LYBUNT – The Healthy Non-Profit

5 Way to Validate Giving Decisions and Drive Retention

January 30, 2013 erik Fundraising

Good morning, DonorDreams blog subscribers. I thought I’d give you a day off from my random non-profit and fundraising thoughts by offering you an awesome article about DONOR RETENTION from a guest blogger. This guest post is from Matthew Mielcarek, the VP of Consulting at Charity Dynamics, who is a contributor for the online consultancy, Software Advice. Enjoy!

With a third of annual donations collected in December, many by first-time donors to an organization, finding a way to keep as many of those as possible going into a new year is a retention strategy proving quite valuable over time. A 2011 donorCentrics Internet and Multichannel Giving Benchmarking Report shows that 70 percent of first-time donors won’t donate again. Here are five steps Mielcarek suggests to foster lasting relationships with as many of them as possible.

1) Mielcarek says, “First time donors are qualified leads.” Therefore, consider first donations an acquisition gift. He goes on to suggest implementing a new donor conversion plan with the end-goal being to establish an ongoing relationship

2) Secondly, he says to be mindful of what a new donor may be communicating with you. He suggests the following metrics to gain insight to constituent behaviors: gift amount, billing city/state, solicitation campaign, and giving channel. He says that analyzing these key points is valuable. “Online acquired donors, for instance, generally have poor online retention; we know that a multichannel communication strategy will be important. In contrast, offline acquired donors are far less likely to cross the multichannel bridge and a single channel communication strategy may be appropriate.

3) Mielcarek also emphasizes the importance of showing gratefulness to donors. One NTEN and Charity Dynamics study shows that 21 percent of donors say there were not thanked for giving. He says that follow-up thank yous are also of immense value. Tell them how your year ended in terms of its goals. Show them they’re donation made an impact to their overall mission.

4) He adds, “Engage relevantly.” Beyond thank-yous, communicate with your donors and supporters on an ongoing basis. Personalize messages based on constituent interests, affinities, and locations. Keeping websites up-to-date and engaging is a key element to achieving lasting constituent interest too.

5) Lastly is the actual conversion to the next stage of giving, Mielcarek says. This stage involves suggesting an affinity-driven gift — whether that be a “renewal gift, or an upgrade or graduation to a monthly or mid-level giving program.”

To read more about Mielcarek’s suggestions, read the original story here.

More lapsed donor best practices

October 11, 2012 erik Donor-centered fundraising, Fundraising

For the last few days, we’ve been talking about lapsed donors. On Tuesday, the discussion started with a personal example of a LYBUNT letter from HRC. Yesterday, we talked about one lapsed donor reactivation strategy that Gail Perry at Fired-Up Fundraising talks a lot about. Today, I am circling back around to the HRC lapsed donor letter that started this entire discussion.

A few days ago, I was critical of the tone in HRC’s lapsed donor letter as well as their ineffective list segmenting efforts. Putting those criticisms aside, it is clear that the folks who constructed HRC’s LYBUNT letter were successful at employing a number of other best practices, such as:

They tried to be very personal and mentioned me by name a number of different times throughout the letter and response card.
They pointed to a number of their recent accomplishments in an effort to say that another investment from me would be well used by them.
They spoke of a few deadlines to create a sense of urgency.

The best practice that I liked the most was that they included a survey in the envelope and asked for feedback. The survey started off with this language:

“Erik, if you have decided not to renew your HRC membership, please let us know why by completing this brief survey and returning it right way in the envelope provided. Your input will help HRC understand the reasons for your decision and help HRC strengthen our grassroots support . . .”

I really like this language because it clearly communicates one simple message:

“We’re listening and what you have to say is important to us!”

The survey was short and sweet and to the point. They asked the following four questions:

Which HRC accomplishment are you most proud of helping make possible over the past year?
Why have you decided not to renew your HRC membership for 2012? (please check all that apply)
Which of the following statements best describes your view of HRC’s advocacy efforts?
Please rank the following HRC advocacy priorities in order of importance (1 = most important)

Obviously, these were multiple choice questions, and the entire survey takes no more than 30 seconds to complete before sliding it into a “business reply mail” envelope.

What best practices have you used to reactivate lapsed donors? What have you seen other non-profit organizations do that struck you as particularly effective? Please share your thoughts and experiences in the comment box below. We can all learn from each other because no one has time nowadays to re-invent the wheel.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
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Reactivating lapsed donors doesn’t have to be complicated

October 10, 2012 erik Donor-centered fundraising, Fundraising

Yesterday, my blog post titled “Take great care when trying to reactivate your LYBUNT donors” focused on a direct mail story of mine that I thought contained some valuable lessons for all of us. Today, I will attempt to pivot and start a discussion about simple things you can do to reactivate lapsed donors at the end of the year.

Last week, I spent the entire week in Indianapolis at Boys & Girls Clubs of America’s Midwest Leadership Conference as an exhibitor and trainer. When I saw one of my favorite bloggers — Gail Perry at Fired-Up Fundraising — as a general session speaker, I got very excited because she is a bundle of energy when it comes to fundraising.

As she dazzled the audience with her fundraising stories, she turned her attention for just a moment to the idea of reactivating lapsed donors. She talked about the boring, ineffective and sometimes upsetting LYBUNT letters (like the one I talked about in yesterday’s post) that too many non-profit organizations use at the end of the year to re-engage lapsed donors. While direct mail is probably a necessary re-engagement tool, Gail suggested that throwing a party for some of those donors might be a better strategy. She shared a story about such a party that she had themed:

“We love you, we miss you, we want you back!”

These 10 simple words got my mental wheels turning. I envisioned a Thanksgiving or holiday themed event with a room full of lapsed donors who didn’t pay a penny to attend. I pictured mission-focused activities and possibly even activities (e.g. focus groups) designed to solicit input on how to improve your fundraising and donor communication programs.

Hmmm . . . how does this strategy compare to the HRC letter strategy that I talked about in yesterday’s post? For me, it feels like night and day. I like Gail’s suggestion of throwing a party for the following reasons:

It feels personal
It is what we do with our family and friends (and aren’t donors part of our extended family and friends circle)
It is fun and energetic
It fits with the spirit of the season
It sends a donor-centered message rather than a “me-me-me” message

For some non-profit agencies that have a large direct mail program and hundreds (or thousands) of lapsed donors, this strategy might be a little more difficult to implement. However, this problem is easily overcome by segmenting your LYBUNT report into two lists: 1) those who get invited to a party and solicited at the event or using a follow-up solicitation letter AND 2) those who just get a well-crafted, personal LYBUNT letter that doesn’t use “guilt” as the message.

There is literally a bushel basket full of good ideas and best practices when it comes to reactivating your lapsed donors at the end of the year. Throwing a party is just one of those ideas.

Would you please take 60 seconds out of your busy day and share one idea from your agency’s year-end LYBUNT strategy playbook? You can easily and quickly do this by using the comment box found at the bottom of this blog page. Please? After all, we can all learn from each other.

Here’s to your health!

Take great care when trying to reactivate your LYBUNT donors

October 9, 2012 erik Donor-centered fundraising, Fundraising

When I resigned from my last job in May 2011 to start my non-profit consulting practice, my partner and I sat down and reviewed our charitable giving portfolio. We made the decision to temporarily stop giving to certain organizations because our household income was about to drop. Needless to say, I showed up on a number of LYBUNT (aka Last Year But Unfortunately Not This Year) donor database reports and we’re still digging out from underneath the avalanche of direct mail.

Today, I want to share a few things from a donor’s perspective that might be helpful as you put together your year-end lapsed donor strategies.

One of the charities affected by my decision to change jobs was the Human Rights Campaign (HRC). Throughout the years, my partner was a Federal Club member, and I was a member of their Partners monthly giving program.

This big, bad national non-profit advocacy organization has a very slick direct mail program and a hundred thousand or more individuals as donors. In fact, it is so big that in addition to calling me by my first name, it is common for this agency to reference me by my membership number (which truth be told always makes the hair on the back of my neck bristle).

Two months ago on a lazy Saturday afternoon, my partner was canning vegetables from our garden in our kitchen and I was opening mail that had built up in our mailbox. For what seemed to be the umpteenth time since we made the decision to temporarily withdraw our support from HRC, I opened another “Won’t you please come back” letter from this organization.

The letter spurred a kitchen discussion that resulted in a decision to re-join HRC’s monthly giving program, albeit at a smaller level (but with the intent of growing our commitment in the next year or two).

As you might expect, we received a gift acknowledgement letter a few weeks later that read as follows:

“On behalf of the Human Rights Campaign’s Board, staff and volunteers, I want to thank you for joining our Partners program with a monthly contribution of $10. The leadership that you have taken . . .”

Yada, Yada, Yada. It was a typical computer generated gift acknowledgement letter, and one that I’ve read countless times throughout my life. It was technically proficient and everything I expected from this world-class direct mail giant. It made me feel good about our decision to re-engage with an organization that we had been supporting for a decade.

Unfortunately, this good feeling didn’t last very long because a few weeks later, I received another letter from HRC and this time the letterhead said it was “From The Desk Of” Cathy Nelson, who is the organization’s Vice President of Membership. I opened the letter expecting more appreciation and thanks, but my heart sunk when I read the following first few sentences:

“The news couldn’t have come at a worse time for the lesbian, gay, bisexual and transgender civil rights movement. I wanted to write to you personally as I have heard you have not yet renewed your Human Rights Campaign membership. We are counting on our active members in this critical year . . .”

To say that I felt punched in the gut might sound a little dramatic, but it isn’t far from the truth. In the first 10 seconds, here is want went through my head as a donor:

OMG, did I forget to mail our check? Where is that gift acknowledgement letter confirming our re-enrollment in the monthly giving program?
I felt guilty upon reading the words “the news couldn’t have come at a worse time . . .“
I felt angry because they were making our charitable giving decision seem like it was all about them, when it reality it was all about our new economic reality.
I felt manipulated and confused.

Any amateur fundraising professional and volunteer probably knows that these emotions and thoughts are not what you want to invoke when trying to reactivate a lapsed donors. If your non-profit organization is committed to transforming its resource development program to a donor-centered fundraising paradigm, then you need to walk away from this blog post dedicated to not replicating this bad example provided by HRC.

Over the next few days, I will blog about LYBUNT donors and provide a few tips I hope you will find helpful as you design your year-end lapsed donor appeals. So, stay tuned for more!

Have you ever been rubbed the wrong way by a lapsed donor appeal? Or has a lapsed donor ever reacted to one of your appeals and provided you with some feedback? How did you respond? Did it change your approach? If so, how? Please scroll down to the comment box and share your stories or thoughts. We can all learn from each other.

Here’s to your health!