What a difference a simple calculation can make. When I ask the question, “How many monthly donors do you have?” fundraisers typically know that number. But then when I ask how much they’re worth, fundraisers sometimes struggle to answer. Or they only look at the monthly gifts, so it doesn’t seem that powerful.
That’s why I created the Monthly Donor Annualizer. Here’s what it looks like:
You can use it in two ways:
- To calculate the total value of your monthly donors for the year
- To calculate what the amount of money is that you can spend to generate a new sustainer
Now, you may say: ”That’s great, but not all sustainers stay for a year.” I’ll argue on the other hand, many of them will stay for at least two years, five years and many even much longer than that. So annualizing is a good way to look at the total value, but I know some nonprofits that calculate two-year values or five-year values, especially those that use more expensive channels to generate new sustainers.
How much your monthly donors give is a combination of the way your monthly donors were acquired, their initial value and the efforts you put in to cultivate them, upgrade them and keep them during the year!
Retention is crucial, but yet so many nonprofits don’t realize its importance. That’s why a simple tracker can make a huge difference. I created the Monthly Donors At Risk Annualizer. If you look at that, you’ll see that it’s totally worth spending a bit of time and a few emails, letters and phone calls to keep them.
Yes, you can make it really complicated as some channels (like direct mail, email and telemarketing) retain at higher levels than face-to-face monthly donors for example, but a number of other variables, such as your number of donors, your number of email names, cultivation, retention, extra gift efforts, etc., all enter into the picture. Not to mention higher engagement in email, extra gift opportunities, legacy gifts and so on. Every monthly donor plan is tailored for your organization.
But you can use this Monthly Donor Annualizer as a way to keep it simple: Annualize the value of your monthly donors in everything you do, and you’ll know their power. And you’ll be even more excited to grow this group of really loyal donors.
- Categories:
- Monthly Giving
Erica Waasdorp is one of the leading experts on monthly giving. She is the president of A Direct Solution, a company serving nonprofit organizations with fundraising and direct marketing needs, with a focus on monthly giving and appeals. She authored "Monthly Giving: The Sleeping Giant" and "Monthly Giving Made Easy." She regularly blogs and presents on fundraising, appeals and monthly giving — in person and through webinars. She is happy to answer any questions you may have about this great way of improving retention rates for your donors.
Erica has over 30 years of experience in nonprofits and direct response. She helped the nonprofits she works with raise millions of dollars through monthly giving programs. She is also very actively supports organizations with annual fund planning and execution, ranging from copywriting, creative, lists, print and mail execution.
When she’s not working or writing, Erica can be found on the golf course (she’s a straight shooter) or quietly reading a book. And if there’s an event with a live band, she and her husband, Patrick, can be found on the dance floor. She also loves watching British drama on PBS. Erica and Patrick have two step sons and a cat, Mientje.