Individual donors are an important part of every nonprofit’s fundraising portfolio. According to Giving USA, 71% of charitable giving in the United States comes from individuals; if we count bequests, that number rises to 80% (with foundations and corporations making up the remainder).
It therefore makes sense to think not only about how to acquire new major individual donors, but also how to cultivate your relationships so that your current donors keep giving, and give more over time. In this article, we’ll focus on one way of developing a large pool of loyal major donors: the donor club.
Donor clubs serve two main purposes: first, they serve as a donor recognition society, allowing you to show appreciation to your biggest donors. Second, donor clubs provide an incentive for donors to increase their giving and keep it at a certain threshold year after year.
According to a recent survey conducted by American Philanthropic, LLC, among organizations with an annual revenue of $1.5M or less, those that have a donor club and consider it an important part of their fundraising efforts have an average per-donor contribution level 49.6% higher than that of the rest of the organizations surveyed. In other words, donor clubs increase your average per-donor contribution.
The good news is that starting a donor club is very simple. Here are 7 steps to get you started.
1. Give it a name.
The name can be generic or particular. Think about your organization’s mission and important figures connected to your work and give it a name that your donors will recognize. Some made up examples to get you started: The President’s Circle, The Herman Melville Society, Friends of Greenwood University, The Hyde Park Club.
2. Think about the levels and structure.
The levels of your donor club will vary based on your current donor pool, but a good starting point may be $1,000-$2,500 for the lowest level. You can build four or five other levels according to what makes sense to your organization, with the highest level including $25,000+, or $50,000+ donors. Each level should have a name, and these can be generic or creative.
3. Define benefits.
Each level of the donor club should have benefits with which you will recognize your major donors. It is important that benefits be realistic. Do not create excessive make-work for your organization, and don’t make promises that you won’t be able to keep. Keep benefits simple but substantial, giving greater benefits as you move up the levels of the club. A sample club layout could be:
- Blue Circle: $1,000-$2,499 – A mug and certificate of membership from your organization.
- Red Circle: $2,500-$4,999 – Benefits above, plus an invitation to annual conference.
- Green Circle: $5,000-$9,999 – Benefits above, plus a quarterly insider update letter from the president.
- Orange Circle: $10,000-$24,999 – Benefits above, plus an invitation to annual board meeting.
- Purple Circle: $25,000+ -- Benefits above, plus private, personal consultations with your organization’s leadership.
The benefits above are easy to implement and do not require a whole lot of extra work.
4. Create collateral material.
The donor club should have its own aesthetic, similar to but different from that of your organization, so that donors know they are part of a special group. Come up with a logo and letterhead for the donor club, and use it on correspondence materials with members. Create a one-page flier that outlines the levels and benefits of the donor club that you can use to introduce potential members to the club.
5. Introduce your donors to the club.
Send an introduction letter welcoming as charter members all donors who fall into the club by virtue of their past year’s giving, and an invitation letter to donors you hope will join the club (If your donor club starts at $1,000, invite all donors who have given $100+ or $250+ in the past year).
6. Implement the benefits.
Make sure that you keep your word and provide all the benefits you said you would to members of the club.
7. Keep growing the club.
Periodically invite donors to join the club and current members to either renew their membership or upgrade to the next level.
American Philanthropic provides strategic consulting and fundraising services for nonprofits, including helping nonprofits design, implement, and manage donor clubs that leverage their strengths and draw supporters more closely into the life of their organizations. Learn more at AmericanPhilanthropic.com.