Giving USA Report Takeaways: Increased need for donor retention

Nonprofit leaders know the fundraising environment has been complex over the last few years and is only increasing in its complexity. The recent Giving USA: The Annual Report on Philanthropy reaffirmed just that. With inflation pressures and a donor decline, it’s more important than ever to focus on donor retention and upgrades.

We’ve identified a few key trends from the Giving USA report that fundraisers need to know about – and three donor retention strategies to implement next.

Our Key Giving USA Report Takeaways:

Giving is down from its 2021 highs, but the sector is showing its characteristic resilience, with charitable giving holding relatively steady year-over-year, despite challenges like persistent inflation.

From an organizational standpoint, inflationary pressures mean gifts aren’t going as far as they used to. While overall giving in 2023 grew to $557.16 billion, its real-dollar impact declined by 1.9%.

Giving USA also observed a decade-long decline in the number of people giving to nonprofits. This is significant, and the aspect of the report we find most urgent and actionable. In the face of a shrinking donor pool, it’s imperative that nonprofits focus less on transactional relationships with supporters and more on lasting ones rooted in transparency, creativity and shared impact. That’s why donor retention and cultivation strategies are top of mind for us in 2024 and beyond.

Three Donor Retention Strategies:

Understand you’re competing for attention. Marketing competition is fiercer than ever. You’re vying for your supporters’ time alongside everyone else; not just nonprofits, but news and entertainment outlets, retailers and direct-to-consumer brands, their favorite bands and sports teams, and their friends and families. It’s important to be mindful of the time your supporters spend with you: How often do they open? Do they give once, or are you able to earn multiple gifts a year? How much time do they spend with internal publications, including everything from newsletters to annual reports?

This all points to the depth of your relationships with your supporters. Key to understanding these interactions is consistently assessing your data and results to ensure you’re tracking interactions beyond just revenue metrics.

Focus on strengthening the donor journey. As you advertise for prospects and tell your story in hopes of securing donations, you need to be focused on talking to your supporters in terms of where they are in their giving journey.

If their generosity suggests the potential to upgrade, you’ll leave money on the table by not extending those opportunities, whether they’re dedicated sustainer invitations or asks to become mid-level or even high-dollar donors. Doing this often centers on what we call “closing the circle:” When someone gives to you, what happens next? How are you putting their gift to work saving lives, fighting climate change or advocating for shared values? They’ll want to know before you make your next ask. So ensure you’re prioritizing impact-based shared backs and identifying key moments for upgrades through segmentation or modeling.

Craft your content with engagement in mind. At the heart of all communications efforts are your brand and mission. The key is ensuring your brand expresses values that bind supporters to your mission, and that you use stories as often and in as many ways as possible. Many of our creative teams begin our brainstorming sessions by asking the questions: How can we engage our supporters? What would that look like?

Fortunately, even in the face of headwinds, there’s never been a better time to tell great stories and harness technology and innovation to get critical support to people in need. The premium is on stories – moving ones, great ones. Let’s tell yours. Reach out to MissionWired today to get the conversation started.