When To Give Up On A Donor?
I’ve had two experiences that make me question when to give up on a non-responsive donor or member.
From too many donor focus groups, I’ve carried away the observation that a startling number of donors don’t even know they’re donors — that is, donors to the specific cause or charity that has them under the lens that particular evening.
There you are, having picked a sample of lapsed donors to Tom’s Worthy Charity (TEC), and when you ask them to name charities to which they’ve donated, there’s always several who don’t name TEC. Behind the glass, in angry frustration you toss another handful of M&M’s down your throat and curse them out. Then worse, even when prompted: “Do you give to any environmental charities?”, there’s still no voice for TEC!
How many of you have been there?
With so little recall — reflecting failure to connect, failure to differentiate — why should TEC be surprised that these are lapsed donors? What are the realistic prospects of re-activating these?
On the other hand, I publish a magazine. Given the nature of the magazine, I tend to think of my subscribers as members. I like to think our readers really bond with our publication, and they support it because it represents a bit of a cause and community for them.
So I never give up on subscribers who have lapsed. I’m astonished at the number who, all of a sudden, pay up again a year, 18 months or more after having lapsed. Often with a note saying something like, “Sorry I let this slide.” Or, “I think I might owe you.”
I know there’s no ‘recall’ issue here. I have no real competition and our geographic market is limited. So it seems to make sense to wait them out! And yes, they get reminder notices of various kinds along the way.
So I suppose the smart advice to TEC (assuming they’ve already read Roger’s Retention Fundraising) is simply to play it by the numbers … at what point does it no longer return an adequate ROI to chase the remaining laggards? Or, when does it become more rewarding to invest in chasing new donors?
With my magazine, I suppose at some I should do the same ruthless calculation. But I’m much more aware that my target universe is not a bottomless pit … it’s a limited pool, and so I know I cannot afford to let relationships wither with subscribers. And that certainly gives me a different attitude about retention and relationship building than your typical nonprofit fundraiser, who thinks,”Hey, there’s always a few more million names I can rent”.
It comes down to how precious one believes your current donors, members, subscribers are. If they’re perceived to be readily replaceable, there won’t be much commitment to retain or regain.
What your attitude? How precious are your donors? How badly do you want to retain them? What price will you pay to regain them?
Tom
8 responses to “When To Give Up On A Donor?”
Behavioral Science Q & A
Integrating an individual giving appeal with other communications from a charity can have both positive and negative effects, and the outcome largely depends on how it’s executed. Advantages of Integration Brand Consistency: Maintaining a consistent appearance and messaging across all communications can reinforce the org’s brand identity and strengthen brand recognition and trust among your […]
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There’s just one thing to consider when designing a supporter journey: the supporter. More specifically, you need to take into account: Who the supporter is i.e. their identity, which is the reason they support this cause, and their personality, which describes the way they “see” and process the world. These will determine the kind of […]
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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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I think there is another aspect we should take into account – and that is if someone is engaged and interested in you but currently doesn’t have the capacity to give. Are they lapsed becuase they are not an active donor? What they do have, if not disposable financial capital is “social capital”. And the social capital they have with thier network will be far greater than the social capital your cause will have. Social capital is powerful – think when a friend asks you a favour or gives you a recommendation. So can you inspire them to spread your story for you? The answer is no if you write them off as a lapsed donor. It gets better too – because in this connected world you do not know who people know. In effect everyone is now a channel. So an individual can open doors to a corporate, a foundation even a major donor if they are so inspired. So if they are interested in you and the mission you stand for never give up.
A small organization I have worked with is facing a slightly different question: a high number (about 20%) of (mostly) elderly donors living on a fixed income who give $1 (or less!) when they receive an appeal. I wanted to simply remove them from the donor list. They cost the organization money that it frankly doesn’t have to continue to invest in these relationships, i.e., the mailing and thank you postcard cost MORE than the donation.
This bothers me on 2 levels: (1) fiscal prudence + limited human resources to document each donation in database (when time could be spent on other efforts), and just as importantly (2) the donor’s wish to support the organization’s cause is completely wasted on communications – nothing is actually left to support “the cause”. (I also suspect that some of these are lonely folks who just like getting & sending mail. As much empathy as I have for them, keeping them as “donors” should be a business decision, IMHO.)
Has anyone found an ethical, responsible way to deal with this issue of donors who give very little, and who are very unlikely to give more – while protecting the fiscal health of a small organization??
In response to Richard Turner’s comment above, I don’t believe (but do not know for sure) that these folks have a social network that would be of any value to the organization.
Maybe I’m a fail on the logic scale today. But I love those $1 donors. I think about what it means to them to give. About how meaningful $1 is to them – probably much more than $100 from someone else.
I think our missions are broader than just dollars and cents.
And if a hard-headed possibility is needed… I’d wonder if my organization had found its way into their wills. There’s a long-term thing here, too.
Most nonprofits have limited resources, so I would recommend several strategies. Send those donors 12 envelopes with your nice, impactful thank you letter. Invest the funds saved by not mailing them in retention strategies for higher value donors. And if those under $5 donors have been on the file for 10+ years, send them an insert in your thank you mailing on your legacy program. They might be cash poor, but I bet they have assets.
I agree on the importance of researching and establishing a profile of those who have left bequests in the past before jettisoning really low-dollar donors. When I was Dev Dir for a regional animal shelter/vet hospital, we averaged 10-15 bequests a year of $5K or more from under $25 donors who had either lapsed in previous 3 years or gave less than $10 at a time and no more than twice a year; this out of an active donor base of 20,000. Does not mean one should just keep mailing $1 donors forever but best to research past bequests to see, as Mary said, if a worthwhile share of your low-dollar folks are those who live on a fixed income or are thrifty in life but have also put you in their will.
To Anita Robinson:
How many of your elderly, $1 donors would consider a gift through a will or other deferred vehicle?
Have they been giving for 5+ years?
While their fixed incomes render them unable to give more now, and some of these donors may not be committed to your organization’s work specifically, some could be prospective legacy gift donors.
If you’re mailing to them anyway, why not include something about how meaningful a gift through a will would be for them and your organization’s work? Include simple wills language with all the information they need and develop a follow-up plan.
Maybe this group of your donors also would respond to the chance to be recognized as members of your Legacy Society.
Tom,
This is so true! I have also been focus groups and had the same horrified response — when proven donors say they have no recollection of ever giving to one of my clients even though I can see that they gave once or multiple times.
And I think I’ve eaten from the same bag of M&Ms wondering what can we do to make sure my clients do a better job to distinguish themselves from the plethora of other enviro, Democratic or Jewish organizations because donors often don’t know the difference.
Worse, in the focus groups and later when field testing some of the “better” distinguishing descriptions to denote how and why these organizations are different, the new messaging drives DOWN the response rate.
Surprisingly, many of these donors and active members prefer giving to the generic category as opposed to a more clearly delineated description of the client’s mission.
Yes, this speaks to other problems in our biz: too many groups doing similar work, too many organizations parading as doing our clients work when they don’t, the need for a better mission statement, etc.
But until the world becomes perfect … Marketers need to know what to do. And one answer is DO NOT assume lapsed donors consciously gave up on your organization. They usually do not remember WHEN they last gave. Also do not assume they are giving for all of the reasons YOU think (or focus groups think) other donors should love or appreciate.
And do NOT assume making your message or mission clearer in their heads will increase your response rates.
Lastly, NEVER let the focus group design your package or shape your pitch — unless you enjoy pain. Those focus group-created packages will tank when mailed to hundreds of thousands of lapsed or current donors. That’s another topic for another day.
In the meantime, ask for a sandwich to go with your M&Ms and know you are NOT alone when asking the focus group organizer, “Are you sure these are MY lapsed donors?” Been there.
Greg Adams
Formerly Adams Hussey & Associates (& CCAH). Now @ Capitol Kreative
Mary Cahalane – “But I love those $1 donors. I think about what it means to them to give. About how meaningful $1 is to them – probably much more than $100 from someone else.
I think our missions are broader than just dollars and cents.
And if a hard-headed possibility is needed… I’d wonder if my organization had found its way into their wills. There’s a long-term thing here, too.”
Mary, I understand your feelings about the $1 donor, and what it means to them to give $1. But frankly I’d rather they gave that dollar to one of their local all-volunteer organizations where it would actually be put to the use they intended it for – not to cover the cost of a reply envelope and postage.
Our missions are broader than dollars and cents, BUT our first responsibility is to the organization’s fiscal health, so that it can continue to fulfill its mission. (I’m sure we’ve all seen organizations where this wasn’t the case, and many of them are no longer around.)
In answer to the longer term prospects of these donors, the agency I mentioned subsequently completed a survey of small, long-term donors and found that they were not the ones who left a bequest. In fact it was those donors who typically gave/were able to give $50+/annually who named the organization in their wills.
Assets? Maybe. We’ve all heard about the house cleaner, handyman, (etc), who lived frugally and left some organization a million bucks. But has anyone else here had to deal with an elderly parent or relative who needed assisted living, a part time or full time aide, or skilled nursing? Those assets go pretty darn fast, and the elder elder (85+) population is the fastest growing cohort in the US today. And healthcare costs continue to escalate. So, assets? I find it impossible to believe that the great majority of low-level donors have many assets. I’d love to be wrong, but I’m a realist.
Finally, a little math: IF an organization spends $10/year on a donor who gives $2, that is an $8/yr loss. Assuming that costs increase over time, it’s probably safe to say that the annual losses will total $100 after 10 years. If I have 35 donors like this, I will need to have ONE leave a legacy gift of at least $3,500 just to break even. I just don’t see that as a good business model. I think we MUST, for the sake of our organizations and their MISSIONS, focus our resources on those donors who are able to provide the resources that enable an agency to “do its job”.
If the organization is very dependent on individual gifts (.e., doesn’t get gov’t contracts to provide services), we should be utterly focused on providing those services/advocacy that are the reason(s) that donors are giving their $upport to the organization. This means limiting our fundraising efforts to those who actually have the capacity to give.
Finally, and personally, there’s nothing that turns me off an organization more than giving a small initial gift (of say, $15) and then seeing it p*ssed away on additional fancy and obviously expensive fundraising mailings. Ugh. As fundraisers, we must never forget that mission/program which we are actually supposed to be seeking to fund!