Donor Retention and Organizational Culture

Is Your Nonprofit Like Your Favorite Coffee House?

Keeping donors often seems like solely a matter of getting thank you letters in the mail and sending a newsletter frequently.  But there is much more to it, not least of all an organizational culture that nurtures its staff as well as its donors.

Shirley Sagawa and Deborah Jospin spelled out the core elements of a nonprofit like that in their 2009 book, “The Charismatic Organization:

8 Ways to Grow a Nonprofit That Builds Buzz, Delights Donors, and Energizes Employees” .

Charismatic organizations have personalities.  Rather than being bureaucratic and hierarchical, they are vibrant, highly visible, and inclusive. They draw people that are similar—employees, volunteers, and donors.

Sagawa and Jospin talk a lot about “social capital” in their book. Social capital is that ability to draw people in and attract friends. It is not so much lack of funds that cripple many nonprofits, these authors suggest, but the lack of this social capital, this charisma.

Download: http://studyfundraising.info/wp-content/uploads/2016/03/Donor-retention-what-do-we-know-abd-what-can-we-do-about-it.pdf

A charismatic organization is a bit like a good coffee house. People want to linger, they come back over and over again. It’s something about the atmosphere, the comfort, the people who congregate there.  In fact, the authors of “The Charismatic Organization” use St. Elmo’s Coffee Pub, a beloved coffee house in Alexandria Virginia, as a model for this special ambiance.

What are the characteristics of a charismatic organization?

Sagawa and Jospin say that these eight are important. Not all of the charismatic organizations they studied had all of these traits, but the best had a number of them.

  1. Mission-driven motivation
  2. Can-do culture
  3. Data-driven decision making
  4. Purposeful innovation
  5. People-focused management
  6. Compelling communications
  7. Active outreach
  8. Meaningful involvement

What does this have to do with donor retention?

Well, everything. Culture drives action, such as a penchant for customer service, saying thanks, and getting people involved in actions that matter.

One example these authors use is DonorsChoose, the wildly popular nonprofit that uses crowdfunding to fulfill the needs of individual teachers as they pursue their underfunded teaching efforts.

With DonorsChoose, even small dollar donors get feedback and ample thanking. When a specific project is fully funded, the teacher who asked for the funds takes photos of her students engaged in whatever activity was funded.  Notes and drawings are produced by the students, and the teacher writes her own thank you. All of that is sent to DonorsChoose, which then forwards it to the donor with an additional note from the organization. Donors can receive a dozen photos of happy children.

One large foundation officer told DonorsChoose founder Charles Best that a $100 donor at DonorsChoose gets more genuine thanks and feedback than he typically receives for a half-million dollar grant.

That is social capital in action.  A charismatic organization just builds in a system that keeps people engaged and feeling good and coming back for more.

There is a lot more to a charismatic organization. It starts with great leadership that is not afraid to hire excellent people and trust them to get the job done.  For a nonprofit, the end result is clients well served and involved donors and volunteers.

If your donor retention is not going well, it might be a good idea to take a look at your organizational culture, not just your procedures. 

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Categorized as Funds

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