The High Cost of Donor Acquisition: the Fundraisers Conundrum

Randy McCabe October 23, 2014 Nonprofits

Would you spend $1 to get 25 cents? This is clearly not a sound investment formula; in fact, in many other environments you might reject the idea and move on to another option.

But seasoned fundraisers know that the key to growing your donor base is “investing” to find new relationships you can nurture from a one-time, often relatively small donation into a relationship that yields multiple gifts over multiple years.

The key to turning that investment into a relationship is to “convert” a first time giver into a donor who gives a second gift quickly. Our experience over the last 30 years has shown that if you can get a second gift from a first time donor within 2-4 months, there is a 50% chance that donor will be a long-term or multi-year donor – which is where the donor acquisition investment turns into a valuable relationship. So, the big question is how do you get the second gift?

1. Send your “thank you” letter within 3-4 days of receipt of the giver’s first gift. This affirms that they are a valued supporter of your cause.
2. Call as many new givers as possible, those who gave $50 or more for sure. Use an in-house call center, perhaps staffed by volunteers, trained by development staff. This call is only to say ”thank you”, not to ask for another gift
3. If the first gift came via your website or an email response, send them an immediate “thank you” via email.

Timely response to new givers is the primary factor in developing an initial relationship, and encouraging a long-term financial relationship with these new friends.


About the Orange Leap Donor Lifecycle Blog: Tom McCabe helped to coin the term “relationship fundraising” in the 1970’s as he began applying relationship development principles across multiple channels of fundraising for nonprofit organizations. As a founding partner of fundraising agency KMA, over the last 40 years Tom helped to orchestrate the expansion of hundreds of critical causes worldwide. Now retired from KMA, Tom still chooses to spend his time serving worthy organizations, and can be reached at tom@mccabe-partners.com.