Why first-time donors leave, and the simple plan that keeps them

Claire Axelrad: For centuries, identity has been deeply tied to work. So now we’re entering this world where millions of people are no longer going to be needed in traditional economic systems. And that makes me think that in an AI-revolutionized society, the role of nonprofits might become more important than ever in bringing meaning, purpose, and a sense of identity to people. So I would say lean into that. Sure, in the short term, AI can absolutely help organizations process information, identify patterns, personalize outreach, and improve efficiency, and you need to look at all that. But fundraisers should never forget the central truth: people give to people.

Ann Fellman: Bloomerang presents Fuel Impact, the podcast that powers your next fundraising breakthrough. This is where we have real conversations with fundraising leaders, technology innovators, and fundraising experts. In this episode of Fuel Impact, I spoke with Claire Axelrad, founder and principal of Clairification. We talked about fundraising as the happiness delivery business, people really do give to people. We talked about donor centricity, raising more, and growing your mission, and ideas you can apply to stand out as a nonprofit. If you work with nonprofits or fundraising teams, this episode really matters because you’re worth investing in. Here’s my conversation with Claire Axelrad. Welcome to Fuel Impact, I have the opportunity to sit down with the people helping nonprofits push their fundraising impact even higher. Hello, I’m Ann Fellman, Chief Marketing Officer at Bloomerang. In today’s episode I’m joined by Claire Axelrad, founder and principal of Clairification. Claire helps nonprofits fundraise so much better, and she really helps through her online fundraising school, it’s truly a pathway to passionate philanthropy. Claire, thanks for being here with us today, let’s jump in.

Claire Axelrad: Okay. Thanks for having me.

Ann Fellman: Let’s pretend, even though I’ve known you for a very long time, let’s just pretend that I just meet you at a conference, walking down the street. In your version, who are you and what do you do?

Claire Axelrad: Well, it’s funny, I asked my son, my adult son, what I should say, because I didn’t want to give a whole resume. And he said, you promote philanthropy as a product, for people who care about love of humanity and who really want to live that. And I thought, yeah, that’s really what I do. I don’t like wanting to just get people to donate to something, I want people to naturally express their values because they want to join a movement, not because they feel guilty or coerced. I started as an attorney, did that for a hot minute, didn’t like it. Then ended up in fundraising, got my CFRE, and worked for five different organizations over thirty years as the head of development. Then fifteen years ago I started Clairification and started working with lots of different nonprofits.

Ann Fellman: Well, speaking of working with lots of

Claire Axelrad: Yeah, that’s okay.

Ann Fellman: different nonprofits, you do give a lot of very good advice, you have a ton of great resources and content, and the online school for fundraising. Right now there’s a lot nonprofits are navigating, what would be your top three pieces of advice for a nonprofit right now?

Claire Axelrad: Okay, well, I see that book behind you that says The AI-Driven Leader, so I’ve gotta start with that. For all nonprofits, what I say is human first, digital fast. Tools have changed, people haven’t. They really want to be known, they really want to feel connected, they really want to experience joining a group where they have shared values. So you really need to figure out what they most value, how do they personally identify. We used to just say, well, they’re soccer moms, or they’re a widow, or a busy businessman, that might not be the number one way they identify. They could be a soccer mom, but they could identify first as a mom, second as an activist, and third as Jewish, they don’t care about soccer. So that’s your first job, find out what motivates them to get up in the morning, what legacy they want to leave. You need the digital fluency to reach people where they are, but you need the human fluency to move them to care. So that’s number one. Number two, increase donor retention by ten percent.

Ann Fellman: Yeah.

Claire Axelrad: Really have a written plan for donor retention, because I don’t know what the deal is, we’ve known this for a decade and a half for sure, since the Fundraising Effectiveness Project has been keeping track. First-time donors now are renewing at under 20%. Ongoing donors we know will renew fifty to seventy percent. So just having a plan to get that second gift is going to increase your retention so much, and you have to have a plan like anything else: goals, strategies, tactics, who, what, when, where, why. Make assignments, track results. If I had to give you one great tip on donor retention, put a monthly giving program in place. Monthly donors are retained at like 80 to 90%. It’s the easiest way to retain your donors, and then you can plan ahead because you’ve got this steady base of donors you can rely on. And three, this is really for new nonprofits, although all of them, work on your mailing list. I so often have people ask me to write an appeal for them, and I say, okay, well, who are you going to send it to? They have the teeniest mailing list, or the mailing list just isn’t very good. You can have the best appeal in the world, but if you don’t have the right people to send it to, it’s useless. So I adhere to the forty-forty-twenty rule: spend 40% of your time building and maintaining your mailing list, 40% developing your compelling fundraising offer, which I could speak about for days, what are you asking folks to do, and then 20% on the creative, the words, the images, the fonts, the color, the design. And if you’re new, it helps to just think logically, who would be interested? Start on the inside, start with your board members, your staff, your current donors, and run a little campaign like “make your friends our friends,” or do a peer-to-peer, or something like that.

Ann Fellman: No, those are great pieces of advice, and they build off of one another too, it’s interesting you talk about mailing lists, again, what is your readiness and your ability to go attract those who may be really interested in your cause? Sometimes we forget about putting the energy and time into that, but that readiness to go get those donors and get that second donation is a really important component to put your energy into. I love controversy, or love challenging common ideas, you’ve given a ton of advice, you’ve written a lot of different columns, what’s something in your work that you believe that maybe not everyone agrees with when it comes to fundraising?

Claire Axelrad: Okay, well, this is something that I know Bloomerang believes, but there’s been a backlash against it: donor centricity. This idea that we have, as part of our mission, really to love humankind. That’s what philanthropy means, love of humanity, and that means all of humankind as far as I’m concerned, which means including our donors. So you can’t just think about treating your beneficiaries really well, donors are also your beneficiaries, they need to find meaning and joy and belonging and live their best lives possible. I think sometimes we treat donors like gumballs, we chew them up, we’re done with them, we spit them out, and we don’t ever think about them again, and you just can’t do that. You have to take time to get to know your donors. There is this zeitgeist now that looks askance at donor-centered fundraising as pandering to elites, as in, well, they should just do this because it’s the right thing to do, but that’s just not how people are. I think the late Simone Joyaux said that donor centricity is just another way of saying building trust, especially in major gift fundraising, where a lot of organizations, particularly the large ones, focus on metrics, how many asks you have to make in a year, how much money you have to raise in a year. But if your culture doesn’t allow time for trust building, you’re going to suffer really poor fundraiser retention, which is extremely expensive, and we’re losing all the experienced fundraisers who know how to build long-term relationships, and that’s really what makes transformational philanthropy possible.

Ann Fellman: It’s interesting, I’ve had a lot of conversations lately about that human relationship, that human connection, getting to know people, there are people out here who are really excited and want to help and want to contribute, but they also want to understand that their support is needed, and making those connections is an important component to building trust and building a relationship with someone over time and bringing them back, and back, and back. You talked about mailing lists and staying connected, I’d love to hear from you, Claire, there are some fundamental metrics, right? You put in the effort and the work, you’ll get a certain amount of results. So as you think about the metrics, let’s talk about the data points that every nonprofit should be tracking in their donor database that many aren’t.

Claire Axelrad: Well again, I’m going to sound like a broken record here, but retention, retention, retention. I cannot believe how often I’ll talk to a group of fundraisers and ask, how many of you know your donor retention rate? Not a lot. And then I ask, how many of you could figure it out if you had to? Similarly, not a lot. You should be keeping track of how many new donors, how many repeat donors, how many overall donors, and how many lapsed donors, so you know where you’re strong, where you’re weak, and what you need to work on. The other thing I’d say now is visited web pages, because that really shows what people care about now. A donor in the past might have given to children’s services, but now they’re somewhere else along the life cycle, and now they’re Googling senior services. It gives you a lot of hints, so does tracking social media, what they click on, what they share with other people, but the easiest thing to do is track the web pages. And you should run the NCOA change-of-address connection at least annually. 17% of people in the United States move every year, that’s a lot, that means every year almost a fifth of your list is wrong. It’s expensive to maintain mailing lists, particularly if you’re doing direct mail. Purge your list of people who have never given, if they haven’t given for three years, maybe you ran a campaign and your board members gave you names of people, but these people have never bitten, so get rid of them.

Ann Fellman: Well, tying into that, Claire, when you think about your readiness and keeping that data clean, let’s talk about how you build a meaningful donor communication cadence without overwhelming that team or that audience. We hear time and time again, they’re tired of hearing from us, but how do you structure, what are your recommendations on structuring that communication cadence without overwhelming them?

Claire Axelrad: We hear time and time again, they’re tired of hearing from us, that’s something that we assume. We have to remember, first of all, you are not your donors, you get tired of it. Secondly, donors lie. A lot of times organizations survey their donors and ask, how often do you want to hear from us, and most people will predictably say annually, and that’s just really a great way to lose your donors, because how people say they’ll behave is often quite different from how they actually will behave. Research in psychology and neuroscience shows people are more likely to give again when they hear from you repeatedly about, and this is the kicker, the impact of their giving, your gratitude for making these outcomes possible. So you need to email them, but you have to mix up your asks with emails that show your gratitude and show the impact of their giving. Large organizations who’ve done A/B testing, many of them are mailing appeals monthly, but then there’ll be three to four emails in between that are about impact and gratitude. And the only way you know if this is right for you is to try mailing a little bit more and see what happens. I remember having this experience once, working for an organization where we always pulled the current givers out of the next mailing, and for one spring mailing, by accident, the current givers got included, and they gave far and above what the other people gave. So you just can’t assume. And you should always offer at the bottom of every email the option of unsubscribing, and when you do that, it builds trust, and the reality is very few people are going to unsubscribe. You need to understand people may not read every mailing you send, but that doesn’t mean they don’t like receiving them, and in a way it reassures them that you’re still a healthy, vibrant organization out there doing good things. And if you stop mailing, it’s really out of sight, out of mind.

Ann Fellman: Yeah, I’d agree with you, Claire, I think about that as, one, don’t decide for your donor, but two, those are a brand impression, a moment to just tell your donor or your supporter community, I might not read the email, but I saw that XYZ organization just sent me a note, so at least I know they’re thinking of me and reaching out. Those are just positive touch points to reinforce that, so when it comes time that I want to make another gift, I think of them.

Claire Axelrad: If they make one gift a year, especially if it’s newish, they haven’t been giving to you ten years, they forget, they don’t even

Ann Fellman: Yeah.

Claire Axelrad: remember that they did it, let alone who you were. Even the next time they get an email from you, let’s say six months later, they don’t remember who you were. You really have to get them to know who you are, that’s your job, you have to get to know them just like you would if you met a stranger. And we’re starting to get to know them, and then, huh, I think we might have something in common, let’s get to know each other.

Ann Fellman: Let’s talk about that in terms of donor health, what does one look for in donor health? From what you’ve seen, what are some early warning signs that would tell you a donor’s about to leave or ghost you, what have you seen in your career?

Claire Axelrad: Obviously the good is that they give, maybe multiple times during the year, they grow their gifts over time, and they feel a strong link to you, you can tell because they come to events, or they visit your web pages, or they’re on social media with you, whatever. Bad is if they used to come to events and they stopped coming, they don’t open your email, they don’t respond to your phone calls. You need to look at those things and then go, huh, what could I possibly do to find out what’s going on here? One of the easiest things, like with monthly donors, if suddenly you’re having problems processing the payment, call them up. If their usual gift deadline passes, like they usually give every year in December and they haven’t given, call them up. If you don’t have a phone number, email them, text them, whatever you can, just remind them gently, you usually give at this time of year, I want to make sure you didn’t miss it. Sometimes people don’t give because a staff person they had a close relationship with left. If you start to notice those people aren’t giving, and you’re the new person, you need to really make an effort to call them up and connect with them. And personally, this has happened to me more than once, where I was really in a relationship, I enjoyed it, the person checked in with me a lot, I was increasing my giving, and then they left, and then nothing. I’ve even reached out to some new person and said, you know, because I do fundraising consulting, and for organizations that I love, sometimes I’ll do it pro bono, and I’ll say, hey, if you ever have any quick questions, let me know, and they still don’t stay in touch with me. You just have to pay attention when people stop engaging.

Ann Fellman: I think it’s really important too, as you just hit on, staff turnover in nonprofits is obviously pretty high, so picking up the phone and reaching out, I’ve seen time and time again, different fundraisers I’ve talked to, when they picked up the phone and had that conversation, they got a next gift or made a deeper connection that kind of pulls them back into the orbit of the organization. So Claire, through the online fundraising school you’ve done and all your advising and coaching and your own professional experience, can you talk to us about a nonprofit you’ve helped that you’re particularly proud of, what was the situation, what did you do, what changed for that organization?

Claire Axelrad: I did work as a consultant and a coach for one organization where they had recently transitioned from one mission to another, kind of, they had been sort of an overarching clearinghouse and now they were doing more direct service. And they had a board that was used to giving very nominal gifts, like $250 each, and they were all high-powered professionals, they clearly

Ann Fellman: Mm-hmm.

Claire Axelrad: could afford more, but this is what they’d always given. Now they had this evolving mission where they wanted to grow. So the executive director and I talked together, and she agreed she was going to go to them and lay out for them the scenarios of the organization: they could be status quo, keep raising as much money as they were raising and what that would mean, they could retrench and what that would mean, or they could grow and what that would mean. She was kind of like, whatever you want to do, you’re in charge, but I just want to lay out all the scenarios for you. Well, of course they wanted to do all these growth things, because those were the exciting things, that was the new stuff. So they started to get really excited about doing that. And then she said, okay, well, you understand this means the board is going to have to step up, the board is going to have to make this happen, the board is going to have to give more money, raise more money. And they said, okay, okay. So then she and I sat down together and figured out what we wanted to ask each board member for, she was going to go ask the board president, and then we were going to ask him to ask everybody else. So she went to the board president, who was actually giving a thousand dollars, so he was already a leader in this group. She went to him, and then she called me up and said, Claire, guess what? And I said, what? And she said, I didn’t even have to ask him, he agreed to double his gift. And I said, great, how much did we say we were going to ask him for? She said, $4,000. How much did he commit to? $2,000. I said, what if every board member we’ve decided we’re going to ask gives half of what we want to ask them for? And she said, I guess I have to go back to him. So she did, and he thought about it, and he got back to her the next day and said, my wife and I talked about it, we agree, that’s what we’re going to give. And once he did that, it was like he got religion, it was like he had enacted his passion passionately, and now he was really ready to share it with everybody else. So it worked, it really worked, the whole board just rose up. And then we did a session with the whole group and talked about what philanthropy is and why it makes people feel good to get engaged that way.

Ann Fellman: Mm-hmm.

Claire Axelrad: And we did that rather than talk about, you have to exactly say this, and stuff that makes people uncomfortable, but it really brought them to a whole new level.

Ann Fellman: You structured the conversation in a way it sounds like you really tapped into passion and people getting excited, like, I’m putting more in, now I’m more invested in this, we’ve been talking about growth and now I’m a part of it and I have a role in that growth. That’s a really interesting way to bring that board along, and really feel a part of the next chapter in that revised mission for their organization.

Claire Axelrad: Even if you are not changing your mission, passion is the heart of everything. Whenever I work with boards, I talk about passion, passion, passion. First you have to get them to connect with their own passion for the organization, and sometimes people haven’t thought about it for a long time, they got on the board years ago because a friend asked them to. But if you can have people

Ann Fellman: Yeah.

Claire Axelrad: go around the room and talk about why they’re involved, or even just, if it’s a large board, talk to each other, this

Ann Fellman: Mm.

Claire Axelrad: is why I’m engaged, and then the other person says, this is why I’m engaged. First of all, it gets them used to talking about what they’re passionate about, which is what you would

Ann Fellman: Mm-hmm.

Claire Axelrad: want them to do with other people, and they get re-inspired by hearing other people’s stories. And once they’ve done that, then you go, okay, now we want you to enact your passion passionately, so this is the idea of making a stretch gift.

Ann Fellman: I mean, you put that why, like, put a couple, not just their own personal why, but a couple of other people’s why, that makes it a lot easier to get off there and tell the story of how we find connections with other people, sharing some of those whys for people in terms of what was it that drew them into the organization.

Claire Axelrad: And then when you make your own passionate gift, it’s like I was saying, this board member got religion, it’s like you have to get religion before you can preach religion. The third part of this passion triad is going out and asking other people to join you in your passion. And that’s it, it’s very simple, very basic, I think, common sense.

Ann Fellman: So Claire, speaking of passions and hot topics, let’s talk about AI for a minute, what’s your advice for fundraisers about how to think about AI tools for nonprofits?

Claire Axelrad: It’s really, really difficult for us to wrap our heads around what may be coming, and that makes me think about what we do know. I think for centuries identity has been deeply tied to work, so now we’re entering this world where millions of people are no longer going to be needed in traditional economic systems. That makes me think that in an AI-revolutionized society, the role of nonprofits might become more important than ever in bringing meaning, purpose, and a sense of identity to people, so I would say lean into that. Sure, in the short term AI can absolutely help organizations process information, identify patterns, personalize outreach, improve efficiency, you need to look at all that. But fundraisers should never forget the central truth, people give to people. Relationships are built on trust, trust is built when people feel seen, when they feel understood, when they feel appreciated, when they feel valued, and you really cannot fully automate that. So I would say that human interaction remains the engine of lasting donor engagement and investment.

Ann Fellman: Yeah, that’s something we talk about, the human component, there’s a lot of great things AI can do to free up time that used to take you away from people, so how do we use those technologies to give us more time to put back into the people component? It’s definitely important to learn what’s out there, and it’s ever-changing, so understanding ways it can help in a good way, being principled and decisive about what you will or won’t do, different causes will have different positions on that, so have those intentional conversations and decisions about what you’re going to do. For people who maybe have just heard from you for the first time, if you could describe clairification.com and the work you’re doing, and what kind of organization should be tapping into your resources and your advice and your content, who’s a good fit for it?

Claire Axelrad: I think of myself as a teacher and a problem solver, so I prefer coaching to doing big audits that people spend a lot of money on and then put in a drawer. I like helping to reframe approaches to the work so that people feel happier and more confident, and I find that generally spills over and makes donors feel exactly the same way. I think joy and passion are contagious, and I think fundraisers are in the happiness delivery business. So I prefer working with people who lead from vision, like you talked about brand earlier, and the brand promise is really the why of your existence, it’s not so much the mission and programs and process, somebody tells me what they do and then I go, okay, great.

Ann Fellman: Yeah.

Claire Axelrad: So what? Well, why should I be involved in that? And I like organizations that never lose sight of the change they’re endeavoring to bring about. There’s one organization I’ve worked with that I ended up being on the board of, a theater company, and I use this example because I love it, they don’t say to you, we’re a theater.

Ann Fellman: Uh-huh.

Claire Axelrad: The executive director came up with this brilliant notion that they are an empathy gym. He wrote this email about a year ago that I loved, and I’m going to read it to you. Our theater is a sacred space, a place where hearts are cracked open, souls are stirred, and compassion is not just spoken of, but practiced. The empathy gym is not just a clever phrase, it’s a spiritual calling. In a time when we are taught to armor up, scroll past pain, and judge rather than connect, theater offers something radical, a return to feeling, a return to each other. That’s the brand promise.

Ann Fellman: Yeah. Mm-hmm.

Claire Axelrad: That’s what people want to invest in.

Ann Fellman: A great test that we do in marketing sometimes is cover up your “about” for your organization. If you take similar-type causes and cover up the org name and read it, how does yours stand out? The example you just gave would really stand out when you’re looking at a number of community theaters, potentially. So that’s another great test to do, to say, how are we standing out and connecting in talking about why we’re here?

Claire Axelrad: And the other thing I’d say that’s related to that is make your case for support meet the moment. You can always tie it to something that’s top of mind for people, pay attention to the news, what are people worrying about right now, and figure out how your mission connects to that, how you touch people’s lives, even in subtle ways. You may have one program that really relates to something that’s just top of mind for everyone.

Ann Fellman: One more big question, then we’re going to go into some fun things, but Claire, what keeps you doing this work?

Claire Axelrad: Well, I like being one of the good guys. When I started in law I thought I was going to be a good guy, but I quickly didn’t feel that way, so I ended up in nonprofit. I would say I really enjoy the challenge of bringing science and art together, there’s so much we can borrow from other disciplines, and we’re doing that a lot more now. There’s a lot of psychology and neurology and behavioral economics you can apply. And then the art again, it’s this relational intelligence, this creatively reading the room and making unexpected connections that really bring joy to people, this beauty of communal endeavor, that I love, and I love reframing approaches to people so that they go, it’s not begging, it’s not even persuading, it’s really inviting, it’s opening a door to an opportunity for people to find some joy and some purpose in their lives. That’s what keeps me doing it, that it’s constantly changing, and it really depends on the person you’re connecting with and what they value. But it’s not just this narrow set of fundraising techniques, it’s all these things that we know psychologically

Ann Fellman: Mm-hmm.

Claire Axelrad: motivate people to give, and keying into those things. So it’s kind of like common sense plus applied knowledge.

Ann Fellman: Love that, the reframing and reframing it for different individuals, tailoring for them, and talking about it as inviting people in. So I want to invite you into a really fun game I love to play, I’m going to ask you just a handful of questions, and I want you to answer with a one-word, one-line type of answer. First question for you is, one word for the future of fundraising.

Claire Axelrad: Disruptive.

Ann Fellman: Disruptive. This is a fill in the blank, the nonprofit sector needs more.

Claire Axelrad: Common sense, people sense?

Ann Fellman: Coffee or tea, Claire?

Claire Axelrad: Darjeeling tea.

Ann Fellman: One word that your clients or your team would use to describe you.

Claire Axelrad: I would say teacher. And it’s interesting, when I left the nonprofit that I worked for for 22 years, my whole staff wrote a song for me, and one of the lines in it was, “she ran her own fundraising school.” So I think it’s kind of natural that I founded my own little online Clairification school.

Ann Fellman: That’s fantastic. Well, you’ve heard from Claire Axelrad, founder and principal of Clairification, that’s clairification.com. So if you’re a nonprofit wrestling with raising more, making stronger connections, Claire is exactly the type of partner worth a conversation, or worth a gander, just go to clairification.com, C-L-A-I-R-I-F-I-C-A-T-I-O-N.

Claire Axelrad: ’Cause

Ann Fellman: Claire’s exactly the kind of partner worth that conversation, you’re worth the investment. So thank you to everybody for listening to Fuel Impact by Bloomerang. We’re going to be back very soon with another fundraiser doing remarkable work for the sector. So until then, keep fueling your impact. Thanks for watching Fuel Impact. Subscribe for more real conversations with leaders shaping the nonprofit sector. Learn more at Bloomerang.com.