More Donors Down The Drain
In what it spun as good news, the Association of Fundraising Professionals, in the latest report of its Fundraising Effectiveness Project, has released findings indicating that nonprofits lost fewer donors in 2010 than in 2009.
Yeah, I guess that’s good news.
But here’s the bottomline, as AFP reports it:
For every $5.35 that organizations gained in gift dollars in 2010, $5.54 was lost through donor attrition, for an average net loss of -1.9 percent. In 2009 there was a much steeper average net loss of -17.7 percent (a median net loss of -8.1 percent).
Under the heading Priority One: Your Existing Donors, AFP advises:
“Research shows that it usually costs less to retain and motivate an existing donor than attract a new one. Your organization may have raised more money this year, but have you sacrificed larger, exponential growth by constantly churning through donors, losing just as many as you have gained? “Real” fundraising growth comes about by not just raising more money this year than the year before, but rather building and upgrading your donor base in the long term and minimizing your losses from lapsed or downgraded donors.
By focusing on retaining existing donors, there is less money that you have to spend recruiting new donors to replace your losses. As the FEP report notes, taking positive steps to reduce gift and donor losses is the least expensive strategy for increasing net fundraising gains.
Plus, the longer you keep your donors and cultivate them effectively, the more they will give over time. If people stay for longer they can upgrade their giving, give to a capital campaign, become a regular (sustainer) giver, volunteer, recommend a friend and perhaps even offer a bequest.”
Amen!
AFP helpfully provides this list of resources on donor retention.
Tom
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