Growing Recurring “Subscription” Giving in 2024
I’m encouraged.
After years of speaking, writing, and waving the flag for the opportunity for recurring giving programs, momentum is building.
The first sustainer program I worked on was 20 years ago. Back then, if your nonprofit wasn’t doing child sponsorship, missionary support, or membership, it was extremely difficult to build a vibrant base of ongoing monthly supporters. The vast majority of nonprofits were left out, unable to tap into the steady, predictable, and renewable source of regular giving.
Then, starting about eight years ago, I noticed how the explosive growth in the subscription economy was transforming donor behavior. Donors were increasingly willing to give to causes on a recurring basis, causes that would not have historically seen significant sustainer giving.
That has led to the rise of a new third category of recurring giving programs, which I call benevolence subscription giving. If you’d like to learn more, I wrote about it in an article titled “Subscription Philanthropy 📈Three Types of Recurring Giving.”
It’s very exciting.
Over the past couple of years, even as single-gift fundraising has struggled with declining donor counts and retention, one consistent bright spot has emerged repeatedly – recurring giving continues to grow.
When I first started speaking about the new opportunities in recurring giving, I had to convince the audience that it was a trend worth paying attention to. That is no longer the case - almost every nonprofit I speak to today not only sees the trend but also believes it’s an opportunity and wants to take advantage of it to grow its recurring giving program.
The question today is where to start. That’s what this Wave Report is dedicated to.
Getting Started with Growing Sustainer Giving in 2024
Every nonprofit I’ve ever worked with already has some form of recurring giving. Usually, it starts with a small group of donors who have self-selected to give monthly.
Later, a charity might make an effort to separate its monthly giving program, even giving it a name – Friends of the [Charity], [Charity] Partners, or similar. But at this point, it’s not really a central part of its fundraising effort.
As nonprofits recognize the value of a recurring giving program, they invest in building it out, developing a value proposition, making it a core part of their fundraising strategy, and developing strategies and tactics from acquisition and conversion to upgrading and retention (more on that shortly).
There are four primary “stages of maturity” that nonprofit sustainer programs fall under:
Starter - Just starting out. There are a small number of recurring donors and very basic giving options, such as a monthly giving checkbox on the donation page.
Basic - Some dedicated effort, maybe even a named program. Occasional promotion, but still not a core fundraising effort.
Intermediate - More significant effort, including regular recruitment and promotion. Some elements may be in place, such as new sustainer onboarding and program features like name, benefits, and an articulated value proposition.
Advanced - Sustainer giving is a central pillar of the fundraising effort. It has fully dedicated resources and strategies for acquisition, conversion, cultivation, upgrading, retention, cancellation, and reactivation. It operates across multiple channels and has sophisticated technology and measurement systems in place.
Which stage of maturity is your program at? I’d love to hear from you – I’ve put together an informal poll you can complete here.
As a thank you for completing the poll, we’ve curated a list of articles and podcasts we’ve created on recurring giving. You’ll get that list upon completion.
Above: What stage of maturity is your recurring giving program at? As a thank you for completing the poll, you’ll get a list of articles and podcasts.
💡 Takeaway: There are four stages of maturity for sustainer giving programs, from just starting to advanced. Growing recurring giving begins with understanding where you are at.
Now that you have a sense of where you are let me suggest three next steps to grow sustainer giving in 2024.
Step 1: Take Stock of What You Have
It’s hard to know where you are going if you don’t know where you’ve been. The first step, regardless of your level of maturity, is to understand where you are.
Start by looking at the following metrics:
Total number of active sustainers (gave at least one recurring gift in the last 12 months)
Revenue from sustainers (total giving from those sustainers in the past 12 months, including any single gifts)
Percentage of total revenue (divide the total revenue from sustainers by your organization's total revenue)
Long Term Value (LTV) of sustainers (60 months of total giving from new sustainers is ideal)
A note on LTV – this is the most important metric but also one that charities have a hard time calculating, often because they don’t have readily available data.
If you need to estimate LTV for now, I recommend using 5X the LTV of your single gift donors if you know that (the average nonprofit in my experience sees 3X-7X, so 5X is a good middle ground).
If you are at a more advanced stage, you will want to look at other metrics, such as average recurring gift amount, sustainer churn, sustainers by payment type (EFT, CC, Check, etc.), cost per acquired, LTV by channel acquired, and payback period (number of months to breakeven on the cost of acquisition).
💡 Takeaway: Understanding where you are is essential to charting where you want to go. It’s also highly motivating – nothing inspires like results.
The next step is to assess your program as it stands today.
Step 2: Evaluate Your Current Program
One of our privileges at Imago Consulting is assessing recurring giving programs and making recommendations. Evaluating existing sustainer programs involves three components.
Go on your donor’s journey.
One of the most powerful ways to identify significant opportunities and issues is to go through the sames experience your donors do. Put yourself in your audience's shoes and walk through the journey, making notes along the way.
When I am brought in to work with a charity on its recurring giving program, one of the things we do is conduct secret-shopper-style research, experiencing every step along the journey.
Inevitably, there are major insights that come from this insight – either a process that was thought to be in place but didn’t happen as intended, or a glaring gap or frustrating experience stands out. Likewise, there can be unexpected delights that provide clues to ways to amplify the experience.
Talk to donors
Look for opportunities to talk to your recurring donors, one-on-one or in groups. The reason to do this is twofold: to gather insights and to stay close to the donor.
The learning opportunities are there if you ask the right questions and listen. Ask questions to draw out the donor's underlying relationship to your cause, what giving means to them, what caused them to get involved initially, and why they continue to stay involved.
The other reason to talk to donors is the same reason store owners like to work the floor of their stores – to keep their finger on the pulse of the customer. In this work, it is very easy to get lost in the mechanics of fundraising and marketing. We remove our “human hat” and put on our “marketer hat,” which can lead to some pretty poor experiences. Connecting with donors keeps us grounded in the human experience.
Assess your value proposition.
Consider your offer and value proposition. The clarity of your offer and the strength of your value proposition need to exceed the friction of taking action.
Your offer should describe what the donor’s ongoing gifts will accomplish:
The problem or opportunity.
How the nonprofit is addressing it.
How much it will cost.
How the donor can be involved.
A timeline that evokes a sense of urgency.
The consequences of not acting (implied or declared).
Do you have a clear offer? Does it justify an ongoing giving commitment versus one-time?
Nathan Hill at fundraising research lab and agency NextAfter writes, "A nonprofit value proposition answers one fundamental question that every donor asks when considering giving to your organization: Why should I give to you, rather than some other organization, or at all?”
“Why should I give to you, rather than some other organization, or at all?”
I would add that recurring giving has to justify itself differently than one-time giving. Committing to give recurring gifts is a different kind of decision than giving a one-time gift, which can be given on impulse or in response to a momentary need.
Consider other elements of your value proposition as well. What benefits do you offer donors, either tangible or intangible? Are there incentives for joining, such as a match or a premium for signing up? Does the program have an attractive identity that draws donors in?
Recurring giving is an ongoing commitment and needs an ongoing value proposition.
💡 Takeaway: Subscription giving requires a clear offer and a strong value proposition. Consider whether yours is where it needs to be to maximize growth.
The final step to growing sustainer giving in 2024 is to think about three things in a loop – design, recruit, and cultivate.
Step 3: Think: Design, Recruit, Cultivate
Tactics are important, but given the importance of the sustainer value proposition, ensuring that you have a program worthy of donors' attention and participation is also important.
Design and launch (or relaunch) a compelling program.
From the first two steps, consider what you might do to improve the design of your program. You may need to design a program in the first place, or you may identify specific things you can do to enhance the attractiveness of the program.
Consider the core elements of your program – a high-quality value proposition, a clear identity, an offer that justifies monthly involvement, benefits for being involved, a dedicated presence on your website, a great onboarding experience, and ongoing cultivation.
Recruit everywhere.
Your sustainer program should be clearly a central pillar of your fundraising effort. Consider every channel and every campaign and strategy as an opportunity to grow the presence and value of your sustainer program should be clear.
As a starting point, here’s a list of channels I often see in programs I’m working with:
Events
Artist/Influencer Relations
Website
Face to Face
DRTV/CTV/Other Broadcast
Phone
Email
Social Media
Digital Media
Passive Collateral
Direct Mail
Cultivate, upgrade, and retain.
Long-term value (LTV) is the most important metric for sustainer giving, so how you cultivate, upgrade, and retain them becomes critical.
Start with welcoming them as the faithful core insiders they are to your charity, and treat them specially. They should receive additional asks throughout the year, but not necessarily every single appeal and ask. Even better - if you have a more mature program, send them special extra gift asks.
Look for opportunities throughout the year to invite them to increase their recurring giving strategically. The justification should always be focused on the donor and the timeliness and impact of increasing their giving.
Ensure you have solid processes for updating payment information, ideally automatically. Communicate with donors before any payment methods expire and promptly after any failed payments.
No matter what you do, donors will leave your recurring giving program. There are many reasons – financial hardship, decreased interest, a bad experience – or they may not know that payments have stopped. It’s important to have intentional strategies to invite these donors to re-up their recurring giving or at least to give occasional single gifts.
💡 Takeaway: Consider whether your program needs to be redesigned or designed anew to maximize recurring giving. Recruit new sustainers from all channels and audiences. Once they join your program, treat them like the faithful core supporters they are, and invite them to additional opportunities to stand with you through renewing or increasing their giving.
Assessing and growing your sustainer program
One of our favorite things to do at Imago Consulting is partner with charities to develop growth plans for sustainability programs.
Our Sustainer Growth Assessment & Action Plan includes an 11-point assessment with both qualitative and quantitative elements, including interviews with key leadership, a review of all existing and relevant past strategies, processes and systems, key metrics and health indicators, and team structure, a review of giftings, opportunities, and gaps.
11 areas we cover:
Structure and Team
The Program
Acquisition
Conversion
Cultivation
Retention
Upgrade
Cancellation
Reactivation
Reporting and Key Metrics
Systems and Platforms
The outcome is a list of prioritized insights and recommendations for what to strengthen, start, or stop to drive measurable results and profitable growth.
If you are interested in exploring this process, developing a tailored roadmap for growth, or considering a tune-up for your sustainer program, contact me with this form, and we can see if there is a good fit.
Announcement
I’m writing a book.
If you’ve read this far, you clearly care about recurring giving. I do, too.
I started the Wave Report to help leaders see the trends and opportunities to create growth through innovation. The massive and new opportunities to take advantage of recurring giving in the Subscription Economy are at the top of that list.
I’m passionate about helping nonprofit leaders see the opportunity. I’ve spoken about it at conferences, written about it here on the Wave Report, and published in guest publications. Now, it’s time to put that into book form.
I’ve been thinking about writing the book for years. I’ve been seriously working on it for over a year, and despite some reservations, I believe it is the time to tell the world. 🥺
I’ll share more in the coming weeks and months, but in the meantime, I’d love your feedback – is this a topic you’d want to see in book form? What questions do you have?
I don’t have all the answers. Far from it - in fact, the deeper I get into this world, the more I realize I don’t know. It’s a very deep topic and there are vast differences even between different sectors of the nonprofit world. But I think the industry needs this. I have some things to say that I think are unique, and I want to be a part of helping encourage the wave of momentum I see in the sector.
Candidly, I prefer to work quietly in the background on big stuff like this. It feels risky to share with the world, but the more I’ve shared privately, the more I hear from others. There is a lot of shared passion to understand and grow recurring giving. The more I’ve heard this, the more I realize I’m not going it alone. There is a group of people passionate about this, too. If that’s you, I’m glad you are here. And if you are just along for the ride, that’s fine too!
Until next week… Surfs Up! 🌊
- Dave
About the Author | Dave Raley
Consultant, speaker, and writer Dave Raley is the founder of Imago Consulting, a firm that helps non-profits and businesses create profitable growth through sustainable innovation. He’s the author of a weekly trendspotting report called The Wave Report, and the co-founder of the Purpose & Profit Podcast — a show about the ideas at the intersection of nonprofit causes and for-profit brands.
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