Tom’s post Donor Relationships? Balderdash produced a wonderful wave of comment from donor-oriented Agitator readers on the importance of working hard on designing and tending the relationship garden.

Lisa Sargent and Mary Cahalane share the experience and rewards of attentiveness to the donor relationship. Mike Cowart summarizes of a major healthcare organization that, because of its attention to donors spun a $9 million acquisition investment into $49 million in donor gold over 15 years. And Simone Joyoux wonders out loud and in her inimitable style why so many fundraisers are blind to the quality of donor relationships. Read the comments here at the bottom of Tom’s post.

For the life of me I truly don’t understand why so many organizations place such low priority, invest so little, and pay little more than lip service to building donor commitment or loyalty.

Maybe it’s because many believe there’s not much substance and too much fluff when it comes to donor relationship management.

That, as the commenters to Tom’s post note, is surely not the case. There’s lots and lots of research on the subject — empirical proof of why paying attention to relationship building is so financially important. [Check out the work and research of DonorVoice and the Centre for Sustainable Philanthropy for starters.]

In fact I devoted nearly a year to writing the book Retention Fundraising: The new art and science of keeping your donors for life based on empirical findings from the study of 250+ UK and US charities. A data-based framework for boosting retention and increasing lifetime value is summarized and applied in that book.

Over the years that Tom and I’ve been worrying over retention and asking other fundraisers, “What are you doing differently today to improve retention?” the answers we’ve heard most often:

• “We’re going to do a test using content marketing — no ask, more visuals, fewer touches or contacts with the donors.”

• “We’re doing a big push on acquisition to build momentum for file growth.”

• “We’ve identified who’s likely to give, upgrade and lapse. We know who’s best to pursue for conversions to monthly giving and who are most predisposed to lapsing.”

All these answers tend to be tactical — meaning they focus on techniques such as frequency of asking, the types of graphics used, the pace or volume of communications. Almost always they represent the act of throwing money at the retention/donor-care problem in a scattershot manner.

All are focused exclusively on activities undertaken by the fundraising/marketing folks. Little or no focus on donor service. Little or no thought on how best to relate programs and mission to the donor.

All place considerable emphasis on the who (the audience) but little attention on the why (donor attitudes for giving or leaving) or on the what (experiences the organization offers that will affect donor attitudes).

All are examples of winning the battle only to lose the war, because unfortunately, none is rooted in what causes door commitment or loyalty and what really boosts retention.

Frankly, I wish we’d hear this type of answer more often:

• “We’ve identified 5 changes we’re now making. We project these changes will add $375,000 in revenue at zero additional cost. They include focusing on the one or two core messages that matter most to donors and not on the other four we’ve also been using.”

• “We’re eliminating two publications that add no value for our donors; improving our first-call resolution in the donor services department; setting up a donor feedback program on our website and in donor services to address problems when they occur so we can build relationships in real time.”

• “By eliminating activities that don’t matter to donors and improving those that do, we’re creating a meaningfully different experience for our most loyal donors and deriving significantly more revenue from them with no mid-level or major gift officer required.”

Fanciful? Hardly.

Responses like these reflect the fundamental reality of building donor relationships with greater loyalty and commitment. They signal the fact that you can’t use business-as-usual tactics to stumble your way to a solution. And you can’t throw money willy-nilly at the problem through a series of techniques and tactics. And you sure can’t target your way to a solution of improved donor relationships through conventional (RFM) segmentation of a donor base.

The only way to arrive at a truly effective, results-producing relationship and retention solution is to identify the experiences that positively affect your donors’ commitment and loyalty and repair or eliminate those who don’t.

Yes, I do understand it’s a lot of work. And involves not only rolling up our sleeves, but also effecting a change in organizational mindsets and metrics. But consider that the studies we’ve done with thousands of donors to hundreds of organizations indicate that a highly committed donor — a donor with whom the organization has built a solid relationship — can produce 105% more income on average over a three year period, than those who’ve been neglected.

Even though there’s no longer any mystery to the steps and actions required to bolster donor commitment, is retention really a problem most nonprofits are interested in fixing?

I’m afraid the answer is categorically “No!”

Of course that “no” poses a dilemma, having devoted an entire book to outlining ways to solve the problem. Why the “no”?

Deep down I suspect most experienced fundraisers — particularly direct response fundraisers — believe that acquisition is a lot easier than building relationships and retaining donors. They simply don’t buy the adage that it’s easier to keep a donor than to find a new one.

And, in truth, donor acquisition is easier than retention and relationship building. Not less expensive, not more valuable, but easier. Retaining and building commitment in donors requires time to analyze and measure. Time to improve donor experiences. Time to test and evaluate improvements. A lot more time compared to the short-term tactics and measurements involved in acquisition.

Determining donor attitudes. Creating effective messages. Providing good donor service. These combined activities require considerable planning and effort.

Few organizations have either the stomach or resolve.

Does yours?

Roger

P.S.  Just as I finished this Tom Ahern, the guy whose question sparked Tom’s post weighed in with his thoughts.  Could have saved me the effort had he responded an hour earlier.

Here’s his full comment which pretty much says it all:

“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.”

–Tom Ahern