Acquisition, But First …
As promised, Roger and I are about to do some systematic posting on donor acquisition.
But we are compelled — yes, compelled — to start the ball rolling with yet another warning about donor retention!
Compelled because this recent ‘Must Read’ report — the 2012 Fundraising Effectiveness Report — from the Association of Fundraising Professionals drives home once again the utter futility of pouring newly acquired donors into leaky buckets.
Here are the grim facts (looking at 2011-12 fundraising by 3,184 organizations, who raised over $2 billion in 2011):
- Every $100 gained in 2011 was offset by $100 in losses through gift attrition — a net gain of $0.
- Every 100 donors gained in 2011 was offset by 107 in lost donors through attrition — a net gain of -7.
- Overall donor attrition in 2010 was 59% — that is, 59% of 2009 donors did not give again to participating nonprofits in 2010.
- New donor retention was only 27%!
These are hard facts, folks.
So, as you fantasize about your new killer acquisition package, consider that, in addition to all those muttonhead non-responders, 73% of its actual donor delivery will be effectively wasted. Sure, those one-time givers help pay for the muttonheads. But then nada.
If this average attrition rate for new donors applies to your nonprofit, figure as follows. Say you picked up 10,000 new donors last year, but lost 7,300 of them in the subsequent twelve months. With a 1% prospecting return, you’ll need to mail 730,000 prospecting packages just to stand in place. Then you can think about growing.
If that kind of math lights your fire, the next time you fill up your car’s gas/petrol tank, why don’t you take a screwdriver and punch a couple dozen holes in the tank while you’re at it.
OK, now we’re ready to talk about acquisition.
P.S. The AFP study includes a Donor Retention Supplement. Be sure to read it!