Forget The Mistletoe, Concentrate on the Mistrust
OK, you've had plenty of time to revel in the year-end returns and swap stories about the holiday office party. Now it's time to turn over a new leaf for the New Year and pay serious attention to a problem we've been warning about over and over–the problem of donor loyalty and retention.
The current issue of Contribute, the glossy magazine that bills itself as “The People and Ideas of Giving”, should get you focused on the problem of retention for the year ahead. In an article entitled, Donor drain: As mistrusts grows, loyalty goes, writer Tracie McMillan leads with the plight of the National Wildlife Federation which has been losing 300,000 donors a year — nearly 1/3 of its close to 1 million members.
Of course, NWF isn't alone. The fact is that the 'donor drain' is endemic. A survey authored by Bill Levis of the Urban Institute points out that most non-profits lose 52% of their contributions each year which is then offset by a 62 percent gain in new or upgraded donations. In short, according to Levis non profits are losing almost as much as they're gaining, pouring a river of money into a nearly open drain.
Why? Well according to the most recent Harris Interactive Survey, cited also in the currernt issue of Contribute magazine, 56% of the 3,040 Americans surveyed said they are “more concerned about the misuse of funds than they were a decade ago. (For an interesting take whether donor trust can be restored see Contribute's Roundtable featuring , among others the irrascible and always insightful Pablo Eisenberg.
Frankly, I'm personally not convinced that the erosion of donor loyalty has much to do with fraud and misuse as it does with the failure of fundraisers and communicators to keep up with the changes in consumer/donor mindset. Tom Belford dealt with this in an earlier Agitator post titled “The Secret Sauce of Brand Loyalty” and his insights are worth re-reading.
So what's a fundraiser to do? Well for starters a good dose of courtesy and common sense won't hurt: Thank your donors immediately after they contribute and frequently recognize their importance and the impact they're having…give them details on how their contributions are being used and the difference they make…focus on keeping your donors fully informed and sincerely make them feel appreciated.
Beyond common sense and courtesy watch for signs of disaffection: changes in giving and involvement patterns –down-grading, less frequent contributions, less responsiveness to e-actions and e-appeals. Any fundraiser worth her or his salt should have a system in place for spotting and taking action on those donors whose giving behavior telegraphs the early warning signs that they are moving out of the zone of affection into the swamp of disaffection.
Finally, download your free copy of the CMS-DonorTrends White Paper on Donor_Loyalty.
Happy New Year!
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