Donor ‘Relationships’? Balderdash!
Nonprofit communications guru Tom Ahern has just published a fascinating post in his e-newsletter asking and answering the question: How long does the average donor give?
Eventually I expect the article will be available to slowpokes on his website.
Before I report the answers to his question (he asked a whole flotilla of consultants and practitioners), I ask YOU to answer the question from your own experience …
- 1 year?
- 2 years?
- 5 years?
- 8 years?
- 10 years and more?
As some of Tom’s respondents noted, the ‘average’ tenure for every organization would be dragged down by the fact that for most (if not all) nonprofits, most donors give but once, and then are gone.
Hence Roger writing a book called Retention Fundraising!
But even taking that in account, I was surprised at the relatively brief tenure some of my favorite experts cited:
- Adrian Sergeant — 4.6 years (he was the most precise)
- Jeff Brooks — tops out at 7 years
- Lisa Sargent — 2-3 years
- Roger Craver — once they’ve made a 2nd gift, 7-8 years (hmmm, maybe he knows something about retention!)
- Sean Triner — 2-3 years, including the one-gift deadweights.
- Mark Phillips — agreed with Sean, but added: “the best 5% of the file tend to stick with you forever”.
All in all, I found this disheartening. If the average donor lasts only 2-3-4 years, is there really any incentive to invest in building ‘donor relationships’? Are ‘donor relationships’ as real as unicorns and leprechauns — or just as fanciful? Why not just accept that churn is inevitable and get back to real life — i.e., mail and email and otherwise harass the crap out of your donors until they fall lifeless and get shoved aside.
If there’s a good rebuttal to that, it must lie in the experience implied by Roger’s and Mark’s responses. What you need to focus on is the revenue stream generated by your multi-year donors. Get as many donors as possible over the hump of making that crucial second gift.
Then you might have a shot at relationship building … at optimising net income … while your average tenure, just a trailing metric, takes care of itself.
Get started by profiling (not averaging) the tenure of your donors — how many 1 year (surely your biggest percentage), 2, 3 … 9, 10, 10+year donors do you have? Then look at the net revenue generated by each of those cohorts. Do you treat these cohorts differentially — e.g., do you recognize donors’ giving anniversaries?
It shouldn’t surprise you to find that ‘donor relationships’ are indeed rewarded.
There’s no ‘normal’ life span to an active donor. They’re not fruit flies. Their longevity is in your hands.
Tom
8 responses to “Donor ‘Relationships’? Balderdash!”
Behavioral Science Q & A
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I’m not an expert in this but a quick search surfaced this article on the effect of tax reforms on 2019’s charitable giving. The researchers didn’t find a reduction. Actually, they observed an “increase in charitable contributions in 2019, even with the lower tax rates and the dramatically smaller number of taxpayers who itemize their […]
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Tom: I can add to this based on direct experience. My 2-3 year estimate was provided by an agency client of mine — a guy I trust a lot — with decades of experience, and it’s US based. Working together with Denisa Casement at Merchants Quay Ireland we just topped a 69% donor retention rate last year, meaning that donors are NOT fleeing the list at warp speed (and this is increasing retention alongside an active AQ program). How? Precisely for the reasons you cite: consistent, kick-butt donor care. Their longevity really IS in our hands. When you take that notion fully to heart, across all channels, magic happens.
A better question would be: why does a donor leave? The answer to this tells us when the donor will leave. From this it is easy to deduce how long a donor continues to give.
A donor will leave when she feels the disconnect with the organization or feels she is taken for granted. This could happen after the first gift or the 10th. or anytime in between.
I had donated to 11 charities last December but have recd. acknowledgement from about 50% of them so far. The only way I know they have even recd. my gift is to check my bank account. I will continue to give to these charities because I believe in the work they are doing but I surely would have felt better to receive a simple “thanks”.
Arvind: if you’ve never read Dr. Adrian Sargeant’s (no relation) research on why donors leave — which btw is a wonderful question you ask — see 2008 pdf here: http://www.afpnet.org/files/contentdocuments/donor_retention_what_do_we_know.pdf and an excellent summary over at Bloomerang here: https://bloomerang.co/blog/dr-adrian-sargeants-7-principles-of-donor-loyalty/. Also see fabulous infographic from Bloomerang’s Jay Love over at Fundraising Coach Marc Pittman’s blog here: https://fundraisingcoach.com/2013/04/15/guest-post-why-donors-stop-giving/. You won’t be shocked to find that lack of a thank-you features prominently. I feel your pain and hope that next year’s giving finds you far more appreciated for the good you did, in giving. A thank you is such a simple thing. 🙂
Oh Monsieur Belford: Donors aren’t fruit flies? And now you’re telling me that all of us fundraisers and our NGOs are responsible for donor longevity?! Surely you jest?! Must be the New Zealand summer sun! Ah sadness… Or as we would say in French, tristesse.
For everyone, follow the research at the Centre for Sustainable Philanthropy (founding director, Adrian Sargeant; research director, Jen Shang, the world’s first philanthropic psychologist). Centre for Sustainable Philanthropy at Plymouth University, U.K.
The Centre will be reporting on recently-completed research about relationship fundraising.
A major healthcare organization shared 15 year giving results. They spent $9,617,974 in acquisition and retention to acquire 248,971 donors with a cost per dollar raised of $1.01
.Over the course of 15 years, 50,103 donors have continued to give, and their giving=$49,271,014!
This organization has a culture of philanthropy that is off the planet. They consider acquisition as a long term investment.
So, how long does a donor continue to give?
I’ve had some experience with organizations that do care for their donors. And it really is about donor care – treating them well, letting them see the work they make possible, inviting them into it. At one organization, our retention rate was between 72 and 72% even during the recession. We made a big deal about their loyalty – special recognition, events, etc.
At another I worked for years ago, I don’t know the number, but I do know that a look at their donor lists (in programs) shows me many, many donors I remember welcoming to the organization. They’ve stuck around more than 20 years!
How silly it is not to pay attention to this! And really? It doesn’t take that much effort. Sadly, donors are used to pretty lackluster treatment. Step above that and watch what happens!
Oops… should read 72% and 74%… sorry!
Thank you, front-liners, for all you share. Your comments show there’s a deep answer to my purposely simplistic question: i.e., How long does the average donor give? (1) Expect half your first-time donors to never give again. (2) Expect almost all the rest to be gone within 3-5 years. (3) UNLESS you improve your retention practices, in which case you’ll be rolling in dough thanks to your own intelligence and hard work. (4) Read Roger’s book, damn it; if you’ve got a flat tire (tyre), his book will fix it. (5) Embrace unfettered, unembarrassed donor-centrism in your language. (6) Put the “fun” back in fundraising. (7) Don’t ask your boss, TELL your boss. (8) Track retention metrics. And invest where the ROI is best. (9) Churn and burn is for chumps and the stunted and those who do not sweeten their morning oatmeal with hope.