Imagine if a donor so inspired by your nonprofit mission left you a sizable donation, and the organization never sent a thank you letter or email (let alone included them to their wall of generous donors). It is likely that the donor will never give to your organization again because they did not feel appreciated. A simple thank you or letter acknowledging receipt makes the donor feel wanted and appreciated. Donors’ loyalty is maintained by practicing donor recognition practices.
It is a well-thought way of defining the practice of appreciating and thanking donors for their donations to your organization. Most nonprofits divide donors’ recognition in tiers depending on the amount and type of gift.
A good donor recognition policy archives these goals:
- It cultivates relationships with existing supporters and encourages them to give more
- Attracts new supporters to the organization
How Donor Recognition Benefits Nonprofits
- It helps maintain your donors- recognizing donors who contributed towards your organization’s mission irrespective of the amount, makes them feel like an essential part of the story. These donors will want to stick around for a more extended period.
- Motivates donors to give more and again- Donors give since they believe their contributions will make a difference. Recognizing a donor’s gift makes them feel valuable, inspiring them to give more to achieve the organization’s mission.
- Helps acquire new donors- Appreciating those who give to your nonprofit attracts other people who want to donate. Appreciation shows some sense of accountability, and every donor wants to associate themselves with an accountable nonprofit.
Who Should Be Recognized
A donor recognition plan should recognize every donor who gave to the organization irrespective of the gift size or amount. However, you should ensure that recognition is proportional to the amount given. It shows respect for donors’ loyalty to your organization. Too much or too little response can leave dissatisfaction or discomfort. Major donors who provide a significant amount make an enormous impact on the nonprofit. These donors should receive public recognition (like adding their names to a custom-designed wall) as they have the potential to make huge, recurring donations. Legacy donors, on the other hand, leave gifts to your organization. You can recognize them by giving them a membership.
Defining Donor Recognition Tiers
Your organization’s recognition levels should be in tiers based on the donation type and amount. The amount and gift types in the tiers depend on the organization. Each tier should have levels of rewards and acknowledgment that grow in value to motivate the donors to move to a higher tier.
Types of recognition include:
- Personal recognition- Include tokens of appreciation, small gifts, in-person meetings, personal letters, emails, and phone calls
- Public recognition- can be donor recognition walls, major donor clubs mentioned on the website, or press releases. It is essential to consult the donor before mentioning them publicly.
- Naming Opportunities- Mostly applied to the company’s major donors. Donor names are done in building, endorsement, campaigns, and funds.
Each tier should have a mix of public and personal recognition. Naming opportunities are strictly for the most significant company donors. A company that practices a donor recognition policy can maintain most of its donors.