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Secrets of the 2nd Gift - The Key to Donor Retention - AFP CAC 2019

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https://bloomerang.co/resources/speaking/

Fundraisers spend a lot of time acquiring new donors, and with good cause. However, in order to create a long-lasting relationship, the most critical gift isn’t the first; it’s the second.

In this session, nonprofit technology veteran Jay Love will make the case for why donors should concentrate on acquiring a donor’s second gift in order to achieve sustainable funding, high donor retention rates and high donor lifetime values.

You’ll see examples that can be implemented by any organization, whether you are a one-person shop or a large development department. The results can be astounding when put into daily use!

Learning Outcomes:

Explore current research on donor loyalty and retention
Understand the importance of donor lifetime value
Learn new donor communications techniques that get the second gift

Published in: Government & Nonprofit
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Secrets of the 2nd Gift - The Key to Donor Retention - AFP CAC 2019

  1. 1. Secrets of the 2nd Gift – the Key to Donor Retention
  2. 2. Your presenter » @StevenShattuck Jay Love @JayBarclayLove Chief Relationship Officer, Bloomerang • 37 Years of Technology Leadership • Over 20,000 Database Installations • Former Founder & CEO of eTapestry • Former CEO of Master Software/Fund-Master • Former Senior VP of Blackbaud • Conner Prairie Museum Board Member • AFP Ethics Committee Chairman • Rogare Research Institute Board Member • Innovation Fund at Butler University • Co-Chair of Indianapolis YMCA Capital Campaign
  3. 3. jay.love@bloomerang.co @JayBarclayLove Free eBook » https://bloomerang.co/staytogether/ @JayBarclayLove
  4. 4. @JayBarclayLove Why focus on the second gift?
  5. 5. @JayBarclayLove It is the KEY to Donor Retention & Lifetime Value
  6. 6. @JayBarclayLove # of Donors in Current 12 Months (from the previous years pool) Divided by # of Donors in Previous 12 Months https://bloomerang.co/retention Calculating donor retention »
  7. 7. @JayBarclayLove “The total net contribution that a donor generates during his/her lifetime in your database” Defining Lifetime Value »
  8. 8. @StevenShattuck The current state of donor retention? » http://afpfep.org/reports/
  9. 9. Donor retention 2017 Results » @JayBarclayLove http://afpfep.org/reports/
  10. 10. Source: Fundraising Effectiveness Project http://afpfep.org 2018 Results just in & not good » • Retention is down 6.4% • New retained donors are down 18% @JayBarclayLove 39.1% 19.8% 61.9%
  11. 11. Source: Fundraising Effectiveness Project http://afpfep.org Recapture rate is falling » @JayBarclayLove
  12. 12. Gift amount matters » @JayBarclayLove http://afpfep.org/reports/
  13. 13. # of Donors Attrition Rate Donors Remaining After 1 Year Donors Remaining After 2 Years Donors Remaining After 3 Years Donors Remaining After 4 Years Donors Remaining After 5 Years 1,000 20% 800 640 512 410 328 1,000 40% 600 360 216 130 78 1,000 60% 400 160 64 26 10 Donor attrition over 5 years » (1% increase in retention = $45,634 annually) @JayBarclayLove
  14. 14. @JayBarclayLove Who to focus on »
  15. 15. Why do donors leave? @JayBarclayLove
  16. 16. • 2001 study by Adrian Sargeant • Survey to lapsed donors of 10 major U.S.-based nonprofits • Respondents were asked to check each reason for stopping their contributions Why nonprofit donors leave » http://www.campbellrinker.com/Managing_donor_defection.pdf @JayBarclayLove
  17. 17. • 5% - thought charity did not need them • 8% - no info on how monies were used • 9% - no memory of supporting • 13% - never got thanked for donating • 16% - death • 18% - poor service or communication • 36% - others more deserving • 54% - could no longer afford Why nonprofit donors leave » http://www.campbellrinker.com/Managing_donor_defection.pdf @JayBarclayLove
  18. 18. Why do donors stay? @JayBarclayLove
  19. 19. • 2011 study • Survey of 1,200 recent (last 12 months), frequent (more than 2 gifts to cause based charities) donors from over 250 nonprofit organizations • Donors were given a list of 32 reasons why they might continue giving • Asked to rank them by order of importance Key drivers of donor commitment » http://www.thedonorvoice.com/national-donor-commitment-study-and-proof-of-link-between-donor-attitudes-and-behavior/ @JayBarclayLove
  20. 20. 1. Donor perceives organization produces outcomes 2. Donor receives a timely thank you 3. Donor receives opportunities to make views known 4. Donor feels like they’re part of an important cause 5. Donor feels his or her involvement is appreciated Key drivers of donor commitment » @JayBarclayLove
  21. 21. @JayBarclayLove Thank you segments »
  22. 22. @JayBarclayLove • Design a “style” and story for each segment • Consider calling and mailing segments 1, 2 and 4 • Handwritten notes and/or P.S. are powerful • Test, test, test! • Personalize as much as possible (database fields) • 3 “touches” in the first 90 days (survey) • Always aim to convert to monthly donors! Segmentation principles »
  23. 23. @JayBarclayLove Donor communications » “Successful donor communications are quite simple. At heart, they are love letters to donors & prospects, woven through with clear cries for help.” - Tom Ahern, Bloomerang Donor Communications Head Coach http://aherncomm.com
  24. 24. Stories get the second gift! @JayBarclayLove
  25. 25. @JayBarclayLove
  26. 26. @JayBarclayLove
  27. 27. @JayBarclayLove
  28. 28. @JayBarclayLove
  29. 29. @JayBarclayLove
  30. 30. @JayBarclayLove
  31. 31. @JayBarclayLove
  32. 32. • “Why did you first give?” • “What’s your connection to the cause?” • “What would you like to hear from us?” • Let them tell their story! Other Survey Question Ideas » https://bloomerang.co/blog/23-questions-to-ask-donors-and-prospects/ @JayBarclayLove
  33. 33. The for-profit world understands » @JayBarclayLove
  34. 34. @JayBarclayLove
  35. 35. @JayBarclayLove
  36. 36. Homework?
  37. 37. @JayBarclayLove
  38. 38. • Treat your first-time donors like royalty • they have lowest retention rates! • Tell them the impact they will have • Tell them the impact they have had • Be unique! • Survey early • let them tell their story! Final thoughts » @JayBarclayLove
  39. 39. More examples » @JayBarclayLove 5 Acknowledgment Principles (Drastically Improve First Year Donor Retention) https://bloomerang.co/bloomies
  40. 40. https://bloomerang.co/resources •Nonprofit Wrap-Up •Bloomerang TV •Bloomies •Daily blog post •Weekly webinars •Downloadables @JayBarclayLove
  41. 41. Questions? jay.love@bloomerang.co @JayBarclayLove Free eBook » https://bloomerang.co/staytogether/ @JayBarclayLove

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