A holy grail for fundrais­ers? Donors who keep on giv­ing.

The Washington Post Sunday - - TAKING STOCK - CASE IN POINT Anik is an as­sis­tant pro­fes­sor, and Steen­burgh is a case writer at the Univer­sity of Vir­ginia Dar­den School of Busi­ness. — Lalin Anik and Laura Steen­burgh

The big idea: With the rapidly ex­pand­ing use of the In­ter­net for fundrais­ing, non­prof­its are fac­ing a grow­ing chal­lenge to re­tain donors. At a time when ac­quir­ing a new donor is three times as ex­pen­sive as re­tain­ing an ex­ist­ing donor, non­prof­its are look­ing to in­crease the life­time value of donors. A low-cost ex­per­i­ment con­ducted at crowd­sourced giv­ing plat­form Glob­alGiv­ing shows a novel ap­proach to re­tain donors over time.

The sce­nario: Glob­alGiv­ing, a non­profit, pro­vides a global crowd­fund­ing plat­form where donors can give to grass-roots char­i­ta­ble projects. The plat­form al­lows non­profit part­ners to reach a base of donors in ways they could not achieve alone. In a given year, Glob­alGiv­ing part­ners with over 2,800 char­i­ta­ble or­ga­ni­za­tions to raise as much as $43 mil­lion.

In the past decade, the non­profit sec­tor has changed dra­mat­i­cally. There is greater com­pe­ti­tion for donors’ at­ten­tion and dol­lars via on­line plat­forms, in­clud­ing re­ward-based, do­na­tion-based and debt-based crowd­fund­ing. From the be­gin­ning, Glob­alGiv­ing rec­og­nized the chal­lenge of re­tain­ing pa­trons over time.

Driven by the fact that the rev­enue gen­er­ated by re­peat donors was four times that of one-time donors, Glob­alGiv­ing de­signed ways to in­crease on­go­ing giv­ing. Bonus days were held pe­ri­od­i­cally, where con­tri­bu­tions were matched. A project-of-the-month club was of­fered, al­low­ing donors to sign up once and con­trib­ute each month to a dif­fer­ent char­ity. News­let­ters were sent to pa­trons, high­light­ing giv­ing op­por­tu­ni­ties.

Orig­i­nally, ef­forts to in­crease re­cur­ring do­na­tions in­volved of­fer­ing con­trib­u­tors on the check­out page the op­tion to give on a re­cur­ring monthly ba­sis. Nei­ther en­cour­age­ment nor in­cen­tives were of­fered to make the switch, and the num­ber of donor con­ver­sions to re­cur­ring do­na­tions re­mained small. In re­view­ing the data, Glob­alGiv­ing de­ter­mined that while fewer donors gave a re­cur­ring do­na­tion, the life­time value of those donors was, on av­er­age, seven times higher than that of one-time donors. So the or­ga­ni­za­tion pri­or­i­tized in­creas­ing the rate of con­ver­sion from one-time to re­cur­ring do­na­tions.

The res­o­lu­tion: Glob­alGiv­ing col­lab­o­rated with aca­demic re­searchers to con­duct an ex­per­i­ment on­line.

On the check­out page, while some donors were in­formed that their re­cur­ring do­na­tion would be matched by an anony­mous donor, oth­ers were in­formed that the match would kick in only if a tar­get per­cent­age of donors com­mit­ted to a re­cur­ring do­na­tion.

Re­sults showed that a 75 per­cent con­tin­gent match con­di­tion re­sulted in the high­est level of con­ver­sion from one-time to re­cur­ring donors. On av­er­age, re­cur­ring donors con­tin­ued their con­tri­bu­tions for over a year, rais­ing do­na­tions more than ten­fold for char­i­ties. Glob­alGiv­ing then im­ple­mented the con­tin­gent match at 75 per­cent, re­sult­ing in a 66 per­cent in­crease in rev­enue from re­cur­rent donors and $7.3 mil­lion raised over five years.

The les­son: On­line plat­forms al­low ex­per­i­men­ta­tion on ways to drive in­creased giv­ing for non­prof­its.

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