Upbeat Outlook Continues

by | Oct 26, 2021

I recently had the opportunity to sit in on the donorCentrics Index of Direct Marketing Fundraising Q2 2021 update.

The outlook continues to be positive, with most organizations showing an increase in donors (+4.5%), in donations (+5.9%) and in revenue (+9.1%). Particularly encouraging, the number of new donors continues to climb (+10.5%), and this after a 15.9% jump last quarter.

For those of you looking for a negative spin, retention numbers dipped slightly, down 1.1% overall which includes a 0.4% decline in new donor retention and 0.2% for multi-year donors. Keep in mind though, that this is compared to a retention rate that was up nearly 7% a year ago and applies to more than a year of healthy growth in donor counts (over the last four quarters, new donors were up 15.9%, 17.5%, 13.7% and 23% consecutively).

Donor Reactivation (gifts from donors who have lapsed for one to five years) was also down slightly (-2.6%).

Not all sectors fared equally, of course. Organizations in the Animal Welfare and Societal Benefit sectors saw a decline in number of overall donors, gifts and revenue. On the other hand, Health organizations saw a boost in reactivation (+9%) as did Arts & Culture (+1.8%)

So, what does this mean, especially as you put the finishing touches on your year end campaign?

Obviously, general positive trends in the past don’t guarantee success in the future. But these numbers reinforce the importance of some key metrics.

  • Most of your revenue likely comes from a core base of donors; one of your top priorities should be taking care of this core (multi-year retention).

  • It is important to identify new donors and to convert these individuals to ongoing giving (first year retention). However, don’t get so enamored with chasing new donors that you forget to take good care of that all-important base.

  • It’s also important to keep track of donors who may start to slip away (reactivation). The longer a donor remains inactive, the less likely it is that individual will give again. You need to find a meaningful way to reconnect with these individuals sooner, rather than later.

How do trends in your organization’s fundraising compare with this overview?

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