Latest / The Nonprofit Podcast / Ep 200| Who are the Most Overlooked Nonprofit Donors?

Transcript

Ep 200| Who are the Most Overlooked Nonprofit Donors? · The Nonprofit Podcast

• 0:00
  SPEAKER_01: Revenue isn't disappearing, it's concentrating.
• 0:03
  SPEAKER_01: And the group sitting right in the middle of your donor base may be your biggest untapped opportunity.
• 0:10
  SPEAKER_01: The Nonprofit Podcast, powered by DonorBucks.
• 0:14
  SPEAKER_01: Welcome to the Nonprofit Podcast.
• 0:16
  SPEAKER_01: I'm Jenna Lynch, Head of Community Engagement here at DonorBox.
• 0:19
  SPEAKER_01: Each week we bring you practical strategies, clear insights, and inspiration to help you raise more, reach further, and take your nonprofit to the next level.
• 0:29
  SPEAKER_01: What we're going to explore today is a specific gap that exists in most nonprofit fundraising programs, one that most teams know there is, but haven't fully addressed.
• 0:41
  SPEAKER_01: It sits right in the middle of your donor base between the broad annual giving pool and the major gift portfolio.
• 0:49
  SPEAKER_01: And the donors who live in that gap may be the most underdeveloped growth opportunity in fundraising right now.
• 0:56
  SPEAKER_01: We're going to take a look at what the data is telling us, why the gap exists in the first place, and what it actually looks like to close it on a real team with real constraints.
• 1:08
  SPEAKER_01: Let's get into it.
• 1:09
  SPEAKER_01: The fundraising effectiveness project, also known as the FEP, publishes quarterly benchmark data drawn from tens of thousands of organizations.
• 1:19
  SPEAKER_01: And it's one of the most reliable sector-wide reads on what's actually happening in fundraising.
• 1:25
  SPEAKER_01: And the Q3 2025 report has some numbers worth sitting with.
• 2:14
  SPEAKER_01: Total dollars raised are up 3%.
• 2:18
  SPEAKER_01: So organizations are bringing in more money.
• 2:20
  SPEAKER_01: That's great.
• 2:21
  SPEAKER_01: And who's driving it?
• 2:23
  SPEAKER_01: Repeat retained donors, people who have given the same amount or more to an organization multiple times over multiple years.
• 2:33
  SPEAKER_01: And they account for about 40% of all donors, but they are generating over 60% of total revenue.
• 2:42
  SPEAKER_01: Their attrition rate is also the most stable of any segment, and that is down less than 1% in dollars compared to the double-digit declines in some other groups.
• 2:55
  SPEAKER_01: And okay, so here's the retention data.
• 2:57
  SPEAKER_01: I think every development director should put on a sticky note.
• 3:02
  SPEAKER_01: Only 14% of new donors from the prior year have given again.
• 3:08
  SPEAKER_01: Meaning, if someone gave to you for the first time last year, there is roughly an 86% chance that they won't come back or they haven't come back.
• 3:20
  SPEAKER_01: That's a pretty wild number.
• 3:22
  SPEAKER_01: And to be honest, that number hasn't really budged in years.
• 3:26
  SPEAKER_01: So when you put all of this together, the picture isn't that fundraising is collapsing.
• 3:32
  SPEAKER_01: Again, we're bringing in more revenue here.
• 3:34
  SPEAKER_01: It's that fundraising is concentrating.
• 3:37
  SPEAKER_01: Revenue is pooling with loyal, committed, repeat supporters, while the broad base of occasional and first-time givers keeps thinning out.
• 3:49
  SPEAKER_01: Fewer donors, more dollars, and the gap between those two things is widening.
• 3:54
  SPEAKER_01: Okay, that is not a crisis by any means, but I do think that it is a signal.
• 4:01
  SPEAKER_01: And the signal is pointing at the middle of your donor base.
• 4:05
  SPEAKER_01: So that's those mid-level donors.
• 4:08
  SPEAKER_01: Those people are giving roughly, I don't know, 500 to 5,000 a year.
• 4:14
  SPEAKER_01: They are already committed enough to give at a pretty meaningful level, y'all.
• 4:21
  SPEAKER_01: Their retention rate uh is at around 49%.
• 4:25
  SPEAKER_01: And that is more than double of those micro donors.
• 4:30
  SPEAKER_01: And they are, in almost every measurable way, the most promising segment in your donor base.
• 4:37
  SPEAKER_01: And I think that most organizations, to be honest, are barely paying attention to them.
• 4:43
  SPEAKER_01: And here's why I think that most teams operate with two pretty distinct systems.
• 4:50
  SPEAKER_01: So on one end, you have what I'd call the expansion model, right?
• 4:55
  SPEAKER_01: The goal is reach, grow the list, run the campaigns, get all the new donors, maximize that donor acquisition, email, digital ads, giving days, direct mail, all of it is designed to bring in volume.
• 5:13
  SPEAKER_01: The underlying assumption is that if you get enough people in the door, some of them will naturally deepen their giving over time.
• 5:22
  SPEAKER_01: Now, on the other end of this, you have a very different approach for major donors, people giving$5,000,$10,000,$25,000 or more, depending on your organization.
• 5:34
  SPEAKER_01: And when you get to this other end, that is relationship work, that is portfolios, personal conversations, very customized and intentional stewardship.
• 5:46
  SPEAKER_01: A gift officer who knows their name, their history, their grandchildren, maybe even, their capacity, their motivations.
• 5:53
  SPEAKER_01: It's intentional and it's very one-on-one.
• 5:57
  SPEAKER_01: It's very individual.
• 5:59
  SPEAKER_01: Both of those systems exist because they work for their respective audiences.
• 6:06
  SPEAKER_01: The problem is, what sits in between these two models?
• 6:11
  SPEAKER_01: Mid-level donors account for about 15% of all donors and 16% of total dollars raised.
• 6:19
  SPEAKER_01: They are not a small group.
• 6:21
  SPEAKER_01: And with a retention rate sitting around 49%, nearly half of them are coming back year after year.
• 6:29
  SPEAKER_01: But here's what often happens to them in practice.
• 6:33
  SPEAKER_01: They are too significant to just drop into the general email stream with someone who gave$25 last December, but they're not usually large enough to trigger a major gift strategy.
• 6:46
  SPEAKER_01: So they end up kind of in what I call no man's land.
• 6:50
  SPEAKER_01: They're receiving the same communications, same appeals, and the same year-end letter as your general donors.
• 6:58
  SPEAKER_01: Now, I want you to think about what that feels like from their side.
• 7:03
  SPEAKER_01: A donor who has given to your organization$800 a year for the last, I don't know, four years.
• 7:09
  SPEAKER_01: They're doing this quietly.
• 7:11
  SPEAKER_01: They're doing this consistently with no fanfare.
• 7:15
  SPEAKER_01: They open your emails, they give it your end, they're never really asking for anything.
• 7:20
  SPEAKER_01: They just believe in what you do, and that's amazing.
• 7:24
  SPEAKER_01: And the message they keep getting implicitly through every generic email and every mass appeal is that you don't really notice, or worse, you don't really care that to your organization, they are just another name on a list.
• 7:41
  SPEAKER_01: Many of them won't tell you that though.
• 7:43
  SPEAKER_01: They're just quietly starting to give less or stopping altogether, right?
• 7:48
  SPEAKER_01: Or they're gonna find it in organization that makes them really feel like they matter.
• 7:54
  SPEAKER_01: Their giving behavior says they're committed.
• 7:57
  SPEAKER_01: And I think oftentimes this mid-level group, their donor experience doesn't reflect that at all or as much as it needs to.
• 8:06
  SPEAKER_01: So here's what I think the deeper issue is for the last decade or so, fundraising infrastructure, platforms, campaigns, giving days, digital tools have been optimized almost entirely for expansion.
• 8:24
  SPEAKER_01: Reaching more people cheaply, growing those lists, right?
• 8:29
  SPEAKER_01: Scaling that acquisition.
• 8:31
  SPEAKER_01: The whole architecture was built for that expansion model because that's what technology made easy.
• 8:39
  SPEAKER_01: But the donor behavior we're seeing in the FEP data is rewarding something very different.
• 8:46
  SPEAKER_01: Repeat retained donors are the most valuable, stable revenue source.
• 8:51
  SPEAKER_01: And a lot of them are sitting in that mid-level land.
• 8:55
  SPEAKER_01: Frequency of giving is one of the strongest predictors of retention.
• 9:00
  SPEAKER_01: Donors who give seven or more times last year are retained at an 87% rate.
• 9:08
  SPEAKER_01: The loyalty signal is getting louder, you guys, not quieter.
• 9:12
  SPEAKER_01: So there's a mismatch for sure.
• 9:15
  SPEAKER_01: Many teams are still running an expansion first infrastructure in a moment when the data is increasingly rewarding depth over breadth.
• 9:26
  SPEAKER_01: And the mid-level donors are the clearest casualty of that mismatch because they're the group that most needs a retention and upgrade approach, and most likely to be getting an acquisition and volume one.
• 9:42
  SPEAKER_01: Now, there's one more dimension to this that I don't want to skip past either, because I think it's actually the most important strategic argument for investing in mid-level donors right now.
• 9:53
  SPEAKER_01: Most major donors don't start as major donors.
• 9:58
  SPEAKER_01: They usually start smaller, sometimes much smaller, and they grow their giving over time as their relationship with an organization deepens, their capacity changes, and the right conversations happen at the right moment.
• 10:13
  SPEAKER_01: So think about that$800 a year donor.
• 10:17
  SPEAKER_01: If someone had called them two years ago just to say thank you, what if they had been invited to a small gathering, a briefing, or received a note that was clearly written for them and not for a list of hundreds or thousands?
• 10:35
  SPEAKER_01: Would they still be giving 800?
• 10:37
  SPEAKER_01: Or might that relationship look very different by now?
• 10:41
  SPEAKER_01: If your mid-level donors are sitting in that no man's land for years, never receiving more personal attention, never having a real conversation with anyone at your organization about their giving, that path to major giving either doesn't happen or it happens much more slowly.
• 10:59
  SPEAKER_01: Or it happens with a different organization that noticed them first, right?
• 11:04
  SPEAKER_01: Mid-level is where you build the major gift pipeline.
• 11:08
  SPEAKER_01: And if your pipeline is unmanaged, you're essentially leaving future major gift relationships invisible until someone happens to stumble across them.
• 11:19
  SPEAKER_01: So that's the real cost.
• 11:21
  SPEAKER_01: And, you know, it can be very sneaky.
• 11:23
  SPEAKER_01: It's a quiet one.
• 11:25
  SPEAKER_01: The good news is the gap I'm describing is actually one of the more fixable problems in fundraising.
• 11:33
  SPEAKER_01: It does not take a big budget or a big team.
• 11:37
  SPEAKER_01: It mostly takes deciding to pay attention.
• 11:40
  SPEAKER_01: And so I want to talk about what that looks like in practice.
• 11:44
  SPEAKER_01: The first thing is to just define the segment, right?
• 11:48
  SPEAKER_01: Not conceptually, you know, me saying, oh, 500 to 5,000, but in your database, right?
• 11:55
  SPEAKER_01: Pull that list, run the report.
• 11:58
  SPEAKER_01: Again, mid-sized donors are generally$500 to$5,000 annually, though your threshold might shift depending on where your major gift level starts as well.
• 12:08
  SPEAKER_01: So pick that range, apply it, and see who's actually there in that data.
• 12:14
  SPEAKER_01: How many people?
• 12:15
  SPEAKER_01: What's their year-over-year retention?
• 12:18
  SPEAKER_01: Are any of them growing their giving?
• 12:20
  SPEAKER_01: Have any crossed into major gift territory in the last few years, right?
• 12:26
  SPEAKER_01: You can't manage a segment if you haven't looked at it, if you do not know who those people are.
• 12:32
  SPEAKER_01: And if you're using a platform like Donor Box, this kind of segmentation is something you can pull directly from your donor reports.
• 12:40
  SPEAKER_01: You can filter by that giving range, look at frequency and history, and you'll have a working list pretty quickly.
• 12:49
  SPEAKER_01: All right, after that, you need to audit what they are experiencing, what this list is experiencing.
• 12:56
  SPEAKER_01: So pull up what a, I don't know,$750 donor received from you in the last 12 months.
• 13:05
  SPEAKER_01: Every email, every appeal, every piece of mail, if it's the same as what someone uh got who gave$30 once in 2023, that's your gap, right?
• 13:20
  SPEAKER_01: Most organizations do have a gap, but now you know where to start.
• 13:24
  SPEAKER_01: After that, add a few deliberate touch points.
• 13:28
  SPEAKER_01: You do not need a full mid-level program to make a real difference here.
• 13:33
  SPEAKER_01: If you can have that, great, but you do not need it.
• 13:36
  SPEAKER_01: So think about a thank you call after a significant gift, not a receipt, although they do need those, but an actual phone call, a brief personal note at your end.
• 13:46
  SPEAKER_01: That's clearly not a mail merge, a small virtual meeting or an impact update just for this mid-level group twice a year.
• 13:57
  SPEAKER_01: Something that signals.
• 13:59
  SPEAKER_01: We know you're not just another name on our list.
• 14:02
  SPEAKER_01: We know that you are giving significantly, and we value that and we want you to feel that.
• 14:09
  SPEAKER_01: These are low resource, high signal moves.
• 14:13
  SPEAKER_01: And if you have recurring donors in this mid-level range too, which if you're using donor box, you likely do.
• 14:20
  SPEAKER_01: Those people especially deserve that personal touch.
• 14:25
  SPEAKER_01: They have essentially set up automatic loyalty.
• 14:28
  SPEAKER_01: So you need to acknowledge that.
• 14:31
  SPEAKER_01: After that, you need to assign ownership.
• 14:34
  SPEAKER_01: So someone on your team should have eyes on this segment.
• 14:37
  SPEAKER_01: It doesn't require a dedicated mid-level officer.
• 14:41
  SPEAKER_01: If you are a small team, it might be your development director carrying a light portfolio of 20 names alongside everything else.
• 14:49
  SPEAKER_01: But if nobody owns it, nobody tends to it, right?
• 14:55
  SPEAKER_01: When nobody tends to it, those donors drift.
• 14:58
  SPEAKER_01: So pick someone.
• 15:00
  SPEAKER_01: It doesn't have to be a big program, but definitely have someone own it.
• 15:04
  SPEAKER_01: And as you do this over time, you will start to see patterns, right?
• 15:08
  SPEAKER_01: Who's been giving consistently for four, five, six years, who's been quietly increasing, who opens up every single piece of email that you send.
• 15:19
  SPEAKER_01: Those are the people worth a more personal conversation and potentially the beginning of something much bigger.
• 15:26
  SPEAKER_01: So dedicate that team member or dedicate it to yourself if you're a team of one.
• 15:32
  SPEAKER_01: Set aside an hour block every single week to tend to this mid-level segment.
• 15:39
  SPEAKER_01: The numbers are not telling you something new.
• 15:42
  SPEAKER_01: I think that this data from this report really confirmed what we have already been experiencing and things that you probably already sensed.
• 15:51
  SPEAKER_01: Again, that revenue is concentrating with loyal repeat supporters.
• 15:56
  SPEAKER_01: The broad base of occasional givers is thinning.
• 15:59
  SPEAKER_01: And the infrastructure most fundraising teams rely on was built to grow that broad base, not to deepen relationships with the people who are already committed.
• 16:09
  SPEAKER_01: And that is the gap where these important mid-level donors live.
• 16:13
  SPEAKER_01: They are giving at a level that says they care.
• 16:17
  SPEAKER_01: Their retention is meaningfully better than those small donors.
• 16:21
  SPEAKER_01: And they're the most realistic pipeline to future major gifts.
• 16:26
  SPEAKER_01: And in most organizations, they're getting the same experience as someone who gave once and forgot about it.
• 16:33
  SPEAKER_01: Closing that gap does not require a big investment.
• 16:36
  SPEAKER_01: It just requires defining the segment, looking at what actually is happening there, giving those supporters a more intentional experience, and making sure someone on your team owns it.
• 16:49
  SPEAKER_01: Not a moonshot, you guys.
• 16:50
  SPEAKER_01: It's just paying better attention to people who already are showing up for you.
• 16:57
  SPEAKER_01: Thank you for being a part of the nonprofit podcast community.
• 17:01
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• 17:04
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• 17:08
  SPEAKER_01: Until next time, take that first step and stay inspired.
• 17:13
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• 17:18
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• 17:24
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• 17:26
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• 17:28
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