Four ways to grow your monthly giving program faster
Tim Paris – 11 November 2020
Machine learning and AI tools have opened up a world of new possibilities to help fundraisers grow reliable revenue through monthly giving programs.
Of course, new donor acquisition through channels like digital and face-to-face are at the heart of most growth strategies. But there’s a whole range of other things fundraising can do to grow their program faster and make sure that new supporters and good long term prospects.
1. Converting your single givers to regular givers
Your existing pool of supporters can be a great source of potential monthly givers. These people are already connected to your cause and willing to make a financial contribution. The challenge is identifying which supporters are open to ‘switching’ to a monthly gift.
Using predictive modelling, we can identify patterns in donor behaviour that indicate which supporters are more likely to convert to regular giving. This allows charities to focus their efforts on converting these higher probability individuals without asking everyone to switch. To get started, you can consider adding a regular giving ask to your next direct mail or electronic appeal or even a telemarketing program directed towards the most likely conversion prospects.
2. Retain your regular givers
One of the biggest barriers to growth in regular giving is donor churn. As charities ramp up their acquisition budgets, they often see a corresponding increase in churn as new donors quickly stop giving or existing supporters drop away.
We posed the question: if you knew in advance which donors were most likely to churn, what would you do with that information? The answer has been to develop new proactive strategies to thank supporters and improve connections, resulting in a reduced churn rate. AI-driven donor scoring allows you to reliably predict the most likely churners on a rolling basis, so charities can then deploy these new strategies. With churn now under control and new acquisitions arriving, the program is ready to grow in a sustainable way.
3. Reactivate your lapsed regular givers
There’s a lot of reasons why regular givers might stop giving. It may be that they have a new credit card, are facing short term financial difficulty, aren’t feeling connected to the cause anymore, etc. But this is not necessarily a permanent condition. Reactivation programs can be a very cost-effective way to re-engage with loyal supporters who for one reason or another churned from the program.
Like conversion to regular giving, however, the challenge is identifying which donors are most likely to reactivate. Many charities use large-scale reactivation programs to contact every lapsed donor by telephone after 6 months. But these programs often struggle to break even because charities end up contacting far too many people. With machine learning, these programs can be targeted each month to the most likely prospects with higher frequency but lower volume calling. The result is less money wasted and more supporters reactivated. Here’s an example.
And for donors with very low reactivation probabilities, you can try lower cost methods like email or SMS.
4. Lead scoring
Growth strategies often just focus on acquiring as many leads as possible and pushing them through the conversion funnel. But this can cost an enormous amount of money, both in terms of data costs for the leads and supplier costs for things like agency or call centre fees.
With new tools like AI-powered lead scoring, charities can instead focus on acquiring higher quality leads. Part of the problem at the moment is when charities pay for new leads but these leads don’t convert or else churn immediately after giving their first gift or two. Lead scoring tools allow you to model which sorts or donors, from which sources, are more likely to convert into reliable long term prospects so you can grow your program sustainably.
And a bonus fifth suggestion…do all of these at the same time!
No single strategy is going to grow a sustainable program on its own. For instance if you focus only on acquisition but forget about retention, the program will struggle (especially when acquisition dries up, like during COVID-19). One of the great benefits with new AI-driven donor scoring and other tools is that you can get all of these programs working together towards the same goal – a healthy and growing monthly giving program.