Tuesday, March 22, 2011

AFP 2011 Harvey McKinnon on monthly donors

Blog from Harvey McKinnon's session at AFP.  He is talking about 'How to Build.a Highly Successful Monthly Donor Program'

Right from the beginning some data - all organisations should be able to get 5% of their current donors to monthly giving. Some will get 20%.

Shocking - of 300 or so fundraisers, no one put their hand up to having more than 5,000 monthly donors.  Nearly all had less than 500. But at least half had some form of monthly giving program.

The USA really is behind Europe and Australia on embracing and growing monthly giving.

Why bother?
Monthly programs....
1. Increase income - value of the donor will at least double
2. Better relationships
3. Donors stay longer - monthly donors stay for ten years on average
4. Predictable - the money just keeps rolling in
5. savings
6. Income grows over time
7. Convenient for the donor

Although some monthly donors make their payments by cheque, as opposed to EFT or credit card they tend to be worth half of their automatic debited peers.

Myths about monthlies...

1. It didn't work - it may not work straight way, need to get the proposition right
2. Small amount of money, it is a lower average donation, but not over a year
3. Worries about access to bank and credit card info - insignificant number of people
4. Are donors too old - some old people will sign up, it is still worth it

So, you want to start a program? What are the essential components.

1. A donor base
2. An appealing mission - accept that some organisations are easier to fundraise for, but it works for pretty much every cause that can get single donors
3. An audit - what are you doing well?
4. Effective processing - must debit quickly and act when people drop off
5. Strong communications
6. Integrated marketing - don't talk about it, do it
7. Senior management support

Harvey was saying to take people out of general direct mail appeals programs once they become monthly donors. He did say there are some caveats, but we find that monthly donors who used to respond to direct mail appeals should still get them - but perhaps fewer, and always personalized and recognizing their monthly donation.

How much to ask for?

Try and tie the amount to something specific. 'Your $50 a month will buy...'

According to Harvey, the easiest method of gaining some monthly donors is having a monthly option on forms. This has worked really well for many charities, but at some point you should send specific monthly donor asks (my opinion not Harvey's).

Phones are a great way to do it too.  In his opinion there is not a lot to decide between the hone and mail. I say do both.

Harvey reckons that face to face (direct dialogue) can be too expensive to start for smaller organisations. 

Age is a huge factor on early attrition in Canada. This reflects the pattern in Australia. His data shows that average donations effect attrition too. The higher the average, the worse the attrition. To fix, always proactively downgrade young donors giving higher amounts.

Greenpeace and Amnesty are pioneers of monthly giving fundraising - check out their websites. They 'slice the salami' - 33c a day etc.

Showed a direct mail stoning pack - sending stones the same size as those used to kill women accused of adultery. It was a campaign, but all responders were asked for monthlies. They got 25,000. (I think he said that much - it is a lot!) 

Monthly programs are worthy it for example,  a specific charity where the average monthly donor gives 6x as much as their non monthly counterparts. It takes a while, but it is brilliant.

You should look after the donors though. Send them invites to special events, open house, send cards - give them a good experience.

Great session.  If you are at a conference and Harvey is speaking, even if you know about monthly giving you should go watch him.

For more on monthly giving, search this blog for 'regular givers' and 'fundraising is beautiful' and listen to the podcast on 
http://fundraisingisbeautiful.com/fundraisingisbeautiful. If you are at AFP, come to my sessions tomorrow! 

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