January 15, 2016

Donor Relationship Management

Thoughtfully cultivating relationships with new donors and stewarding current donors in order to maximize donor retention, engagement and investment.

Donor relationship management is the process of thoughtfully and proactively cultivating relationships with new donors and stewarding current donors in order to maximize donor retention, engagement and investment. It typically requires clear segmentation and prioritization of donors and leads to the formulation of clear goals and action plans for how the nonprofit will interact with a given donor segment to achieve desired results.

How it's used

Most nonprofits have a range of donors, from large foundations or corporations to government agencies, individual philanthropists, and smaller individual donors. While all donors are important, their significance to the work of the nonprofit organization can vary greatly, as can their motivations and needs. Effective relationship management takes account of these factors and enables the nonprofit to determine what level and type of action and staff investment relating to each will best enable the organization to effectively achieve its funding model. By developing and implementing effective practices and systems that yield strong relationships with donors, nonprofits can generate more sustainable and dependable revenue, strengthen grant effectiveness, and, ultimately, achieve better results.


Specific donor relations strategies will depend on the organization's funding model and priorities; however, nonprofits that seek to employ donor relationship management can follow the following general guidelines:

  1. Segment donors: Nonprofits should pursue different strategies and level of engagement for donors depending on grant size and other funder characteristics. As a result, segmenting donors into relevant categories based on such factors as level of giving (or potential giving), donor type and key needs is the first step in donor relationship management.
  2. Encourage involvement: For each donor group, nonprofits should determine the level of engagement necessary to effectively manage the relationship and seek to involve donors accordingly. For larger donors (e.g., foundations, high net worth individuals), this may mean pursuing a relationship that goes beyond the provision of capital to become a partnership to achieve shared goals. For smaller donors (e.g., online donors), this may mean finding opportunities for more informal engagement (e.g., through fundraisers, volunteering or social media).
  3. Establish goals and frequent channels of communication: It is important to establish goals for donations and maintain frequent communication with donors of all sizes. For larger donors, this may mean providing frequent updates on program progress to gather input, while for smaller donors it may mean monthly newsletters or annual reports.
  4. Gather and incorporate feedback: Throughout donor engagement efforts, nonprofits should seek to gain feedback from donors about their satisfaction with the relationship. For example, organizations might ask smaller donors how often they would like to receive emails. For larger donors, nonprofits can establish written and in person reporting and updates on a cycle mutually amenable, always encouraging open channels of communication to enable donors to provide feedback.

Related topics

Additional resources

The Donor-Grantee Trap: How ineffective collaboration undermines philanthropic results for society, and what can be done about it
Adapted from the book Give Smart:Philanthropy that Gets Results, this article highlights the factors that can undermine—and strengthen—donor-grantee relationships.

Webinar series: Cultivating Lifelong Donors
A free, five-part webinar series that helps nonprofits build long-term giving programs that span the entire supporter lifecycle, from engagement through the end of life.

eBook: Cultivating Lifelong Donors: Stewardship and the Fundraising Pyramid
A 60-page eBook that guides readers through the process of cultivating new donors, managing relationships with existing donors, and building a "complete" fundraising pyramid.

Nonprofit experts in fundraising, marketing and communications, social media, mobile technology, digital advertising, and more come together to bring you insights and advice on leveraging technology to engage your donors.

Examples and case studies

City Year fights the national dropout crisis with Salesforce
This case study tracks City Year's move from Excel spreadsheets to a Salesforce based donor management solution that allows it to paint a detailed picture of its donors, their contributions, and what programs their money is supporting.

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