Tag Archives: Monthly Giving

Can Nonprofits Turn Previous Failures Into Future Success?

Can Nonprofits Turn Previous Failures Into Future Success?Listen to any conference speaker, self-help guru or tech entrepreneur and you are sure to hear about their failures. Of course, they are speaking because they turned their failures into lessons that helped them succeed. Can you imagine going to a funder and telling them that you had to close down your last nonprofit due to lack of money but this time you knew how to handle their 7-figure gift? Can nonprofits turn previous failures into future success? Of course, saying you have changed the way you run your organization is not enough.  You need to “walk the walk as well as talk the talk.”

  • Show that you now have a strong case for giving and are only approaching the right people at the right time.
  • Prove you have learned your lesson by talking about your new and detailed focus on acknowledgements.
  • Demonstrate that you understand stewardship for each and every donor and each and every gift.

What are other areas that nonprofits ignore that can be turned around to prove success?

To some this list may seem overwhelming. To others, it will highlight areas on which to focus or tweak in the coming year. Either way, turning previously missed opportunities into growth and prosperity will sustain your nonprofit. And, it will be something positive to talk about to current and prospective funders. Showing that you are learning and growing is something everyone can get excited about.   Please let us know if we can help you improve your nonprofit by emailing Abigail Harmon.

Assessing Your Nonprofit’s Donors and Prospects: Annual Fund Segmentation Strategies

Annual fund segmentationSolicitation strategies start with assessing the current situation. Do you treat all your prospects and donors the same? Should you?

Now, more than ever, you should have a development plan for all prospects and a stewardship plan for all donors.

But, you should not plan on having the executive director “meet” with every donor. How can a nonprofit engage each prospect and donor when there are thousands? Annual fund segmentation.

Start annual fund segmentation by considering how they give.

  • Are they a Prospect or Donor
  • If a donor, are they
    • Current
    • Once-a-year Donor
    • Monthly Donor
    • Major donor
    • mid-level donor
    • mid-level donor you are trying to upgrade
    • 10-year donor
    • 25+ year donor
    • first time donor
    • LYBUNT
    • PYBUNT
    • Someone who gave to a
      • specific event
      • end-of-year mail or email campaign
      • other mail or email campaigns
      • sponsorship
      • special campaign donor
      • restricted gift donor
      • peer-to-peer campaign on behalf of a friend
      • also a volunteer
    • If a prospect or a donor, are they also a
      • Recent graduate or services beneficiary
      • 10-year alumnus\a
      • 25-year alumnus\a

Additional key points to keep in mind include:

  1. It costs 4.5 times as much for the nonprofit to find a new donor than retain one
  2. Donors don’t usually give a major gift in the first year they give to a nonprofit. Cultivation and stewardship over years (3-5 years minimum) is what will get you to the point you can ask for a major gift. *This assumes they have the capacity and had been stewarded properly during the time since they made their first gift.
  3. When you start accounting for lifetime giving, someone who gave $50/year for 20 years gave $1,000 to your nonprofit. How would you treat someone who gave $1,000?
  4. Break it down specifically for your organization. Should:
  • major donors get more personalized interaction than other donors?
  • monthly donors get a different appeal than once-a-year donors?
  • PYBUNTS or LYBUNTS get the same letter as new prospects?
  • members get the same email as non-members?
  • alumni get same event invitation as prospects?
  • parents get the same Facebook post as the students?
  • ____ get the same ____ as _____ (fill this in for your nonprofit)

Each organization will have its own set of segmentations.

And contrary to popular belief, segmentation was not created to give you more work.  Instead, it gives you more directed work. And a path to raising more money (which is the point, isn’t it?)

It may seem easier to send the same fundraising letter to the 1000+ people on your mailing list and move on.  But what are you moving on to? If you rely on your annual fund to support your organization, this must be a priority for your development team. Even if it is a team of one.

Technology, Email and Monthly Giving

David A. Mersky imageTechnology, Email and Monthly Giving:

Part 8 in Creating a Monthly Giving Program

Do you remember the quote, “For want of a nail…”?

The line opens a bit of verse, often attributed to Benjamin Franklin, that tells the tale of how even the most insignificant element can cost you the world.  For the want of a nail…the kingdom was lost.”

If you want to read the entire, brief poem, here it is:

“For the want of a nail the shoe was lost,
For the want of a shoe the horse was lost,
For the want of a horse the rider was lost,
For the want of a rider the battle was lost,
For the want of a battle the kingdom was lost,
And all for the want of a horseshoe-nail.”

The same can be true about your monthly giving program.  The least little thing can torpedo your best laid plans.

In these past seven months, we have spent time outlining the development of a monthly giving program.  The primary motivation for exploring the values of program to create a group of sustaining supporters is to address issue of the “leaky bucket” of donor retention.  We have gone into a fair amount of detail.  Now it is time—before you pull the trigger—to make sure that everything is working like clockwork.


If it is not easy and accessible for your donors and prospects, then you will end up with the “abandoned shopping cart.”  People with limited attention spans and low levels of tolerance for frustration, will not consummate the transaction.

In a word, it’s got to be seamless.  Here is how to find out

Make an online gift to your own organization

  • Is the process easy and straightforward?You should only ask for the most basic, required information and nothing more.  The more you make the donor work, the less likely they will finish the transaction.
  • What kind of error message do you receive if you enter your card’s expiration date incorrectly?Is it a friendly and tinged with a touch of self-deprecating humor?  Don’t be critical of the donor.  After all, they are trying to help you and your organization.  Take responsibility and ownership for the mistake as if it were your own.
  • What kind of “thank you” or “welcome” message do you receive?Even though this initial communication is automated, it should be personalized for the donor and recognize the amount of the gift.  It should also tell them what to expect in terms of the monthly charge to their credit card or withdrawal from their bank account.Above all, this is the time to show your true appreciation.But, it is not the end, but the beginning of a series of seven different acknowledgement and touches of recognition.  You can learn about the Seven Ways to Thank Your Donor by clicking here.

Research has shown, that even though we send a “snail mail” invitation to prospective sustaining supporters to join our special circle of most valued donors, the majority of people today will turn to your web site.  So in your mailing—even though you have provided a gift form and a reply envelope—you should put a link to the monthly giving subscriber page, probably in P.S.

And, then, in your planning, you should create a series of three to five follow-up emails, each focused upon a different feature and benefit of becoming a Sustainer.  This will markedly increase the likelihood of a positive response.  And in the email, the link to the right page on your web site will be prominently featured several times.

Finally, for those people who are your most technologically savvy and deep into social media, you should support your solicitation on a multi-channel basis, using FaceBook, LinkedIn, and every other place where you might be present and your donors could meet you.

Then, you will have provided the “nails” and the kingdom and the glory of a robust monthly giving program will not be lost.

NEXT MONTH: Growing Monthly Giving
LAST MONTH: Key Components of the Monthly Giving Ask


A Step-by-Step Plan to Ask for Monthly Gifts

Part 5 in Creating a Monthly Giving Program

Last month, I outlined what you would require to launch a monthly giving program. This month, let’s focus on a step-by-step plan to make the ask for monthly gifts.David A. Mersky

    1. Create a monthly giving launch letter/appeal
      It is now time to sit down and write the first invitation for your target audience to join that most special group of sustaining donors. Get a “picture” of one of those wonderful donors and put it beside your monitor so that as your fingers race across the keyboard, you can visualize her reading the story that will make a compelling connection to the value, first to her, and then to your mission, if she were to agree to contribute by credit card authorization or an electronic funds transfer $15 per month—thus moving from a $100 annual gift to a value of $180.
    2. Develop a web page for monthly giving
      This is the destination to which you will send your prospective sustainers by link in the letter or emails that is dedicated to this concept and simple to navigate. Do not ask for information which you either already have or will never need. Make the transaction so simple that no one will ever abandon the process.
    3. Mail your monthly giving launch letter or email
      At some point, you have to stop editing and polishing. Make sure the package that you put together will be opened—whether it is in print or electronic. Have nothing superfluous in it. Everything that you send should be in support of the one simple request—please become a monthly sustainer. And, when it is good, even great, but not necessarily perfect, hit send or put it in the mail box.
    4. Follow up with a series of emails and phone calls
      Just as Coca-Cola or Budweiser do not depend upon a single advertisement in only one channel, so should you also plan to use every means possible to follow up with your prospective monthly sustainers. If you used snail mail for an initial invitation, then a series of emails and even a telephone call might be employed to move the donor to the desired action.
    5. Welcome new monthly donors
      As we said about stewardship in general last month, a thoughtful, effective and speedily executed plan of post-gift engagement is essential. With credit card authorizations or electronic fund transfers, you should be set up to acknowledge the gift and confirm that the donor will be a monthly sustainer at that level, but you do not need to send monthly letters of appreciation. Once a year is enough but it should provide information as to how the donor can opt out at any time they choose. Then, you should have plan in place to send out whatever welcome package, token of appreciation, communication from the CEO, Board Chair, Chair of the Monthly Sustainer Society, that you have created for all gifts.
    6. Add monthly giving as an option
      Be sure to provide a link on your web site and it in your email signature so that people who may not have been asked might “stumble” upon the opportunity to join your sustainer society. In fact, you should add it to every solicitation device from marketing materials to your current donation website page. You may not get to ask everyone directly, but think about the indirect option for people who learn about the benefits of monthly giving by the example of their friends and colleagues. Make it easy for them to sign up on their own.

NEXT MONTH: Building Momentum: Your Monthly Giving Ask

 LAST MONTH: What You Need to Launch a Monthly Giving Program


What is Monthly Giving and Why It Matters

Part 2 in Creating a Monthly Giving Program

David A. Mersky imageAs I wrote last month in the introduction to this series, six out of every ten donors will stop giving to your organization next year. This trend is going in the wrong direction. But you can retain more donors with the right strategy. The donors currently in your database represent a hidden treasure of funds just waiting to be found (or in this case, asked!). They know you, they gave to you, and they most likely want to give more. Why not ask them to become monthly donors?

Most monthly donors stay with an organization between five to seven years and sometimes even longer. We have even seen donors who give recurring gifts to organizations for more than 20 years!

It is important to consider exactly the concept, what is monthly giving? A monthly giving program involves pre-authorized or recurring gifts. These are gifts that the donor has authorized you to deduct directly from their bank account or charge to their credit card every month on a recurring basis. In monthly giving, the donor makes a pledge to give a certain amount to your organization each month, and then provides you with a credit card or bank account number, or some other means to directly deduct the money from their account.

Monthly giving programs are very popular with non-profits in Europe, and have been gaining popularity with organizations in the US and elsewhere, and for good reason — they work. There are many benefits of monthly giving programs.

Launching a monthly giving program can be a powerful strategy for non-profits both large and small. Studies over the past decade have shown that monthly givers give more money and stay with a non-profit longer than non-monthly givers. Here are some of the reasons why monthly giving is so important for every non-profit:

Retain more of your donors for many years
The average donor retention rate is 43%. That means 57 of every 100 donors will not give again to you next year. If you start a recurring donor program, your retention rate more than doubles!

Once a donor signs up for a monthly giving program, they stay more loyal to the non-profit and tend to give more than they otherwise would because monthly donors, if cultivated right, build stronger relationships with the nonprofits they support, and because that relationship won’t be stopped just because the donor forgets to put a check in the mail. Stopping a monthly giving relationship takes a proactive step from the donor, one they are unlikely to take unless they really mean to stop their support for a particular non-profit

Monthly Giving Programs Build Strong Relationships
One of the most amazing things about monthly giving is that once a donor signs up for a monthly giving program, you can stop asking them for money, because the person is giving you money each and every month. Instead of making regular asks, you can focus 100% on stewarding your donors. Imagine, donors that get tons of attention from your non-profit, and none of it is an ask!

Okay…the truth is that you’ll want to send your monthly donors one ask per year, an opportunity to upgrade/increase their monthly gift. But other than that, all of your communications are based on cultivation and stewardship. You can build amazing and strong relationships with your monthly donors, confident in the knowledge that the money is coming in every month.

Monthly Giving Programs Provide a Stable Foundation for Your Non-Profit
Good monthly giving programs build a regular, dependable monthly income upon which your organization can rely, month in and month out. Instead of waiting around for donor checks to arrive or worrying about whether or not this donor or that donor will make a gift this quarter, you know that you are starting every month with a increasingly substantial deposit in the bank.

Monthly Giving Programs Lower Fundraising Costs
While there will be some expense in launching a monthly giving program, overall the larger your monthly giving program becomes, the lower your fundraising costs will be. As donors sign-up for monthly giving, you can stop sending them direct mail solicitations and stop worrying about scheduling asks and follow-up calls. And, because monthly givers are more loyal to your organization, you can spend less money trying to find new donors to fill in for all of the donors who lapse each year.

NEXT MONTH: Monthly Giving—How to Get Your Program Started

LAST MONTH: Creating a Monthly Giving Program: A Solution to Donor Retention and Financial Sustainability