What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 1
What Every Fundraiser Can Do to Stop Falling Donor Retention
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Ignited Online Fundraising Community
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 2
Donor Retention…Is the New Acquisition Strategy
Measure Donor Activity
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 3
Pay Attention to Retention
It takes 4 ½ times the resources, staff and effort to get a new donor as it takes to get a renewal.
Utilize dashboards to show activity and build in accountability.
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 4
What Every Fundraiser Can Do
to Stop Falling Donor Retention
Six Key Factors to Increase Lifetime Value by 200%
Jay B. Love
CEO & Co-Founder
Bloomerang
August 22, 2013
@bloomerangtech | 7
Your Presenter
Jay B. Love CEO and Co-Founder of Bloomerang
• 29 Years of Technology Leadership• Over 20,000 Database Installations• Former Founder & CEO of eTapestry• Former CEO of Master Software/Fund-Master• AFP Board Member• AFP Ethics Committee Member• Center on Philanthropy at IU Board Member• Innovation Fund at Butler University Board Member• Gleaners Food Bank Board Member• Co-Chair of Indianapolis YMCA Capital Campaign
3
@bloomerangtech | 8
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 5
What does a 10% increase in donor
retention rates mean in terms of LIFETIME dollars raised?
• 50%
• 100%
• 150-200%
Do you know your Retention %? »
@bloomerangtech | 9
Improving donor retention rates by 10% can improve LIFETIME dollars raised by?
• 150-200%!
(Do we have your attention yet?)
Is Retention important for NPO’s? »
@bloomerangtech | 10
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 6
“Active donor commitment is the enduring
passion for your nonprofit. Inspiring donors is
key for loyalty.”
- 101 Fundraising
Lifetime Value = Donor Commitment
@bloomerangtech | 11
Year
5.004.003.002.001.00.00
Val
ue %
of d
onor
bas
e re
mai
ning
120
100
80
60
40
20
0
Attrition Curve
@bloomerangtech | 12
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 7
Let’s dig even deeper into “actual” NPO data . . .
This scares most NPO Board Members »
Donor Attrition Over Five Years
# of Donors Attrition
Rate
Donors
Remaining
After 1 Year
Donors
Remaining
After 2
Years
Donors
Remaining
After 3
Years
Donors
Remaining
After 4
Years
Donors
Remaining
After 5
Years
1,000 20% 800 640 512 410 328
1,000 40% 600 360 216 130 78
1,000 60% 400 160 64 26 10
@bloomerangtech | 13
Fundraising Effectiveness Project (FEP)
A project to help nonprofit organizations measure and
compare
The 2012 Fundraising Effectiveness Survey Report is based on 3,184
responses for 2010-2011, from nonprofit organizations in the United States.
The 2010-2011 responses reflected a total amount raised of $2,049,794,709.
@bloomerangtech | 14
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 8
Fundraising Effectiveness Survey Report “FEP”
Participating Donor Software Firms:
• Donor2/Campus Management Corporation
• PhilanthrAppeal (FundTrack Software)
• DonorPerfect Fundraising Software
• The Raiser’s Edge ® (Blackbaud)
• eTapestry
• Avectra
• Bloomerang
• Sage Software
• MatchMaker FundRaising Software
• Telosa Software (Exceed!)
• Metafile
Donor Retention Rate
was 41%
Donor Attrition
was 59%!
2011 FEP Data on Donor Retention Rate »
@bloomerangtech | 16
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 9
Yes, your eyes read correctly:
Nearly SIX out of every TEN Donors
from the previous year did NOT
donate at all the next year!
@bloomerangtech | 17
@bloomerangtech | 18
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 10
Addressing the Retention Problem!
Is it a Donor Relationship Problem?
@bloomerangtech | 19
CUE THE EXPERTS:
Dr. Adrian Sargeant
Bloomerang Chief Scientist
Professor of Fundraising at the Center on
Philanthropy at Indiana University holding
what is presently the world’s only endowed
chair in that discipline.
Top 10 Most Influential People in Fundraising
Renowned expert on Donor Retention and
Donor Loyalty
Mr. Tom Ahern
Bloomerang Donor
Communications Head Coach One of the world’s top authorities on donor
communications
Author of 4 books on Donor Communications
Winner of 3 prestigious international IABC Gold
Quill awards
@bloomerangtech | 20
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 11
DONOR RETENTION BEST PRACTICES
Dr. Adrian Sargeant
Bloomerang Chief Scientist
“A 10% improvement in retention can double
the LIFETIME value of your donor database!”
@bloomerangtech | 21
Donor Retention Made Simple
@bloomerangtech | 22
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 12
# of Donors in Current 12 Months(from the previous years pool)
Divided by
# of Donors in Previous 12 Months
23
Figuring Your Retention Rate »
@bloomerangtech | 24
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 13
“The total net contribution that a
customer/donor generates during
his/her lifetime in your database”
Defining Lifetime Value »
@bloomerangtech | 25
LTV = åCi
where:
c = net contribution from each year’s fundraising activity
i = expected duration of each relationship in years
@bloomerangtech | 26
Defining Lifetime Value »
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 14
$1000 +
$500 - $1000
$100 - $500
$25 and under annually
$25 - $100
Value
Value Segments »
@bloomerangtech | 27
Why Do Customers Leave? (can this apply to donors . . .)
• Death 1%
• Relocation 3%
• Won by Competitor 5%
• Bad Complaint Handling 14%
• Lack of Interest from Us 77%
@bloomerangtech | 28
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 15
Key Reasons For Donors Leaving
• No longer able to afford support
• No memory of ever supporting!
• Organization asked for inappropriate sums
• Feeling that other causes are more deserving
• Not reminded to give again
• Organization did not inform how monies were used
• Did not feel connected!
@bloomerangtech | 29
@bloomerangtech | 30
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 16
Automatic Engagement Factors
@bloomerangtech | 31
• Recency and pattern of giving
• Cash donors vs. sustaining donors
• # of years giving +
• Upgrade / Downgrade + -
• Lapsed -
• Event attendance +
• Opens email +
• Click links in emails +
• Unsubscribes from email -
• Has stated communication preferences +
• Has inbound interactions +
• Has soft credits +
• Volunteers +
• Social Media (coming soon)
• …and a whole lot more!
What is the
donor’s
engagement
over time!
Highlight vital “retention” information
---
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 17
6 Key Retention Drivers(That can double lifetime value)
• Drip feed mission performance data
• Connect often
• Be personal (SEGMENT)
• Develop like a good personal friendship
• Find & use numerous human connectors
• Always communicate what monies are doing!
@bloomerangtech | 33
DONOR COMMUNICATION BEST PRACTICES
Mr. Tom Ahern
Bloomerang Donor Communications
Head Coach
"Successful direct mail appeals are quite simple. At
heart, they are love letters to donors & prospects,
woven through with clear cries for help."
@bloomerangtech | 34
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 18
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 19
@bloomerangtech | 38
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 20
Final Piece of the Puzzle
How many of you use a donor database?
What percent of the product do you use?
@bloomerangtech | 39
Final Piece of the Puzzle
How many of you use a donor database?
What percent of the product do you use?
@bloomerangtech | 40
• Majority of NPO’s Use Less Than 20% of Their
Database’s Functionality
• Large Amounts of Features = Complexity
• Database Complexity Keeps Fundraisers Out
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 21
@bloomerangtech | 41
1. Game Changing Ideas
2. Relentless Execution
@bloomerangtech | 42
Revolutionary Change Comes From?
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 22
Game Changing Ideas:
• CRM so Intuitive (No training needed)
• Anyone can (and WILL) use
@bloomerangtech | 43
Game Changing Ideas:
• CRM so Intuitive (No training needed)
• Anyone can (and WILL) use
• Bring BEST practices to life
@bloomerangtech | 44
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 23
Game Changing Ideas:
• CRM so Intuitive (No training needed)
• Anyone can (and WILL) use
• Bring BEST practices to life
• Focus on core functions only
@bloomerangtech | 45
Net Result:
All Fundraisers Use the Database
(Quite Revolutionary!)
@bloomerangtech | 46
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 24
Net Result:
All Fundraisers Use the Database
(Quite Revolutionary!)
Everyone using the database enables …
@bloomerangtech | 47
Net Result:
All Fundraisers Use the Database
(Quite Revolutionary!)
Everyone using the database enables …
FUNDRAISING SUCCESS!!
@bloomerangtech | 48
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 25
Next Gen Database/CRM
Enables Fundraising Best Practices
Donor Retention/Donor Communications
Extreme Ease of Use
Relentless Focus on Results, not Features
Leading a “Revolution of Change”
Pedigree . . .
”Finally Got It Right!”
FUND-MASTER
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 26
Conclusion:
So Strive For:
• Donor Satisfaction
• Donor Commitment/Engagement (which . . .)
• Donor Trust
• Donor Loyalty (close your eyes)
Doubling Your Lifetime Value = ?
@bloomerangtech | 51
Questions?
Presenter: Jay B. Love
52
What Every Fundraiser Can Do to Stop Falling
Donor Retention Rates
8/21/2013
Ignited Online Fundraising Community 27
September: How to Get More Likes, Comments & Shares on your
Facebook Updates
Thursday, Sept 1911 AM Central
Facebook Guru: John Haydon
What Every Fundraiser Can Do to Stop Falling Donor Retention
Please share your feedback on today’s
session with Jay Love.
Thank you!