Monthly giving programs can be a wonderful way to ensure your fundraising program sustains throughout the year. Although the concept of monthly giving is not new, the onset of subscription-based services, online giving programs and multiple digital tools make it easier than ever to provide this option to your donors.
We spoke with Erica Waasdorp, the leading expert on monthly giving and president of A Direct Solution, about best practices in monthly giving and how you can implement such a program as part of your nonprofit’s fundraising efforts.
Q: Why are monthly giving programs important, especially as a tool for smaller nonprofits?
A: Great question. The three most important reasons are:
- You’ll increase your donor retention. Monthly donors stay with you for many years to come. On average organizations are seeing an increase in donor retention from 45% to 90%.
- You’ll be able to raise more money. If you get $58 as the average one-time donation, you’ll be able to get some $23 to $36 a month from the average monthly donor so that’s between $276 to $432 a year. You’ve just multiplied your donor’s value multi-fold!
- You’re offering the donor a way to give that’s easy and convenient on their budget, so you’re doing your donor a favor. No matter the status of your donors (young, old, single or married), fixed or flexible income, they can contribute in a way that works for them.
Q: What are some tips on getting buy-in from leadership around setting up a monthly giving program?
A: Well, I’d start by sharing some of the statistics I mentioned above as they are very powerful. What’s not to like about those numbers? Then I recommend you look at the tools you already have in place for your fundraising. You’ll typically be able to identify that implementing a monthly giving program is not that hard at all.
It’s going to require some time but virtually no additional investment. Which donor base (CRM) are you using and how are you managing online giving? Chances are that monthly giving is already built in. (That was not the case several years ago but now you almost have no excuse NOT to have a program).
Q: Are there certain donor types that gravitate toward monthly giving programs over others? How can nonprofits identify potential monthly donors?
A: Yes. Those donors who are already making multiple gifts a year are the most likely to become monthly donors. Those donors who have made a credit card gift are more likely to become monthly donors. Those donors who make small one-time gifts are more likely to become monthly donors. I typically use the cut-off of $100 or under.
You may find that some of your larger donors may be interested in giving monthly but that becomes part of a discussion when you speak with them but they’re not your first target group. I always recommend trying to upgrade single check writers of $250 to $500, to $1,000 and up.
Q: What are some of the biggest mistakes you’ve seen nonprofits make with monthly giving programs?
A: There are five mistakes I see nonprofits make most:
- Organizations don’t have someone in charge of the program and things get scattered and fall through the cracks because of it. It’s important to make someone accountable to oversee the program. They can delegate things, but they need to know the numbers and what’s happening.
- Organizations hide the monthly giving option so it’s not easy to find. You really must make it easy to find. Those organizations that are most successful growing their program are those that have monthly front and center, first and foremost everywhere.
- Organizations don’t ask enough. I think many organizations don’t ask enough for single gifts either, but they certainly are not building in opportunities to give monthly. Put it in your email newsletter, send a special email with a link to the monthly page, put it on the back end of every email thank you, test a p.s. etc. In a recent webinar, I asked how many people asked donors to give monthly and one third never asked. Well, you know what they say: If you don’t ask, you’re not going to get and that same applies here.
- Organizations don’t follow up on those monthly donors who are at risk of dropping out because their card expired or declined. You need to stay on top of this and act right away. The first 30 days are crucial. Call. Email. Send a letter. Do whatever it takes to prevent the monthly donor from dropping out simply because something happened with their card.
- Organizations don’t cultivate their monthly donors. Many don’t send a thank you letter to begin with. I think that’s wrong. They often stop communicating with them and that’s wrong. These donors want to continue to hear from you. Perhaps a limited number of appeals and newsletters with recognition for being a monthly donor is in order (if you’re sending a lot of appeals now) but on average I see that organizations can send their monthly donors two appeals a year, their email newsletters and printed newsletters just fine without a problem.
Q: How do tools such as Account Updater help nonprofits retain donors? Are there are other tools and technology to consider?
A: Credit card account updater has been called a game-changer when it comes to monthly donors because it keeps those donors whose card expires or declines going without the organization having to follow up. It saves you time, money and lost revenue. So, if you’re investigating options for monthly giving because you’re not happy with the tools you have now, make sure that the provider offers credit card updater. I know that some systems allow donors to update their own information. I’m not totally convinced yet that donors will do so.
To prevent dropouts and having to deal with expiring and declining cards is to offer the Electronic Funds Transfer (otherwise known as EFT, ACH, Direct Debit, Automatic Bank Withdrawal) option online. That’s a trend that’s growing. Donors in Europe have been giving that way for years but it’s just starting to catch on here. If you can get your monthly donor to provide their bank account, your retention increases even more.
Q: Can you provide some best practices in how to set up your website that best supports and communicates monthly giving options?
A: The first step is to create a monthly only payment page. Then pick a month in the year where you don’t have too much else going on (maybe January, May or September). Then take over the home page, have a great picture, short message. Help xxx today. Make a monthly gift. Use a button that says Give monthly. Click through to the monthly only payment page. You don’t want to confuse donors there; you really want them to give monthly.
Then drive people to the monthly page in your e-news, in your email appeal and in your direct mail and any other messaging. The more you drive people to go there, the better off you are.
I presume your one-time giving page already has the monthly (recurring) option included, but if you haven’t looked at your page in a while, make sure that is there now.
Then, the rest of the year make sure you have a clear Donate Now button that stands out. If you have space, add a button Give monthly right below it in a different color. If that’s not immediately possible, make sure that you have the give monthly as one of the options under ways to give or a little pull-down menu. Cross-reference to Give monthly everywhere you possibly can.
Offer multiple options, going from low to high, left to right. Start with the smallest option you can get away within your system. For some that may be $5 a month, for others $10 a month. Always have another option of course.
Finally, offer examples of how $5 a month, $10 a month, $20 a month makes a difference for your organization.
Your donor will self-identify.
Q: What are some additional communication strategies that can be successful when marketing a new or revamped monthly giving program? Which channels prove most effective to get the word out?
A: The more integrated or multi-channel your messaging can be, the better. Digital/online right now is the most common way to generate monthly donors but it’s not the only effective channel. If you send direct mail, add the monthly giving option on your reply form. Some donors may give online and they may decide to give monthly when they go there. If you call your donors to say thank you, you could offer the option to give monthly if the donor asks how they can do more. Then there may be some events where you can mention monthly giving, you should include the option in your print newsletter and every e-news.
The most response you’ll get by calling but you will not be able to reach everybody. That’s why depending upon your organization, it still makes sense to send a targeted direct mail appeal followed by some email reminders. And if you’re able to, check out your local cable access channel, perhaps they’re willing to help you get a little PSA mentioning monthly giving. You can then use this everywhere else.
Finally, start by getting some testimonials from existing monthly donors and use it wherever you can (with permission of course!).
Q: Many nonprofits are concerned with donor retention. Are retention strategies different for monthly givers as compared to annual donors? What should nonprofits be concentrating on?
A: Yes, monthly donor retention is higher than annual donors but it’s crucial to stay on top of those expiring/declining credit cards. Also, it’s important to include your monthly donors in cultivation efforts but keep it doable and manageable.
It could be as simple as a handwritten note on appeal letters, a tiny variation of the email message with a thank you for giving monthly on top. It could be a special invitation for an event you’re doing anyhow. You can recognize them with a dot or a star on their name tag, etc.
Q: If you could give a final tip of advice to nonprofits setting up monthly giving programs, what would it be?
A: Keep it simple. Don’t’ overthink it. Do spend a few hours organizing everything ahead of time, follow the monthly donor road map and then just start chipping away at it. You can do a lot by for example focusing one or two hours a week on it. Also, celebrate little successes and be sure to annualize the revenue you’re sharing. For example, if you reach the first 10 monthly donors, giving an average of $36 a month, that’s $4,320 a year. Share that number!
Finally, if you have any questions when you’re working on your program, I’m only an email away and feel free to download the many free resources at www.adirectsolution.com I’m here to help and make your monthly donor program successful!
