Strengthening donor relationships with limited resources

Let’s say a friend gives you a box of chocolates on Valentine’s Day. If you send her a note with a handwritten message as a thank-you, she’ll likely realize just how much her box of chocolates meant to you. She’d probably consider giving that gift the following year, too.

The same goes for donors. Each donation your nonprofit receives is an expression of support for your mission and should be treated as such. Just like a gift from a friend, that donation deserves a notecard, a phone call or a highly personalized email to let the donor know that you value their gift.

However, for many organizations, limited resources strain their donor relationships. Especially since individual giving is declining with a decrease of 2.1% in 2023 when adjusted for inflation, nonprofits must figure out how to make the most out of the least and offer unforgettable donor experiences that keep them around. In this guide, we’ll explore the importance of donor relationship management and how your organization can maintain strong relationships without depleting your budget.

Why does donor relationship management matter?

It may seem obvious that creating and maintaining strong relationships is important because donors are so vital to your organization’s work and success. However, donor relationship management is essential for a variety of other reasons, too.

eCardWidget explains that recognizing donors and building strong relationships with them is crucial because it allows your organization to:

• Stay top of mind for donors. Think about how many emails you receive each day. When you stay in touch with donors and properly thank them for their contributions, you’ll cut through the clutter and remind them of your organization’s work and their passion for your cause.
• Increase donor retention. Did you know that the one-year donor retention rate for 2023 was 44%, meaning less than half of donors from the previous year made a donation again the following year? Donors who feel connected to your nonprofit are more likely to stick around and continue showing their support.
• Encourage donor upgrades. If donors feel valued by your organization, they may be willing to upgrade their support to make a larger impact and give back to your cause in a more substantial way.
• Acquire new donors. In addition to retaining and upgrading the donors you already have, forming strong donor relationships encourages your supporters to spread the word about your nonprofit and recruit their friends and families to contribute as well.

Above all else, taking the time to bond with each individual supporter transforms them from mere givers into integral members of your nonprofit’s community who are around for the long haul.

How can nonprofits strengthen donor relationships with limited resources?

Despite its many benefits, donor relationship management can be a challenge, especially when resources are scarce. Let’s explore several strategies to help you create personalized, engaging donor experiences that align with your budget and organizational capacity.

1. Create a stewardship matrix.

In today’s hyper-personalized world, where Amazon knows what needs restocking in the pantry, Netflix recommends just the right title for family movie night and Facebook reminds you that you looked at a pair of fur-lined boots once, donors expect more than generic solicitation letters or calls.

Nonprofits must evolve beyond current models in which they only treat the top few donors as friends and, instead, find ways to give each donor the personal attention they deserve. 

The solution? A donor stewardship matrix.

Aly Sterling Philanthropy’s donor stewardship guide defines a stewardship matrix as a resource that “maps out your different outreach strategies and when you’ll execute them.” That way, you can organize your donor stewardship plan and match donors’ contribution sizes with appropriate recognition strategies.

Here’s a sample of what one might look like:

For example, you may plan to send small donors a personalized thank-you email, give mid-level donors branded merchandise and feature major donors on your donor wall. While these appreciation methods increase with donors’ contribution sizes, each strategy still demonstrates your gratitude for donors’ support. A matrix helps streamline the stewardship process so no donor gets left behind, opening up the potential for deeper relationships—regardless of donation size.

2. Implement low-cost appreciation strategies.

Recognition doesn’t have to be costly to be effective. Fortify your donor relationships while keeping expenses low by opting for low-cost appreciation strategies like:

• Thank-you emails. Even if you don’t prioritize donor stewardship as part of your overarching fundraising strategy, you likely send thank-you emails after donors contribute. With an email marketing platform and appropriate template in place, thank-you emails are easy, effective and inexpensive.
• Social media shoutouts. Leverage your social media presence to thank donors for their support on a larger scale. Create general appreciation posts after your fundraising campaigns wrap up, and consider featuring individual donor spotlights for more meaningful recognition.
• Newsletter mentions. Add some pizzazz to your regular newsletter by starting a donor-of-the-month feature. Each month, you can select a donor and interview them about their experience supporting your nonprofit. Then, you can publish snippets of your conversation in your newsletter to highlight individuals within your community.
• Phone calls. A good old-fashioned phone call can go a long way to show donors you care. Plus, you can make donors feel special without breaking the bank.

Experiment with these strategies to see which your donors best respond to. For instance, if you have a younger audience, social media shoutouts may be a hit, whereas older donors may appreciate receiving phone calls from your organization.

3. Leverage automation.

Sometimes, it can be difficult to personalize donor communications in an efficient manner. Automation helps you customize communications at scale and speed up the process so you can deliver better supporter experiences with a very low lift from your team.

For instance, you may leverage automation to:

• Trigger thank-you emails immediately after donating.
• Add personal details to emails, like donors’ names, donation sizes and involvement history.
• Follow up with donors based on actions they take on your site, like reading a blog post or downloading a resource.

With automation, your nonprofit can save time and forge stronger relationships through quick, personalized messages.

4. Offer additional engagement opportunities.

Keep donors involved in your cause by offering additional, nonmonetary engagement opportunities. Instead of immediately asking donors to give again after they just contributed, consider encouraging them to participate in:

• Volunteer outings. If donors are already passionate about your cause, they may be willing to lend a helping hand and become volunteers. Remind them to explore their employers’ volunteer grant and time off programs to maximize their impact.
• Advocacy work. Have interested donors spread the word about important issues relating to your cause via social media, canvassing, petitions and more. Advocacy often feels empowering and helps donors become more active members of your community.
• Campaign or project planning. Let’s say you’re preparing for an upcoming capital campaign. You may invite donors to participate in your feasibility study so you can get their feedback on your case for support and campaign plan.

Even if donors only contribute once a year, involving them in other areas of your organization can increase the value they provide to your nonprofit and help them feel genuinely involved in your community.

While these tips can help you make the most of your resources, you may need additional support to analyze your organization’s specific needs and goals. Consider partnering with a nonprofit consulting firm to create a donor relationship management strategy tailored to your organization.

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