Charities Struggle to Retain Donors, Survey Finds

While charities saw more gains in giving than losses in 2014, the number of donors overall fell, with fewer than half supporting the same organization two years in a row, a study from the Association of Fundraising Professionals and the Urban Institute finds.

Based on a survey of more than eight thousand charities, the 2015 Fundraising Effectiveness Project Survey Report (28 pages, PDF) found that losses in 2014 of nearly $3.4 billion through reduced gifts and lapsed donors were offset by gains of $3.6 billion in gifts from new, upgraded, and previously lapsed donors. Viewed another way, for every $100 gained by nonprofits in the sample, $95 was lost through gift attrition. In addition, 43 percent of donors who gave to one of the surveyed charities in 2013 gave to the same organization in 2014, while the median retention rate was unchanged from 2013 and the total number of donors fell 3 percent on a year-over-year basis.

The survey also found that larger organizations fared better than smaller ones, with charities that raised at least $500,000 and those raising between $100,000 and $500,000 seeing average increases of 10.4 percent and 3.1 percent, respectively, while those raising less than $100,000 suffered an average loss of 7.8 percent.

"In some ways, nonprofits are in a new world when it comes to post-recession giving levels and behavior," said Elizabeth Boris, founding director of the Center on Nonprofits and Philanthropy at the Urban Institute. "When the economy was strong, we worried less about retaining donors because new donors were easy to find. But it's far less expensive to retain existing donors than it is to identify and find new donors. The search for new donors is a costly burden for many charities."

"New Report: Less Than Half of Donors Give Again to Organizations That They Supported in the Previous Year." Association of Fundraising Professionals Press Release 10/01/2015. "2015 Fundraising Effectiveness Survey Report." Association of Fundraising Professionals and Urban Institute Report 10/01/2015.