What are sustaining gifts?

Sustaining gifts (also known as recurring gifts) are fixed donations that occur at pre-defined intervals of time. In the U.S. most nonprofits use monthly intervals, while outside of the U.S., the models are more varied and include quarterly or biannual options.

Donors who favor sustaining gifts are referred to as ‘sustainers’ and they represent an extremely valuable donor segment due to their lifetime value and the consistent revenue they bring in for the causes they support. While growing the number of sustainers is a priority for most nonprofit organizations, Animal Welfare, International Relief, Children’s orgs, and public radio & TV are especially good at attracting sustainers.

Unicef is transparent with how funds from monthly donations can help children around the world.

What are the benefits of this giving model?

There are many benefits of sustaining gifts:

• Having a predictable stream of donations at a set time means it’s easier for nonprofits to know how much money they bring in monthly or annually. Many nonprofits expect the majority of their fundraising would come in December, which is very stressful and makes it hard to allocate budget and set goals throughout the year. NonProfitPRO reported that the average sustainer gift is between $24 and $36 a month.¹ Sustaining donations take some pressure off the Q4 crunch and the predictability is also helpful for forecasting. Sustainers have an average retention rate of 90%², which means nonprofits that have a good number of sustainers can forecast future revenue far more reliably.
• Sustainers tend to make more substantial gifts over time, moving them to mid-level or major gift stream donors. The State of Modern Philanthropy report found that sustainers are worth 5.4X more over their lifetime than one-time donors.³ One-fourth of sustainers will make another annual gift on top of their recurring donations and they are also more likely to fundraise, buy event tickets, and volunteer.⁴
• Long-term givers tend to be more engaged and more likely to recruit others to support your cause. Studies have found that 92% of all people trust a word-of-mouth recommendation over any other kind of marketing⁵, so having dedicated sustainers talking up your cause is a significant bonus.

What motivates sustainers?

Sustaining gifts are on the rise as donors become more acclimated to subscription formats in their everyday lives – such as Amazon Prime, Netflix, weekly food delivery services or monthly makeup/apparel/décor/pet product subscription boxes. It is also more convenient to make a recurring donation; automated deductions from credit cards or bank accounts let donors “set it and forget it.”⁶ In fact, 92% of Millennials and Gen Z-ers, both extremely desirable demographics, have active subscription services and automated bill payments.⁷

Our recent survey of over 1,200 donors supports that finding. We found that 48% of respondents aged 18-29 and 41% of those aged 30-44 report making monthly recurring donations, compared to 27.9% and 29.3% of donors aged 45-60 and over 60, respectively. Take a proactive approach to educating donors about sustaining gifts. Nonprofits are starting to include information on how to become a sustaining donor on their website, how sustaining gift funds are allocated and who they help each month, giving donors the option of signing up easily online and including an FAQ section for donors who need more information before committing.

The Animal Humane Society has an FAQ page dedicated to addressing sustainer questions and concerns.

How can you attract sustainers to your cause?

Attracting a particular type of donor is going to require a data-driven strategy. Nonprofits need to identify and target the audience most likely to become sustaining donors for their cause. Which means they need data on who their current sustainers are and the channels they are most responsive to. Data-driven tactics such as look-alike models and donor lead scoring to figure out who is most likely to give is the best way to increase sustainers. Let’s dig into what these tactics are, how they work and how to apply them.

1. Look-alike modeling

Look-alike modeling is an AI-driven process that uses data to identify donors who have similar demographic attributes and exhibit similar behavior to your current, high-value donors. Look-alike models allow you to:

• Identify your best existing donors
• Identify potential donors who “look like” your best donors and sustaining givers
• Reach these potential donors through a multi-touch acquisition strategy designed to engage and encourage them to donate

Armed with this knowledge, nonprofits can take their current sustainers and start targeting look-alikes in order to increase recurring gifts. However, for look-alike modeling to be successful, nonprofits need a good amount of data to learn from. Data Axle’s donor cooperative database boasts data contributed by over 1,000 nonprofit and political organizations, spanning millions of donors and billions of individual donations. This data is also overlaid with Data Axle’s reputable third-party data which gives nonprofits further insight into demographic and psychographic characteristics of both individual donors as well as donor households. This breadth of information means more accurate modeling and more effective fundraising and donor acquisition programs.

2. Donor lead scoring

Lead scoring is a methodology used to rank prospects in terms of how valuable they might be to the organization. The ‘score’ is used to determine how likely that lead is to further engage with the company, in order of priority. Lead scoring shouldn’t just be the realm of retailers and big corporations. Nonprofits can use it in their acquisition efforts as well. A Marketing Sherpa survey found that companies using lead scoring processes increased their lead gen program ROI by 77%.⁸ There’s no reason for nonprofits not to adopt lead scoring as they consider how to allocate valuable resources.

Lead scoring for nonprofits is unique. When scoring a lead, the key areas to take into consideration are:

• Is the donor willing to give?
• Is the donor able to give?
• Has the donor interacted with the nonprofit before?
• Does the donor have similar firmographic or demographic characteristics to the nonprofit’s current sustaining or high-value donors?

This is an example of a lead scoring model from the Institute of Direct and Digital Marketing.

Once leads are scored, nonprofits can develop a strategy to reach out to them in a meaningful way. For example, we know that young donors are more likely to become sustainers, so it could be beneficial to score them higher when launching a sustaining gift campaign. Nonprofits need to nurture and lead high-scoring leads down the path to donation. Nonprofits can work with a solutions provider, such as Data Axle, to help automate lead scoring and optimize the donor acquisition process.

Conclusion

Sustainers are high-lifetime value donors who are committed to the nonprofits they support via recurring donations. They help nonprofits raise consistent amount of funds, meet their goals, and spread the word about the worthy causes they support. Research has shown that recurring givers have a 90% retention rate and are six times more likely to make a legacy gift, meaning to name a nonprofit in their wills. Utilizing data-driven strategies, such as look-alike modeling and lead scoring, allows nonprofits to target prospects who are likely to become sustaining donors.

Want to get started with look-alike modeling so you can increase recurring gifts? Contact us to learn more.

 

_{1 https://www.nonprofitpro.com/article/improving-donor-loyalty-with-a-winning-sustainer-program/
² https://www.nonprofitpro.com/post/new-industry-research-validates-importance-of-recurring-giving/
³ https://www.classy.org/blog/the-state-modern-philanthropy-report/
⁴ https://go.classy.org/reports/the-state-of-modern-philanthropy-2020
⁵ https://writersblocklive.com/blog/word-of-mouth-marketing-statistics/
⁶ https://www.nonprofitpro.com/article/improving-donor-loyalty-with-a-winning-sustainer-program/
⁷ https://www.subscriptiondna.com/blog/younger-americans-are-the-perfect-demographic-for-subscriptions/
⁸ https://ducttapemarketing.com/lead-scoring-roi/}