention rates.
Here is what Jeff thinks it means, and I think he’s right. Consider what he says—it’s very important:
The donor universe isn’t shrinking; it’s just changing. We’re at the beginning of a generational changing of the guard in the donor-aged population. Boomers are different from the older generation, and they’re just starting to show up in significant numbers. From the under-60 group, you typically see lower response rate but higher average gift. Get used to it, because that’s the way it’s going to be for a few decades.
Fewer donors/more revenue is something many organizations are doing on purpose. They’ve discovered value is more important than volume when it comes to a healthy donor file. One $20 donor is better than two $10 donors; you’ll get the same gross revenue either way, but from the one donor you’ll get it at a better ROI—and you’ll walk away with more net revenue. Organizations that know this are not seeking the high volume of low-dollar donors. The result is just what TAG found: lower numbers of donors, but higher revenue.