Does stewardship matter? It sure does and here are three reasons to keep investing time and money in stewarding your donors.
Good stewardship boosts donor retention
Stewardship boosts donor retention and donor retention matters. According to Bain & Company, it costs 6-7 times more to acquire a new customer than to retain an existing one. Same is true with donors. Acquiring new donors is far more costly than keeping and upgrading the donors you already have.
Adding insult to injury, retention rates are pretty poor for those first-time donors we spend so much time and energy to acquire. For a visual picture, check out Bloomerang’s fabulous infographic summarizing key findings of the 2014 Fundraising Effectiveness Project Survey Report.
Good donor retention has a ripple effect
Getting your donor retention right can yield big dividends. Donors who stick with you for the long haul are more likely to increase their giving, provided you’re doing a good job showing them how their gifts are being used, in other words, stewarding them.
Getting donor retention wrong can result in you working harder to raise the same (or less!) money every year. Looking at the same infographic, check out the statistics mid-way down – for every 100 new and recovered donors, 102 were lost through attrition!
Stewardship is relationship building
Most of us believe—because we have lived it—that fundraising is about relationships. And stewardship - along with its kissing cousin, donor cultivation - IS relationship building. At its core, stewardship is about communication, graciousness and transparency – key ingredients in any healthy relationship. I would go so far as to say that if you aren’t practicing stewardship, you don’t actually have a relationship with your donor!
A ray of hope? AFP’s annual Fundraising Effectiveness Report suggests that after many years of steady decline, donor retention rates may now be on the rise. Thanks, in large part, to stewardship!
Special gift for you: Conquer Your Fear of Asking for Money, a step-by-step guide, is available here (click).
Do you have stewardship advice to share? Please do so in the Comments box below. Your fellow fundraisers thank you!