10 Tips to Creating a Nonprofit Monthly Donor Program
Strong donor retention is critical to sustaining and growing your nonprofit. One of the best ways to increase your donor retention is by creating a monthly donor program (sometimes called recurring giving). In a monthly donor program, a donor chooses to give a pre-determined amount on a monthly basis and the funds are automatically collected from their financial account. Creating a monthly donor program can have a long-term benefit to the health of your nonprofit, including:
The average donor retention rate for single-gift donors is 23%. However, monthly donor programs often see retention rates of over 80%. Meaning, having a monthly donor program can triple your retention rate.
Higher levels of giving
Monthly donors generally give more money than single-gift donors. The average monthly online donation is $52 ($624/year) compared to the average one-time gift of $128. Many monthly donors often give additional single gifts throughout the year for special appeals and during the holiday season.
Reliable stream of income
Monthly donations are funds your nonprofit can rely on and can help normalize some of the revenue fluctuations that many nonprofits encounter. Having a reliable source of income also allows you to spend more time on other fundraising activities to help further your mission.
Convenient donor experience
Monthly donor programs are extremely convenient for your donors since they can “set it and forget it” and feel good about supporting your cause all year long.
Here are 10 tips to help you create a monthly donor program.
Donor Tracking System
Develop a tracking system to help manage your monthly donor program. These systems can help automate the sign-up process, allow donors to manage their accounts, and help you contact donors. There are several paid software choices that you could use. However, there are several free options that you can use to help you get started. If one of these systems is not optimal for your nonprofit, you can also use an Excel spreadsheet if you need to.
Brand the Program
Since monthly donors have made such a big commitment, you want to honor them by making them feel special. Create a brand that aligns with your overall nonprofit. For example, Pencils of Promise calls their program “Passport”. Branding your monthly donor program helps to create a community. By developing a community, you help show your monthly donors that they are part of a movement working together towards a collective goal and making them feel more valued. To help showcase this community, you could create an online monthly donor-giving page that features some of your monthly donors. On the page, include donor testimonials and photos of current monthly donors. Testimonials are great because they help build trust and credibility. Charity Water’s monthly donor program, The Spring, is a great example of this practice.
One of the best donor segments to target for monthly giving is your current donors. Start by targeting donors that give multiple times a year (at least 3 times/year). Develop a specific appeal to target these donors with a special invitation to join your monthly donor program. Another segment is supporters that have participated in an advocacy campaign, such as signing an online petition. Reach out to each of these specific segments with custom messaging that reflects your current relationship with them and invite them to join!
Make indirect asks
In addition to creating direct appeals, you should include indirect asks throughout your marketing channels. For example, in your email appeals, you can add a “Make it Monthly” button in addition to your ask for a single gift. Another strategy is to add a monthly donation option to your online donation forms, newsletters, direct mail reply devices, etc.
Help contextualize what the monthly gift can deliver by linking it to a dollar handle. For example, you could say “A $10 monthly gift will help provide 2 meals to a family in need”. Using a dollar handle of how the funds will be used provides transparency and helps create a stronger emotional connection between the donor and the nonprofit, increasing the chances for the donor to commit.
Conduct A/B tests on the different aspects of your monthly donor program to determine what is driving the highest conversion. For example, you could develop an appeal that compares “Just $10 a month can help provide 2 meals to a hungry family” vs. “Just $.33 a day can help provide 2 meals to a hungry family”. Both amounts are equal ($.33 x 30 days – $10/month) but one message may resonate better with your donors.
New Donor Welcome Package
Donors are most engaged with your nonprofit when they become first time donors. To leverage this enthusiasm, you should include an invitation to become a monthly donor in the welcome package. If you have an email welcome series, consider adding a monthly donor appeal as one of the parts to the email welcome series.
Tiered Levels of Giving
Offer multiple levels of giving with associated benefits for each level. Public radio stations such as NPR and museums are great examples of nonprofits that leverage this strategy. Although donors can join the monthly donor program at any level, higher levels of giving provide more premium donor benefits, which helps to increase revenue. Even if donors start out at a small level, you can cultivate them to higher levels of giving by launching yearly upgrade campaigns where you ask them to increase their monthly donation amount by small amounts. Moreover, these lower level donors may provide other value such as attending events, becoming volunteers, signing online petitions.
As one of your best donor segments, you should offer strong stewardship to your monthly donors. This can take place in the form of sending them yearly giving reports, conducting yearly thank you calls, sending them small donor premiums (such as a refrigerator magnet), etc.
Updating Credit Cards
One of the biggest causes of monthly donor attrition is an online gift that does not process. This is due to credit cards that expire, debit card payments that do not process, etc. Oftentimes, donors do not even realize that this has occurred. To combat this, you could use credit card updater services to automatically update donor’s credit card information. Alternatively, your staff can review all the credit cards that did not process for a month, and reach out to donors (via email or phone) to alert them that their credit card did not process and ask them to re-engage.
Monthly donors are one of your most valuable donor segments. Launching a new program can be challenging but can pay future dividends and help your nonprofit achieve its mission.
About Market Me Consulting
Market Me Consulting is a consulting firm that develops marketing, strategy, and fundraising solutions for nonprofits and socially conscious small businesses. We combine analytics with creativity to build strategies, campaigns, and programs that help our clients achieve their goals. With over 15 years of experience in driving results for nonprofits, universities, local governments, and small businesses, our team has the skills and experiences to deliver results for our clients.