The donor churn report: How to change the conversation in your board room from financial results to fundraising strategy – in one page!

publication date: Mar 17, 2015
 | 
author/source: Lelia MacDonald

Leila MacDonaldIs your board more comfortable reviewing accounting statements than your fundraising results? Does your board spend a lot of time talking about reducing expenses and very little time talking about fundraising strategy? If so,you may want to consider displaying your fundraising results in a language that your board is more familiar with.  

Inspired as the marketing equivalent to a cashflow statement, a donor churn report takes about 3 hours to prepare and succinctly outlines the strength of your fundraising programs – all in one page!  

Start with measuring your donor churn

Churn is the percent of your donors who choose not to donate again.  A donor churn report displays the churn within each revenue stream and answers important questions like: Are some donors more loyal?  Are some donors disappearing? Are you making real progress or are you swimming fast to just stay in the same spot?  Up to now, if your board has been comparing balances from last year end and this year end, they may not understand the nuances within each revenue stream.

Just like a cashflow statement, the donor churn report shows a beginning balance of donors who left, who renewed, and who are new. In the example below, the board might conclude that corporations and foundations are equally loyal. Yes, both portfolios started and ended the year with 20 donors each.  But, the corporate portfolio experienced major churn (and staff time) while foundations were quite loyal and used less time.  This report can help convince your board how they can help and which fundraising channels are the best use of limited staff time. 

Donor Churn Report

Revenue diversity between streams?

Multiple revenue streams reduce overall organizational risk. How dependent is your organization on any one source? It is also useful to compare the revenue from each stream with the percentage of staff time required to raise the same amount of money and if there is a correlation between the two.

Revenue diversity within a stream?

How concentrated is each revenue stream?  Compare the average donation sizes (bottom rows).

  • How exposed is the organization if a major donor does not renew? How and when might your board be able to support staff to either cultivate that donor or bring in new ones?
  • What is the definition of major gift for your organization. Is the $1,000 threshold appropriate or should you lower it (eg to $500) to give more donors individual attention?
  • Do some donors have a higher “life time value”, eg monthly donors with automatic withdrawals vs annual donors where it is easier to disappear.
  • Are you more successful asking corporations to donate (eg employee matching program) or to sponsor you (eg logo to increase their profile).

Is your organization better at acquiring new donors or keeping existing donors?

Donor acquisition means: finding new donors.

Donor retention means:  keeping your existing donors,  upgrading existing donors and converting in-kind donors into monetary donors.

A donor churn report has the potential to change the conversation in your board meetings. It is also a very useful tool for senior management to use to inform your fundraising strategy. If you want to create your own Donor Churn report, take a look at this 4 minute how-to video and get started today. 

Lelia MacDonald is a Volunteer Consultant with MAS - a pro bono consulting firm whose mission is to build capacity in the non-profit sector. Lelia has created a website for Directors, senior management and marketing volunteers that with more resources for marketing nonprofits.  Lelia is interested in the art and the science of marketing.   

 



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