The Importance of Segmenting Your Donors

5786426902_1b9405e1a5_wYear-end fundraising time is here. I’ve already started receiving appeal letters and I know this is just the beginning. 

I get appeals from nonprofit organizations I don’t already support and many of these are generic and impersonal. This is annoying. But what’s even more annoying is receiving generic appeals from organizations I do support.

Maybe I’ve donated for at least five years. In many cases, I’m a monthly donor. Do these organizations recognize that? No, they don’t. I just receive a one-size-fits-all letter. 

This is a mistake. If you don’t segment your donors and send different letters to different types of donors, you’re telling them you don’t recognize them for who they are.

Do not send everyone the same letter. You don’t need to create 100 different types of letters. Four or five should be sufficient. Besides segmenting your appeal letters, you also need to segment your thank you letters. You need to segment your donor communication (newsletters, etc), too, but I’m only going to cover appeal and thank you letters in this post.

Your donors are getting tons of appeals right now, as we enter one of the busiest times of the year. Your appeal will stand out if it’s not the same old same old.

Here are a few different types of donor groups. Feel free to add more if that’s relevant. The more you can segment, the better. Investing in a good database will help you with this.

Current single gift donors

One of the biggest hurdles nonprofits face is ensuring first-time donors give a second time. If they keep giving after that, they’re showing their commitment to your organization. Don’t blow it by ignoring this.

An appeal letter to current single gift donors (Monthly donors get their own appeal. More on that below.) must acknowledge their past support. This is also good opportunity to ask for an upgrade. Many organizations don’t do this, but it’s a good way to increase your revenue. 

If these donors give again, they should get a handwritten note, phone call, or letter letting them know how much you appreciate their continued support. If they’ve upgraded their gift, acknowledge that, too.

Potential/new single gift donors

If you’re sending an appeal to someone who’s never donated to your nonprofit before, what is your connection to them? Are they volunteers, event attendees, or people on a list you just purchased?

The more you can establish a connection, the better chance you have of getting a donation.

The retention rate for first-time donors is abysmal. One of the reasons is poor communication. You can help boost your retention rate by making your new donors feel special.

New donors should get a handwritten note, phone call, or letter welcoming them as donors. Invite them to connect with you in other ways such as signing up for your newsletter, following you on social media, or volunteering.

Then a week or so later, send them a welcome packet by mail or email. Personalization is crucial with new donors.

Are We Sure An Automated Email Welcome Series For New Donors Is A Good Idea?

New monthly donors

Brand new donors who opt for monthly or other recurring donations get the same special thank you treatment mentioned above. Welcome them to your family of monthly donors. 

Current monthly donors

Your current monthly donors must get their own appeal that recognizes them as monthly donors. In this appeal, you can either ask them to upgrade their gift or give an additional year-end gift. Here’s an example from the Southern Poverty Law Center.

What’s In My Mailbox | How are you upgrading your monthly donors?

When your donors renew or upgrade their monthly gifts, they, of course, get a super fabulous thank you.

Current donors who become monthly donors

Your current donors who decide to become monthly donors are also showing their commitment to you. They get a handwritten note, phone call, or letter thanking them for their continued support and for joining your family of monthly donors. From now on they should get specialized appeals and other communication targeted to monthly donors. 

Segmenting your donors can pay off

You might be panicking because this type of segmentation sounds like extra work. But it will be worth it if you can raise additional revenue and boost your retention rate.

11 Ways To Segment Your Donors To Improve Your Fundraising

How to Effectively Segment Your Donors and Audiences 

Show Some Donor Appreciation by Holding an Open House

46151444015_a1828a3de5_mMany nonprofits do a poor job of showing appreciation to their donors, but you don’t have to be one of them. 

There are many ways to show some donor appreciation. One idea is to have an open house at your organization. If you can’t hold one on-site, have it at a restaurant or other venue. You may be able to find someone to donate space.

Invite other supporters, too

You could just have an event for donors, but why not invite other supporters such as event attendees, email subscribers, and social media followers, as well? This could be a great way to convert these supporters into donors. Encourage your donors to bring a friend, too.

Coordinate it with your year-end appeal

Depending on your resources, you may only be able to hold one open house a year. If you can hold more, that’s great.

A good time to have your open house is before you launch your year-end appeal so you could hold one sometime between mid-September and early November.

Another option is spring if you have an appeal then, or you could make it a thank-you event.  

Winter is tricky unless you’re lucky enough to live someplace where it doesn’t snow. And summer’s not good since most people go away on vacation.

Whenever you decide to hold your open house, don’t ask for money at this event.

Keep it casual

No three-course dinners and speeches that go on and on. Hold a gathering where your supporters can drop in after work, and serve something to eat and drink. You may be able to get food and beverages donated or find a sponsor.

Have a brief program. You could show a video and/or let a client share his/her story. Your executive director or board chair should thank your guests and share some accomplishments and plans for the future. Remember to keep it brief. You don’t want anyone looking for the nearest escape route.

Create some photo displays and have literature available. You could also show a video on a laptop. Offer tours, if that makes sense.

Speaking of tours, you could offer them at other times, too. After I became a monthly donor, one organization invited me to arrange a tour. Even though I didn’t take them up on it, I thought it was a nice gesture.

7 Tips to Create an Amazing Donor Cultivation Tour

Get your board involved

You must have a good turnout from your board. Encourage board members to invite friends and other potential prospects.

Make everyone feel welcome

Don’t hide in the corner or spend all your time talking to your co-workers. Your staff and board need to mingle with your guests and make them feel welcome.

You may want to go over your organization’s talking points and brush up on your elevator pitches so everyone is prepared to talk about what you do and answer questions. And that doesn’t mean reciting your mission statement. Use language your attendees will understand.

How to Nail Your Nonprofit’s Elevator Pitch

Don’t forget the follow-up

Anyone who has taken time out of her/his busy schedule to attend your open house needs to be thanked. Follow up is crucial. Don’t miss out on this opportunity to build relationships.

Collect names and addresses of the people who attended and send a thank you note right away. This is a good project for your board. Don’t ask for money (that comes later).

Segment your open house attendees, so when you send your next appeal you can include a sentence that says, “It was great to see you at our open house.”

Not all your donors will attend your open house but will appreciate the invitation. Donors and other supporters who do come are showing you they’re interested in your organization. Keep them interested and keep showing appreciation and building relationships with them! This will help ensure they’ll continue to support you for a long time.

 

 

 

How to Stay on Track for the Rest of the Year

OLYMPUS DIGITAL CAMERACan you believe we’re already halfway through the year? I hope your fundraising and communications are going well so far. If not, you’re not alone. According to the 2019 Giving USA report, overall giving is down 1.7%.

5 Key Takeaways from the 2019 Giving USA Report

The mid-point of the year is always a good time to see if you’re meeting your fundraising and communications goals. If your fundraising is down, you’ll need to make some smart choices for the rest of the year. This often includes better donor communication.

If you never made a fundraising plan for 2019, stop right there and put one together now and use it for the remainder of the year.

Nonprofit Fundraising Plan: 6 Must-Do Steps For Success

No need to panic yet. There are ways you can stay on track and raise more money in the second half of the year. Here’s how.

Ask your donors for an upgrade

An obvious, but overlooked, way to raise more money is to ask your donors to upgrade their gifts. Even if you’re a smaller organization, it’s not too much to ask $25 donors to give $50, $50 donors to give $75, and so on.

Make a point to do this in your next fundraising campaign. If you don’t, you’re leaving money on the table.

How to Get Your Donors to Give More this Year than Last Year

Start or enhance your monthly giving program

I’m a big fan of monthly or recurring giving. It’s a great way to raise more money, as well as your donor retention rate. Retention rates for monthly donors are 90%, much much better than other retention rates.

If you don’t have a monthly giving program, plan to promote one in your next campaign. To get more monthly donors, send a special targeted letter to current donors inviting them to become monthly donors. This another good opportunity to upgrade smaller dollar donors, or any donors for that matter.

Also, do something special for your current monthly donors. Send them a thank you postcard or email. They’ve made a commitment to you, now make a commitment to them.

Get in touch with your lapsed donors

Reaching out to your lapsed donors could help you raise additional revenue. An organization I used to contribute to sent me a nice letter asking me to come back. I won’t go into a lot of detail, but I stopped donating to them mainly because my giving priorities changed. 

I was impressed that they made a special attempt to reach out, because most organizations don’t do that. Yes, you might get the usual generic letter.

In your next fundraising campaign, send targeted letters to your lapsed donors telling them you miss them and want them back. After your campaign is over, make an attempt to reach out to any additional lapsed donors.

Do a better job of thanking your donors

Last week’s post was all about doing a better job of thanking your donors by creating a thank you plan. 

Creating a Thank You Plan Will Help You Stay Focused on Gratitude All Year Round

Showing gratitude is just one part of the donor communication mix. Stay in touch throughout the year with donor-centered updates. Show your donors how they’re helping you make a difference.

You still have time to stay on track

If you’re falling short of your goals, you still have time to do better, but you have to make an effort.

Giving USA 2019 | How to fundraise smarter, not harder

Be sure to keep evaluating your progress for the rest of the year to help ensure a successful 2019.

3 Ways to Stay Ahead of Giving Trends

 

A Few Common Donor Communication Problems and How You Can Fix Them

8775923664_553640db9e_mSome nonprofits do a good job of communicating with their donors, but many do not and that’s a problem.

Mediocre or poor donor communication will hinder your success. If you wonder why your retention rates are floundering that may be the reason. Here are a few common donor communication problems and how you can fix them.

Sending your donors the same appeal letter

Your donors are not the same, so why are you sending everyone the same generic appeal letter? When you do this, you’re showing your donors you don’t know who they are.

I recently received a letter that was a good appeal, but didn’t recognize me as a monthly donor or acknowledge any previous donations. Monthly donors shouldn’t get a generic appeal like this. What should have happened is the organization should have thanked me for my monthly gifts and either asked for an upgrade or an additional one-time gift.

The same applies if someone is a theatre subscriber, museum member, or college alumni. I spend a significant amount of money on a theatre subscription. It’s perfectly fine for this theatre to ask for an additional donation, but I also want them to thank me for being a long-time subscriber.

This happens way too often. You should always recognize a donor’s past support.

Here’s an organization that did that. Their appeal letter opened with For the past 4 years, your generosity has made a world of difference. Wow, this organization knows me! The appeal included several instances where they mentioned how my support has made a difference.

What kind of message are you sending to your donors? That you recognize them for who they are or that they’re just a source of revenue for you?

6 easy ways to segment your fundraising appeal letter

Thank you letters that don’t focus on gratitude

The purpose of a thank you letter is to thank your donor. It’s not to brag about your organization or explain what your organization does. It’s also not a receipt. You can include a donation summary, but don’t lead with that or make it the main focus of your letter. If you do that, you’re implying that the donation is a transaction instead of the beginning or continuation of a relationship.

I use the term thank you letter, because that’s what most organizations send. Although, sometimes it’s just an email. You can do a better job of thanking your donors if you send a handwritten note or make a phone call.

I get so many thank you letters and emails that are uninspiring. They lead with the usual On Behalf of X organization before veering into receipt territory. Occasionally, I’ll get a card in the mail that pours on the gratitude with phrases like We cannot thank YOU enough and You make it possible.

Also, the thank you that you send after you receive a donation is just beginning, not the end, of a donor engagement journey that lasts throughout the year.

Take Thanking Your Donors to the Next Level

Newsletters that ignore donors

Newsletters are a big problem area. They’re usually too long, boring, and organization-focused. I recently received an eight-page newsletter written in the third person that primarily mentioned a bunch of accomplishments. It had no stories and read like a promotional piece, which is not the purpose of a donor newsletter.

Your newsletter should show your donors how they’re helping you make a difference.

The magic word you was nowhere to be found in any of the articles. That’s why your newsletter needs to be written in the second person dominated with phrases such as Thanks to you or Because of you.

The only time the organization mentioned donors and used the word you was in a section asking people to give to a Donor Advised Fund (DAF). It was basically a solicitation and required a minimum contribution of $100,000, which most people aren’t going to be able to do. As someone who gives $5.00 a month, I’m certainly not in that demographic.

They didn’t even thank their current donors before asking them to make such a big financial commitment. They would have been better off targeting people who would be likely to donate to their DAF.

You’re ignoring your donors (or at least most of them) when you include a message that’s only relevant to a small number of people.

Of course, you can share your success in your newsletter, but you need to let your donors know how they helped with that. Another organization did a better job with their newsletter. It included a cover letter thanking donors, as well as a success story and a section titled You Make a Difference.

A good rule of thumb for your newsletter is more donor appreciation – less bragging.

Why your fancy newsletter is failing you

You don’t want to upset your donors with poor communication. Send different appeals to different types of donors, write a thank you letter that focuses on gratitude, and continue that appreciation in your newsletter instead of bragging so much about your accomplishments.

 

Build Relationships With Your Donors Every Step of the Way

2592683540_77e7a1ac7f_mMany nonprofits think fundraising is all about raising money. But raising money is only part of the fundraising equation.

Fundraising’s Not About Money (What???)

One of the most important things you need to do is to build relationships with your donors. Building relationships should be front and center in everything you do.

Here are some ways you can incorporate building relationships every step of the way.

Make relationship building part of your fundraising campaign

You need to build relationships before, during, and after each of your fundraising campaigns.

Before your next appeal, send your donors an update to let them know how they’re helping you make a difference. This is especially important if you do more than one fundraising campaign a year. You don’t want your donors to think the only time they hear from you is when you’re asking for money.

Don’t send the same appeal to everyone on your mailing list. It’s crucial that you segment your donors and personalize your appeal letters.

What is your relationship with these individuals? Maybe they’ve given once or many times. Perhaps they’re event attendees, volunteers, e-newsletter subscribers, or friends of board members. Mention your relationship in your appeal letter. For example, thank a long-time donor for supporting you these past five years.

Monthly donors get their own appeal letter. This doesn’t happen enough and it’s one of my biggest pet peeves. Build relationships with these committed donors. Recognize they’re monthly donors and either invite them to upgrade their gift or give an additional donation.

Pour on the appreciation

Your focus on building relationships continues when you thank your donors. Many organizations do a poor job with this. Send a handwritten note or make a phone call if you can.

Send welcome packets to your new donors. Let them know how much you appreciate this new relationship. If you don’t, it’s likely to be a short relationship.

Be sure to also shower your current donors with love to keep your relationship going. Give a shout out to donors who have supported you for several years.

Don’t miss out on opportunities to build relationships

I’m amazed that after I attend an event or give a memorial gift, most organizations don’t do a good job of building a relationship. I could be a potential long-time donor.

When you hold an event, give your attendees an opportunity to sign up for your mailing list. Next, call or send thank you notes afterward.

Besides thanking people for attending your event, let them know how much money you raised and share specific ways their support is helping you make a difference. Then invite these supporters to connect in other ways such as signing up to receive your newsletter or volunteering.

The same thing applies if you hold a charity run or walkathon. These events often generate new donors. Someone might donate to your 10K because her friend is running in it. Thank everyone who donated and invite them to be a part of your community.

Memorial gifts are another missed opportunity. Also, if a person has given a donation in memory of someone, they deserve a heartfelt response and the opportunity to connect with you in other ways.

Personally, I would never give a memorial gift or support someone in a charity walk if I didn’t believe in that organization’s cause. Don’t miss out on a potential opportunity to build longer-term relationships.

Turn a giving day into a relationship building day

My main objection to giving days, such as GivingTuesday, is they focus so much on asking. What if we put all the time and energy we focus on giving days into a relationship building day?

I’m not saying you can’t participate in giving days, but instead of the relentless begging, follow the formula above and build relationships before, during, and after your appeal.

Of course, you could choose not to participate in a giving day and have an all-out relationship building day instead.

Build relationships all year round

It’s easier to stay focused on donors when you’re sending an appeal or thank you, but this is just the beginning. Many organizations go on communication hiatus at certain times of the year and that’s a big mistake.

Ideally, you should keep in touch with your donors every one to two weeks. You can do this with newsletters, updates, thank you messages, advocacy alerts, and surveys. A communications calendar will help you with this.

Build relationships with your donors every step of the way. This will help you with that always-important donor retention because you want committed donors who will support you for a long time.

Build Loyal Donor Relationships in 3 Easy Steps.

Donor Relations: 8 Best practices for your Nonprofit

How To Build Meaningful Relationships With Your Donors

It Takes More Than Luck to Keep Your Donors

422810636_b02ba5dfed_m.jpgDonor retention rates continue to be poor, especially for first-time donors. Donors don’t keep magically donating to your organization and you can’t hope you’ll get lucky and they’ll donate again. You need more than luck to keep your donors.

Pay attention to your donor retention

Many organizations spend all this time and energy on acquiring donors, concentrating more on volume and don’t seem to be concerned that they’re churning through different donors year after year.

If you don’t know your retention rate, figure that out now. A Guide to Donor Retention  If you ’re losing donors, it’s most likely because you’re either not communicating enough or communicating poorly. Fortunately, this is something you can fix, but it will take more than leprechauns granting wishes. If you want to keep reaching that pot of gold at the end of the rainbow, you’ll need to work at it.

When figuring out your retention rate, you’ll find you have some lapsed donors. Take some time to reach out and let them know you miss them and want them back.

You need good donor relations

Donor relations should be easier than raising money, and it can be fun, too. Make it a priority, as well as something you do throughout the year.

The biggest hurdle is getting your first-time donors to donate again, so do something special for your new donors like sending them a welcome packet.

That said, don’t take your longer-term donors for granted. Send them a welcome back letter. I’ve donated to several organizations for a number of years, and it bothers me when they don’t acknowledge that.

Donor loyalty is also important

Your goal should be to have high-quality donors who will support you for a long time. Who has supported you for three, five, or even ten years? Go the extra mile for these loyal donors. This takes more work, but it will pay off in the long run. You don’t want to lose these valuable donors.

Keep building relationships

You may be between fundraising campaigns or events. It’s easy to get complacent right now, but don’t do that. You need to work on building relationships. Let your donors know how much you appreciate them and keep doing that again and again.

It takes more than luck to keep your donors. You need to show appreciation and stay in touch throughout the year. You could reach out now by using a St. Patrick’s Day or spring theme, or get inspired by one of the ideas in the links below.

12 Ways to Inspire and Delight Your Donors…With Examples!

The K.I.S.S. Method For Donor Retention Is Best For Most Nonprofits

Get Ready to Show Some #DonorLove

A Few Ways You Can Raise More Money in 2019

Happy New Year! I expect many of you launched a year-end appeal last year. I hope it was successful. If it wasn’t, I have some suggestions about how you can raise more money – both now and throughout the year.

Reach out to your lapsed donors

Take advantage of this now. Look to see who donated in 2017, but didn’t give this year. It’s possible some people meant to give but were too busy.

Send these donors a personalized appeal or give them a call. Let them know you miss them and want them back. You can go back another year or two, as well.

Take a good look at your list of lapsed donors. They’re not all the same. Do you have someone who’s given consistently over the last few years, but not this year, or are you looking at a person who gave once five years ago?

Eventually you’ll want to move some of your lapsed donors to an inactive file. This will save you money because you won’t be mailing appeals to people who aren’t going to donate.

But you can raise more money with a pesonalized appeal to donors who are likely to give again.

5 ways to win back your lapsed donors

We Want You Back! A Simple Strategy for Reactivating Lapsed Donors

Emphasize monthly giving

A great way to raise more money is by having a monthly/recurring giving program. Monthly donors usually give more and their retention rate is 90%.

If you don’t have a monthly giving program, make this the year you start one. You can also try to get current donors to upgrade to monthly giving.

Your best bet for monthly donors are people who’ve given at least twice. These are donors who have shown a commitment to you. This doesn’t mean you can’t ask first-time donors. You can include information about monthly giving in the welcome packet you send to new donors. You do welcome new donors, right?

Donors who gave in November or December may not be ready to give again so soon. Make a plan to specifically invite people to become monthly donors in the spring or at other times of the year.

Incorporating Monthly Giving Into Your Fundraising

Quick Tips to Create a Great Monthly Giving Program

Remember the two R’s

Now I’m going to tell you how you can raise more money without asking for money. You need to remember the two R’s – retention and relationships.

It’s easier and less expensive to keep your donors than to find new ones. Yet, many nonprofits have abysmal retention rates, especially for first-time donors. Now is a good time to figure out your retention rate.

One way to raise your retention rate is with the second R – relationships. Building relationships with your donors is a key component of fundraising.

This starts with a good thank you experience and continues as you update your donors regularly throughout the year letting them know how they’re helping you make a difference.

One reason you may be behind in your fundraising goals is because you just blasted out a bunch of generic appeals without targeting them to specific donors and trying to build relationships.

How To Actually Calculate Donor Retention (The Right Way) & 8 Essential Tips For Effective Donor Retention

What Comes Next

The New Year is a good time to evaluate what’s working and what’s not in your fundraising. You should be able to raise more money by reaching out to your lapsed donors, starting or growing a monthly giving program, paying attention to your donor retention, and focusing on building relationships.

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