What is the perfect way to reactivate a lapsed donor? For starters, you have to consider how long after a donation you’ll wait before classifying a donor as “lapsed”. Also, all lapsed donors aren’t made equal; some are major donors, volunteers, or micro donors.
Reactivating a complex group of individuals like lapsed donors is a challenging task but an absolutely essential one. Lapsed donors present a significant opportunity for fundraisers as 71% of donors don’t donate to the same organization twice. This means that the majority of your donor base will be lapsed donors.
In this article, we’ll discuss everything you need to know about reactivating lapsed donors and why it’s important. Here’s a full outline:
What is a Lapsed Donor?
A lapsed donor is someone who donated to your organization but has not done so again for a significant amount of time. For most organizations, if a donor has not donated for 365 days, they would be considered lapsed.
There are a few reasons that donors may stop giving to an organization:
- Poor stewardship: If an organization hasn’t properly demonstrated that it values its donors’ gifts and spends funds wisely, donors may begin to feel that their giving isn’t meaningful. This is why investing in donor stewardship is so important.
- Change in personal capacity: A study found that 22% of donors stopped giving because they experienced a change in their personal capacity to give. A change in personal capacity can be characterized as a financial loss, geographic relocation, or career transition that leaves a donor unable to give.
- Change in priorities: What donors consider important can change at any time. This can be because they’re focussing on a different cause or even because they’re saving up for a new jetski. It can be quite difficult to reactivate a donor who has actively decided to stop giving.
- You haven’t asked: Put simply, if you don’t ask for a donation, you probably won’t get one. So, it’s important to send appeals regularly and ensure your donor communications have reached your contacts.
While we consider these donors, who stop giving for these reasons, lapsed, they’re not completely lost.
Reactivate Donors With FREE Thank You Letter Templates
Saying “thank you” is a vital part of a nonprofit fundraising strategy. Use these templates to reengage lapsed donors and let them know they made an impact.
Why Reactivating Donors Is Important
In 2021, donor retention dropped 7% from the previous year. This downward trend is expensive for nonprofits because they can’t afford to lose more donors than they gain in a given year.
However, it’s not all doom and gloom when it comes to donor turnover. A study found that 12.4% of lapsed donors are eventually reactivated. This percentage means that your lapsed donors present enormous potential, and there’s plenty of room for nonprofits to improve their reactivation rates.
Additionally, asking someone to donate again requires far fewer resources than acquiring a new donor. This is simply because former donors already have a meaningful connection to your cause and are easier to connect with. Contrarily, you need to invest considerable resources to find new donors.
How to Reactivate Lapsed Donors
In order to reactivate a lapsed donor, you need to address the reasons they left in the first place. While you probably can’t impact their personal capacity to give, you can regularly improve your donor stewardship and send targeted appeals.
After you lose a donor, you can’t go back in time and improve your donor stewardship. But, you can reach back out to them and ensure that they receive great stewardship going forward. This begins with you reaching out; either with an email, phone call, or invitation to meet in person.
Depending on the donor, your approach should be different. For example, a major donor will require lots of attention while a micro donor may only require an email. Below is how you reactivate major donors and micro donors.
Reactivating major donors
Major donors take more time to cultivate, and the relationships you build with them are much more personal than relationships with smaller donors. So, you’ll need to put in a little more work reactivating these donors. To start, we suggest setting up a one-on-one meeting with a major donor, or a phone call if a meeting isn’t possible.
When re-engaging a major donor, you should focus on aligning your nonprofit’s objectives with theirs. Moreover, you need to approach major donors with a clear reason for why they should resume their funding.
Also, It can be very helpful to learn why a donor has lapsed without making them feel guilty for leaving. Often, a major donor will have outlined the terms of their previous gifts, making it clear when their funding will have ended.
However, if you’re unsure why they’ve stopped giving, find an appropriate time to ask, “It’s been a while since we last chatted. How are things with you?” This leaves the conversation open for the donor to tell you why they haven’t donated, but doesn’t make them feel guilty.
Additionally, when winning back lapsed donors, it’s important to remember that you’re asking them to continue their support and this can come in many forms. For example, their support could come in the form of introductions to other high-net-worth individuals, volunteering, or even links to corporate sponsors.
Here are some ways you can rekindle your connection with major donors:
- Offer them a site visit
- Send them a personalized impact report
- Ask how you can align your social objectives
- Add them to a “donor wall of fame”
- Send a handwritten letter
- Invite them to meet your team, volunteers, or beneficiaries.
Download a FREE Donor Profile Template
Keeping track of donor data is essential to effective fundraising. Use this template to record and track important information about your major donors and prospects.
Reactivating minor donors
The average retention rate among donors who give under $500 remains below 38%. However, with some help from email automation, you can increase your retention rate. Here’s a simple formula for a personalized lapsed donor letter:
- Start by saying thank you for all they have contributed
- Describe the positive impact they’ve made on your organization and beneficiaries
- Provide a donation link or other call to action
- Finish saying thank you again
This lapsed donor letter outline shows the donor that they are valued and that you would love to have them back.
Additionally, for these smaller donors, it’s not always necessary to ask them why they left. By asking, you risk alienating them and discouraging a follow-up donation. Instead, focus on the reasons they would want to give again.
Your goal is to help rekindle the connection the donor had with your organization. One great way to do this is by segmenting your lapsed donors by the impact area they previously contributed to. By asking each segment to give to an impact area they’re already passionate about you can increase your chances of piquing their interest.
Building a Lapsed Donor System
A process helps you progress!
If you don’t have a lapsed donor management system in place then your re-engagement methods will be sporadic and inefficient. Creating a process for managing lapsed donors helps you to be proactive in retaining donors and recapturing lapsed donors.
Reactivating lapsed donors with KIT
Fundraising KIT is a donor insights and fundraising reporting tool powered by artificial intelligence that identifies opportunities in your CRM database. One of KIT’s newest features is its Donor Lapse Potential prediction.
Prevent Donor Turnover With KIT
Using KIT, you can enrich your fundraising data with the Donor Lapse Potential prediction. Book a demo today to learn how to take your fundraising to the next level.
This prediction analyzes donation history, interaction, and demographic data to identify trends that signal a donor who is at risk of lapsing.
For fundraisers, this prediction can be used to identify and prioritize high-value donors who are at risk of lapsing. With this prediction, you can confidently invest your time and resources in retaining your most valuable donors.
KIT integrates seamlessly into your pre-existing CRM to provide accurate insights, actionable predictions, and a host of reporting tools.
Don’t let that 71% of donors be ‘the ones that got away! Consider the strategies listed above next time you reach out to your former donors. With an efficient lapsed donor reactivation strategy you can recapture lost donors and rekindle their passion for your mission.