Ask Wiley: What If I Don’t Have The Funds To Invest In Donor Acquisition?

Ask Wiley

Question:

What If I Don’t Have The Funds To Invest In Donor Acquisition?

Answer:

Since I don’t know of any free way to acquire a significant number of new donors, you’ve got a big challenge. The Fundraising Effectiveness Project showed that on average, over half of your donors from last year will not give a gift again this year. That’s an industry average attrition rate of over 50%! If you don’t replace or reactivate these lapsed donors, your donor base will continue to shrink accordingly.

You can see why we have a dilemma. So, how many new donors do you need to acquire just to replace your lapsed donors?

Let’s do the math: Active Donors* X Attrition Rate** = Number of Donors Needed

That’s how many new donors you need to add, just to replace your lapsing donors. You will need even more if you want to grow.

So the question becomes, can you afford not to acquire new donors? And the answer I would present is: absolutely not.

Instead of figuring out how to survive without investing in acquisition, let’s talk through a proven strategy to help you optimize your acquisition investment through major donor partnerships.

The cost to acquire a new donor is significantly less than the long-term value of a new donor. As such, many non-profits have successfully convinced major donors to help them invest in donor acquisition.

And they’re excited about it! It’s an easy sell when major donors can see that the value of their gift gets multiplied many times over by the new donors they helped make possible to acquire.

For example, $25,000 invested in digital acquisition could generate 357 new donors. In a single year, when properly cultivated, those donors will generate about $60,000. What a great way for a donor to turn their $25,000 gift into $60,000 for your organization!

This is entirely possible! We are getting results like these for the clients we serve at Douglas Shaw & Associates. And with the right consulting partners at your table, you too can see your investment multiply.

*Active donors are those who gave you a gift this past year, 2019.
**Your Attrition Rate takes the total number of donors who gave the prior year (2018) but did not give again this year (2019) divided by your total number of donors in 2019.

Wiley Stinnett’s highly successful career in direct response fundraising provides our clients with proven direct response strategies and ideas based on real-world experience. With more than 35 years of experience working with ministries, Wiley continues to provide counsel on how to grow donor relationships and improve direct mail, web, digital, radio, television, and events income.

Submit your question at www.douglasshaw.com/askwiley.

We look forward to helping you continue your work of being a part of what is right in the world!