What Is Donor Stewardship?

Donations are a significant part of any nonprofit’s funding, but did you know there is an easy way to increase nonprofit donations? By following the practices of good donor stewardship, your nonprofit can ensure even more donations in the future. So, what is donor stewardship and how can your nonprofit practice this technique? In this article, you will learn the answers to both of those questions.

Donor Stewardship Defined

Donor stewardship is the process of creating a connection (and nurturing that connection) with any individuals who have donated to the nonprofit, regardless of the donation’s size. This term is often used interchangeably with donor relations, but there is one clear distinction. Donor stewardship focuses specifically on relationships with donors after they have donated. Whereas, donor relations is the entire donor process, including reaching out to potential donors. Many people spend so much time marketing and trying to attract new donors that they miss the opportunity to increase donations with the donors they already have.

Current donors have already shown an interest in your nonprofit and share a passion for the work you are doing. This makes them more likely to donate again, but that doesn’t mean you don’t need to reach out to them. Donors are often times looking to find a relationship with one nonprofit that they feel as though they can trust. Donor stewardship is how nonprofits can show current donors that their organization is worthy of their continued donations and time, which will increase overall donor loyalty to your organization.

How to Practice Good Donor Stewardship

There are many ways that a nonprofit organization can follow the principles of donor stewardship. Today, GrantNews is listing a few of these ways below in hopes that your nonprofit can increase its donor loyalty.

1. Acknowledge Your Donors 

The first and most important step in donor stewardship is to acknowledge your donors. There are many options for how your nonprofit can do this. The key is to showcase how their donation has helped your nonprofit and how grateful you are for them. Try sending a personalized thank you card or maybe give them a call to directly share your gratitude.

Acknowledging your current donors will increase your retention potential. In turn, increasing the lifetime value of each supporter. Providing your donors with a meaningful interaction will motivate donors to give again. Be sure to thank your donors no matter the size of the donation. Also, it is imperative to thank your donors in a timely manner. Update your donor data regularly to reflect all new donors to ensure that all supporters are contacted. Keeping real-time tabs on where each individual sits within the donor journey is a critical piece in building relationships that last.

2. Identify What Motivates Your Donors

Once your initial exchange is complete, it’s important to discover what event or conversation motivated this donor to give. Knowing how often a donor is engaging with your cause is a strong indicator of how connected they feel to your mission. Libby Hikind, the founder and CEO of GrantWatch, recommends that you begin by defining donor categories; such as first-time donors or recurring donors, and then set up giving levels. Research how many current donors have the potential to become major donors. Set aside time for meaningful exchanges outside of donation appeals. When your team is interacting with patrons, encourage them to ask questions like, “How did you hear about our nonprofit?”. This will strengthen your donor engagement and guide you in the right direction.

3. Develop an Outreach Strategy

A well-managed outreach plan will include offering your donors volunteer training and using strategic marketing. Update your nonprofit’s supporters outside of your planned communication strategy to keep donors in the loop. Include numbers, statistics, quotes, and visuals to communicate your gratitude for all donations. you can achieve this through quarterly, bi-annual, or annual reports. In return, your loyal donors will know just how much of a difference their generosity makes. This feeling of belonging to a cause goes a long way in engaging with donors and receiving recurring donations.

Businesses perform audience segmentation research. Your nonprofit organization can follow their lead. Start this research by first defining donor categories. Then, create ways to initiate thoughtful conversations with your supporters. Do this by sending regular newsletters or posting videos on your social medial platforms.

Every donor has a special connection to your mission. Understanding that connection is essential to increasing your retention rate and ensuring that donors support your initiatives with further donations.

4. Increase Donor Engagement

Always keep your donors engaged. Organize charity dinners, sports tournaments, exhibitions, auctions, and other events to which you can invite your donors. Offer the chance for them to volunteer with an upcoming project. Donors want to feel like they are part of your organization. So you should create an environment where their involvement extends beyond making donations.

Nonprofit organizations have to meet donor expectations, just like a business would with its customers. This is why the previous step is so important because by communicating with your donors, you will be able to see what kind of expectations they have for your nonprofit.

5. Do What Works For You

Every nonprofit aims to increase donations through donor stewardship, but make sure your plan is sustainable. Remember that you know your donors best. There is no one-size-fits-all approach to crafting an effective donor stewardship program. Do not take on more than your nonprofit can handle. Think about how you would like to be acknowledged as a donor if the roles were reversed. It can seem overwhelming to create the perfect plan. However, it should be as simple as treating others how you’d like to be treated. Be intentional about each opportunity to strengthen donor relations. Commit to connecting with donors through planned and unplanned communications. Above all, find the donor stewardship solution that your nonprofit can maintain.

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