I’d like to chat about a new buzzword, 'Retentioneer', and some tips on how you can get started “retentioneering”.
I’m a big fan of The Agitator and was really chuffed to find they mentioned my consultancy Productle after I sent them an article about the job title Retentioneer from Medium.com*. This was for two reasons – firstly because they called out that I was a long-time subscriber. Like how in fundraising we thank donors for giving, appreciating them for sticking with you is also important. The second reason is that it reminded me about the term “leaky bucket” and how retention strategies help prevent losing donors. Some stark statistics are laid out in a blog by Jitasa:
Marc Pitman of The Fundraising Coach states that “the average nonprofit loses 7 out of 10 donors every year.” If that isn’t staggering enough evidence, consider that of the first-time donors your organization acquires, 65% of will not gift to your organization a second time. […] This means not only will your organization have to work twice as hard to beat last year’s donation numbers, but until you focus on retention, this will happen year after year.
The loss of first time donors isn’t the only statistic that should alarm you. Roger Craver from The Agitator states, a lapsed donor only has a 20 to 40% likelihood of re-gifting to your organization. And new prospects only have a 2% probability of donating. Although an obvious statement, Pitman points out that “businesses don’t survive if they lose 70% of their customers each year. Neither do nonprofits.”
Alistair Croll’s book Lean Analytics describes that this problem is true for for-profit companies too, and outline that you can boil down your analysis of customer to key points in their lifecycle. These will vary from organisation to organisation, but by following the customer through this funnel you get a clear picture on what is keeping customers/ donors with you – ideally before they have lapsed. (
I prefer a funnel analogy to the leaky bucket, as realistically we will lose all donors at some point. But like how sand dropped through a funnel flows more slowly than water, I feel we can look at what interventions can slow this rate down. I picture it looking like this:
I’ve called out a few stages down the down the funnel, along with some options for what you might analyse at each stage.
Acquisition. The top of the funnel is the widest point, where people are converted from members of the public (or website browsers) to donors. There are many classic RoI or % success stats you can review at this point, but how many of you review what element(s) of your mission drove the donor to give to you, and what channel they prefer to be communicated by? If so, do you use that fact for the rest of the donor’s journey with you? Getting this information might involve using browsing history or surveys to augment what information you have from the marketing campaign.
Activation. I could have used the Pirate Metric for the entire funnel, but I certainly think assessing what happens at the early stage of the relationship is critical. If you ordered a weekly food box, your food box company would try every trick to ensure that you stick till week four by which point the relationship will be established. This is similar to the early days of a love relationship even! (just without the weekly debit card payment…) In the donations world, there are few things to measure as parallels – speed of thank you letter response, how many set-up a login to an online portal, how many follow a call to action on a campaign email, or how many take the time to select something personal about a dedication or certificate.
Loyalty/ Risk. Also called retention analysis, but I feel one should actively look for signals of positive or negative behavior before the donor lapses. This was you can either recover or build on the relationship. Looking at email click-throughs and upgrade responses is key. But how much do you look at what content about your organization your donor is engaged with? How likely is a group of users to give you feedback on social media? Be it positive or negative feedback, it shows they care about you. I once got an email from Action for Children with a subject of “Why aren’t you opening our emails any more?” – now that grabbed my attention if only because it showed they cared whether I opened my emails! It would be really interesting to see what the open rate of that email was.
Lapse/ Rejoin. Sadly, donors do stop their recurring gifts or don’t give again after years of appeals letters or calls. It’s important to stay on top of that as a practical reality – if only to stop sending them updates about their sponsored child/ dog/ brick! (Yes, I’ve received annual updates on how a recurring gift I’ve never given is being spent…) On top of that, it’s worth taking those users down a different path for rejoining your cause. I say “rejoining” rather than “reactivation” as the former term reflects that the donor has to make an effort to become friends again, and healing a wounded relationship can be hard! Some charities actively ask and record why a donor lapsed, allowing for a strong message to regain them later. I am always hopeful, so that’s why I drew a ladder next to my funnel. Croll in Lean Analytics also advocates analysing not by the month a donor left by the number of months since they started. This sort of cohort analysis allows you to find out whether there were expectations in a joining month that were not met and also to see if there is a time period that donors are naturally getting exhausted by. This last point is really interesting, as I’ve seen a few charities find that their regular donors are lasting for instance. exactly six or fifteen months of giving. These charities have learned to invest effort in retention activities at four or thirteen months respectively.
Of course, also analyse how many lapsed donors do rejoin. If only to show that it’s better to effort into the Loyalty/ Risk stage!
Hopefully, this retention funnel gives you some ideas on what to analyse in your database, and maybe you’ll give yourself the job title of Retentioneer! If you have other ideas to share, please add them to the comments below or email me via Productle.com.
The blog that first mentions Retentioneering is about the web software industry, and increasingly in that sector there is a driving desire to create “sticky users”. Sticky users are those that want to come back to the software – to sticky donors.
*in a future blog, I’ll talk about how awesome Medium.com is - along with some other new publishing tools. Credit to @Retentioneer on that site for the image at the top of this blog.
This blog has also been published as an independent post on www.blackbaudvoice.co.uk