Maximizing Lifetime Value Part 2 | npENGAGE

Maximizing Lifetime Value Part 2

By on Sep 15, 2011

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Last month I posted a treatise on sustainers vis a vis maximizing lifetime value of your donors.  If you’re looking to increase lifetime value (LTV) – and you should be – then converting your donors to a monthly giving program is the way to go.

This month I want to briefly discuss something that goes hand-in-hand with fundraising, especially to monthly donors – stewardship.

Stewardship can mean different things to different organizations, but at the heart of it, it means developing a relationship with the donor that acknowledges both their gift and their commitment to your organization’s mission.  And when it’s done well, it can mean that your donors are more likely to give again and again.

Last week Michelle talked about how she had signed up as a sustainer with an organization, but then her card expired and the organization never followed up with her.  Tragic!  Here’s a partner story for that tale of woe:

Many years ago I signed up as a sustainer with an organization.  It seemed like my gift was a “set it and forget it” arrangement, because beyond the initial thank-you, I didn’t receive monthly acknowledgements that my gift was processed.  I know that it was, because I saw my credit card statements every month, but didn’t hear from the organization about it.

That’s fine, whatever – honestly, I didn’t really need a monthly email receipt.  I was committed, and even upgraded my gift without being asked.

But annoyingly, the organization seemed to have me just dumped into the general messaging stream.  The appeals for additional donations I receive never acknowledged my ongoing support in any way, or that after 6 years of being a sustainer I had given over $3,000 to the organization from a monthly donation of $40.

Now, I wasn’t looking for special kudos from the organization – I gave because I wanted to support the mission, not because I wanted to be thanked.  But the lack of acknowledgement pointed to a larger problem, which at the heart of it was a lack of stewardship.  Not only was I not being acknowledged as a donor, but the organization wasn’t making any special effort to communicate with me differently than everyone else on the email file.

Here’s the punch line:  during a crisis point for the organization,  I wasn’t sure where they were headed strategically, and so I canceled my gift.  And I probably wouldn’t have canceled if the organization had better communicated with me during the crisis, but also over the last 6 years.

So what does it mean to be a good steward?  It means hard work, unfortunately (hat tip to Tom at The Agitator and Mike Rogers at Convio).  There are metrics and data that you can apply to your donor file to predict trends and do modeling.  This is all a proven science – and yet, I think there’s more work to do here beyond the data, and it goes to how organizations actually communicate with people.  That’s why I don’t love the word “cultivation” as it relates to donor communications, and much prefer the term “stewardship.”

It’s a data-driven world, but don’t forget:

  • your donor file is actually made up of individual people
  • data can predict trends but people are motivated by emotional connections to your mission, the courage of their convictions, their friends and families, peer pressure, etc.
  • speak with a consistent message and even with a genuine tone through all channels – even through staff transitions or agency transitions
  • think holistically about what your donors – and potential future donors – are seeing from you over the course of months and years
  • communication is a two-way street – when was the last time you asked your members how they think you are doing, sort of an “approval rating?”

This goes beyond the concept of a message calendar.  You need a system to support a holistic view of constituents, like Convio’s Luminate CRM™ to help you analyze constituent behavior across all channels.  But you also need to communicate back through those channels with a genuine tone, a consistent message, and an eye toward stewardship.

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