Nonprofits Are Failing to Engage Microdonors

By Amanda L. Cole

In a year when the individual donor will likely have a profound impact on nonprofits’ ability to fund their missions, the latest data on donor behavior shows nonprofits must improve their engagement strategies, particularly with donors giving smaller gifts.

Though major donors are back, resulting in more money donated to charity last year than in 2023, microdonors and small-dollar donors aren’t engaged — and the number of those giving to nonprofits continues to decline. In fact, the numbers of these smaller donors declined steeply at year end in 2024, and their behavior strongly affected retention year over year.

These findings and more are in the latest "Fundraising Effectiveness Project (FEP) Quarterly Fundraising Report" released today. The report from the Association of Fundraising Professionals Foundation for Philanthropy and GivingTuesday features 12 nonprofit tech vendors that provide aggregate data from more than 12,000 organizations that raised $10.5 billion from 6.7 million donors last year. The aggregate data is used in year-over-year comparisons to evaluate the state of fundraising.

While dollars are up 3.5% overall, the number of donors is down 4.5% year over year. 2024 became the fourth straight year the number of donors has declined. Dollars had fallen from pandemic-inflated years and then remained relatively flat year over year until 2024. Interestingly enough, donations were strong in the first half of the year, outpacing 2023 year-to-date figures, but fell short by year’s end.

This graph tracks the number of donors by month over the past three years. The green line that represents 2024 depicts the year’s strong start and sharp year-end decline. | Credit: "Fundraising Effectiveness Project Quarterly Fundraising Report" by Association of Fundraising Professionals Foundation for Philanthropy and GivingTuesday

“The continued decline in small donor participation, despite an increase in overall dollars, highlights the pressing need for renewed strategic focus,” Woodrow Rosenbaum, chief data officer of GivingTuesday, said in a statement. “Our Q4 FEP data emphasizes the growing reliance on fewer, larger gifts, a trend that underscores the urgency of revitalizing small donor engagement to sustain long-term sector health.”

Let’s take a look at various donor types to see what’s happening across the sector.

Major Donors

Major gifts have been softening downward in dollars raised, but the reduction in the number of donors shows that nonprofits are relying more heavily on wealthier donors to fund their missions. After all, the data shows these large gifts are driving the increase in dollars going to charities. But statistics have shown that wealthier individuals pull back their generosity when the stock market and economy declines, so it’s unclear if this trajectory will continue with how volatile the market has been so far in 2025.

The gains in 2023 and 2024 were similar with the number of major donors (those giving $5,000 to $50,000) up nearly 1%, and supersize donors (those giving more than $50,000) up 2.6%. Combined, these donors make up 3% of 2024’s total number of donors, but nearly 78% of total dollars given.

Major and supersize donors have maintained strong retention rates, with more than two-thirds of these donors being retained. However, these groups did see a slight decline in retention rates year over year.

Small-Dollar Donors

Countering rising everyday costs, like the price of eggs increasing 37% last year, micro donors (those giving $100 or less) gave nearly 9% last year. Those giving slightly more ($101 to $500) had the second biggest decline in giving of 4%. Drops in donor participation for these groups mirrored decreases in dollars given.

This chart breaks down donors by contribution size and depicts an inverse relationship between donor size and growth rates. | Credit: "Fundraising Effectiveness Project Quarterly Fundraising Report" by Association of Fundraising Professionals Foundation for Philanthropy and GivingTuesday

While large gifts may result in bigger impacts, all those small gifts add up — and you never know when a small gift will turn into a large gift down the road. While all these small donations might not seem significant at first glance (about 2% of total dollars), micro donors comprise slightly more than half of the sector's total donor base, or 81% if you combine micro and small donors. The retention rate for microdonors’ was 32%, while 50% of small donors were retained.

“With fewer micro donors, the sector will have a much smaller base of donors to develop or cultivate longer term relationships,” according to the report.

Recurring Donors

One-time donors made up 69% of donors in 2024, but their 6% decline accounted for three-quarters of the overall decline in donors in 2024. And in terms of dollars, they contributed 40% of total gifts last year.

The remaining 31% of donors gave at least one additional gift in 2024. It’s important to note that donor participation and retention were down across all giving levels, but those giving three or more gifts gave more year over year. In 2024, donors giving two gifts gave about 3% less — the most of any frequency. Those giving three or more gifts continued to increase at a similar year-over-year rate in 2024.

Year-End Donors

While year-end donors could overlap with any of the other segments, there was a noticeable drop in the number of donors giving from October to November (when the 2024 presidential election occurred), with just a slight increase in the number of November to December donors.

When it came to retention, the rate of decline accelerated in November and December. While the election may have played a role, year-end giving hasn’t been as strong. But nonprofits should be cultivating donors year round and not just at year end anyway. With full-year giving declining as well, nonprofits are in need of some new strategies to increase giving throughout the year.

Retained Donors

Retention is down across the board, with the exception of dollar figures when it comes to those retained from the previous year. Overall, retention declined by 2.6% to 42.9%. This marks five years of declines, meaning 2019 was the last year retention increased year over year. So while the pandemic introduced nonprofits to many new donors, since then, donors have churned at high rates.

This chart breaks down donors by acquisition or retention status, showing negative growth across all categories. | Credit: "Fundraising Effectiveness Project Quarterly Fundraising Report" by Association of Fundraising Professionals Foundation for Philanthropy and GivingTuesday

The decline in the number of repeat retained donors has slowed, with a nearly 5% drop compared to 2023’s 8.4% decline. This is important because this group accounts for the largest proportion of dollars, making up 60% of dollars. These donors’ total dollars also grew about 1%.

There was also a 8% decline in new retained donors — those acquired the previous year and not retained — though they gave roughly the same total amount. Their retention rate also declined nearly 6%, meaning only one in five donors acquired in 2023 gave again last year. This group’s overall giving remained relatively flat.

While new donors make up 40% of all donors, lack of engagement has caused a 7% decrease in the number of donors and 2.5% decline in the amount of giving, according to researchers. New donors’ retention rate was 19% in 2024.

“This suggests a need for the sector to better understand the motivations of first-time donors and develop strategies around their retention and continued engagement,” according to the report.