A few years ago, there were not many charities offering monthly giving. Other than child sponsorship, it was a relatively new concept for charities, and for donors as well.
Times are changing though. Monthly giving has now become an important part of many organization’s marketing strategies.
As we respond to an aging donor base, the need to diversify our income and the need to reach younger donors, monthly giving has been increasing in popularity.
Last year, CauseVox saw an 18% increase in recurring giving (with similar results corroborated by the 2019 M+R Benchmarks Report) and it is expected to continue growing.
So, if you’re still unsure if it’s right for you, here are 6 reasons why your organization needs a regular giving program.
1. Monthly Giving Helps You To Plan and Budget
Unlike one-time giving, monthly giving can help provide a more predictable annual income.
And, in a time of economic instability, having predictable income is immensely valuable for your organization’s budget.
By looking at your existing regular giving database, and their average gift, you should have a very clear idea of how much revenue you will generate throughout the year.
You will need to take into account attrition and acquisition but this stability in income can help you plan and budget accordingly.
While one-giving isn’t as predictable, it may still be the preferable way to give for some donors – particularly high value donors and online donors. Regular giving should therefore be considered just one part of your organization’s portfolio.
We recommend targeting a specific group of donors to become one-time donors:
- Donors who have given once a year, for the last two or more years.
- Donors who recently made a smaller one-time gift.
- Donors you acquired during year-end (to help support throughout the year).
- Donors who have strong ties to a particular program (think program alumni, former staff, etc) that are poised for ongoing support.
- Donors 35 and under.
You don’t necessarily need to ‘name’ your monthly giving program, however if you’d like some ideas see 4 Unique Recurring Donation & Monthly Giving Program Examples
2. Monthly Giving Can Be More Convenient For Donors
Monthly giving is an attractive method for donors, as it doesn’t require any ongoing effort to make a donation.
Their donation is automatically deducted from their account every month, and it can be a “set and forget” way for them to contribute to your cause.
It is also more affordable for some donors – instead of giving one, large cash gift a year, they can break their donation down into smaller, monthly amounts. This may make it more manageable on their personal budgets.
3. Monthly Donors Have The Best Retention Rate
Simply put – monthly donors stick around for longer. While they may be smaller in volume, at least to begin with, they have a better retention rate than cash givers.
The retention rate of recurring donors is 90% (Bloomerang) so even though they may cost more to acquire, they are your best donors.
In comparison to a 46% retention rate for one-time donors, when you acquire recurring donors, you double your retention rate. That makes a huge impact on how much you raise throughout the year and for years ahead.
To help you acquire more recurring donors, it’s essential to have a monthly option on your donation page on your website.
But, you want your recurring giving technology to work for you, helping you to increase retention rates.
CauseVox helps you keep your recurring donors with email automation whenever a payment fails, prompting your recurring donor to update their card on file.
4. Monthly Donors Give More
Even when a donor is returning to give once a year, their gift amount may not be as high as the overall annual revenue from a recurring donor.
In fact, recurring donors give up to 42% more than annual returning donors (Network for Good) – so while the average gift for a cash giver might be higher, your recurring givers actually give you more throughout the year.
And it’s easy to see why:
Let’s say Sally goes to your donation page and clicks on your donate button. Your first one-time donation tier (suggested level of giving) is $30, but your first recurring donation tier is $10.
Sally, while she initially intended to give once, sees the option to give $10/mo to provide ongoing support. It’s less money out of her pocket at the moment, and she’s excited about what you’re doing, so she chooses to make a $10 recurring donation instead.
You’ve just increased Sally’s gift size 4x times over the course of a year, with no more effort required on Sally or your organization’s part.
The recurring donor typically gives more and sticks around for longer, which means they have the best lifetime value for your organization. So what are you waiting for?
With CauseVox, you’re able to tailor your one-time and recurring donation tiers so that you can drive more recurring gifts at the right price point.
5. Monthly Giving Is Attractive To Millennials
As it is considered more affordable to give small amounts every month, recurring giving is potentially a great way to engage younger donors.
The Millennial Impact Report found that 52% of Millennials are interested in monthly giving as a means to give back in a meaningful way.
However, keep in mind that if your recurring donation process is clunky, you’ll be less likely to convert this group as well.
75% of young donors are turned off by an out-of-date website.
So, in order to capture these young recurring donors, you’ll want to make sure your donation page is updated and easy to use, especially on mobile.
CauseVox Donation Pages are mobile-optimized, offer mobile payment options, easy recurring donation tiers, and can be embedded right onto your website. Set up your own recurring donation page.
6. You Save Time And Effort With Monthly Recurring Giving
There’s a number of ways your organization benefits from recurring giving:
- Save time and money on donor acquisition costs, like advertising and direct mail. With automatic recurring payments, you don’t need to send as many solicitation appeals and spend as much to attract new donors.
- Automated emails for easy management. With CauseVox, we do all the heavy lifting for you: automatically sending monthly donor receipts, rescue emails for lapsed donors, and convenient links to help donors manage their own recurring donation – whether they need to change the amount, update their card, + more
- Easy donor management. CauseVox helps you keep track of all your recurring donors with donor profiles, helping you monitor recurring giving growth, engage with donors, and identify potential recurring donors.
Even when you engage a recurring donor, keep in mind that this is not the end. We recommend:
- Continuing to ask recurring donors for an additional one-time gift once or twice a year – at key times such as a matching campaign or at our end of year appeal.
- Sending monthly email updates just to recurring donors to keep them in the loop on how their organization is making an impact.
The one-time donors who become a monthly recurring donor are the holy grail – they have the best retention and the best lifetime value of any donor group.
And now more than ever, you need stability and predictable fundraising income at your organization.
Run Your Monthly Giving With Less Hassle On CauseVox
You can easily set up monthly giving with CauseVox Donation Pages.
CauseVox is the easiest way to acquire, manage, and retain recurring donors with less effort.
So what are you waiting for? Get started for free today!