In philanthropy today, it sometimes feels like everything is changing all at once. New tools and tactics present themselves every day. We’re inundated with blogs, webinars and conferences that offer to update our skills and improve our performance. Professional fundraisers change jobs every 17 months on average. It can be dizzying…
There are countless changes happening all around us, all the time. The trick is to identify those changes that are most important – and to ensure that we meet those challenges head on in a smart and strategic way.
In this 6-part Summer Reading Series, I’ll review the six trends that we’re paying closest attention to – and why you should be, too. Check back every other Monday to discover a new trend!
Any fundraiser worth his or her salt in this day and age will tell you that one issue plagues us above all others: declining donor loyalty. If you’re reading this, you’re probably a fundraiser. And, if you’re a fundraiser, I’ll bet you dollars to donuts that your organization’s renewal rate is a LOT lower than it was ten or fifteen years ago.
Why is this? What’s going on?
When I started out as a fundraising consultant some 20 years ago, it wasn’t unusual for a charity’s direct mail program to renew 80% of its donors from year to year. Today, that same charity, working just as hard, might only renew 60%. This makes the program more expensive to run – and it puts incredible pressure on donor acquisition (which is a headache we’ll talk about later in this series!)
I attribute this donor loyalty decline largely to age demographics.
Back in the 1990s, direct mail donors were overwhelmingly members of the Civic Generational cohort, born before 1946. In 1995, this donor group was aged 49+ and was in the prime of its giving lifespan. Now, Civics came of age shaped primarily by the Great Depression and World War II. These people were very focused on security, dependability and stability. The Civic cohort is also the last generation in history to attend church in large numbers. Their charity was very influenced by the Judeo-Christian ethic. Civics became classic loyal donors – so much so that we used to pretty much send them ‘reminder invoices’ to keep them giving from year to year.
The problem with the Civic donor generation today is that it’s too old to be of much value to us anymore. The youngest Civic today is 72 years old – well into retirement. And, of course, most Civics today are into their 80s and even older. Their day has come and gone.
Welcome today’s direct mail donors – the Baby Boomers and (to a lesser degree) members of the Gen X cohort. Boomers today are aged between 52 and 71 – while Gen Xers are aged 37-51. As people, and as donors, these people do not look like Civics in the least! These donors are skeptical and self-centred. Just because they gave a donation last year, they don’t feel AT ALL obligated to you to give again this year.
The Boomer disloyalty effect isn’t just being felt in philanthropy.
Car companies used to count on their customers coming back to them for a new vehicle after five years or so. Not anymore. The majority of Canadian voters used to stick with the same party from election to election. Now, the pundits love to talk about ‘voter volatility’ as elections become increasingly unpredictable and erratic.
My advice to fundraisers who want to keep Boomers and Gen Xers giving? Don’t take ANYTHING for granted! With these donors, you have to earn and re-earn their trust over and over and over again.
My advice for trying to maximize donor loyalty with Boomers and Gen Xers?
- Treat them like they’re incredibly special starting the moment you cash their cheques!
- Talk about how your cause and your mission are a part of THEIR life’s values and ethos.
- Show them positive results as clearly and often as you can. These guys LOVE impact.
- Give them things they can boast about.
- Tell them explicitly that you want them to drive the bus. Let them choose how they communicate with you, and you with them. Give them some kind of voice in your programming and service decisions. Show that you listen hard. Show them respect.
The sad fact (for fundraisers) is that the Golden Age of Donor Loyalty is over forever. But, if you pay close attention to your audience, you can outperform your competition and still make lots of money.