Retaining donors is not something that most Canadian charities do well, with donor retention rates hovering around 50.8%. In other words, Canadian charities are failing to retain about half of their donors year over year!
And while the 50% figure for donor retention is far from inspiring, it gets worse: retention rates drop even more significantly for new donors – with only 23.5% of first-time donors making a repeat gift the following year. With all the work that goes into acquiring new donors, these numbers can feel disheartening.
So, what do you need to know to beat the odds and keep your donors engaged? It really comes down to one word: stewardship. Stewardship is the way you show your appreciation to your donors. Good stewardship goes beyond a basic thank-you letter.
If you’re looking to improve your donor retention rates, here are 5 ways your DMS can help you retain your donors by improving your donor stewardship practices.
- To improve your donor retention rate, you first need to know where it currently sits for your organization. While industry benchmarks are helpful, you are only able to gauge the success of your retention strategies by measuring against your own progress.
- Your DMS may have an automated report that calculates your retention rate for you but it is useful to understand the formula behind donor retention rate. You can calculate your retention rate by running a query for the number of repeat donors who gave both this year and last year and dividing it by the total number of donors who gave last year.
- For example, if you had 100 donors who gave in 2020 and again in 2021, and you had 200 donors who gave in 2020 in total, your donor retention rate would be 50%.
- To understand if your retention rates are improving or declining, try the same formula for the previous two years. Don’t be discouraged if it’s low right now - use it as a baseline for improvement.
- Before you run this type of calculation, don’t forget to clean-up your contact data by doing a duplicate check. Duplicate data can skew your donor retention rate.
Once you have a better understanding of your donor retention rate, you can start digging into your data by identifying which donors you’re retaining, gaining, or losing by running the following reports:
- Lapsed Donors: A lapsed donor report, such as a LYBNT (Last Year but Not This) or SYBNT (Some Year but Not This) will help you identify the donors who have given to your organization in the past but have not yet made a donation this year. By identifying these donors, you can reach out to try to re-engage them or at least connect to have a conversation about why they may not be able to support your organization right now.
- New Donors: Running a report that highlights new donors allows you to focus on building a good relationship from the get-go. You’re able to access this report by running a query of any donors whose first gift is in the current calendar year.
- Repeat Donors: Who keeps giving every year? By running a report that showcases which donors have given multiple years in a row, you’re able to identify who your most loyal donors are. Once you’ve identified them, you can then start thinking about what you can do to honour their loyalty.
Now that you’ve identified segments of your donors, you should communicate with them according to which category they fall into. From your queries or reports, create groups of donors based on the segments you’ve identified. You can then create custom communications for each segment using the integrated email marketing tool in your DMS.
- For your lapsed donors, you may wish to acknowledge that you miss them and remind them of the important work you’re doing.
- For new donors, consider sending a welcome series that introduces donors to your mission.
- For your most loyal repeat donors, you may wish to set up a call or meeting to thank them for their continued support.
These relationship building techniques show your donors that you’re paying attention and can help open the door to even greater support.
- If you’re taking advantage of the integrated communications functions of your DMS, each touchpoint with your donors will be tracked. This will help you identify the type of interactions you’re having with your donors and the ability to better understand what your donor stewardship practices look like.
- For example, are you only sending your donors emails that contain donation appeals? Or do your donors get important program or organizational updates? When was the last time someone from your org reached out to them personally?
- Once you have a better grasp on the type of interactions you’re having with your donors, you can better shape your communications to include stewardship pieces like thank-you notes, donor appreciation features in your newsletters or feel-good stories about the impact they’re making.
- You’re grateful for the support of your donors. Sometimes the hardest thing can be showing gratitude in a way that is genuine, but also manageable.
- Now that you’re ready to make a concerted effort to improve your donor retention rate, don’t let distraction get in the way. By using the activities functions in your DMS, you can keep yourself and your team on top of donor stewardship by setting tasks and reminders. You can use this to do anything from sending out your annual impact report, to running a new donor report to simply sending a ‘thinking of you’ note to one of your major donors.
- Stewardship doesn’t have to be complicated. But it should be systematized. With your DMS, you have the tools to make every donor feel appreciated.
The CanadaHelps DMS comes with all the features you need to improve donor stewardship and retention, from donor reports, to touchpoint tracking and custom outreach. Reach out to one of our charity experts today to learn how it can improve your donor retention.
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