All of a nonprofit’s actions are interconnected. If you do something to enhance your fundraising, that action is likely to affect another one of your strategies as well. Therefore, make sure you’re thinking through how one decision will affect each and every one of your strategies.
This means that when you’re looking for advice to improve the efforts of your nonprofit, don’t mindlessly accept what you read. You need to consider how one decision can have a domino effect. How will asking for a major gift impact your relationship with a donor? How will implementing a matching gift database affect the user experience of your website?
We’re not saying this interconnectivity is a bad thing. Actually, just the opposite. When you carefully think through your decisions, you can purposefully enhance one aspect of your nonprofit strategies and simultaneously improve another effort.
One of the best examples of this phenomenon in the nonprofit world is the connection between donor relations and fundraising efforts. Improving your relationships with your donors can result in more revenue. Meanwhile, improving the way you approach fundraising can increase transparency, resulting in better donor relations.
We’ve compiled some top tips to expand upon the relationship between these two factors. Let’s dive in to learn more about this symbiotic relationship!
Tip 1: Keep an eye on your donor retention rate
Your organization’s donor retention rate is a great indication of how well your nonprofit is maintaining its relationships with donors. A high retention rate means that your nonprofit has not only touched the hearts of donors once, but has done so repeatedly. A low donor retention rate is like your car’s “check engine” light; a clue that something might be wrong in how you’re approaching relationship-building.
Make sure your nonprofit has an effective way to keep a steady eye on this metric. It should be in more than just your regular reports. Increasing donor retention rate should become a habit, so frequent access to this metric is key.
The best nonprofit CRM (customer relationship management) software will display your donor retention rate directly on your performance dashboard for everyday access. Another option is to set up a weekly regular report featuring donor retention rate (and other important metrics if you so choose) to be sent to your email.
Tip 2: Know the factors of engagement
Not all donors are created equal. While they are all important to your organization, some have shown to be more valuable than others even if they donate the same amount. Higher engagement rates reveal which donors are more in touch with the core mission of your nonprofit.
Many nonprofits focus only on the donation amounts from their donors. This is a mistake. Be sure your nonprofit also looks at the other factors of engagement in order to build relationships.
Look at engagement factors such as event attendance, volunteerism, email click-through rates, tweets to your organization, website visits, and recency of giving. From this information, you may see signals of donors becoming disenchanted with your organization (a sign to reach out) or have a better idea of who to turn to for opportunities like major giving.
When you’re investing in new tech for your organization, choose fundraising software that takes these factors into consideration. This will help you pay better attention to donors’ cries for attention as well as signals of potential lifelong relationships. Don’t miss out on engagement opportunities for interaction by ignoring these important factors.
Tip 3: Know each donor’s history
Not only should you know the engagement factors that affect your donors, but you should also have a good way to see how each donor is engaging with your organization over time.
For example, if you see that a donor hasn’t given in a while, you should check to see if they have engaged in other ways. Maybe they’ve attended an event or volunteered.
Knowing this information can help you to better understand your donors and communicate more effectively with them. It can also prevent you from potentially embarrassing assumptions, like considering a donor to be lapsed when they’re actually engaging in other ways besides just monetary donations.
Make sure you have an effective way to view the recent history of each of your donors. A timeline of their compiled information in your CRM is one effective way to accomplish this for every donor instead of searching through cluttered data on a spreadsheet.
Tip 4: Kick-start prospect research
You’ve probably read many articles citing prospect research as one of the best ways to improve your fundraising asks. Knowing more about each prospect can help you to be more intentional about your approach and the gift amount you ask for.
Invest in access to a prospect research database, like DonorSearch, to gain access to the philanthropic and wealth indicators that can help you make fundraising outreach decisions. They integrate with many of the leading donor database providers.
Tools like these will show you where constituents have previously given, as well as wealth factors like what kind of real estate they own. You don’t have to screen strangers either. Knowing the capacity of your current donors can help guide your asks, preventing you from the embarrassment of asking for too much or too little.
Tip 5: Communicate using various platforms
While it’s not a bad idea to consider the types of communication that have resonated well with the recipient in the past to choose a messaging platform, taking a multi-channel approach has its benefits.
For instance, donation request letters don’t have to be reserved for donors who have only given through the mail. Likewise, email doesn’t have to be the only channel you use for those who have only given online.
Often times a direct mail piece can lead a donor to give online, so don’t be too quick to lock someone into a communication channel that only reflects the channel through which they last gave.
Tip 6: Use effective language in communications
Writing and sending messages to supporters is a nuanced process. Your language in letters, emails, and social media updates should be clear and direct, but most importantly donor-centric. Picture yourself in the donor’s shoes reading the message before you hit “send.”
Send messages that will register directly with your donor by using donor-centric language. Research has shown that the word “you” is key to fundraising efforts. By using this word, you’re putting the spotlight on them instead of the organization, thus validating their own needs and interests.
Before sending messages, check to make sure you’re avoiding the words “I’” and “we” as much as possible. Some software offers a service to check this usage before you send your message. For instance, Bloomerang offers the “Ahern Audit” feature that will run this “you” test and check how donor-centric your message is.
Tip 7: Use social media to show appreciation
Nonprofits everywhere are leveraging social media as a gift acquisition channel, but few use it to its best potential: as a gift acknowledgement channel. Social media is a great, informal way to show appreciation to your supporters, including donors, volunteers, employees, and sponsors.
Most people’s news feeds are cluttered with bad news and commercials. As a nonprofit, you can be a lone bright spot by shining a light on those who support you.
Plus, when you tag your supporters in your posts and photos, it shows up to all of their friends (depending on their security settings). It’s a great way to get your brand in front of new people, while saying thank you!
Tip 8: Ask donors how they feel about you
While all of the above advice is a good way to measure how healthy your donor relationships are, you don’t have to just wonder. You can ask your donors how they feel about your organization, the cause, and how they’ve been communicated to.
Research shows that regularly surveying your donors is a good idea. Even if they don’t respond, it still shows them that you care what they think. And if they do respond, you can put that feedback into action immediately (don’t worry too much about suggestions concerning what color the table cloths should be at your event).
While many nonprofits isolate each element of their overall growth strategy to be a different entity, that’s not the most effective way to accomplish your goals. Everything is connected and should be treated that way.
While this guide walked through the relationship between donor relations and fundraising, there are many other elements that need to be considered. Think about your event planning, your outreach strategy, your approach to gift acknowledgements, and more. All of these things are impacted by your actions.
Before making a big decision for your nonprofit, take a minute to consider what other elements of your overall strategy could be impacted. Consider both the positive and the negative potential impacts. Then you can make a conscious effort to make the biggest positive impact for your nonprofit in a single swoop.
Jay Love is co-founder and chief relationship officer at Bloomerang. A 30-plus years veteran of the nonprofit software industry, Jay Love co-founded Bloomerang in 2012. He currently serves on the board of the Center on Philanthropy at Indiana University and is the past AFP Ethics Committee Chairman.