Erica Waasdorp, CEO of A Direct Solution says, “If you don’t have a monthly donor program yet, you’d be wise to make that part of your plan for next calendar year and perhaps even sooner than that.”
People often ask me why you should focus on this now? Well, if last year’s Harvey hurricane disaster is any indication: Monthly donors provide sustainable revenue, no matter what happens. Their gifts keep coming in, rain or shine! In essence, it’s an extra insurance policy for your organization’s operating budget.
Monthly donors are also important for your organization, because:
a. They retain at higher rates. In other words, they will keep giving to your organization a lot longer.
If you know that the current donor retention rate stands at 45% (based upon 2017 AFP Fundraising Effectiveness Study), this means that out of the 100 donors you had last year, you only keep 45 donors this year! Research shows that monthly donors retain at levels of 85% or higher!
b. They will give you more money.
Let’s look at an example. If you have a donor who gives you one gift a year o $57 after you send an appeal, ,that means his or her annual value is $57. Once you convert that same donor to giving monthly, even if it’s at $10 a month, you just doubled the donor’s value to $120 a year. The better news is that many monthly donors will actually still give you that $57 and now $120 so that means the total value of this donor has jumped to $177!! And if you know that the average monthly gift is now $24 (but this does differ by type of organization (religious and animal and environmental tend to be slightly lower), you’ll do even better. I always recommend annualizing your revenue and you can see the impact.
c. It’s a very convenient way for donors to give so you’re making it easy on the donors and at the same it’s going to create a better cash flow for your organization.
d. Research shows that monthly donors are very loyal and committed donors and they’ll be more likely to leave you in their will.
When I asked Richard Radcliffee, an expert on legacy giving in the UK who does a lot of research in this area, he shared that its 7 times more likely. Last year one of my clients that has about 20% of their active donor base giving monthly, 75% of their legacy gifts came from monthly donors. And from their most recent legacy appeal, we found 77% of monthly donors committed to leaving the organization in their will.
e. It’s a great way to tap into a younger population.
Research from Network for Good shows that 52% of millennials are interested in giving monthly. It’s a very convenient way for ‘small’ donors to give, knowing that they are contributing to a cause they care about.
f. You have the tools in-house. In most cases, you should be able to start generating monthly donors with your web site and online donation page.
In other words, monthly donors are very important to organizations now and they’ll only become even more important in future. They provide that sustainable revenue you need to continue to serve the children, animals, clients you help.
And there are many great free resources available to help at the website below that can help.
Erica Waasdorp is President of A Direct Solution, located on Cape Cod, Massachusetts. Erica Waasdorp is a Master Trainer for the Association of Fundraising Professionals and she is the US Ambassador for the International Fundraising Congress (IFC). Erica published one of the very few books on monthly giving, called Monthly Giving. The Sleeping Giant. She co-authored the DonorPerfect Monthly Giving Starter and Marketing Kits, she blogs on #MonthlyDonorMondays for Nonprofit Pro and others and she presents in person and via webinars on anything appeals, direct mail and monthly giving. She’s a member of National Association of Nonprofit Organizations & Executives and serves on NANOE’s Board of Governors. Contact Erica Waasdorp at [email protected] or via (508) 428-4753.
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[…] Originally posted on 501c3.buzz in February, 2018. […]