The non-profit quarterly states that keeping a donor is five times more cost-effective than finding a new one. Loyal donors are like a circle of friends you can always rely on. However, for institutions, building that circle requires a proactive approach and genuine commitment that can sometimes prove difficult. This is why donor retention has steadily become more important over the years.

In this blog, we’ll take a fresh approach to defining donor retention and engagement that goes beyond the traditional ask. We’ll dive into creative strategies that truly integrates donors into your goals to make a permanent part of your journey.

What is donor retention?

Basically, donor retention is the ability of an institution to keep its donors coming back to contribute over the years. It is not just the numbers but also the genuine long-term donor relationships with people who appreciate your mission and enjoy being a part of that mission. It involves understanding their motivations, doubts, and the personal connection they feel as a giver and as an individual.

Making a habit of measuring your donor retention rate allows you to spot trends early and find new ways to keep supporters engaged. The data from the most recent Fundraising Effectiveness Project report shows that the first-time donor retention rate is 26%. In comparison, the average donor retention rate is around 46%, meaning most donors stop after contributing for the first time. Considering the unpredictable nature of the world today, keeping donors on board will be even more essential for the long-term success of K-12 and higher education institutions.

Factors influencing donor retention

Several factors can influence donor retention. Let’s take a look at some of them to understand what motivates long-time donors—big or small—to stay:

Donor Engagement:

Engagement is one of the key pillars for long-term donor retention. Your emails, newsletters, blogs, in-person events, and reports all play a key part in making returning and new donors alike feel connected to your institution. For past donors especially, continuous and meaningful interaction can reinforce their dedication to supporting your mission.

Trust and Loyalty:

Trust and loyalty drive any fundraising effort. Your donors come with their own expectations This can be achieved by a transparent demonstration of the impact of their contributions.  

💡Check out how Thomas Aquinas College holds one of the highest alumni donor participation rates across the country

Donor Management:

For retaining donors, donor management matters even more as it involves how you collect and analyze their data, as well as what you provide through communication, recurring gift enrollment, etc., to keep them interested and in the loop.

Feedback management:

To retain donors, you’ll want to be proactive in collecting and acting on feedback to show your commitment to how donors feel as well as what they can expect by sticking around. It will also help returning or past donors develop a sense of community and progress, making them feel like a vital par of your overall fundraising efforts.

Strategies to improve donor retention

Understanding the components of a well-rounded donor retention strategy is necessary to create a pathway for first-time donors to walk on and become repeat donors. These can include:

Strengthening Donor Relationships

Your efforts to reach out to the donors should go beyond fundraising needs. Send them timely thank-you emails, curate programs to identify and honor long-term donors for their valuable contributions, and conduct community meet-and-greet events that strengthen your bond and forge a trustworthy relationship.

💡Check out these 6 ways to take your donor relationships to the next level

Donor Management Tools

Try to get the most out of your donor management software for real-time engagement metrics,  deep integrations, live dashboards, automated communication tools, etc., to create an environment where donor interactions are recorded and analyzed to power future outreach and fundraising efforts.

💡If you’re looking for a new donor management tool, give Almabase a try

Personalized Communication

Tailor your communication to each donor to make sure you communicate your goals, acknowledge their impact, and make them feel appreciated. Emails, phone calls, handwritten notes, gifts, and event invitations are all viable communication channels to show how you can personalize your outreach to each donor.

Social Media Engagement

Keep your donor informed and engaged by providing updates on where their donated funds are being spent, any achievements arising out of them, and acknowledging their generosity whenever possible. Depending on how your donors use social media platforms, you can consider forming groups of similar donor segments to form giving communities.

Annual Reports

Annual reports are a time-tested way to communicate the impacts the beneficiaries achieve. These longer reports and real-life success stories inspire donor loyalty to the institution and the cause as they allow your donors to zoom out and view your overall fundraising mission as you do.

You can also provide subscription and recurring donation options or welcome different kinds of donor engagement through volunteering, referrals, and advocacy. At the end of the day, there are countless ways to retain donors, and what works for one institution may not work for you. Always consider your donors and how they they prefer to contribute to your cause.

Determining the success of Donor Retention

You can take a quick look at your overall donor retention rate using the formula below.

Donor retention rate = (Number of Donors who gave again / Total number of donors in previous period) × 100

With the wide array of tools available today, however, tracking your donor retention rate is a lot more extensive than it used to be. Making detailed segments of various levels of donor retention, however, will require more effort.

At its core, donor retention will take more time and investment from your team to get started and you’ll want to make sure you get a good ROI from your efforts. For this, you’ll first want to consider all donor retention expenses such as:

• Staff time and salaries
• Communication and engagement materials
• Events and stewardship activities
• Technology and software costs

It may be a bit difficult to narrow down your exact expenses for retaining donors but once you have a somewhat reliable estimate, you can use the following formula:

ROI = (net gain from retained donors / cost of retention efforts) x 100
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where Net Gain = Total donations from retained donors - Costs of retention efforts

Keep in mind that these are rudimentary calculations meant to give you a simplistic idea of your donor retention efforts. No two donors are exactly the same, and one retained donor might just be the right person who can snowball your efforts into a large giving community later down the line.

Challenges and considerations

Keeping the donors around throughout is not an easy task. Some of these challenges include but are not limited to:

• Lack of manpower or funding
• Donor fatigue
• Mismanaged or messy databases
• Inconsistent donor engagement
• Over-solicitation
• Changing donor expectations
• Lack of personalized outreach/generic communication
• Demographic shifts
• Inadequate stewardship
• Insufficient transparency and/or reporting

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Consider these key questions to improve donor retention strategies:

• Do your donors get to see and feel the impact of their gifts?
• Is your donor retention strategy appropriately scaled to your institution’s resources available?
• Which gaps in your fundraising strategy most often seem to cause donor fatigue?
• Do your existing digital engagement strategies and tools inspire donors to maintain interest long-term?
• Is your database/CRM suited to integrated communication, donor tracking, and analytics?
• Are your outreach efforts sufficiently customizable and scalable to enhance donor retention?

How Almabase helps you retain donors

Almabase offers digital engagement tools with features such as dynamic event management systems, personalized donor portals, and automated communication workflows to foster stronger donor relationships. Institutions such as the Merchant Taylors’ School and the Alumni Association of the School of Medicine at Loma Linda University have not just increased their donor base but have formed active online communities to power future fundraisers.

Finding the right tools to balance technology with a personal touch is crucial. That’s where Almabase’s engagement solutions come in—helping organizations offer both a personal and digital experience that makes donors feel valued, keeps them engaged, and drives sustainable long-term giving.

If you’re interested in learning more on how we can help, we’d love to not just tell you about us but also hear your problems and show you how we can help! Request a personalized demo and we’d love to get in touch with you ⬇️

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About the author

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Sharada is a freelance blogger and communication trainer who loves exploring the intersection of education and training. When not working, she enjoys reading and dabbling in calligraphy.