The lifeblood of any nonprofit organization is its donor base. Organizations can falter and fail to reach their full potential without a steady influx of new supporters. In today's crowded philanthropic landscape, the challenge of acquiring new donors looms large, especially for resource-strapped charities.
To thrive and maximize impact, NPOs must adopt a strategic approach to identifying, engaging, and retaining a diverse pool of committed givers.
Whether you're a seasoned fundraiser or just starting to navigate the world of donor acquisition, the following 15 expert-recommended strategies to be successful in 2024 and beyond.
Here’s what’s ahead:
What is Donor Acquisition and why is it Important for Your Nonprofit?
Acquisition involves finding, attracting, and securing new donors through different marketing initiatives. It is the first step in the nonprofit donor management lifecycle.
Donor acquisition benefits nonprofit organizations in the following ways:
Expand Your Nonprofit’s Reach
To expand your organization's reach, you can target specific audiences who may not be part of your current donor base. You can also find more support from people whose interests align with your mission but who are unaware of your cause.
Raise More Funds
A broader donor base ensures the success of your fundraising plans and increases donations. The acquisition strategies involve educating potential supporters about your cause and showing the impact you create.
These efforts compel the prospects to feel connected with your charity and extend financial support.
Improve Growth Possibilities
Donor acquisition helps your nonprofit scale up and increase community impact. With more supporters joining your organization, you can launch bigger fundraising events and create meaningful societal change.
4 Donor Types Every Nonprofit Must Know
1. Individual Donors
Many people feel a sense of responsibility to give back to the community. They often contribute to charitable donations to which they feel connected.
Birthdays and holidays are some special occasions when individual donors make their contributions. Donations from individual donors account for the largest share, about 80%, of total funds in the US, making them worth targeting.
Individuals support causes through:
- Employee payroll-giving programs
- Fundraisers and other events
- Directly sending checks via mail
- Legacy or planned gifts
- Peer-to-peer fundraising campaigns
- Crowdfunding pages
While their donation size can be smaller than others, individual donors provide the much-needed support and funds. Each donor is unique and adds value; aim to deepen your connections.
Understand their motivations and engage with each existing and potential donor to build lasting relationships.
2. Major Donors
88% of the total funds raised come from 12% of supporters. With the high capacity to fund causes, support from these major donors can create a life-changing impact on communities.
These individuals or firms often connect more deeply with the NPO. To ensure the success of your initiative, cultivate engaging and meaningful relationships with them. Have a clear plan for interacting with major donors. Have a clear plan for how to interact with major donors.
Keep them informed about your work and involve them in the organization’s activities.
Create a unified plan to build stronger donor relationships. Make them feel valued and connected to your NPO’s cause.
3. Businesses or Corporate Donors
You can acquire corporate sponsorships for your nonprofit and have a wider network of corporations to get new donors. They work with NPOs to build on a positive reputation and brand exposure. Corporate donations usually come through:
- Matching gift and employee-giving program
- Corporate and volunteer grant program
- Cause-related marketing for mutual benefits
- In-kind donations
As customers of these businesses expect them to support communities, nonprofit partners can use it to raise more funds. Corporate donors seek marketing opportunities and recognition from NPOs.
Engage in different strategies to meet their philanthropic and other business requirements. Announcing their contribution to your cause during events and on social media is a great way to maintain relations with top corporate donors.
4. Foundations
Foundations are other large nonprofits created by families, communities, faith-based organizations, or corporations. These entities work within the US law taxes and contribute a percentage of their revenue to maintain their tax-free status.
Foundations often show their support through:
- Corporate grants
- Community grants
- Private charitable grants
- Capital assistance grants
- Challenge grants
Ask foundations for donations to raise funds for your cause. To improve your chances of getting support or grants for nonprofits, ensure you connect with the target foundation, which has similar values and missions.
Understand that foundations fund nonprofits with a track record of creating impact and achieving mission goals. Giving them clear-cut information and approaching them professionally is the best way.
Research the foundation well and send press releases and updates. Give them detailed financial annual reports, and prepare a pitch to apply for grants and show the impact of your initiatives.
15 Ways to Find New Donors for Your Nonprofit Organization
Like any marketing activity, you need a strategy to attract new donors so your nonprofit can get more donations. It must include tactics to identify and motivate new prospects to join your cause.
Here are a few donor acquisition strategies to convert prospects to financial contributors:
1. Strategize with Board Members
Board members are powerful assets of your NPO and the strongest advocates of your cause, as they are already connected with your mission. They understand and have contributed to your successes, so encourage them to become your biggest supporters.
Strategize with them to spread the word about your organization. Host events to include their family and friends to donate to the cause. Consider sending them a plea or discussing this during your meetings.
2. Find Prospects from Other’s Donor Networks
Many donors are open to supporting multiple causes if given a choice. According to Forbes, one hurdle that keeps potential donors from giving is a lack of awareness. Raise awareness for your cause and offer people the chance to donate.
Here is how to find and secure new donors:
- Compile a list of prospects based on annual reports and donor recognition lists of other organizations.
- Ask board members and staff if they have any connections with those prospects.
- Request them to spread the word about your mission.
- Invite interested individuals to attend one of your events or sign up for your newsletter.
Donors are more likely to contribute to NPOs that are passionate about their mission. Show your impact and share success stories to earn their trust.
3. Conduct Prospect Research
Personalized and targeted requests deliver more positive results. Without prospect research, organizers may miss opportunities to acquire new donors.
Perform thorough research to understand the background, interests, and giving capacity of potential donors. The research is not merely to identify supporters and ask for funds. It is about developing a better understanding by learning about:
- Causes prospects to be more passionate about.
- How likely are they to donate.
- What is their capacity to fund causes to personalize messages?
- How do you ask them to donate more?
4. Connect with One-Time and Lapsed Donors
Supporters may stop funding your cause for various reasons. Your role is to remind former donors that the organization is still doing meaningful work. These donors will continue their support when they see and learn about your ongoing efforts.
Even one-time donors can become recurring contributors when they understand the impact their donations can make.
Re-engage lapsed donors with different activities to continue their involvement. Nonprofits know that gratitude goes a long way, but it is not a one-time practice. Charitable organizations sometimes overlook this aspect and lose the chance of repeat donations. Be sure to thank these supporters and show them the value they add to the cause.
5. Send Donation Letters
Encourage prospects and current donors to support your cause financially or in-kind. Donation letters require less effort yet can help raise funds for upcoming events. Well-written donation letters can reach and compel a broader audience at once.
Most nonprofits use free CRM (customer relationship management) tools to segment their supporters into specific groups for more targeted donation letters.
Segmenting can be done in the following groups to address and personalize your appeals:
- Current donors
- Prospects who showed interest in your mission, like attendees, newsletter subscribers, followers, etc.
- Lapsed donors to reconnect and express appreciation for past supports
- Local businesses and corporations
Create an ideal donor profile to reach and send donation letters. Previous donations are the best indicators of a prospect’s willingness to contribute in the future.
Personalize your donation request to attract a positive response. Use success stories to appeal to supporters and urge them to join your mission. Include a specific, timely, and compelling call to action (CTA) to motivate.
6. View Volunteers as Potential Donors
Volunteers are a hidden resource that nonprofits often ignore. There are several reasons to treat volunteers as potential donors:
- They already know about your cause and mission.
- 50% of the volunteers say support activities lead them to give more financial support.
- Volunteers’ experiences set the tone for their further engagement. A positive experience can encourage them to donate when you ask them.
Track volunteer engagement metrics in your CRM. Metrics like service hours, event attendance, social media interactions, or email open rates can give insights on how to personalize your donation appeal to volunteers.
7. Use Social Media Platforms
Social media platforms offer powerful tools for reaching and engaging potential donors who align with your nonprofit's mission.
Platforms like Facebook, Instagram, and Twitter provide advanced targeting options based on demographics, interests, and behaviors, allowing you to deliver compelling ads to the right audience at the right time.
By crafting a social media strategy for your nonprofit you can showcase your impact stories and calls to action. You can capture the attention of scrolling users and inspire them to support your cause.
To maximize the effectiveness of your social media advertising campaigns, continuously monitor and optimize your ads based on performance metrics, ensuring that your acquisition efforts yield the highest possible return on investment.
8. Improve Website to Drive Traffic
Interested donors search for a nonprofit website to learn about your work before extending support. You should optimize your website as per best practices to convert prospective donors.
52% of nonprofits' web traffic comes from mobile devices. Making your website responsive can help improve visitors' experience. Adding mobile-friendly features to your website can also engage new and existing donors.
Use “pop-up” lead magnets offering free information and resources to convert website visitors into supporters.
9. Build a Content Marketing Strategy
Content marketing is a valuable strategy for reaching people with your impact stories. People search for information on fundraising opportunities and ways to contribute to different causes. Your blog can offer the right resources and share success stories.
Blogging is also a great way to use search engine optimization (SEO) practices and tools. Here are some ways charities can use blogs to find new supporters:
- Publish regular blogs about the latest industry news and trends related to your mission.
- Share updates from your leadership and more.
- Show your fundraising results with impact stories and reports.
- Add CTAs to encourage readers to become supporters.
10. Work with Local Media
Local community organizations and news outlets are perfect sources to spread your message. Pitch a story about your mission, founder, or organization to the local newspaper. Share recent highlights or upcoming events with a strong hook and angle to secure coverage.
News stories on TV, radio stations, social media, or print help find supporters that resonate with the cause. Adding human-interest elements instead of mere updates is the best way to evoke emotions and acquire donors.
11. Host In-Person Networking Events
Open houses, fundraising events, or casual get-to-know-you events create a welcoming environment for new donors. These events bring local guests together to interact and start meaningful conversations about causes.
Make in-person events a door to your NPO’s culture, facilities, and activities. To attract interest, share information about the organization and mission at these events.
Introduce your nonprofit’s impact and give prospective supporters time to talk to leadership face-to-face. Talk about your goals and how donors can join you in the mission to better the community.
12. Build an Email Newsletters
Email campaigns are the best way to build relationships with prospects. They are inexpensive and powerful channels for ensuring potential supporters receive your message. Nonprofits can build donor lists to use email campaigns and acquire supporters.
There are multiple ways to gather email contacts of attendees or people interested in working for the community.
Even if prospects do not support your cause financially, you can nurture relationships with them by sending them emails.
Here’s how to engage your email subscribers:
- Start a welcome series for new subscribers to engage them.
- Introduce your organization’s mission.
- Share the long-term impact their contributions can make.
- Offer other ways to connect with your NPO.
- Try sending a newsletter once per month and build from there to find the right frequency.
- Track the open rates to identify the right time to send newsletters.
Even if they do not always open newsletters, seeing your NPO’s name in the inbox keeps you on top of their minds. Do not flood their inboxes with your emails.
13. Plan Virtual Events
Host online events to cut costs and reach prospects beyond local boundaries. Having a virtual event that is emotionally inspiring and meaningful can encourage donations.
Reach out to your major donors and volunteers to show their support. These supporters can spread the message in their networks and invite friends to join the event.
The best part about virtual events is that you can invite more prospects. Unlike in-person events, you don’t need to worry about the venue size.
Virtual events allow accessing data, analyzing attendees, and connecting with them after the event.
14. Build Partnerships with Other Organizations
Partnering with corporations and community development organizations can bring in-kind donations, volunteer grants, and other fundraising support.
Work with corporations or major donors to offer match employee donations. Such programs incentivize first-time supporters and keep donors coming to support your cause.
Reach out to eligible organizations to spread your mission’s message. Other ways are to host collaborative events and engage with these prospects directly.
15. Follow Up to Create Strong Relationships
Previous donations made by supporters helped your cause, so be sure to acknowledge that. Contact them through in-person calls or send thank-you letters via email or direct mail. Let them know how their time or donations added value to your NPO.
When they see their contribution and gifts do not go unnoticed, they are more likely to continue donating. They can even tell their friends and family about your organization’s gesture and the cause they donated to.
How to Calculate Donor Acquisition and Retention Rates
Acquiring supporters isn't enough—you need to track and analyze the rate at which you attract new donors. From there, you want to be able to track your rate of retaining those donors to maximize your acquisition cost and continue to see a return on investment.
Calculating your donor acquisition and retention rates is like having a compass that guides you through fundraising, helping you navigate toward sustained growth and impact. With a few simple steps, you can unlock this vital metric and gain invaluable insights into the health of your donor pipeline.
Calculating Donor Acquisition Costs
To figure out your donor acquisition cost:
- Collect data from a recent fundraising campaign. Look for expenses that are related to finding new donors: marketing costs, advertising expenses, event costs, staff time, etc.
- Break down those costs.
- Marketing and advertising expenses (e.g., direct mail, online ads, social media promotions).
- Event costs (if you held events to attract new donors).
- Staff time spent on donor acquisition efforts.
- Creative design and copywriting costs for marketing materials.
- Any software or tools used for donor acquisition. (Zeffy’s 100% free event management and fundraising platform can help you save money!)
- Add up all the expenses related to signing up new donors.
- Determine how many new donors signed up due to the event or campaign.
- Divide the total cost of acquiring new donors by the number of new donors acquired: Donor Acquisition Cost = Total Cost / Number of New Donors
For example, if your total acquisition expenses amount to $10,000 and you acquire 200 new donors through those efforts, the donor acquisition cost would be $10,000 / 200 = $50 per new donor.
Knowing your donor acquisition cost will help you understand how much it costs to sign up a new donor and how much you need to earn from each donor to break even.
Average Donor Acquisition Rate
The donor acquisition rate helps keep your efforts focused and gives insights into what’s working and what’s not. Find this rate and build stronger donor relations for your nonprofit.
Here’s how to calculate the donor acquisition rate:
Donor acquisition rate (in percentage) = (first-time donors / total donors) X 100
Be sure to pick a period to calculate the rate of acquiring donors.
For example, for last month’s rate, consider the first-time donors in the last month over the total donors during the same time.
The average donor acquisition rate is about 0.8%. This rate can change based on different fundraising activities, the size, and the charitable organization type.
Average Donor Retention Rate
Donor retention rates show how many donors your NPO retains from last year. They can vary for different fundraising campaigns, but they usually have a 40-45% industry average.
Here’s how to calculate the donor retention rate:
Donor retention rate (in percentage) = (donors that gave this year/donors that gave last year) x 100
A low donor retention rate means you are losing more supporters than you are retaining. It leads to a decrease in revenue and a less stable donor base.
A high donor retention rate indicates that you have long-term supporters who come back regularly.
Cost of Donor Acquisition vs Donor Retention
The cost of retaining donors is 10 times less than acquiring new ones. Donors contribute to the causes of nonprofits they trust.
It takes more effort and resources to convert a new donor than to retain a loyal one. It means donor retention is cheaper than acquisition.
Avoid These Mistakes to Keep New Donors Around
Here are a few common reasons donors leave organization or stop giving to avoid as you build your donor engagement plans:
- Not putting enough focus on keeping current donors as finding new ones
- Failing to follow up or thank your donors
- Not investing in overhead
- Not collecting or implementing donor feedback
- Not having a donor retention plan at all
Final Thoughts on Nonprofit Donors
Acquiring new donors allows nonprofits to breathe life into their missions and expand their impact. While the acquisition cost can seem daunting, ignoring this crucial aspect is akin to leaving money on the table – a missed opportunity that no organization can afford.
By implementing the strategies outlined above, you'll find new supporters and build lasting relationships for your cause for years to come. When you succeed in optimizing your donor acquisition rate, the remarkable difference it can make will reverberate through every facet of your operations.
Zeffy's 100% free online donation platform is your ultimate co-pilot on this journey, empowering you with all the necessary tools and resources.
Nonprofit Donors FAQs
