Do You Know The #1 Reason Donors Stop Giving?

Do You Know The #1 Reason Donors Stop Giving?

Donors stop giving for all sorts of reasons, really. Financial difficulties. Shifting interests. Donor fatigue. Disagreement with leadership.

But do you know the #1 reason donors stop giving?

In this article, we will explore why the majority of donors stop contributing to charitable causes.

Lack of Communication

Sure, donors may run into financial difficulties, gain new passions, get tired of being asked to give, and disagree with the direction of your organization. But the main reasons donors stop giving? A lack of communication. Said differently, a lack of donor engagement. For more than a decade, the average U.S. nonprofit has lost well over half its donor base each year due to a lack of connection. 

Think about it: new donors typically have zero loyalty to your nonprofit. There’s no real relationship or buy-in yet. They either gave because one of their friends, family, or colleagues asked them to, saw an ad, or were inspired by your mission and need. So, why should they donate again? How do they know your nonprofit needs them?

Challenges to Donor Retention

It’s one thing to win a donor by capturing their attention. It’s another thing entirely to retain them. There are a few main reasons why a donor’s second, monthly, or annual donation doesn’t come in:

  1. Zero or little acknowledgment. Sending supporters an automatic tax receipt is the bare minimum. Do you give new donors a proper phone call, personalized thank you emails, or handwritten letters? These are some of the first steps toward a relationship with your new donors. Each interaction builds on acknowledgment. Don’t neglect to thank new supporters!

  2. Ask again right away. This is a classic example of what causes donor fatigue. Unfortunately, one of the first things many nonprofits do is ask a donor for another donation right away in a follow-up email. This can push donors away, leaving them feeling uninspired and, frankly, used.

  3. Infrequent messaging. Without regular email updates, newsletters, and social media posts, how are donors supposed to stay up-to-date with the important work you’re doing? You may think these micro-communications don’t make a big difference, but they do. Over the year, your recurring updates set the stage for successful year-end giving and a sustained loyalty to your mission.

Solutions for Donor Retention

  1. Segment. After thanking your donor, add them to one of your CRM groups (e.g., new donors, volunteers, X campaign, major giving). Then, create an automatically scheduled email series. This way, when you add a new supporter to this group, they begin a 3-5 welcome series. Be sure to remind them of your mission, vision, program impact, and the problems you’re solving. Once they complete the email series, follow-up with a personalized email or phone call to keep building the relationship. Your main goal on that call? Listen. Listen to what drew them to your nonprofit. Listen to what they liked and didn’t like about the email series. Listen to questions and needs they have.

  2. Connect. Once you personally follow-up with a new donor, you should have an idea of what motivates them to support you. Tag their values in your CRM (e.g., kids, pets, problem-solving, closing). Then, see who else is in that category that is more involved. Think about inviting them to join a Facebook group or volunteer group of donors to connect with other people who are passionate about your cause. Don’t forget to add Text-to-Engage as a part of your “connect” strategy for donor retention! It’s the fastest way to connect with donors – 98 percent of texts have an open rate within 90 seconds.

  3. Build. Believe it or not, donors can tell when the relationship is purely transactional. Supporters know when nonprofits only want a relationship for another gift. To avoid transactional relationships with donors, aim to build genuine, mission-driven relationships. Continually work to know who your supporters are, what inspires them, and how they want to contribute to your cause. Assure donors that they matter to your mission, belong within your donor community, and are making a deep impact through their support.

The Bottom Line

The #1 reason donors stop giving is due to a lack of consistent, mission-driven communication from nonprofits. To increase donor retention, donor engagement needs to be top-of-mind for development teams. There are many strategies for doing so, just keep in mind that the most important goal is to develop donor relationships, not just the next gift.

To help your nonprofit with donor retention through this challenging time, you can use ZGIVE, an online auction platform used by nonprofits in the USA. To set up a free demo and learn more about ZGIVE, kindly visit us at zgive.com.