Lapsed Donors 101: Understanding Lapsed Donors and Their Potential
What is a lapsed donor?
Lapsed donors are individuals who contributed to your nonprofit organization in the past and have stopped giving. Many organizations consider a lapsed donor as someone who has not given a gift in the last 12 months. However, this can vary depending on what your organization defines as a lapsed donor.
Why do donors lapse?
Donors can lapse for a number of reasons such as:
Their personal situation may change. Economic and financial pressures may cause a donor to not have the disposable income they once had.
Do not feel appreciated. Donors would like to feel appreciated for their contributions to your organization, and for many donors if they do not receive a thank you for their gift it may cause them not to donate again.
Uncertain about the impact of their gift. Donors want to know that they are making a difference. If your organization is not reporting back the impact of your supporters' gifts, they may not feel like their gifts are generating the results that they had hoped for.
May have forgotten that they gave to your organization. Especially in times of crisis, donors may be motivated to give to a cause, or several causes. And over time, if there is no communication between the organization and the donor, they may simply forget that they contributed to your organization.
Why should your organization pay attention to lapsed donors?
Building long-term relationships with your donors is a key component to any organization’s fundraising strategy. A high number of lapsed donors may be an indicator that you will need to reconsider your current donor stewardship strategies. If the number of lapsed donors has been increasing over time, you may need to implement new stewardship initiatives.
Oftentimes when organizations are looking for new donors to support their nonprofit they look outside of their organization for potential donors who have never made a gift in the past. But, an often overlooked group of donors is their lapsed donors. These donors have given before, and already have a familiarity with your organization and mission.
In the for profit world, one of the costliest processes in the business cycle is finding new customers. It is much more cost effective in terms of time and money to simply retain a customer then to find new ones. And the same can be said for nonprofits. It is easier to maintain current relationships, with those who have supported you in the past, than to cultivate new ones.
How to identify lapsed donors
With a well-organized spreadsheet, or donor management software that can generate this automatically, you can pull together a list of these lapsed donors. First, you will need to define the timeframe of a lapsed donor for your organization. Then you will need to go through all of your donor gifts and note those who have not given in the timeframe that your organization has specified. For instance, if a year without donating qualifies a lapsed donor, highlight these individuals in your document, spreadsheet, or donor database.
How to reconnect with lapsed donors
Once you have identified your lapsed donors use it as an opportunity to reconnect with them. Whether that be an email or a hand-written card, connect with these donors in a way that feels right for your organization, and within the capacity of your staff and volunteers. Shifting your focus from seeking new donors to re-engaging those who've previously shown their support will help boost your donor retention rates over time, which will help with funding your organization more stably over the long-term. Remember, re-engaging past donors may not happen after just one communication, and can require careful planning, but it's a friendly approach to welcome back your previous supporters.
Lapsed donors are a valuable resource and can be a great source of fundraising potential for your organization. And if you are proactive in identifying them it can lead to encouraging results for your organization. By implementing engagement strategies, your organization can renew bonds with those who previously gave to your cause. These renewed relationships not only contribute to your organization's sustainability but also allow it to continue its essential work. Lapsed donors have shown their support in the past and with the right approach, they can be encouraged to do so again.
