I hear this statement A LOT in my work with nonprofits.

“We need new donors.”

When I kindly ask why, I receive a slew of answers:

  • Our donors are getting older
  • We don’t have enough funding
  • Funding isn’t consistent
  • We need to grow awareness

These are valid concerns...

But new donors aren’t the solution to your fundraising problems.  

Fundraisers and Executive Directors lose precious time and energy pursuing new donors and (inadvertently) neglect their best sources of funding.

According to Bloomerang, the cost of acquiring new donors costs 50% to 100% more than the dollars collected from new donors. Hosting fundraising events, building partnerships, and “relationship mapping” are valid tools.  But they’re time intensive. And their ROI is negligible when expense and time are considered.

You may be asking, “What’s a nonprofit’s best source of funding? The data points to two things: your major donors and recurring, monthly givers.

Here are some data points to back up this assertion 😉:

  • Approximately 88% of your nonprofit’s revenue comes from your top 12% of donors.
  • Monthly donors provide sustainable, consistent funding. Monthly donors save you from the hamster wheel of donor acquisition.
  • The average recurring donor will give 42% more in one year than those who give one-off gifts. Additionally, while new donor retention rates hover around 20%, monthly donor retention rates average 80% and greater.
  • Both major donors and monthly donors are personally invested. They are retained at much higher rates than one-time donors. And their lifetime value is significant. According to Dr. Adrian Sergeant, as little as a 10% lift in donor retention can 2X donor lifetime value.

This data is a mere sprinkling of the research available looking at major and monthly donors.

Fundraising events, corporate sponsorships, and new donor acquisition campaigns seem promising. But they’re nowhere near as valuable (or profitable) as donor retention.

What can you do?

  • Continue to ask your donors for a gift.
  • THANK them promptly (ideally 5-7x) and personally.
  • Follow up a month or two later, showing them the impact of their gift.
  • And then ask again. For your major donors, this may look like setting up a meeting to ask in person. For your monthly donors, this may look like asking for an upgrade via email or direct mail.

Focus on donor stewardship. It’s your ticket to greater, sustainable funding.