4 Steps to Keep and Renew Your New Donors
New Donor Acquisition is the lifeblood of a healthy and growing direct mail fundraising program. It is generally believed that 80% of a charity's income is generated from 20% of the donor file. Obviously, this varies and the more diverse your income sources the healthier your charity will be. But for the direct mail dependent organization, new donor acquisition is absolutely necessary.
Cost-effective new donor acquisition campaigns are generally measured in terms of Long Term Donor Value (LTDV). This asserts that the cost associated with acquiring a donor can only be evaluated against the revenue each new donor will contribute in the future. Identifying a LTDV can be a challenge and generally requires some serious calculating.
But one of the most critical factors impacting LTDV is the all-important 2nd Gift. Therefore a good New Donor Renewal Strategy is key to getting the most out of acquisition campaigns. Here are 4 steps to keep and renew your new donors: implement these and watch your LTDV climb!
Step 1: Acknowledge and Reinforce!
Donors say that the primary reason they lapse is because their gift was not acknowledged. Therefore, sending a timely acknowledgment is a must. We recommend a new donor Thank You / Receipt mailing be processed within 24-48 hours of gift processing
Furthermore, an effective new donor Thank You / Receipt package should acknowledge the initial gift offer and reinforce the cause while welcoming the new donor. We suggest you include a fact sheet or simple brochure. If possible mail a Thank You / Receipt in a unique carrier envelope that stands apart and says "Receipt Enclosed". This will require 1st-class postage which is exactly the way we recommend they be mailed.
Step II: Thank and Appreciate.
Next we recommend, after the Thank You / Receipt is mailed send a new donor post card and follow with a thank you phone call. Neither should include an "ask" for money. The post card should include a large outcome-based photo and the words "Thank You" on one side and a laser handwritten message of appreciation on the reverse. The personal phone call (no pre-recorded messages) should simply and quickly thank the donor for their initial gift.
Step 3: Creating a Dialogue.
After mailing a Thank You / Receipt and post card and making thank you phone calls, it is time to expand the relationship. You are ready to mail a newsletter to the new donors. However, we suggest a cover letter to again welcome the new donor, introduce the first newsletter and offer the donor the chance to "talk back" with several response check boxes, such as; "I'd like to volunteer", "contact me to donate food or clothing" and alike. This is a nice way to start a dialogue and build on your new relationship.
Step 4: Welcome and Renew.
After the initial newsletter has been mailed and sufficient time has passed, merge each new donor into an abbreviated mail stream of personalize and specialized appeals. The typical new donor mail stream might be every-other month for several months.
Each campaign should include unique new donor text and upgrade asks to aid in slowly and carefully returning a 2nd, 3rd and more gifts. The goal remains to secure additional gifts and increase your Life Time Donor Value.
Test results prove that following these four steps in the New Donor Renewal Strategy will result in as much as a 20% increase annual retention and 15% higher average gift! Don't spend all that time, money and energy on New Donor Acquisition and then not have a good New Donor Renewal Strategy in place. Times are difficult. New Donor Acquisition is costly. A little investment on the follow up strategy and you'll see great improvement on the revenue side.