Retention vs Acquisition


What are you really doing to keep your donors?

‘We don’t have a problem with retention – our donors love us and continue to give to us every year.’ N E Muslim Charity

We hear this a lot, or variations of this theme. You like to believe it, because, after all, you believe in your charity so why wouldn’t everyone else who you come into contact with? Plus, you keep seeing the same faces at your events, and hearing from the same people – so it has to be true right? Hey, you only bumped into someone the other day who told you his whole family have been donating for years. Keep up the good work, he said. Remember?

So we ran an exercise with a client recently: no names, but one that’s built a good reputation, is still growing strongly, and is really delivering value for its donor’s bucks. But, despite our constant nagging, they just weren’t doing enough to maintain their existing donor base. Instead, everything was geared around attracting new donors. Of course this sounds familiar because most of you are in the same boat.

No, they insisted, we don’t lose donors, we don’t need to worry about them – they trust us. Our retention rates are way above average. But was this actually true? We did a simple exercise to see.

It was easy: we looked at giving patterns over 3 years and found that, historically, only 9% of donors remained as givers by the end of the 3rd year and just 53% after the first year.

Now, nobody keeps 100% of their donors, but if they could have done, then in this case they would have seen over £10m in lost income over that period. Even a 10% improvement in their retention rates would have yielded an extra £1m in much needed income. Certainly, those statistics got their Trustees attention in a hurry.

So what were the next steps to improving their retention rates?

Working out donations bands meant that we were able to define exactly how best to reach out to inactive donors. For example, from simple uplifts for lower-amount donors, to invitations to private events for bigger donors and more.

Then by going through the hotspots of donors we were able to put together a strategy to attract more donors form the same areas through more targeting banner ads and direct mail communications.

Thirdly looking at donation types meant we were able to adjust the focus onto the things that were working better, and work out how to better present the items that weren’t appealing as much.

Also, understanding average donor values led us to be able to suggest adjustments to the asks, and the timing of the asks. Ensuring they made more of an impact and resonated with that audience the most.

Once we understood all of this and the giving patterns of the donors we were able to work out the best times to instigate touch points for existing and new donors.

All of this was for a fraction of the income they will get back just for staying in touch with their supporters! It is also much more cost effective than going after new donors by the way.

So the moral of the story is clear: in this climate of increased competition and increasing donor expectations, you absolutely cannot afford to get complacent about retention. Go run the exercise, we’d love to hear how you get on.

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