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04/13/2023 Customer & Market Insights 1
NEW DONOR TRENDS
Target Analytics Seminar @ 2013 DMA Non-Profit Conference in DC
February 6, 2013
04/13/2023 Customer & Market Insights 2
DECLINE IN NEW DONOR ACQUISITION2001-2010
Sector(# of organizations)
Total # New Donors2001-2010
% Change New Donors/Year
2001-2007
% ChangeNew Donors/Year
2007-2010
Advocacy (16) 6.6 million -9.5% 14.4%
Hospitals (23) 1.2 million 17.2% -0.4%
Cultural (16) 2.2 million 5% -2%
Environmental (37) 16.4 million -23.1% -11.0%
Health Research (30) 117 million 12.5% -14.8%
Human Services (36) 6.7 million 4.7% 2.5%
Colleges (34) * 350,000 -18.9%
* The % Change for colleges is for the period 2006-2011
SOURCE: TARGET ANALYTICS
04/13/2023 Customer & Market Insights 3
DECLINE IN F IRST YEAR RETENTION2001-2010 Sector(# of organizations)
Retention Rate 2001
Retention Rate 2010
% Change 2001-2007
% Change2007-2010
Advocacy (16) 34.0% 27.4% -19.5% 0.1%
Hospitals (23) 21.2% 18.1% -2.7% 0.6%
Cultural (16) 33.3% 26.8% -13.7% -6.5%
Environmental (37) 29.7% 24.0% -18.2% -1.4%
Health Research (30) 20.9% 19.3% -11.7% 0.4%
Human Services (36) 30.8% 26.3% -10.9% -4.2%
Colleges (34) * 30.8% 28.1% -8.8%
* The % Change for colleges is for the period 2006-2011
SOURCE: TARGET ANALYTICS
04/13/2023 Customer & Market Insights 4
• Acquisition is increasingly more expensive• First year retention rates are declining• Trends started prior to downturn and will likely continue
after recovery• Younger donors are less loyal than older donors• Low ROI on new donor acquisition (and getting lower).
- too costly to acquire new donors to replace lapsing donors
• WHAT CAN WE DO? !!!
SUMMARY OF CHALLENGES
04/13/2023 Customer & Market Insights 5
04/13/2023 Customer & Market Insights 6
• View donors as valuable assets!
• When acquiring new donors, factor in whether you will retain the donor, and at what dollar level
• Fill the holes in your leaky bucket!
• Why did the donor give? Stop giving?
• According to Adrian Sargeant, Ph.D. from Indiana University’s Center on Philanthropy“A 10% increase in donor retention can increase the lifetime value of the donor database by up to 200% .”
EMPHASIZE DONOR RETENTION OVER ACQUISITION
04/13/2023 Customer & Market Insights 7
04/13/2023 Customer & Market Insights 8
• View donors as valuable assets!
• When acquiring new donors, factor in whether you will retain the donor, and at what dollar level
• Fill the holes in your leaky bucket!
• Why did the donor give? Stop giving?
• According to Adrian Sargeant, Ph.D. from Indiana University’s Center on Philanthropy“A 10% increase in donor retention can increase the lifetime value of the donor database by up to 200% .”
EMPHASIZE DONOR RETENTION OVER ACQUISITION
04/13/2023 Customer & Market Insights 9
04/13/2023 Customer & Market Insights 10
• View donors as valuable assets!
• When acquiring new donors, factor in whether you will retain the donor, and at what dollar level
• Fill the holes in your leaky bucket!
• Why did the donor give? Stop giving?
• According to Adrian Sargeant, Ph.D. from Indiana University’s Center on Philanthropy“A 10% increase in donor retention can increase the lifetime value of the donor database by up to 200% .”
EMPHASIZE DONOR RETENTION OVER ACQUISITION
04/13/2023 Customer & Market Insights 11
• Be willing to invest in your donors, e.g. thank you calls. See Donor-Centered Fundraising – Penelope Burk
• Determine a donor’s potential early in your relationship and allocate resources accordingly
• Be Donor-Centric, not Campaign-Centric
FOCUS ON LIFETIME VALUE, NOT RESPONSE RATES
04/13/2023 Customer & Market Insights 12
04/13/2023 Customer & Market Insights 13
• Set goals and measure your results
• Find peer groups and benchmark your results
• Checklist Manifesto, by Atul Gawande
• Identify best practices
• Find ways to collaborate to maximize results
FOCUS ON RESULTS, NOT EFFORT
04/13/2023 Customer & Market Insights 14
• Organize yourself to recognize a donor’s passion for your mission
• See yourself through the eyes of your donors
• Be willing to invest in your donors
• Test investments and track results carefully
INVEST IN YOUR MOST PASSIONATE SUPPORTERS
04/13/2023 Customer & Market Insights 15
04/13/2023 Customer & Market Insights 16
1. Emphasize donor retention over donor acquisition
2. Focus on a donor’s lifetime value, not a campaign’s response rate
3. Focus on results, not effort
4. Identify & invest in your most passionate supporters
KEY TAKE-AWAYS
04/13/2023 Customer & Market Insights 17
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04/13/2023 Customer & Market Insights 18
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