Fundraising 101 for Nonprofit Leaders
Turning First-Time Donors into Lifelong Supporters
When I was the executive director of a local nonprofit, we had a policy of thanking every donor who gave, even down to the $25 level. Our goal was to show genuine appreciation for each contribution, regardless of the amount. One instance that stands out involved a new employee who had only been with us for two weeks. We tasked her with calling donors to say thank you.
She spoke to a donor during one of these calls and expressed our gratitude. After her thank you, there was a silent pause—a moment many fundraisers know well—when donors might anticipate another ask for more money. Instead of soliciting further, our staff member asked if we could pray for the donor or offer any other service. The donor, seemingly taken aback, inquired if we were calling to ask for more money. Our staff member clarified that our sole purpose was to say thank you, not to solicit a gift.
This gesture of gratitude surprised the donor. A few weeks later, to our astonishment, this donor sent us a gift of $10,000. This experience reminded us of a fundamental truth in fundraising: people want to be appreciated. When we take the time to thank them genuinely, it can lead to unexpected generosity.
"Feeling gratitude and not expressing it is like wrapping a present and not giving it." – William Arthur Ward.
Our greatest privilege is giving back to donors who give to improve people's lives. Saying thank you in person, over the phone, or by letter is a simple way to share the joy we feel when donors make it possible for us to change the lives of the people we serve. It's important to emphasize the significant impact of their contribution, making them feel valued and important.
Why It's Important to Encourage a Second Gift
It's crucial to give donors reasons to make a second gift because it significantly impacts a nonprofit organization's sustainability and growth. According to the 2023 Fundraising Effectiveness Project (FEP) Report* by the Association of Fundraising Professionals (AFP), the average donor retention rate is around 45%. By improving this rate, organizations can significantly enhance their ability to change the lives of those they care about.
*Fundraising Talks - May 2023 - USM Foundation. https://www.usmf.org/fundraising-talks-may-2023/
What happens when nonprofit leaders show gratitude:
Building Trust and Relationships: The first gift is often a test. Donors want to know their contribution is making an impact so they can feel connected to the cause. By engaging them effectively after their initial donation, you demonstrate transparency, build trust, and show the impact of their generosity, which increases the likelihood of a second gift.
Cost-Effectiveness: Acquiring new donors is generally more expensive than retaining existing ones. Investing in cultivating relationships with first-time donors can lead to higher lifetime value, as it costs less to encourage a second gift than to find a new donor.
Increased Giving Potential: Once donors make a second gift, they are more likely to continue giving and may increase their donation size. This progression often leads to significant gifts as donors become more invested in the organization's mission.
Creating Advocates: Donors who give multiple times are more likely to become advocates for your cause. They are more inclined to share their passion with others, leading to referrals and new donor acquisition through word of mouth.
Nonprofit Fundraising Habits 101
The following habits can help encourage people to give not only a second gift but many more:
Follow up promptly. Share with people that their gift is already at work and making a difference. Organize your staff to send a Thank-You in 48 Hours. Acknowledging a donor's gift shows appreciation and sets the stage for a continued relationship. Make time for staff to make a Phone Call in 5 Days. A personal call to thank the donor and listen to their motivations can strengthen their connection to your cause.
Welcome Kit in 10 Days: Providing additional information and inviting donors to take the next step helps integrate them into the organization's community. You can share a quick summary card that shows the services you provide. Share a story card of someone your organization impacted. You can also share more ways for donors to get involved, like getting a tour or volunteering.
Listen, Thank, Then Ask: By understanding why they give, you can tailor future communications to align with their values and interests, making it more likely they will give again. This approach involves actively listening to the donor's motivations for giving, expressing genuine gratitude for their contribution, and then, when the time is right, asking for their continued support in a way that resonates with their reasons for giving.
Focusing on the donor experience and showing them the impact of their contributions can significantly increase the chances of receiving a second gift. This approach benefits the organization by providing more consistent funding and enhances the donor's experience, creating a lasting partnership.
In fundraising, appreciation can lead to transformation.
Just as in the story of our donor who gave $10,000 after being thanked, we see that taking the time to acknowledge donors sincerely opens doors to deeper connections and support. When we show genuine gratitude and prioritize building relationships, we turn first-time donors into lifelong supporters. As nonprofit leaders, it's our role to create these lasting partnerships, ensuring that our mission continues to make a difference in the world.
"A generous person will prosper; whoever refreshes others will be refreshed." – Proverbs 11:25 (NIV)
As a nonprofit fundraiser, we have the opportunity to refresh not only the people that we serve but also volunteers who give their time and donors who give their money. We know people who give are not just giving time or money; they are giving people an opportunity to have hope and a dream.
We get to facilitate joy every day as nonprofit leaders. Take time to say thank you.