5 Problems With Not Having a Donor Stewardship Plan

“It’s far easier to retain an existing donor than to acquire a new donor” is a comforting truth in the world of nonprofit fundraising. Yet, this is only the case if you do the right things in the way of nurturing existing donor relationships through an effective donor stewardship plan. A comprehensive and specific donor stewardship strategy is essential for any successful fundraising effort. It might seem like something you can constantly put on the back burner, but here are five significant challenges nonprofits encounter without a dedicated donor stewardship plan.

1. Increased Donor Attrition

Without a stewardship plan, nonprofits face higher donor attrition rates. Donors need to feel appreciated and informed about the impact of their contributions. Absence of consistent, meaningful engagement can lead donors to feel disconnected, prompting them to cease their support. Even worse, the only time your donors hear from you is with your hand out, again. Get your donors used to hearing from you in ways that are not solicitations. High attrition rates not only result in lost revenue but also necessitate additional effort and resources to attract new donors.

2. Missed Opportunities for Donor Upgrades

A stewardship plan is crucial for identifying opportunities to encourage donors to elevate their level of support over time. Without actively cultivating these relationships, nonprofits miss out on encouraging donors to increase their donations, opt for recurring gifts, or explore legacy giving. Engaging donors with personalized communication is key to uncovering their willingness and capacity for increased giving.

3. Working “Reactively” to New Gifts Coming In

One of the most significant problems with lacking a donor stewardship plan is the inefficiency and inconsistency it introduces to the donor acknowledgment process. Without predefined stewardship actions for different donation levels (e.g., $250, $1,000, $10,000, $50,000), staff may find themselves constantly trying to determine the appropriate way to recognize and engage each donor. This reactive approach is time-consuming and reduces the effectiveness of stewardship efforts. By having set rules for acknowledging and stewarding gifts of various amounts, the process becomes streamlined and efficient while still remaining personal, allowing for timely and appropriate engagement with donors.

4. Inefficiency and Inconsistency in Communication

In the absence of a stewardship plan, communication with donors can become sporadic and inconsistent, leading to missed engagement opportunities and potentially sending mixed or confusing messages. A well-defined plan ensures that all communication is consistent, timely, and aligned with the organization's goals, enhancing the donor's experience and engagement with the nonprofit.

5. Failure to Build Long-term Relationships

Neglecting donor stewardship fundamentally undermines the nonprofit's ability to sustain long-term relationships with its supporters. Effective stewardship is about more than just acknowledging donations; it's about fostering a continuous engagement loop that deepens the donor's connection to the cause. These relationships are vital not only for securing ongoing financial support but also for building a community of advocates for the organization.

Implementing a Successful Donor Stewardship Plan

To address these challenges, nonprofits should focus on developing a comprehensive donor stewardship plan that includes:

• Personalized Communication: Customize communications to reflect the specific interests and past support of donors, demonstrating the impact of their contributions. Think phone calls, emails, handwritten notes.

• Regular Updates and Transparency: Keep donors informed with regular updates on the organization's work, successes, and challenges. Information with no ask gets the donor used to hearing from you without wanting something from them.

• Recognition and Appreciation: Develop a structured approach to thanking donors that varies with the size of their gifts, ensuring meaningful acknowledgment across all levels of support.

• Opportunities for Engagement: Offer donors various ways to engage with the cause beyond financial contributions, including recognition events and volunteer opportunities.

• Feedback Loops: Establish channels for donor feedback to show how their input influences the organization's direction.

A strategic and well-executed donor stewardship plan is indispensable for any nonprofit aiming to maintain and grow its support base. By understanding and mitigating the problems associated with inadequate donor stewardship, nonprofits can enhance their relationships with donors, leading to a more stable and prosperous future for their cause.

Looking for help with your donor engagement plan? A majority of nonprofits don’t do the right things with donor stewardship, so even some small adjustments can really put you ahead of the pack! Reach out to us and we would love to see how we can help your nonprofit.