Donor retention, how good is yours?

The latest view on not-for-profit accounting issues

donor, donors, donor retention, nonprofit, accountingTurning first-time donors into long-term donors is always the goal but not often the reality. Gaining new donors is expensive and time consuming and often an organization will lose on the amount of time and money put into gaining that donor if they give only once. If you feel your organization has a difficult time keeping the same donors year after year, then you are not alone.

Statistics that show donor retention for nonprofits ranges 60% – 70%. To calculate your donor retention rate to see how you compare to the average:

  1. Obtain the number of donors your organization had last year
  2. Obtain the number of donors from last year who gave again this year
  3. Divide the number of donors from step 2 by the number of donors in step 1

There are keys to retaining donors such as working on making your donors fans of what your organization does and what you stand for. This will produce in them a loyalty to your organization as they become your cheerleaders.

Creating a relationship on an individual donor level can often be difficult for many reasons but it is hard for a donor to not feel a sense of value to your organization if you make them feel like the most important person in the world. Even something as simple as telling your donors “thank you” in a timely manner can mean a lot to them. Bottom line: put a strong effort in showing your donors respect and appreciation.

Lastly, make sure to show your donors how their contributions have helped fuel your mission. The sense of value they will feel just might turn them into a long-time donor.

As your organization works on increasing that donor retention rate, keep track of the things that work and don’t work for you. Find a way to measure responses to figure out which method of telling your donors “thank you” is the most effective in bringing them back again and again.

Brandon Keeto