By Tim Sarrantonio, Director of Corporate Brand at Neon One
In 2023, giving to nonprofits was down—and it wasn’t a one-year blip. So that’s the bad news.
Here’s the good news: Recurring donors are bucking these negative trends. Not only are committed, regular givers holding strong in the face of industry-wide declines in giving, but their numbers are actually increasing!
In this post, we’ll cover six reasons—drawn from Neon One’s own research—why recurring donors are the future of nonprofit giving.
The Recurring Giving Report: Data-Backed Insights for Sustainable Generosity
How do we know so much about recurring donors? We analyzed five years of giving data from Neon CRM clients and produced an 83-page report, that’s how! (We promised to pay ample attention to our friends, family, and pets during the downtime).
We found that recurring donors are a uniquely valuable resource to the nonprofits they support—a trend that holds true for small, midsize, and large organizations alike! Let’s dive into the findings.
6 Things You Need to Know About Recurring Donors
The truly amazing thing about recurring donors is how resilient their support remains across all nonprofit causes and sizes. There are so many ways that the support of these loyal, engaged supporters can’t be summed up in numbers—but the numbers are pretty incredible, too!
Here are six ways—all backed up by hard data—that recurring donors show the path forward for nonprofit giving.
1. Recurring Donor Bases Grew by 127%
From 2018 to 2022, the average nonprofit saw their number of recurring donors grow 127%. Most nonprofits didn’t have a lot of recurring donors—your typical organization saw an increase from 11 recurring donors in 2018 to 25 donors in 2022—but that increase is still remarkable.
The report breaks down its results by organizational size, with additional separate analyses of small nonprofits (less than $1 million in annual revenue), midsize nonprofits (between $1 million and $5 million in annual revenue), and large nonprofits (over $5 million in annual revenue).
A graph with 4 lines representing small, midsize, large, and all nonprofits. All of the lines show growth in the average number of recurring donors from 2018 to 2022. There is also text stating that “the average nonprofit’s recurring donor base grew 127%” and an image of Neon One’s Recurring Giving Report, the source of these industry-wide recurring giving benchmarks.
Recurring donors increased across all three categories, too! Despite the fact that the average nonprofit saw the total number of records in their database decline from 2018 to 2022, this growth in recurring donors shows that your nonprofit’s most engaged supporters are willing to step up for their favorite organizations.
As recurring donors make up a larger and larger portion of a nonprofit’s overall donor base, their role in your fundraising strategy will only increase. How many of your regular donors are willing to set up regular, recurring gifts? There’s only one way to find out!
2. Recurring Donation Revenue Increased 144%
One of the great things about recurring donors is how the impact of their support compounds over time. With every scheduled gift, their donor lifetime value increases—not to mention that the regularity of their giving gives your nonprofit a stable revenue stream, which can be crucial for long-term planning.
This is another area where increases were seen by nonprofits of all sizes.
The largest percentage increase was for midsize nonprofits, with recurring donations growing 154% from $7,874.13 in 2018 to $20,002.61 in 2022.
But small and large nonprofits got in on the game, too! Large nonprofits saw their recurring donation revenue grow 143% (from $21,726.52 to $52,920.56), while small nonprofits’ revenue from recurring donations increased 134.66% (from $3,220.14 to $7,556.4).
For small organizations, recurring donations comprised less than 1% of revenue in 2018, but that percentage had grown to 2.39% in 2022. The potential benefits that small nonprofits can see from a thriving recurring giving program—especially the promise of greater financial stability—are huge.
3. The Average Recurring Donor Gave $941.11 in 2022
Cultivating major donors is always going to be a part of nonprofit fundraising. But reliance on major gifts can expose your nonprofit to the whims and changing priorities of individual givers—never a great position to be in.
On the other hand, recurring donors can make a financial impact similar to that of a major giver simply by giving smaller amounts consistently. By building a base of recurring givers, you ensure steady financial support while insulating yourself from the loss of any one supporter.
But just how big an impact can recurring donors make? In 2022, the final year we analyzed in The Recurring Giving Report, the average recurring donor gave $941.11. Here’s the rub: That number is actually quite a bit less than the amount given annually by the average non-recurring donor: $2,155.10.
So, while almost $950 from a single donor in a given year isn’t anything to sniff at, this would seem to undercut our point that recurring donors are the future. Why would anyone choose a donor who gives less than half what another donor gives? Small donations are great and all, but the numbers don’t lie. Do they?
Keep reading.
4. The Average Donor Lifetime for Recurring Givers is 8.08 Years
Read that headline again. As of 2022, our research found that the average recurring donor sticks around for 8.08 years! Compare that to non-recurring donors, whose average donor lifetime as of 2022 was only 1.68 years.
Let’s do some quick math. A non-recurring donor gives $2,155.10 annually but only stays for 1.68 years, bringing their lifetime value to $3.620.67. Meanwhile, a recurring donor gives $941.11 per year but stays for 8.08 years …
That recurring donor’s lifetime value? A whopping $7,604.17.
Once the average donor lifetime is factored into the equation, the value of recurring and non-recurring donors flips. Non-recurring donors go from giving over twice as much on an annual basis as recurring givers to giving almost half as much over the course of their relationship with the organization.
As impressive as that statistic is, it’s not until you pair it with this next one that the real ROI of returning donors really snaps into focus.
5. The Donor Retention Rate for Recurring Givers is 77%
On average, 2022 saw recurring donors stick around year over year at a rate of 77%. For non-recurring donors, the number was lower. How much lower? Try less than half: 34%
It’s a commonly cited truth that acquiring new donors costs way more than retaining your existing ones. With recurring donors, that truth is, well, is it possible for a truth to get truer? The ROI on recurring givers is out of this world.
And that makes this final finding the real icing on the cake.
6. 50% of Recurring Donors Make Additional Gifts
If you’ve built a base of recurring donors for your nonprofit, you might feel like one hand is tied behind your back when raising funds for a specific project or occasion. These folks already give on a regular schedule, they aren’t going to give additional gifts on top of that, are they?
They sure are! In fact, a staggering half of recurring donors make additional gifts to their favorite nonprofits above and beyond their recurring donations. It turns out that when someone loves a nonprofit enough to become a recurring giver, they’re willing to go above and beyond when the moment calls for it.
So don’t be afraid to include your recurring givers in your other fundraising appeals. Just make sure you create a donor segment for them that comes with special messaging—and maybe even their donation form tailored to acknowledge their ongoing support.
Conclusion
Investing in the long-term sustainability of your supporter base through initiatives like recurring giving isn’t just a strategy—it’s a gamechanger, particularly for smaller nonprofits that often find themselves on the periphery of sector-wide conversations about the future. These programs are not merely about stabilizing revenue but about cultivating a community of dedicated supporters who are invested in the journey and mission of your organization.
For small nonprofits, the power of recurring donations lies in their ability to level the playing field. They provide a predictable and steady income stream that can make planning and budgeting not only easier but also more strategic. Moreover, they create an opportunity for deeper engagement with donors, encouraging a sense of partnership and shared commitment that can amplify the impact of their contributions over time.
As the sector continues to evolve, the organizations that will thrive are those that recognize the value of building relationships that last. It’s about seeing beyond the immediate horizon and nurturing a supporter base that believes in the sustainability and necessity of your work. By focusing on recurring giving, smaller nonprofits can secure their place at the table, ensuring they are not just participants in the conversation about the future of the sector but active shapers of that future.
For the full analysis (plus actionable tips for implementing a recurring giving program), download the full report.
