Gloriously Predictable

The beauty -- and challenges -- of recurring donor programs

As my readers are well aware, I think that having a robust and well-conceived recurring giving program is one of the best tools that a nonprofit can use to increase revenue (and, in turn, impact). As a recurring donor to many causes, I personally love the feeling of knowing that I’m helping the NPO in an ongoing way. As a nonprofit advisor, I appreciate that these recurring giving programs:

  1. Provide a continual and predictable form of revenue to the organization

  2. Create ongoing cash flow that can help the nonprofit in the “slow months”

  3. Add a level of increased certainty for budgeting

  4. Engage younger donors

  5. Give donors a feeling that they’re connected to the organization year-round

According to a report from Double the Donation, there was a 40% increase in recurring donations this past year. Another report (Blackbaud’s “Retention Toolkit”) showed that half of the donors acquired as sustainers (recurring donors) in the fiscal year 2017 were still giving in the fiscal year 2020, versus just 18% of single-gift donors acquired at the same time. (You might want to read that last sentence again — it’s really quite remarkable.)

Despite these numbers, many people in the nonprofit world don’t seem to understand how the addition of this simple program can be a game-changer for them. I have no idea why every nonprofit isn’t incorporating this option in their fundraising efforts — other than the change-averse “that’s the way it’s always been done” way of thinking.

Kudos to the many organizations that have included recurring donation programs as part of their fundraising efforts, and about 20% of all online (nonprofit) revenue now comes from recurring donations.

I’ve recently noticed that political fundraisers are promoting this wonderful tool. Typically we think of political fundraising as being very intense for a very short time — and then on to the next thing. However, a friend of mine (a very savvy Member of Congress) completely floored me when she sent out a pitch email titled “The logic of a monthly donor”. Besides being impressed by her presenting a long-term perspective, I loved her description of monthly giving. She called it “gloriously predictable”. She also used the word “sustainer” interchangeably with “monthly donor”.

Think about it. Would you rather be a “donor” or a “sustainer”? For some, a “sustainer” suggests a more meaningful contribution to the organization, instead of a “donor”, which connotes giving and then walking away.

Regardless of the wording, do whatever you need to do to set up a recurring donor/sustainer program. If you want to know how there are tons of articles online (usually under “sustaining donor program”), or you can make it easy on yourself by looking at any membership organization (doesn’t matter if it’s for-profit or nonprofit) and see how the sign-up looks. I would be shocked if anyone reading this doesn’t have their credit card on file for some type of recurring (usually monthly) payment.

I spoke with the head of a nonprofit recently who told me that she didn’t want to run a “sustainer” program because she didn’t want to deal with people who stopped giving when their credit card expired. This makes no sense to me. The donor is a customer, and if the customer wants to give, the organization needs to help them do so. Does this mean that you, as a fundraiser, need to monitor when cards “on file” are nearing an expiration date or have expired? Yes! Remember that an ongoing donor is a donor who you have a relationship with, and if you don’t want to have any interaction with a donor, then that’s not a relationship — it’s a transaction. Recurring donor programs, and repeat donors of any kind, are typically not going to be with you long-term if you don’t want anything to do with them.

A relationship would involve you regularly updating the donor on impact, growth, and challenges. If you are doing that, asking for a new credit card expiration date shouldn’t be a non-starter. Having said that, the example above is far from unusual. According to 360 MatchPro/Double the Donation, “1 in 4 nonprofit organizations don’t try to re-secure a recurring donation after a credit card number changes.” Transactional, not relational.

Next week’s article is on valuing recurring donors and their donations — there seems to be some confusion and contentiousness about this issue.

In the meantime, check out some of my previous articles on recurring donations, with not only the basics but with some more interesting/compelling statistics, here: The Holy Grail of Fundraising & A Really Lame Way to Lose a Donor

Onwards!


I’m Saving Giving by providing a clear path to success, supported by data, statistics, and interviews. You can find more of me lifting the lid on the charitable sector here on Philanthropy 451, in my bestselling book, Philanthropy Revolution, on socials at TwitterFacebook, and LinkedIn or listen to this episode of UBS On-Air: In Conversation with Lisa to learn more.

- Lisa