Returning to the Fold

Charities intensify efforts to recapture lapsed donors

Looking for ways to increase donations from individuals, the Christian Appalachian Project, in

Lancaster, Ky., last summer decided to redouble its efforts to solicit people who hadn’t given in a while.

After calling 30,000 donors who had given the charity $15 to $25 each within the last three or four years, it raised about $45,000. More than one in five donors agreed to make a gift; for donors who had not given to the social-service charity in four years, the average gift was $27; for donors who had stopped giving three years ago, the average donation was $31.

Not only were the results far better than the $13 average gift the Christian Appalachian Project typically receives from first-time donors, but the charity did not have to spend the approximately $2,700 it would have cost to obtain the names and addresses of 30,000 potential donors from mailing-list brokers.

“These people, for some reason whatever, like the Christian Appalachian Project — and you don’t need to let those people go away, ” says Sue Sword, a fund raiser at the charity. She says persuading such people to return as regular donors is essential, especially because the charity’s fund raising has been hurt by the recession. “These are not the best of times for fund raising for lots of reasons — increasing postage, the bad economy,” she says.

Growing Competition for Donors

Other charity officials agree that it has become increasingly important to pay attention to donors who have stopped giving.

“It’s becoming much more expensive for us to acquire new members,” says Giselle Holloway, director of basic membership at Thirteen/WNET, a public television station in New York, citing increased competition from other charities for donors. “The more we can do in terms of reinstating lapsed donors, the better that is for us financially.”

Veteran fund raisers differ on how best to recapture lapsed donors — generally defined as people who haven’t given in at least a year. Some favor blunt approaches, reminding people that they haven’t given in a while, while others suggest avoiding that point and treating lapsed donors like everyone a charity solicits.

But most fund raisers agree that it is important to find out why contributors have stopped giving. Some may feel slighted about something a charity has done but could be wooed back by an apology or a promise to make changes. Others halt their giving temporarily due to changes in financial, family, or other circumstances. Indeed, a recent survey found that the second-biggest reason donors stray is their financial circumstances.

Charities such as the Planned Parenthood Federation of America, in New York, prize lapsed donors in part because they tend to give much more to the charity than first-time contributors: $44 on average, compared with $29. Since donations from individuals account for more than half of Planned Parenthood’s $40-million annual unrestricted revenue, its fund-raising strategy has long placed a high priority on encouraging former donors to give again — even those who haven’t made a donation in more than a decade. “We’re one of those organizations that never gives up the ghost on those people,” says Molly Smith Watson, a fund raiser at Planned Parenthood.

Even so, the charity continues to look for ways to help determine who among its 800,000 lapsed donors might be most likely to give. Besides how recently a gift was made — and how often and how much a donor gave in the past — the charity determines who to solicit based on other characteristics, such as estimates of how much disposable income lapsed donors have and whether the former donor lives in a wealthy area. Recent mailings to donors who fit some of these profiles yielded two gifts of $10,000 for Planned Parenthood. While Ms. Watson sees those gifts as a fluke, since the majority of the charity’s donors who give through the mail usually donate less than $50 at a time, the strategy “illustrates that there are people below the radar that might be fleshed out using additional information,” she says.

Costs of Attracting New Donors

The charity found another advantage of appealing to lapsed donors: Acquiring new donors often costs money initially, while returning to lapsed donors nets immediate revenue. For example, the group expects to receive around $326,000 from appeals sent to an estimated 400,000 people who haven’t given in at least two years. While this doesn’t seem like a big sum, it is still a gain compared with the $1.2-million the charity expects to lose when it mails appeals to 12 million potential new donors. Part of the reason Planned Parenthood loses money on acquiring new donors is that while it maintains the names, addresses, and phone numbers of lapsed donors in its databases, buying a list of names and addresses of potential donors can cost as much as several hundred dollars per thousand names, says Ms. Watson.

However, Planned Parenthood doesn’t worry about those costs because it expects to more than recoup the loss in future gifts from this new pool of donors. But it has found that the initial payoff is much greater by continuing to appeal to lapsed donors.

Subtle or Blunt?

While most charities recognize the value of winning back lapsed donors, opinion is divided about how best to do so. Ms. Sword of the Christian Appalachian Project says that her group has found that most of its lapsed donors, many of whom are older than 60, do not realize that they have not contributed in several years.

“We don’t call and say, ‘Yeah, we notice you have fallen off from giving to us,” she says. “They might feel offended, when really it’s that they have forgotten to give.”

Other charities, however, have had good luck being direct.

Since 1996, Save the Children United States, an international relief charity in Westport, Conn., has mailed a simple notecard to donors who have not given in more than three years. The mailing, which opens with the line, “It’s been a while since we’ve heard from you,” produces an average gift of $42.57, more than double the size of the average donation made by first-time donors.

Geoffrey Peters, a direct-marketing consultant in Crofton, Md., says charities should not be afraid that they will make people feel guilty if they are reminded of their failure to give — since guilt, he notes, is an emotion that often inspires charitable giving.

He recommends that charities take advantage of the chance to get in touch with lapsed donors and ask, “Gee, we haven’t heard from you. Did we do something wrong?” Two charities he has worked with managed to woo back donors by apologizing for not sending a thank-you note and letting a donor know he could earmark contributions for a specific program.

The Jewish Community Federation of Cleveland enlists its board members and other volunteers to visit donors of $1,000 or more who have ceased contributing to the organization.

“It’s worth the investment,” says Daniel S. Blain, a senior fund raiser at the group.

During the meetings, the volunteers try to determine whether the decision to stop giving stems from a gripe the donor has with the federation or one of the organizations it finances, a change in the person’s financial circumstances, or some other reason.

In cases of complaints, federation officials attempt to resolve the issue. If a donor cannot give as much as he or she did because of financial circumstances, the federation encourages the person to make a small gift to convey a show of support. Even if the donor cannot contribute a dime, the federation continues to send the donor invitations to events, and has a volunteer or staff member occasionally call or visit to maintain the individual’s connection to the federation, says Mr. Blain. One donor who had stopped giving for two years for financial reasons later donated $10,000, which matched his previous contributions to the group.

Some groups hold parties or other events to reconnect with donors who haven’t given lately. Gay Men’s Health Crisis, in New York, last month invited 16 former donors who had each given between $5,000 to $10,000 to attend a cocktail party held by another lapsed donor at his apartment in the Dakota, a building that is one of New York City’s most exclusive addresses.

The event — which was billed as a party to honor the group’s President’s Council members, donors who have contributed $25,000 or more — gave guests a chance to see the host’s art collection as well as to get an update from the charity’s executive director, a longtime volunteer, and an AIDS patient the charity is currently helping, says Addie J. Guttag, acting director of development. While guests did not have to make a gift to attend the party, and no explicit fund-raising pitch was made there, Ms. Guttag says she is hopeful some of the people who attended will give again. “Many people said to our staff, ‘We are glad to be back,’” she says. The charity’s fund raisers already have scheduled follow-up meetings with two people who went to the party.

Mail Solicitations

For charities that don’t have enough volunteers or staff members to contact donors individually, mail appeals specifically designed for lapsed donors may be the best option. Each month, the American Institute for Cancer Research, in Washington, selects several thousand donors who haven’t given in six months to three years to receive an appeal that says: “Your past support has been important in helping further the fight against cancer. Our future efforts depend on your continued support.”

While the money contributed in response to those appeals only translates into a fraction of the group’s $37-million annual budget, it’s still “2 to 3 percent you wouldn’t have if you didn’t work it,” says Kelly B. Browning, the group’s chief fund raiser.

Some charities try to tie solicitations to lapsed donors with announcements of new programs or services.

When the All Stars Project, a New York charity that helps youths gain self-esteem through performing, started a program in New Jersey two years ago, fund raisers mailed newsletters about the effort to lapsed donors who lived in New Jersey. Some of those donors were also invited to small gatherings to learn about the program.

In neither case were the donors explicitly asked to give, but the efforts to update former contributors are now beginning to pay off: Last summer the group mailed an appeal to several hundred of the same lapsed New Jersey donors and raised $2,000. Another appeal will be sent this summer to an additional 2,000 former donors in conjunction with a telemarketing appeal.

“Our having expanded to New Jersey gives us something new to go to these donors about,” says Bonny L. Gildin, who oversees fund raising for the New Jersey program. “It’s good to remind people that they know about our organization and have been moved to support it in the past.”

At the Nevada Museum of Art, in Reno, a capital campaign for its new building spurred officials to seek renewed support from corporate donors, many of whom had drifted away as the museum trimmed the number of exhibits in preparation for demolition of its current building.

Instead of asking only for financial help, Lisa N. Ritterbuck, director of development, met with officials at seven companies of varying sizes and asked what benefits the businesses would like the museum to offer in exchange for donations of $1,000 to $100,000. Top requests included ways for employees to become involved with the museum and invitations to a gala opening for the new building. One telecommunications company that had previously given $10,000 to the museum has pledged to give again, though the amount it will give is still being worked out, says Ms. Ritterbuck.

Starting Early

While recapturing lapsed donors can be a solid source of support, experts caution that the best strategy for charities is not to let donors fade away in the first place.

CARE USA, an international relief group in Atlanta, sends a special mail appeal to donors of at least $50 who haven’t given in 11 months. “We call it our ‘win back’ package,” says Beth Athanassiades, head of direct marketing for the organization. The envelope features a handwritten address, and the notecard inside has a black-and-white photograph of two children above the words “A Promise Renewed.”

Inside, the handwritten copy reads, “We haven’t heard from you in a while. I hope you are well. Your support is sorely missed and the need is still great. Please, can you help us again?” The charity’s president’s signature is on the appeal, which typically prompts 9 percent of recipients to give, with an average donation of $41, says Ms. Athanassiades.

The charity sends the appeal after 11 months because it found that the chances of receiving a second gift decline significantly after 13 months. The charity plans to test sending the appeal even earlier, at 10 months since the last gift, to see if a higher percentage of people give. Securing second gifts from donors early in the process, Ms. Athanassiades says, is “crucial because they are still interested in you.”