This is a synopsis of an article written by Charity Village.
For not-for-profit organizations, a major concern in ensuring their success and sustainability is donor loyalty. The cost of obtaining donations can be lowered significantly by ensuring donors remain loyal. Many studies have been completed recently on this topic, relating to different types of organizations, including those outside of the not-for-profit sector. For example, Sargeant and Jay found that a “typical non-profit will lose 50% of its cash donors between the first and second donation and up to 30% one year thereafter.” By reducing donor attrition by, say, 10%, donor value can be increased by approximately 200%.
The difference between satisfying and delighting customers
- Outcomes of customer interaction with an organization can be classified into four main categories; outrage, dissatisfaction, satisfaction, and delight. In order to achieve the desired state of delight, it is important to distinguish delight from mere satisfaction.
- Satisfaction arises from meeting the basic criteria which would result in major disappointment if not fulfilled. This can also be understood as simply meeting expectations.
- Delight happens when the customer has a positive surprise that surpasses expectations. Delight is so important in encouraging customer or donor retention because it develops a commitment to the product or service.
- Achieving this sense of loyalty through delight is not always easy, as the organization cannot control expectations; more knowledgeable individuals are often difficult to delight due to their higher expectations.
How much of an impact do delighted customers have on an organization?
- Delighted customers make for excellent word-of-mouth advertising. They can generate the same value as 11 customers who simply remain loyal.
Here are a few tips on how to do implement a donor program that delights:
- Determine who will be involved in the delight program.
- Communicate advantages of delight to staff and anyone who is involved.
- Understand your donors. Talk to them and get to know what makes them happy!
- Don’t stop at just satisfying customers. Go above and beyond in serving them. Donors recognize everything, and when you go out of your way to serve them, they appreciate it.
- Delight your donors through as many channels as necessary: in person, direct mail, web, social media, phone, etc.
- Monitor key success factors (e.g. donor retention rates, conversion rates from annual giving, average gift, etc.) before and after implementation.
- Re-visit your delight program and re-tool or scale up as necessary.
However, every project implementation involves risk. Here are the potential risks that come along with the implementation of a delight program, and how to manage them:
- Customers or donors come to expect the same delightful experience all the time, therefore it is no longer technically considered delight.
Solution: To manage this, give options with every purchase or donation. Offer a variety of rewards or gifts, and ask donors to choose one.
- There are potentially high costs associated with delivering delight.
Solution: To manage this, calculate the financial impact of your delight program and reserve delight service for the more significant donors.
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