GENEROSITY, THE SUBSCRIPTION ECONOMY, AND THE FUTURE OF NONPROFIT FUNDRAISING BY JAMIE MCDONALD, CHIEF GIVING OFFICER, NETWORK FOR GOOD Inspire them once, get them giving forever The most important supporters of any nonprofit are the committed donors who give each year. Today, most repeat donors are acquired through an expensive process of online and offline stewardship, involving periodic communications and cultivation followed by an annual ask. And every year, 40-50% of these past donors fall away. Technology is enabling nonprofits to reverse this dynamic with subscription giving.
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NTEN CHANGE | DECEMBER 2014
To receive multiple one-time donations from a single donor, a nonprofit must present a persuasive reason to give every time, which may or may not work. But with subscription—or recurring—donors, you only have to inspire them to donate once. After that, they must actively take steps to stop being generous—which goes against our basic instincts. This results in the long-term retention of subscription givers who will end up giving more over their lifetime than they would as one-off donors.
The rise in the subscription economy It’s not surprising that recurring giving is on the rise. Its growth mirrors one of the hottest trends in the economy: subscription buying. You may be familiar with subscription startups like Dollar Shave Club, Birchbox, Love with Food, Pact Coffee, and even big companies like Microsoft and Adobe that now sell software through low-cost monthly subscriptions as an alternative to onetime purchases. These companies recognize the value of subscription buyers in terms of recurring revenue, loyalty, ongoing marketing, and higher lifetime value. Growing momentum in nonprofits Nonprofits are now getting in on the action. Subscription giving is the fastest growing segment of online giving,