5 Digital Fundraising Challenges and Their Solutions : Successful Nonprofits

5 Digital Fundraising Challenges and Their Solutions

By Jay Love, Co-Founder and Chief Relationship Officer at Bloomerang

by Ro

5 Digital Fundraising Challenges and Their Solutions

By Jay Love, Co-Founder and Chief Relationship Officer at Bloomerang

by Ro

by Ro

Digital fundraising is now the default for many nonprofits

and a crucial part of their strategic plans, but that doesn’t mean that it’s without challenges.

With so many organizations competing for supporters’ attention, how can your nonprofit stand out online and earn sustainable support? In this guide, we’ll cover five common digital fundraising  challenges and tips for overcoming them. These challenges include:

      1. Retaining online donors
      2. Leveraging data effectively
      3. Creating a message that stands out
      4. Recruiting digital advocates
      5. Building and maintaining donors’ trust

Consider these challenges as opportunities to improve your nonprofit’s digital strategies and position your organization to thrive online.

1. Retaining online donors

Donor retention is always a struggle for nonprofits, with the sector-wide retention rate typically hovering around 45% Online donor retention tends to be even lower. In 2022, Many donors give only once and then fall off your organization’s radar, whether because they don’t feel appreciated for their gifts, don’t see how they made a difference for your cause, or simply forgot about your nonprofit.

The key to improving your online donor retention rate is strengthening your approach to donor management. Start with these strategies: 

      • Thank donors promptly and explain how you plan to use their gifts. Send an automated donation receipt right after donors give, and then a longer thank you letter within 48 hours of their donation. Describe how you plan to use their gifts and offer ways to stay in touch via email or social media so donors can get real-time updates on your nonprofit’s mission. 
      • Personalize messages. Personalize your thank you notes with donors’ names, gift dates, and specific donation amounts. This makes donors feel seen and recognized as individuals. 
      • Segment donors to send more relevant communications. Group donors based on shared characteristics, such as their gift amounts, giving frequency, or the specific program they support. Then, you can send relevant information to each group. For example, you might send program-specific updates to different donor groups based on which campaigns they’ve supported in the past.

Continue sending ongoing updates and thank you messages to donors. This ensures that your organization stays top-of-mind for supporters. You can even invite them to engage with other opportunities at your nonprofit, such as volunteering or attending events. This can deepen their commitment to and connection with your cause.

2. Leveraging data effectively

Proper data collection and hygiene are essential for modern nonprofits but it can be challenging to know what type of data to collect and what to do with that data once you’ve gathered it. 

You don’t have to capture every bit of information you discover about your donors. That will only clutter your database and make it more challenging to focus on what really matters.

NPOInfo’s nonprofit data collection guide recommends gathering donor information about:

      • Demographics
      • Giving histories
      • Interests
      • Giving capacities 
      • Communication preferences

This data will tell you more about who donors are, what motivates them, and what donation amounts you can reasonably request from them. You can use this information to: 

      • Personalize donor outreach with messages that align with their motivations and interests.
      • Send gift requests based on donors’ past gift amounts and giving capacity. 
      • Communicate with donors on platforms that they use most often.

Audit your database regularly to ensure that you’re collecting the right data. Consider leveraging a data append when necessary to fill in any gaps in your donor information, such as wealth data or current mailing addresses. 

Also, assess your data collection processes regularly to ensure that you aren’t capturing unnecessary information. Review forms like your donation page or volunteer registration form to ensure that they’re only asking for information that improves your strategies.

3. Creating a message that stands out

With social media notifications, news alerts, and email pings competing for supporters’ attention, it can be challenging to break through the digital noise. That’s why your digital marketing efforts must convey the unique aspects of your organization to differentiate your nonprofit. 

Align your message, audience, and communication platform to make your marketing strategy more impactful. Let’s break down the steps of this process:

      • Know your audience. Who are you trying to reach online? Your audience might consist of potential new donors and volunteers and existing supporters. Use your donor data and donor surveys to learn more about your audience and understand what drives them. 
      • Know what makes your organization unique. How does your nonprofit differ from similar organizations? Perhaps you have a uniquely creative approach to solving pollution problems in your area or empowering community members to start small businesses. Knowing what makes you different and why your approach is the most effective one for solving a specific problem can help you stand out from the crowd. 
      • Know which platforms your audience uses the most. It’s not worth your time to create digital marketing campaigns for platforms your audience doesn’t use. Identify your target audience’s preferred communication platforms and focus on those channels.

Use this research to guide your online messaging strategy, from your social media approach to your email tone and blog content. You can even use this guidance to revamp your mission and vision statements so they better convey your nonprofit’s purpose. Digital audiences respond best to clear, brief statements that quickly convey your message. 

4. Recruiting digital advocates

Your nonprofit might launch peer-to-peer fundraisers or digital awareness campaigns that require active support from your community to succeed.

Becoming an online advocate for your cause requires greater involvement than other activities. Donating or sharing social media posts are convenient ways of showing support that donors can complete within seconds. But taking on the role of an online influencer or fundraiser requires more active participation.  Donating or sharing social media posts are convenient ways of showing support that donors can complete within seconds. But taking on the role of an online influencer or fundraiser requires more active participation.

Because of this, recruiting supporters for these positions can be challenging. To simplify the recruitment process, Bloomerang’s peer-to-peer fundraising guide

 recommends personally sharing these opportunities with long-time donors and volunteers who have exhibited strong support for your nonprofit in the past. Let them know that getting involved is a great way to connect more deeply with your mission and generate even greater support for your cause. Make your digital advocates feel special by sending personalized thank you messages that include how much each individual helped raise. Thank them by name in the social media and email updates that you send out after the campaign concludes.

5. Building and maintaining donors’ trust

Establishing and preserving trust with donors can be challenging when you’ve only communicated with them in the digital realm. They might not have engaged with any of your staff in person before or live too far to visit your organization’s headquarters.  

Consider taking the following steps to foster trust in your online community and develop stronger bonds with donors: 

      • Provide a secure online giving process. Invest in secure online donation software that is PCI-compliant. This means that the software is vetted through a comprehensive security verification process to ensure specific safety measures are in place, such as firewalls and data encryption protocols.
      • Illustrate how you’ve used donors’ gifts. Provide donors with hard data to prove that their gifts made a real difference for your mission. For instance, let them know how many people they helped or how many pounds of trash your volunteers were able to retrieve from local waterways because of their support. Make your annual reports easy to find on your website so donors can get a financial overview of your organization. 
      • Ask for donors’ feedback. Bring donors into the conversation by interviewing them or sending surveys to gather their input. Ask for suggestions on how to improve your online donation process or communication strategy. Follow up with donors to let them know exactly how you plan to implement their recommendations.

Donors will appreciate your efforts to be transparent and make them feel like part of the team, which can boost your online donor retention rate. 

As nonprofit fundraising becomes increasingly decentralized, optimizing your digital fundraising approach will be critical to continue engaging donors. Prioritize addressing these challenges within your strategic plan and train your team on digital fundraising best practices to overcome current and future obstacles. 

About the Author 

Jay Love is a Co-Founder and current Chief Relationship Officer at Bloomerang, a prominent figure in the charity sector with 33 years of experience.

Prior to Bloomerang, he was the CEO and Co-Founder of eTapestry, a leading SaaS technology company serving the charity sector, where he led the company’s growth to more than 10,000 nonprofit clients. 

He holds a B.S. in Business Administration from Butler University. Jay Love is renowned for giving over 2,500 speeches worldwide, advocating for new technology for fundraisers, and is considered the most well-known senior statesman in the field.

Additionally, check out the following Successful Nonprofits® resources if this post was helpful:

Blog: Crafting Your Digital Marketing Strategy

Blog: There’s Gold in Your Strategic Plan!

Podcast: Unlock the Power of Social Media with Nick Black

Podcast: Time to change the way you fundraise and raise more money with Jack Silverstein

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