Low-value donors have low value — but you still need them

Way back when, a nonprofit I worked with learned an important fact: The lower a donor’s first gift, the less long-term value that donor has to the organization.

That may sound like something you say “duh” about. But it’s actually a very useful and dependable truth. A donor’s first gift to a given organization is a predictor of their future value. A first-time donor who gives you $10 will be less valuable than one who gives $50:

  • Total lifetime value will be about one-fifth as much.
  • Retention of the lower donors will be lower — they’ll lapse sooner.
  • Chance of upgrading (to a significantly higher level of giving) will be about half as much.

It’s just a simple fact of life: Donors tend to stay true to their behavior.

A prudent approach is to seek higher first-tine gifts. You can do this with a combination of higher value channels, higher value lists, higher ask amounts, and higher-value fundraising offers.

My client, though, took the idea a step further. They began to see low-end donors basically as a curse. People to be avoided because their long-term value wasn’t as high as they wanted.

They said: We will no longer seek donors who give under $20. From this day forward, we’ll allow no riff-raff onto our donor file. (That’s not exactly how they put it, but you get the picture.)

Here’s what they did:

  • For direct mail, they stopped renting lists that returned average gifts below $20.
  • They raised the amount they were asking for.
  • They stopped cultivating their under-$20 donors.

And guess what: It worked. Average gift skyrocketed. Lower-end donors started lapsing off the file at high rates. Retention and upgrade rates climbed. Campaign performance was better than ever.

But that’s not all that happened. At the same time, overall revenue went into a steep decline. This decline had two sources:

  • A dramatically lower volume of donors.
  • A shrinking pool of major donors and bequests.

When they decided under-$20 donors were persona non grata, they narrowed the gate through which donors could enter their file. So a lot fewer donors came through. Those who made it were more valuable, but the drop in volume offset that increase in value.

The pool of potential upgraders became too small: The percentage of upgrades was excellent, but it was a percentage of a much smaller number — leading to an overall drop in major donors.

Low value donors are something else beside low value donors: They are a pool of potential higher value donors. When you shrink that pool, you choke off an important source of high-value donors.

It took over a year for them to become aware of the disaster that was happening under their feet, because they were dazzled by the rising performance numbers they saw. They eventually corrected course, but the overall impact was devastating to their mission.

Shifting from a volume orientation to a value one is something most nonprofits would be wise to do.

Just don’t do it with a chainsaw. Take it slowly. Replace lower-value donors with higher-value ones. Then you’ll get the improved performance you want — and the overall revenue you need.


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff BrooksJeff Brooks has been serving the nonprofit community for more than 35 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com. More.


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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About the blogger

Jeff Brooks has been serving the nonprofit community for more than 30 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com.

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