This was just published as a guest blog in Tom Ahern’s email newsletter… Thank you Tom. I am deeply humbled.

In nonprofit labor relations news…

You’re fired until you have a solid monthly giving program launched…

Do the easy math. Then get to work. Cash gifts are a drink of water. Monthly giving is a forever spring flowing 5 times faster.

Two names mean “monthly giving expert/guru/evangelist” amongst North American fundraisers … and the other one’s Harvey McKinnon. The one from Holland is Erica Waasdorp, president of A Direct Solution, and author of Monthly Giving: The Sleeping Giant. Here’s a smoking-hot guest article written by Erica upon request, just for you and my other scary-smart subscribers:

Spoiler alert:

  • Monthly giving easily pays for itself.
  • Your finance person shouldn’t run fundraising.
  • About being too greedy and asking too high….

One of the things that absolutely floors me is the fact that so many organizations STILL do not have a monthly giving program.

I know: change is hard. Historically, this country’s nonprofits have always paid more attention to major gifts. That’s “where the money is.” Or so they thought.

What they forget is that they have a lot more small donors than large donors. They forget that it takes inordinate amounts of time and money to reach those ‘big donors.’

Monthly donors can be considered “major donors on an installment plan.” Those unending monthly contributions add up.

I’ve been fortunate to have worked at and with organizations that “got monthly giving.” One of those truly saw the impact of their monthly giving program when September 11 happened … and they halted the mail for a few months. Thanks to the monthly donor program, they were able to keep going and keep funding their programs.

That’s the power of monthly giving.

Just think about it. Every time a disaster hits, it can impact your direct mail and email campaigns. If you have a monthly donor program in place you don’t have to worry. Because those monthly donations still come in, no matter how many donors support the disaster.

That is the power of monthly giving!

That is why it absolutely stuns me that some organizations that spend millions of dollars on their direct response programs with staffs focused on donor relations and acquisition and donor appeals are STILL hesitating about monthly giving.

It’s an absolute mystery to me why organizations that are literally sitting on a gold mine, are turning away heaps of money!

You will not know which organizations these are, but I hope you’ll learn from some of their mistakes. And please do not make any of these at your own organization!

!!!!!!!!! Terrible Monthly Donor Decision 1: We don’t have a monthly giving program, because we can’t afford to hire someone to run it!

Organization X has literally millions of email names and hundreds of thousands of direct mail names. And yet, they continue to not put any money into developing their many small donors into monthly donors.

They offer monthly giving as a giving option on their web site … but are not promoting it at all. I personally joined their program two years ago and am still receiving the same email thank you every month!

Let’s look at what we see in the market place right now:

  • 20-60% of members of public TV and radio stations already give monthly (among other things, they love that monthly giving trims the length of on-air fund drives)
  • 21% of baby boomers already do it (and baby boomers will be the backbone of giving until 2035, according to expert analyst Jeff Brooks)
  • And it’s trickled down: 4% of donors to tiny organizations are already giving monthly

So, let’s do a simple calculation on the back of a napkin here.

You plug in the number of donors who’ve given in the last 12 months.

Multiply that number by the conversion percentage you’re thinking you might reach: say, 1%.

Then multiply that times your average monthly gift (which currently stands at $20 a month) times 12.

If you had 100,000 donors, using this illustration, you’d raise $240,000 from just those 1,000 (1%) who converted to monthly giving.

If the average gift for your donors is $50 annually (which is on the high side for most charities), the same 1,000 donors UN-coverted would have yielded just $50,000. Monthly giving conversion improved charitable income almost 500%.

I’d say you should be able to hire several people for that program and all you need to get started is one!

You could reach your goal of 1% in less than a month if you only focused on it, I can pretty much promise. So what are you waiting for?


!!!!!!!!! Terrible Monthly Donor Decision 2: Letting your finance person run your fundraising department.

Believe me, this is really scary stuff! This is a real story and I just keep shaking my head. It’s amazing this organization is still in business.

Huge organization Y mails millions of pieces a year and has several hundreds of thousands of direct mail names and thousands of email names. They have the recurring giving option set up on their web site.

So, the donor says yes, make this gift recurring, fills out her credit card information and hits submit and expects her monthly donations to start.

Well, whomever it was that was wearing the finance hat and should have never been hired to be in that department, told the Fundraising Department that this particular activity “does not count as a monthly donor commitment”.

And the worst part is, the Fundraising Department listened to this ‘idiot’.

They were told to call this donor and ask her for her credit card information again and only then is she considered a monthly donor.

Well guess what? Of course you’re not going to reach everybody! And those you do reach will be totally ‘sketched out’ as my son would say.

Why would I give you my credit card information over the phone if I just did it online? What part of my donor intent did you not get?

So, this organization just lost the few monthly donors they could have. Set up your monthly donor option online and process the donor’s monthly gift. That’s what she wants you to do! And please hire another finance person so you can really start raising some money!


!!!!!!!!! Terrible Monthly Donor Decision 3: Being too greedy and asking too high.

Organization Z was interested in monthly giving and they had the process for monthly giving in place. So far, so good.

But then, they started getting greedy and got some bad advice (not by us, mind you!).

Someone had told them that they should start at the same level of the typical donor’s gift, $50.

So, they sent an appeal asking for $50 a month (and no alternatives). The appeal did poorly and they could not understand why the donors were not joining the program.

When we looked at it, that was the first thing we noticed. Never make the first ask the same as the average gift. That is simply too high. You cannot expect a donor to go from $50 a month to $600 a year.

Rather, start by using one third of that amount or go even lower. The key with monthly donor acquisition is to generate monthly donors and upgrade them later.

Think about it this way, if you ask the $50 donor for $15 a month, you’ve now upgraded her to $180 a year and you just increased their retention rate multifold. Sounds pretty good in my book!

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Sign up for my blog so you’ll receive future posts on monthly giving and tools as they’re developed.  And if you’re interested in finding out how to start or grow your monthly giving program, just contact me! 

And be sure to check out the new Monthly Giving Help Line where we can discuss specific questions you may have for your organization. It only takes one extra new monthly donor to pay for it! You can’t beat the price.