Most nonprofits need a dependable foundation of unrestricted support. To build this base of ongoing support, one of the best things you can do is build a strong recurring gift program.

What is a Recurring Gift Program and Why Start One?

A recurring gift program is a group of loyal supporters who generously give a monthly gift with no specific end date via a credit/debit card or bank draft.

You’re probably thinking, “Of course we need unrestricted revenue, but I don’t need one more thing to do or maintain. Why should I start something new?” Well, recurring gift programs are different. They work in your favor, helping you raise funds smarter, not harder.

Advantages of a Recurring Gift Program

Recurring gift programs are appealing to organizations for many reasons. Recurring gifts:

  • Are very cost-effective as the gift is only solicited once
  • Are processed electronically, so costs are low
  • Provide steady and reliable income generation

If you built your program up to 200 monthly donors who gave an average of $50 per month, your organization would have a platform to generate $10,000 of monthly unrestricted revenue. Some donors may give only $5 per month, and others will give up to $83.33 ($1,000 annually) or even $150 monthly. I have several donors who give $833.34 monthly.

Additionally, multiple studies have shown that recurring donors give more than donors who give one-time gifts over the course of both a year and over the lifetime of a donor.

In an article from The Agitator in May 2019, Kevin Schulman refers to monthly donors as “high commitment donors,” a category that also includes major donors and planned giving donors. He states that monthly donors are more likely to become major and planned gift donors as well.

I have found this overlap between the categories to be true. I have seen major donors and estate donors become significant monthly donors, and I’ve seen monthly recurring gift donors make larger commitments (through both planned and major gifts) over time.

Appeal of Recurring Giving to Donors

Why would donors find recurring giving appealing? Donors are drawn to a recurring gift program for a variety of reasons. Donors appreciate that recurring gifts are…

  • Cost-effective as more of their gift goes to support your organization’s mission rather than to administrative and fundraising costs
  • A reliable source of income for stability and growth for your organization
  • Convenient since they renew automatically
  • Easily built into their monthly budget, enabling them to make a larger gift than perhaps they thought possible
  • More gratifying as they are an investment in long-term projects and encourage participation in sustainable improvements
  • Eco-friendly by eliminating the need for paper checks and decreasing the reliance on direct mail

How Do I Get Started With a Recurring Gifts Program?

I recommend an 8-step approach to starting and building your program.

Step 1- Explore Technical Options

The first thing you need for a successful and easy to maintain recurring gift program is a software solution that will securely store the credit card numbers of members and charge them each month at the designated time.

You also need a donation management solution that allows donors to sign up to be recurring donors anytime…day or night.

Here are a few things to consider as you look at technical options:

User Experience (UX)
Creating a frictionless experience from beginning to end for your website visitor and donor will dramatically increase recurring gift conversions.

Mobile Optimized
With mobile device usage having long surpassed desktop usage, having a donation page that displays well on mobile devices is an absolute necessity at this point.

Easy for Staff to Manage
Backend must be simple to use with a dashboard that allows staff to easily manage donations as well as other donor actions.

High Security
All transactions must be Payment Card Industry (PCI) compliant and highly encrypted storage of the donor’s credit card number.

Payment Processor
A company that acts as a kind of mediator between the bank and the merchant in the credit card transaction process is needed.

Automation
A complete automation of recurring payment and donor acknowledgement receipt for time-saving efficiencies.

When I began this research to start our recurring gift program at Starr King, we had a few donors who had requested to make monthly gifts, but without a technical solution, credit card numbers were stored in a file cabinet and manually entered and charged once a month.

We needed technology to securely store the numbers and to automatically process the charges. Generally, any investment in technology for this purpose is recouped through the recurring gift funds raised within a few months, not counting staff time saved.

We also did not have the ability to set up web giving forms for recurring gifts. For us, the solution was available in our current database package, but it wasn’t being utilized.

Of course, prospects could set up a recurring gift by calling staff or writing their credit/debit card number on a reply card or form, but the best way to grow a recurring gift program fast is to provide a way for donors to set up their recurring gift online. This makes becoming a monthly donor quick and seamless, and it is the only real way to grow your program long-term.

Step 2 – Build Internal Organization Support

I recommend writing up some draft text for your recurring gift program donation page as well as a short executive summary of your plans and circulating this to leadership and relevant staff.

The main question you’ll need to answer is: “Why do we need to do this?” Feel free to use information from this blog post to build your case.

If your plans may result in new work tasks for anyone, letting them know what you are planning and answering those “why?” questions is the first step to making this a team effort.

Step 3 – Create an Identity and Logo for Your Group

We know how important it is to recognize those who support your organization. This is especially true for those who have chosen to contribute to your program on a regular basis. Creating a sense of identity and community around this group of special donors will provide them with that special recognition and help engender ongoing donor loyalty.

Along these lines, an effective course of action in launching your recurring gift program would be to create a unique identity for the group, including its own logo and webpage. We chose to call our program, The Starr King Sustainers.

starr king sustainers logo

The donation page includes special messaging about the program and a listing of the benefits for donors.

The nature of the program, the benefits to both to the organization and the donor, should be clearly articulated on the program webpage before any solicitation begins.

Not only does having an identity for the group give donors a sense of belonging, but it helps them to project how their generosity, combined with that of the other members, is amplifying the mission of your organization.

Another example of an organization that has effectively branded their recurring giving program is the Oakwood Arts and their Oakwood Arts Call Sheet. A call sheet is used on film sets to help cast and crew members stay organized and plan ahead, and Oakwood Arts has developed a fun, engaging theme around that concept.

oakwood arts landing page donation page

Example: Oakwood Arts recurring giving web page and donation page for the Executive Producer, $250/month tier.

Step 4 – Get Your First Members on the Phone

It’s likely you already know who your most ardent supporters are. Make a short list of 25-50 prospects whom you think would be willing to become your first members in your new recurring gift program.

Hop on the phone (or Zoom) and give them a call. Explain to them the benefits (both to them as donors and to the organization) and make an ask. Can you get 10 members in your program from phone calls?

I recommend this step because it gives you the opportunity to test your program before you spend money on mailings or before you have a deluge of new donors entering the system. This allows you to pilot the program with a small group of happy, tolerant donors before the big rollout.

The other advantage to beginning with a small group is that you can ask these donors to provide testimonials about why they became recurring gift donors and the ease of signing up, etc. This becomes an important part of your launch campaign.

Step 5 – Build a Plan for a Broader Recurring Gift Campaign

Once you’ve experienced a few months with a small number of recurring gift donors and everything is running well, go ahead and launch your inaugural recurring gift campaign. Utilize a variety of solicitation methods to reach diverse audiences within your constituency.

Make your case with the same language you use on your website and donation page, focusing on the benefits of monthly giving for the organization and the donor. Show prospective monthly donors how it works and why it’s beneficial using testimonials from your pilot program. Consider using video throughout the donor’s journey and even on the donation page to communicate how much of an impact a recurring contribution could make.

If you use a testimonial as the anchor for a direct mail piece, you can then modify that text and use it in an email and social media post. You can then use other testimonials for future emails and supporting social media posts as follow-ups.

I also recommend continuing to work the phones. If you have a phonathon, great! Change the scripts to focus on recurring gifts. If not, keep connecting one-on-one with donors. You would be surprised how many major donors will also support the organization on an on-going monthly basis. Keep asking and feeding that sense of momentum and success.

And, don’t discount passive mentions of the program. For instance, including a link and some brief language about the launch of this program in every general newsletter or e-newsletter your organization does for several months.

You also want to make sure you are returning to your community with regular updates about the growth of the program, including numbers of members and the total monthly and annual amount of support those members represent for your mission.

Step 6 – Put Some Perks in Place to Say Thank You

The benefits of this program should be minimal but distinct from being a one-time annual donor. Benefits are a way to say “thank you” to these loyal supporters and steward their ongoing involvement with the organization. The benefits of the program should not become a burden in terms of either budget or staff time.

Most membership programs tend to become upside down, meaning the amount of the membership is exceeded by the total costs of the benefits provided. We should guard against this. Your monthly donor program would not be a traditional member program as it is more of a recognition society that may use the word member.

Here are some ideas to get you thinking creatively about “member” perks:

  • Sticker/Decal (sent annually with their annual receipt in January)
  • Access to special Facebook group only for monthly donors
  • Early registration for events
  • Annual Zoom Q&A with the CEO or stewardship event
  • Recognition on your monthly giving program website
  • Letter or handwritten note upon joining program

In addition to these benefits above, you should also tout less tangible benefits such as:

  • Easier for donor to budget and easier on your wallet
  • Donor can maximize your gift’s impact with manageable monthly increments
  • Donor has control over their giving
  • Monthly gifts renew automatically
  • It’s paperless, so it’s easier on the environment (only send acknowledgements once per year in January for tax purposes)

Step 7 – Maintain and Upgrade Members

Maintenance
Credit and debit cards have expiration dates. One of the few maintenance costs of the program may be to those who are about to expire and capture their new expiration date or an alternate card.

Even if your program grew to 200 donors, and on average credit/debit cards expired roughly every two years, that’s about eight phone calls or follow-up emails per month. That’s a manageable workload.

Upgrades
Periodically, it will be necessary to ask stalwart Starr King Sustainers to upgrade their monthly amount. A rule about when to do this can be determined as the program grows, perhaps every two years from the origination of the recurring gift. The upgrade amounts would be minimal monthly increases but those would add up over time.

Step 8 – Add New Members With an Annual Recurring Gift Push

Don’t let the early months of a recurring gift program discourage you. It can be somewhat disappointing to see fewer sign ups than you had anticipated, but your persistence will pay off as you will slowly see them increase over time.

The persistence will be worth it in the long run, especially since these are high value donors with the potential to upgrade their gift. They also have an extremely high renewal rate at little to no cost.

We began our recurring gift program, coined The Starr King Sustainers in 2016 with 11 existing monthly donors, representing less than $1,000 per month, not even $12,000 annually.

Now, we have a program of over 80 monthly donors, representing over $4,300 monthly or almost $52,000 annually in support of our organizational mission. That’s an increase of nearly 70 committed monthly donors and over $40,000 to our annual budget.

We have been even higher than that in the past in both membership and dollars. The process took longer than I expected when I began, and it wasn’t (and still isn’t) linear. Our numbers go up and down monthly, but the long-term trajectory is up.

But, each of our monthly donors is proud to support our mission in this way, and the program takes very little staff time to maintain. For an additional $40,000 of operating revenue per year, that’s totally worth the effort.

Final Thoughts

I mention my ups and downs in building this program to remind you that your donors will have things that come up in their lives and they may need to take a break or cancel. You need a process of reaching back out and renewing them again.

You also need an annual push to bring in new members to replace those who have lapsed and add some more members to keep your program growing. That means sending mail pieces and emails, posting on social media about your monthly giving program, and hitting the phones. It also means periodically reviewing your maintenance and upgrade practices.

Writing this has helped me realize that it’s time for another focused push for monthly giving at my organization. I’ll be drafting my plans soon to grow the Starr King Sustainers program so that it is even more of a foundational support for our annual budget. I hope you too will consider launching or reinvigorating your monthly recurring gift program.

Build a Strong Recurring Gift Program With Humanitru

Create beautiful, mobile optimized membership, donation, and recurring gift pages with the Humanitru platform, complete with highly secure payment processing capabilities. Your staff will save more time with a user-friendly dashboard that automates recurring payments as well as branded receipts to the donor every time a transaction occurs.

To learn more about our full suite of fundraising tools, visit our Features page or get a quick overview on our Product Tour page.

Sign up for a demo today, and we’ll be happy to give you a walkthrough of our fundraising solution.

oakwood arts donation page desktop

With over 20 years of fundraising experience, Jessica has worked for the Starr King School for the Ministry, The University of Southern Mississippi Foundation, The University of South Carolina, RuffaloCODY, and the Libertarian National Committee. As a consultant, Jessica provides her fundraising services to nonprofits and higher education organizations. You can find her at Real Deal Fundraising.
Jessica Cloud, CFRE, MA

Fundraising Success Coach

Humanitru clients experience an average active donor growth of 69%

See how we can help you reach those who support your mission and grow your revenue today!

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