Soapbox Engage Blog

Monthly or recurring donations are one of the easiest ways for nonprofits to boost their fundraising revenue without bringing in a lot of new donors. At a time when acquiring new donors has become more challenging, that is very valuable. This giving strategy also appeals to many donors who might not be able to make large, one-time gifts but can give smaller amounts more frequently.

With the rise in popularity of online giving, monthly giving programs are easier than ever to maintain. Before, nonprofits spent countless hours asking donors to commit to recurring giving, then track each gift and ensure donors actually followed through. Now, online giving platforms and fundraising systems can automate most of the process, freeing up time and energy and boosting revenue streams.

Table of Contents

• Monthly recurring donation basics
• Top 5 reasons to invest in a recurring giving program
• How to start a recurring giving program for your nonprofit

Monthly Recurring Donation Basics

The beauty of recurring donation programs is that they’re just like subscriptions for loyal supporters to give at regular intervals! Whether they want to give monthly, quarterly, or annually, they can set the amount and frequency that suits their preferences.

Your donors will appreciate the convenience of a monthly draft or credit card charge. There are no checks to mail or giving slips to keep track of. It’s one less thing they need to remember (and they likely already pay their bills through this method so they’re familiar with the process).

Nonprofits really benefit from regular, predictable revenue streams and less time chasing and processing donations. Plus, most donor management software platforms include tools to manage and monitor monthly giving programs.

And some platforms can even encourage one-time donors to change to monthly donors! The Soapbox Engage Donations App recently added a new upsell feature that will nudge your one-time donors to become recurring donors as they are making a gift. You’d be surprised at how many donors might be interested in providing more sustainable support once given the opportunity!

Top 5 Reasons to Invest in a Recurring Giving Program for Your Nonprofit

The benefits of monthly or recurring giving programs don’t stop at convenience. There are many other reasons nonprofits should invest in creating (or upgrading) a recurring giving option for their donors.

1. Increase your annual revenue without recruiting more donors

Recent data has shown there is a 5x higher value over a lifetime from recurring donors versus donors who make a one time gift. That is partly because recurring donors make additional one-time gifts 75% more often than one-time donors!

These numbers do make sense when you think about it. Suppose Dave can’t afford to make a one-time gift of $1,000 but he’s able to make monthly donations of $100. Over the course of the year, Dave will actually give $1,200! Also, if they have a recurring donation they don’t even have to think about, and then you send an email with a specific appeal, they might feel moved to donate at that moment, regardless of the regular support they provide.

The longer the measurement period, the greater the gap between recurring donors and one-time donors.

2. Increase donor retention

Not only do monthly donors tend to give more than one-time donors, but they also tend to be more loyal to your organization! Recurring donors are more likely to stay engaged with the cause beyond the first year, making it easier for you to exercise your stewardship skills to cultivate a long-term relationship.

Some assessments indicate that retention among recurring donors can be as high as 90%. Even if your retention rate doesn’t reach that level, it’s still a huge benefit to enjoy, especially when you consider the revenue that represents over several years.

3. Reduce operating costs

As I’m sure you know based on where your team devotes your energy and effort, it takes more resources to recruit new donors than to engage current donors. Since recurring giving programs often increase donor retention, you’ll be reducing your operating and fundraising costs!

Consider all the costs associated with donor recruitment--marketing, administrative costs, postage, and on. With a monthly or recurring giving program in place, you’ll likely reduce the overall costs associated with soliciting new donors, which can be especially helpful for smaller nonprofits with fewer resources.

4. Create reliable cash flow and improve long-term planning

From an operational perspective, recurring giving programs are a God-send! Most nonprofits receive a large portion of their annual income during the year-end giving months. Fundraising and giving tend to be cyclical.

This can create operational challenges, especially for small and mid-sized nonprofits. While revenue can be sparse at certain times of the year, operating costs are a year-round occurrence. Some organizations end up with limited funds during the slow giving months.

Creating a monthly giving program builds a predictable revenue stream throughout the year and helps mitigate funding imbalances during those slower months.

A well-established recurring giving program can also help with longer-range budgeting and planning for bigger expenses. For example, it’s much easier to commit to upgrading your CRM system or piloting a new program when you feel confident you’ll be able to afford it with recurring donations.

5. Care for your donors by offering convenient giving options

We hate to sound like we’re stuck on repeat, but it’s critical to make giving as easy and convenient as possible for your donors. In fact, it’s a core part of effective donor care.

Affordability and convenience are especially attractive to younger generations that grew up in the “digital age.” From utilities and entertainment subscriptions to “coffee of the month” clubs, many people expect to have some kind of recurring giving or automatic draft option. If they can set up a recurring expense for their gym membership, why not give them that option for supporting the causes that matter most to them?

How to Start a Recurring Giving Program for Your Nonprofit

Now that you’re (hopefully) thoroughly convinced of the benefits of monthly or recurring giving programs for nonprofits, the natural next question is how to start a recurring giving program for your nonprofit! It’s actually surprisingly simple!

Step 1: Create a name and goal for your recurring giving program

This step doesn’t need to take a lot of time or energy and there’s no need to agonize over the name. Really, the goal is to give your program a name so people understand what it is and it’s easy to advertise it on your website, email updates, and other places.

Organize a quick brainstorming session with a few members of your team and spend no more than an hour choosing a name for your program. Some industry experts recommend avoiding words like “legacy” and “society” in giving program names because they’re often associated with wills and bequests.

Step 2: Establish suggested giving tiers

While it’s always important to allow donors to set their own donation amount, it’s helpful to offer suggested giving amounts. Some nonprofits use this as an opportunity to highlight just how much it costs to provide specific services.

For example, if you provide tutoring services for elementary school kids, you might create suggested giving amounts based on how much various services cost.

• $25 a month provides math and reading tutoring for one child
• $50 a month ensures 3 children receive tutoring and access to healthy nutrition

You get the idea. Attaching a specific action or accomplishment to the gift gives your donor a sense of exactly what they’re contributing to, which is an impactful fundraising strategy.

Step 3: Choose and set up a system to collect and track donation and donor information

Using an online donation tool like the Soapbox Engage Donations app can save you a lot of time and energy. You can customize everything from the suggested giving amounts to the donor contact information you collect. With just a few clicks, you’ll have a custom donation form for your recurring giving program! You can even customize the appeal and confirmation content and add text, images, or videos.

Furthermore, with our upsell feature you can invite one-time donors to upgrade to becoming recurring donors as well. You can even customize the prompt! For example, if a visitor plans to make a one-time donation between $0 and $49.99, the upsell can prompt them to make a $10 monthly contribution. If the visitor plans to make a one-time donation between $50 and $99.99, the upsell can instead prompt them to make a $25 monthly contribution. And so on.

All the giving and contact information integrates seamlessly with Salesforce and Microsoft Dynamics, reducing administrative time and ensuring accurate records.

No matter what online giving platform you use, make sure it supports mobile giving and can receive and track recurring gifts.

Step 4: Start recruiting recurring supporters!

Now that you’ve got a way for people to set up their recurring gifts, it’s time to start recruiting supporters to your new monthly giving program! Introduce your new program with an email and social media campaign. Create some marketing content to share the benefits and impact of recurring gifts.

Another great recruitment strategy is to add an option to all your donation pages to make it a recurring gift. But don’t make it an auto-select option because people might not notice if the box is checked. We want everyone who signs up to be a recurring donor to do so knowingly and with enthusiasm!

While most people are comfortable heading to your online donation page to set up their recurring gift, some nonprofits still find it helpful to offer a paper sign-up form at in-person events.

Step 5: Don’t forget the follow-up and thank you

Before you sign up your first recurring donor, have a plan in mind for showing gratitude and building a strong relationship with them. Skip the traditional monthly thank-you note and come up with different ways to show gratitude each month.

For example, one month you might make quick thank-you calls. Another month you might send a thank-you video highlighting what their ongoing support means to your organization. You don’t need 12 unique thank-you ideas, but four to six different gratitude strategies is ideal. The key is to keep the gratitude sincere, relevant, and ongoing.

Taking the time to build and manage a recurring giving program for your nonprofit is well worth the investment for you and your donors. It’s a great way to build sustainable, predictable income for your organization, which can help you accomplish your mission more effectively. Really, it’s a win-win for both your organization and your donors.

Now that you’re on the way to starting an effective recurring giving program, here are three more resources to help boost your fundraising.

• 8 Top Online Donation Software Options for Nonprofits: It’s more important than ever to offer online giving options for both one-time and recurring gifts. Online donation software comes in all shapes and sizes, and they’re designed to address a wide range of needs. This blog walks you through a few top online donation software options for nonprofits to help you select the best one for your unique needs.
• Moves Management Basics for Every Nonprofit: Attracting and retaining donors, volunteers, and other supports takes strategic effort and donor stewardship. Moving donors toward new giving levels or into recurring giving programs takes even more strategy! This is where Moves Management comes in. Head over to this blog to learn the basics of Moves Management and how to implement it in your own nonprofit fundraising and donor care strategies!
• Event Management Software: What Your Nonprofit Needs to Know: Planning fundraising events of any size can be a monumental task. Event management software can help organize and handle many aspects of event planning with a host of digital tools. But like many things in the world, not all software is created equal. We’ve gathered some top features and things to look for and consider to help you invest in the right event management software for your nonprofit.