mne·mon·ics: the process or technique of improving or developing the memory.
The Four R’s: Retention = Reporting, Rewarding, Renewing
Donor retention is one of the most important tasks in the development responsibilities of a nonprofit organization. After substantial effort in terms of time and resources, translating suspects into prospects and prospects into donors is one of the great accomplishments in fund-raising. Cultivation and solicitation of new donors are among the great skills of the fund-raising community.
To retain and upgrade the donor becomes the significant ongoing task, and many organizations fail in this essential activity. Retention and upgrading, the “bringing them in and bidding them up” of yore is a task of Sisyphusian dimension. And yet, many organizations fall behind in this essential requirement.
Studies show that many donors are lost by such organizations because the donor no longer feels needed, at a time of even greater need for the organization. Ironically, other studies show that many donors are willing to make even larger gifts if they could understand how their funds would bring better impacts. So what is wrong?
One of the best ways to retain donors is to enter into a lifetime of dialogue with them, the same way one would with a new friend. The “dialogue,” like a friendship, has a number of elements, all of which may be combined in a sophisticated stewardship program.
Retention is what we all work toward in personal friendships that are win-win. The same would be true in donor relationships. What constitutes win-wins with donors, who are not usually a homogeneous group other than having strong values concerning the client, work, results and/or outcomes of an organization?
The answer is in the sophisticated retention/ stewardship program that segments donors into the behavioral groups that constitute the organization’s constituency. The Seven Faces of Philanthropy and Money for Good are excellent starting places for creating categories for each organization’s segmentation process.
Then the dialogue takes on three distinct aspects: Reporting, Rewarding and Renewing.
Keeping donors abreast of activity through various communication modalities is essential in the first stage of the dialogue. Again, different donors communicate in different ways, at different rates, and over different substantive topics.
The organization should to get to know as much as possible about these preferences. The best way to begin the generation of this information is to go to the donors themselves. Questionnaires, surveys, e-surveys, focus groups, one-on-one conversations, all are part of the dialogue.
And like dialogue, an essential aspect for the organization is to listen to the donor. Listening is more than half the responsibility to understand the donor’s values, their preferences, their reasons for donating and their specific interests in ongoing information.
If the donor only hears from the organization when it needs money, the probability of losing the donor increases. Certainly this is obvious, although many organizations follow this practice, sometimes sending frequent appeals and talking about their organization only in terms of need.
These organizations do not realize that most donors want to hear about the successes, the outcomes, and the wins that their contributions may have brought about.
Donors can receive too much communication, as we all well know.
Understanding the type and frequency of information donors want, and then making sure they systematically receive this information is vital.
Certainly major victories, outstanding results, invitations, annual reports should go to all, with as much personalization as is possible in this digital age.
Complimentary to reporting is rewarding donors according to their profile and values. Donor clubs, inclusion on lists of donors, plaques, pins, named entities, memberships are all part of the conventional stewardship program, and they work and don’t work, all according to donors’ preferences.
Recently, for example, my alma mater sent me something rather expensive, which I later realized was a metal and enamel hooked bookmark. Unfortunately, it didn’t work on my Kindle.
Knowing more about the donor’s preference would result in better “rewards,” which then might include a personal letter to the donor from a program participant, or a picture of the donor at a significant time, or a prime seat in a recognition event, or the functional equivalent of two seats on the fifty-yard line, or actually, two seats on the 50-yard line.
In other words, it is about the intrinsic, not material, value of the reward in the eyes and emotions of the donor. One donor, in recent memory, saved every photo ever sent, assembled in a leather-bound album sitting on the coffee table in her living room. Or the gentleman who proudly wears a lapel pin on his business attire. Or the unassuming donor who treasures a crayon drawing done by a five-year old in the program.
The essence of reward is to reinforce the very values which led the donor to make the original and subsequent contributions. Such reinforcement is essential to the overall success of the stewardship program.
Finally, with successful, specific reporting and rewarding, donors will be more likely, when asked appropriately, to make additional gifts, renew in the annual fund, participate in special events, contribute to a capital request and execute a planned gift.
With solicitation based on these deeply imbedded values, personalized and building on the previous R’s, rather than some mechanical request, donors recognize the importance of what they are doing to contribute to success as well as feeling wanted and needed by the organization.
The concept of the lifetime dialogue, the lifetime friendship, helps point the nonprofit organization’s development program in a more intense, more tailored stewardship program. It also produces better retention rates and increased giving among those affected.
At a time when all of us will need to rely more and more upon individual donors, the 4R’s give us the initial mnemonic to launch a successful stewardship program that will help assure us of significant success in benefitting society as well as having our donors feel greater satisfaction in their own choices and contributions.