How Not-for-Profit increase profitability by keeping supporters longer

The 2008 PFRA Attrition Survey was the first survey of not-for-profit organisations engaged in recruiting supporters and members via street, venue, door-to-door or face-to-face fundraising. The analysis was based on the giving patterns of over 377,000 regular members and gives insights that might impact on subsequent levels of donor loyalty. Its findings could be of interest to any not-for-profit organisation that has a membership base and is concerned with churn, attrition and loyalty rates.

The main insights

Whilst charities used a variety of methods to interact with donors a number of strategies were identified to reduce lapse rates. They were:
1. Personalised direct communications will reduce attrition and cancellation rates.
2. Ongoing, regular communications (between three and eight a year) has a positive effect on retention rates.
3. Setting supporter expectations early on in the relationship.

The research was devised and set up by Morag Fleming, Head of Fundraising at the charity Quarriers, suggested "Our findings have demonstrated in the clearest possible manner that how charities communicate with their donors can dictate the amount of money they raise across the short, medium and long-term."

The clear message from the research is that the view that regular giving supporters should be left alone, for fear of prompting them to cancel, has been exploded once and for all.

How to apply the key insight

Whilst all those charities surveyed used a raft of contact strategies including welcome calls, texts, e-mails, newsletters, e-newsletters and surveys to engage with their audience, what is most surprising is that the least used method of communication is often the one that is most effective.

That's because, the least favoured method was to contact supporters via a personal welcome call. Most organisations sited complexity and the cost as the major stumbling blocks. Yet if your desire is to scale down attrition rates and prompt supporter loyalty, it is the most effective option.

Welcome calls often produce a positive Response

Recruiting a new donor can be expensive, as the up-front cost of recruiting a supporter via face-to-face can be as much as ?100, which means that typically each supporter only becomes profitable after several years. Often an early welcome call will to identify potential cancellations before the up-front fee is paid. The saving from this alone is often sufficient make the welcome call pay for itself.

An early call can increase retention rates by up to 22%

It's not surprising that if a supporter was recruited by a personal interaction then another personal interaction would connect with the supporter with the cause. Additional research supports this view and shows that this one act, if conducted early on in the relationship can reduce attrition rates by between 13% and 22%.

So for any not for profit that is serious about reducing attrition rates the question should not be if to do welcome calls but what's the best way to do them? There are only three options: In-house may seem to be the most personal and cost effective, but the downside is often recruiting and managing the staff, quality issues and consistency; Call centres avoid the downsides of doing it in-house yet the 'reading from a script' approach often fails to provide the important 'personal' aspect of interaction; Perhaps that's why many favour a middle way - a tele-research company who specialise in unscripted welcome calls. Whatever you decide all the research suggests that a friendly, personal welcome call will dramatically increase retention rates.

A free booklet on advertising research with charity case-studies is available to all marketing professionals who wish to improve their response rates from espconsultancy.com the research for marketing specialists.