Written by Erica Waasdorp, Monthly Giving Expert and President of A Direct Solution
You must absolutely start a monthly giving program.
There, I’ve said it. And you’ll hear me say it time and time again. But why is this so important? I’ll tell you why!
In the US, historically, organizations have focused on major donors. That’s where most of their resources went. 20% of their donors gave 80% of their gifts.
But how about the many small donors in the donor base? Until a few years ago, those were less important. They were simply nice to have and merely a way to generate new major donors.
Then, early 2014, the AFP published its Fundraising Effectiveness Study and showed you that the typical donor retention rate had dropped to 39%. That shocked the industry as organizations saw so many of their donors leaving.
Now, in 2015, the report came out again and retention rates had gone back up to 43%, but only after we saw that organizations had started monthly giving programs.
Monthly giving provides an important solution to your donor retention problem.
With monthly giving, you can ensure that your small donors become mid level to major donors, in a dependable, sustainable way. No more waiting for the major gift officer to meet with the donor.
Many organizations that have a program only started monthly giving after donors called and asked if they could make a small regular donation through their bank account or credit card account. They just could afford to give any more now. That’s how monthly giving started for some organizations, and it grew from there.
The country I hail from, the Netherlands, (and many other European countries as well as Canada) had discovered monthly giving a long time ago. Major gifts was just not that common there. Most organizations have a lot more small donors so they had to find a way to get ongoing revenue from them. Monthly giving has become a way of life, and many organizations see 60 to 80% of donors giving that way. Nonprofits can truly ‘bank’ on this money!
Here, the tide is turning. Some big guys have made major inroads and are reaping the fruits! Public television and public radio stations have 20 to 60% of their members now giving monthly. They can ‘bank’ on sustainable revenue coming in monthly after month.
That’s why I’m so excited to let you know that DonorPerfect has developed a tremendous new tool, called the Monthly Giving Starter Kit.
It’s aimed at helping you retain more donors and raise more money, year after year. And It’s available for download right here.
The kit addresses the five important reasons why you should start a recurring giving program NOW! They are:
Reason 1. Retain more of your donors for many years
You can truly go from keeping 43% of your donors on average to 90% if your donors sign up via Electronic Funds Transfer or Credit/Debit card.
Reason 2. Raise more money
There is no question. Donors who give 12 times a year might give smaller amounts each time, but usually they triple to quintuple their annual giving.
Reason 3. Worry less about cash flow and focus more on your mission
You can plan on the funds being there on an ongoing basis and you’re less dependent on seasonality. You can focus on executing the programs.
Reason 4. Give your donors the convenience they’ll love
Donors already like giving to your organization when you ask them, but they really like the convenience of giving small amounts on a regular basis.
Reason 5. With DonorPerfect, you already have the tools. Now all you have to do is activate them.
For many organizations, setting up the system could be a problem, but not for you. The tools are already there. You already have DonorPerfect. Just set up your EFT (electronic free transfer), and organize your donation forms. C’est tous!
I trust that these reasons will give you the ammunition to present to your boss and board to get started with a recurring giving program as soon as possible.
You’ll find much more in the Monthly Giving Starter Kit, as well as some great downloadable templates you can use right away to get started.
We’ve truly made it easy for you to start and grow your monthly giving program, but if you have any questions at all, simply contact Erica Waasdorp at DPConnect.