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Jul 13, 2016

The Shift to Lift


At Analytical Ones, we simplify all of our recommendations into three categories: Win (acquisition and reactivation); Lift (upgradation) and Keep (retention).

If you study donor files, active donor counts peaked in 2008, at the cliff of the Great Recession. Though some organizations have stabilized their active file sizes, few organizations are able to surpass where they were in 2008.

As I have reviewed our SGAs (Strategic Growth Analyses) over the past 8 years, our recommendations have been heavily weighted in the Win category. Organizations have consistently had challenges acquiring and reactivating donors. And despite a lot of effort and dollars targeted in this area, it’s not moving the needle. File sizes continue to decline.

Keep rates have improved a bit over the last 8 years. But this isn’t because organizations are better at bonding with their donors. It’s more a file weighting composition thing. Since there are fewer new donors on file, the balance is tilted to Multi-Year donors which have better retention rates. Thus overall retention looks better. When it fact, they are relatively stable.

The one area that has improved is Lift. Donors are giving bigger gifts. In fact, if you look at most files, in terms of revenue the improvement in average gift size has more than mitigated the decline in donor counts. Or in other words, revenue continues to grow while file sizes shrink.

I think the conclusion here is though we can’t give up on winning new donors and reactivating old ones, more investment should be directed towards Lift strategies: Upgrading donors through either larger gifts, more frequent gifts, or both. This is the macro trend in fundraising at the moment. Stop trying to fight it and embrace it.

Shift to Lift.

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