Donor cultivation is for more than just major donors, but this doesn't have to mean a lot more effort.
Donor Cultivation 101
What is donor cultivation and why is it important? How do you build a donor cultivation plan? We'll cover all of the basics you need to know to get started!
Whether you’re a new nonprofit looking to secure your inaugural donors or an established organization wanting to expand your reach, it helps to return to the basics of donor cultivation.
In this article, we’ll cover:
- What donor cultivation is and how it differs from donor stewardship
- Why donor cultivation is important
- 6 stages of effective donor cultivation plans
- 6 action steps to create your own donor cultivation plan
We’ll also leave you with a donor cultivation plan template to make getting started even easier!
What Is Donor Cultivation?
Donor cultivation is the process of identifying potential donors and building the relationships with them that inspire them to give to your nonprofit. Donor cultivation is closely tied to donor stewardship, which focuses more on maintaining those donor relationships once donors have given their first gift.
Donor cultivation can target a variety of individuals or organizations. For example, you may cultivate cohorts of small gift donors at a university or ask the CEO of a large corporation for a major gift.
Why Is Donor Cultivation Important?
There are many reasons donor cultivation is important. The most obvious is that it’s what brings donors to your nonprofit to help raise the funds you need for your mission.
The average donor retention rate in 2020 was just 43.6%. That means that over half of first-time donors don’t return to give another gift the following year. While donor stewardship efforts can increase your retention rate, this average also shows the need for ongoing cultivation of new donors. You want to identify new supporters each year to continue to grow your audience.
In addition to establishing a strong donor base, donor cultivation is also important if your nonprofit wants to:
- Increase Recurring Donors: Recurring donors are a critical revenue stream for nonprofits, and being able to grow your recurring donor group ultimately starts with smart donor cultivation.
- Secure a Major Gift: If you have a large project you need to fund, you’ll likely want to identify a key major donor to sponsor the effort. Donor cultivation helps you find the right partner for the job.
- Establish a Planned Giving Program: Many people want to leave a legacy. Donor cultivation can connect you with individuals who want to make a sizable planned gift toward your cause when they pass, letting you help them make a lasting impact.
- Strengthen Your Brand: Public perception of your nonprofit’s brand affects how new donors engage with your organization. Proactive donor cultivation gives you the chance to demonstrate your care for your supporters and get them excited to join your community.
What Are the Key Stages of a Donor Cultivation Plan?
There are six steps you’ll want to include in your donor cultivation plan. These steps take you from your initial research to the moment a donor gives their first donation.
1. Identify potential donors.
There are many ways to identify people who may want to donate to your nonprofit. Some good places to start include:
- Host Events: Events are a great way to bring new faces to your nonprofit. These can be small gatherings like an informational session or happy hour, or larger events like an annual gala or 5k fun run. Make sure all attendees learn about your important work at the event and leave knowing how they can stay involved.
- Review Similar Nonprofits: This tip can be especially helpful if you’re looking for a major donor. See who has previously given to nonprofits that work within a similar field as you. If they have a connection to that cause, they may be willing to help your nonprofit, as well, or at least make a connection to someone else who can.
- Consider Your Volunteers: Donors may start as volunteers. Review who has been attending your volunteer events and give some thought to how you might be able to strengthen those relationships and encourage them to make a donation.
2. Research your prospective donors.
It’s not enough to identify the people you want to ask to donate and then bombard them with a bunch of generic asks. Donor cultivation is about relationship building. It’s about letting supporters know that you see them as individuals and appreciate the unique value they bring to your nonprofit.
Take some time to learn about your prospective donors so you can build more authentic relationships with them that are tailored to their interests and needs. In particular, you’ll want to understand your potential donors’:
- Interests, such as specific parts of your cause that resonate with them or the types of events they prefer to attend
- Affiliations, such as clubs, professional associations, or certifications that may be relevant to your work
Past involvement, such as attendance at one of your events or volunteer hours they’ve logged with your nonprofit
- Relationships, such as board members they may work with or family members who may be current donors already
- Giving capacity, which lets you know whether it would be more appropriate to ask for a $10 gift or a $10,000 gift
3. Build relationships with the potential donors.
Once you’ve identified and researched the individuals you’d like to cultivate as donors, you’ll need to work to build relationships with them. The more you can create an emotional connection between the prospective donor and your organization, the more likely they will be to make a donation to your cause.
To cultivate relationships with potential donors, you can:
- Invite them to events. Reach out personally to prospective donors to let them know you’d love to see them at your next event.
- Send them updates on your work. You can mail a brochure or send an email to tell them about what you’ve been able to accomplish recently. Remember to show your impact through storytelling, highlighting the people whose lives you have improved or projects your organization has facilitated.
- Connect with them on social media. Effective social marketing is about reciprocity. If a potential donor likes your content on social media, consider following them and engaging with what they post too.
- Tell them happy birthday. If you have information on prospective donors’ birthdays, anniversaries, upcoming graduations, or other meaningful life events, take time to celebrate with them. That kind of individual touch can leave a big impression.
4. Ask these supporters to give their first donation.
Once you’ve built a strong relationship with a prospective donor, it’s time to make your ask. The key here is to customize your ask to their giving capacity and interests.
For example, if you’re an animal shelter, you might ask a college student volunteer for a $10 donation to support food costs for kitten season. Or, you might ask a major donor for $10,000 to support a remodel of your dog kennel.
5. Express your gratitude for their gift.
As soon as a prospect becomes a donor, you want to get busy with your thank yous. If the supporter donated online, you can set up your system to automatically email the donor a thank-you note along with their donation receipt.
However, you’ll still want to follow-up within a week with a more personalized thank you. Take that time to describe the impact their gift will make, let them know how glad you are to have them in your community, and offer a call to action for how they can continue to stay involved.
If you’ve received a major gift, you’ll also want to consider setting up a time to meet with the donor in-person over lunch or to tour your facility while thanking them for their support.
The two main things to remember for expressing your gratitude are to make it timely and personal.
6. Continue to build the relationship.
This last step is where donor stewardship kicks in to increase the likelihood of retaining that new donor year-over-year. Continue to invite them to events, send them updates, and demonstrate the work you’re doing to make your mission a reality.
To show the impact of a donor’s gift, remember to tell stories that have an emotional appeal and display easy-to-digest data that demonstrates your progress.
How Do I Create a Donor Cultivation Plan?
Now that you know the stages of a donor cultivation plan, it’s time to create one that is specific to your nonprofit’s goals. The six steps below can guide your team through this process.
1. Identify who will be involved in the plan.
The first step to creating a donor cultivation plan is considering who should be involved in it. Typically, you’ll want your development team, board members, and executive director coordinating on the plan.
However, that donor cultivation team should also consider how all of your staff can lend a hand in donor cultivation. For example, direct services staff can share their stories with potential donors and marketing staff can design effective social media campaigns to get prospective donors’ attention. While you will have a core donor cultivation team, ultimately, everyone at your nonprofit plays a role in effective donor cultivation.
2. Set donor cultivation goals.
Know what you want to achieve from your donor cultivation efforts. This will allow you to track your progress and see what activities are working well and where you might need to pivot.
For example, your goals could include measurements such as:
- Engage with 10 new prospective donors per month.
- Convert 40% of new contacts to first-time donors within 10 months.
- Develop five well-researched prospective donor profiles each month.
- Identify 10 potential donors for a major gift by mid-year.
3. Create a donor cultivation schedule.
Once you have your goals set, you’ll want to map those to your calendar through a series of events that will lead you to accomplishing the goal.
For example, if you’re trying to convert 40% of new contacts to first-time donors within 10 months, you’ll want to know when you’re going to:
- Send them email communications with updates on your work.
- Interact with them through social media.
- Invite them to an event.
- Recognize their involvement through a volunteer appreciation program.
- Wish them a happy birthday or happy holidays.
Think through the little steps to get you to your goal and use those as your schedule.
4. Establish donor segments.
You can make donor cultivation easier by segmenting your prospective donors into categories they share. This way, all donors within a particular segment can receive the same schedule of invitations, communications, and more.
Some donor segments to consider include:
- Giving capacity
- Communication preferences
- Areas of interest
5. Use donor relationship management software to track donor cultivation activities.
As you cultivate relationships with potential donors, track those actions in your donor management software, like Instil.
This helps you keep organized and on schedule with your donor cultivation efforts. It’s especially helpful if you have multiple staff working on cultivation efforts because you can easily see everyone’s contributions in one place.
6. Meet regularly to review results.
Set up monthly or quarterly meetings for your donor cultivation team to check-in on the results of your donor cultivation plan. These meetings are a great time to discuss what’s working and address any pain points. It’s also a good time to introduce any new prospective donors to the team to begin the donor cultivation process for them.
Practice the Basics of Donor Cultivation to Build Lasting Relationships for Your Nonprofit
Donor cultivation is ultimately about relationship building. You want to find the right people to support your cause and inspire them to be a part of your community. You can use the tips above to get started on your donor cultivation plan.
Looking for a little extra guidance? Make sure to check out our Donor Cultivation Plan Template for an easy way to get started with your process.