Rapid Evolution of Donor Experience Drives Giving Revenue

By Adam Martel, Givezy, an AGB Event Sponsor March 5, 2024 Blog Post

Opinions expressed in AGB blogs are those of the authors and not necessarily those of the institutions that employ them or of AGB.

As we navigate the ever-changing landscape of nonprofit fundraising, it’s crucial to stay on top of the latest trends and technologies, especially when it comes to building major and planned gift pipelines.

This is true even in the best of fundraising climates. Unfortunately, research shows us that small and mid-sized donors are disappearing, while major donors aren’t adjusting their gifts for inflation. So how can advancement and development professionals scale sustainable revenue when it seems the economy has a different agenda?

The key is to understand the current climate and stay at the forefront of the innovation curve to elevate world-class donor experiences.

Latest Donor Behavior Research

The latest Giving USA report tells us that overall giving declined by 10.5 percent in 2022. Giving by individuals was down 6.4 percent. And according to the Fundraising Effectiveness Project, retention hit an all-time low of 42.6 percent in the same year. Donor retention continued to slide, driving a slight decrease in fundraising dollars. This continues a trend that began in 2021 after a large uptick in donations and donors in 2020.

This isn’t to say that declining retention is the fault of the donor. Rather, institutions have an opportunity to elevate their world-class donor experiences to grow a culture of continuous philanthropy among their donors and increase giving at all levels.

Consumerization of Donor Expectations

It’s no secret that the widespread digital tech adoption and the automation of most commercial interactions have affected the way people purchase products and services. The further this tech adoption makes its way through our collective culture, the more we all expect increasingly fast and seamless online transactions (from order to fulfillment), self-service options, and tailored services. Donors are no different.

Where advancement professionals have an opportunity that their for-profit peers do not is knowing their donors in deep and meaningful ways outside of transactions. Today’s donors are conditioned to expect self-service options, highly personalized touchpoints that remove constant transactions from donor communications, and ways to make giving easy.

When institutions elevate their world-class donor experiences to meet these needs, not only can they retain donors at all levels of giving, but they increase multi-year giving commitments, grow the planned and major giving pipelines, and put a stop to the larger trend of donor attrition.

How to Elevate the Donor Experience

1. Digitize Existing Processes and Standardize Multi-Year Giving

The large majority of institutions have a threshold for accepting a pledge from a donor. Typically, this gift threshold sits between $50,000 and $100,000, completely eliminating multi-year giving programs for donors at all levels.

The reason these programs don’t exist has merit. Traditional processes and gift agreements require rounds of edits, review, printing, signing, and scanning PDFs or paper documents. These processes don’t lend themselves to timely gift closes or streamlined workflows. There is not enough juice to justify the squeeze underneath the pledge threshold.

However, by digitizing the gift agreement process with digital gift agreements that solve these challenges, from creating a pledge to collecting e-signatures and managing gift procurement processes, leading institutions are now expanding their pledge process to donors at all giving levels, opening multi-year giving opportunities that never existed before.

2. Ensure Highly Personalized Communications at Every Level of Giving

“Personalization” has been a hot-button topic in advancement for years. While institutions give much attention to personalization in donor communications, the same cannot be said for the entire donor experience. Consider this: In the financial services industry, 72 percent of customers rate personalization as “highly important.” Fundraising shares similarities with financial services in many respects, and this is one—deeper personalization leads to increased customer retention and lower acquisition costs.

Find ways to incorporate highly personal communications across the entire donor experience. Think about ways to translate donor data into actions, giving intent, and tailored giving plans that match their affinity for your institution. Higher education institutions have robust donor profiles that can offer elevated levels of personalized donor experiences.

3. Use Automation to Improve Time to Close

When institutions improve the donor experience in meaningful ways, they see the impact on the back end. One notable metric that the donor experience improves is the time it takes to close a gift. Time-to-close measures the time between when a donor commits to giving and when that gift is properly documented, confirmed, and booked.

Time to close impacts gifts of all sizes, including major gifts. Finding an automation solution that empowers advancement officers to create, edit, and send a gift agreement in seconds is the first step to improving this metric. The second step is making the donor experience around confirming the gift not only easy but so easy that donors feel rewarded by the process.

Cutting-Edge Tools and Technology for Nonprofits

In 2024, several new tools and technologies have emerged to help nonprofits streamline their fundraising efforts and enhance donor relationships:

1. Digital Gift Agreements

Today, donors expect an easy process for making donations. There’s no need to drown your supporters in lengthy paperwork and PDFs that they have to print, sign, scan, and email back to you. Digital gift agreements have revolutionized the way nonprofits handle major gifts. These online agreements provide a clear, legally binding framework for both the donor and the organization, detailing the use of the funds and any recognition the donor will receive. They’re quick, easy to manage, and environmentally friendly, reducing the need for paper-based processes.

2. Pledge Reminder Software

Pledge reminder software is a game changer for managing multi-year commitments. This technology automatically sends pledge reminders to donors about their upcoming pledge payments, keeping them engaged and informed. It also allows for easy tracking and reporting of pledge fulfillment, ensuring that your team stays on top of these crucial commitments.

3. Enhanced CRM Systems

Constituent relationship management (CRM) systems have evolved to offer more sophisticated segmentation, analytics, automation, and even AI tools that provide deeper insights into donor behavior and preferences. This enables nonprofits to tailor their communications and appeals more effectively, increasing the likelihood of securing and retaining major gifts. If you’re still using a legacy CRM, it might be time to at least take a look at what the landscape has to offer.

Implementing New Strategies

With these tools and strategies in place, institutions can confidently approach 2024 with a solid plan for elevating the donor experience and expect to see bottom-line results, both in the form of increased revenue today and growth in major and planned gift pipelines. The key to successful fundraising lies in the perfect blend of technology and personal touch. While new tools and technologies provide efficiency and insight, they can also provide genuine, heartfelt engagement—what turns mere donors into lifelong supporters.

To learn more about using digital gift agreements to grow giving, connect with me and my team at hello@givzey.com.

Adam Martel is founder and CEO of Givzey.

With Thanks to AGB Event Sponsor: Givezy

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