Donor Attrition – the enemy of every fundraiser!
If you’ve been in the world of professional fundraising for more than 20 minutes, you’ve heard the term ‘donor attrition’. It keeps you awake at night. You see it hiding in dark corners as you walk through the streets at night, causing you to break out in cold sweats.
If you are NOT a professional fundraiser, or you just got put in charge of the big annual fundraising event your Church holds, you’re able to read the words ‘donor attrition’ with the calm of a person who is looking at an angry king cobra through an inch of glass at the zoo. “Look, Bobby. That thing could KILL you!”
For fundraisers, donor attrition is that kind of serious.
Simply put, it means that everyone who gave this year will not donate next year. Some people will stop. You can track this figure, and get a handy statistic called your ‘donor attrition rate’ by dividing the number of donors you lost by the number of donor you once had.
An example: Last year, you had 1,000 donors. This year you have 800 donors. 200 of your donors no longer give. Some have moved to another state, another plane of existence, another church, or have gone bankrupt, or a myriad of other reasons. Your donor attrition rate is: 200 Lost Donors / Last Year’s Total Donors = 20% donor attrition rate.
Just so you know, a 20% donor attrition rate is very low. Most organizations would kill for that attrition rate. A national study done by the Association of Fundraising Professionals estimated the average donor attrition rate at 57%. So for the average agency that had 100 donors last year, only 43 donated again this year.
Do you begin to see why this is the fundraiser’s nightmare?
The reason that you need to know about your donor attrition rate is very simple. If you have fewer donors, either they have to give more money, or you have to reduce your budget.
Never fear – the three amigos are here!
If Donor Attrition is the bad guy in this movie, then the good guys are three amigos named Donor Retention, Donor Acquisition, and Donor Reactivation. If you call for them, they will show up at your darkest hour and defeat the bad guy.
What are they? In a nutshell…
Retention – These are the activities that you do to encourage your current donors to continue to give.
Acquisition – These are the activities that bring new donors into the fold.
Reactivation – These are activities that seek after those donors that the bad guy has captured, and brings them home again if possible.
Each one of these good guys deserves their own post, so that is what they’ll get.
Looking for more articles on key fundraising concepts and tools? Try these:
- Is my fundraising cost effective? Fundraising Return on investment.
- How can I find new donors? Donor acquisition.
- Can I ask donors to give again?Donor Cultivation.
- How do I inspire donors to keep giving? Donor Retention.
- How do I segment my donors into meaningful groups? Donor segmentation.
- How do I encourage donors who have stopped giving to give again? Donor reactivation.
- How do I create an annual fundraising plan?
- What is a fundraising case statement? And why do you need one?
- How do I write a program budget that donors can understand?
- How do I create a donor database?
Check out The Fundraiser’s Playbook for a full list of fundraising articles.
Would you like to learn more about raising money for Church and Ministry? Check out Letters From The Almoner, now available on Amazon.com.