Everything you need to know about tiering donors

6 October 2021

Building strong lasting relationships with your donors and making sure they are thanked properly and feel appreciated for their donation is hard work. That is why tiering your donors is a great way to help you manage your fundraising efforts better as not every type of donor shares the same economic value. It is important to separate them so you can focus your time and effort towards donors who are more likely to donate large amounts or more frequently than others. 

This may seem as you are isolating small donors but there simply isn’t enough time to go above and beyond for all. While all donors should be thanked and appreciated, bigger donors have a huge impact on your organisation so it is crucial that you spend time making sure they know how much their contribution means to you.

That is why we’ve put together everything you need to know about tiering donors to help build strong relationships to increase giving.

Why is it important?

Tiering donors is so important as it can save your organisation so much time and money because showing every donor that same amount of appreciation is costly and often unrewarding. It may seem harsh but it is a reality, tiering donors will allow you to clearly see how much each individual donor contributes to the overall economic value of your organisation. There is no point in spending money going above and beyond to only receive $2 in return.

How do you tier them?

There is no set way to tier your donors but a simple way to get you started is by simply dividing them into three groups; Major donors, Medium donors and Minor donors. This can be done by calculating each individual donor’s contribution over a financial year or lifetime value. Some donation platforms like Generous even calculate it for you, all you have to do is enter in the values for each group and the donors will receive different stars on their profiles.

Major donors

Major donors make a massive difference to organisations, so it is crucial that you make them feel like they are a part of your organisation and by trying to build a personal relationship with them. The more you go above and beyond to show how much value they bring to your organisation the more likely they are to continue making sizable donations as they will feel as though they are making a difference and helping your cause. 

The level you should go to trying to thank your major donors is largely dependent on available funds, so don’t spend what you don’t have. For major donors, you can send a gift to symbolise your appreciation, but if money is tight and you can’t send every major donor a gift, consider making a personal phone call. This will allow you to start building that strong personal connection as you will be able to learn a bit more about your Major donors and gain insight into why they are so passionate about your cause. A personal phone call may not seem like much but showing major donors you are willing to spend time on making sure they are thanked and heard will only extend the branch for further communication in the future to create a long-lasting positive relationship. Major donors can also be highlighted on your website, social media and or newsletters as a cost-effective way to show their importance to your mission.

Medium donors 

Medium donors still have a big impact on organisations, so you should still work hard to ensure you look after them, as if done well they may become future major donors. To show your admiration for medium donors’ contribution you could send out an organisation pack, this could include some information about your organisation and campaign as well as some nice merchandise. This will show donors that you recognise their valuable contribution and that they are a part of your mission, pushing them to continue to donate. 

After an initial organisation pack is sent you can continue building a relationship with them by sending our anniversary letters or birthday cards, to remind them that you value their contribution. It will also show that your organisation takes time to ensure they manage their donors with care and with a personal touch.

Minor donor

Minor donors may just be one-time donors or small recurring donors but don’t underestimate how much value they bring to your organisation. Make sure you still make an effort to understand them so you know how to best reach them through different channels in case they ever want to increase their donations or are considering setting up a recurring gift. Minor donors are just the first step if you look after them and start building a good reputation with them, they may become Major donors in the future. 

Always thank your donors with an email after a donation, try to personalise that message as much as possible, so they feel acknowledged. Most minor donors will not expect much, so try your best to show your gratitude and why your organisation is different from others, to start building a relationship with them. Keep them up to date with all your organisation’s news so they feel involved and included no matter how small their contribution is. Lastly, encourage them to follow your social media accounts and share their donations, this will allow you to reach out to them personally and comment on their post, showing that your organisation recognises and admires all donors.

Keep up to date

It is important that you constantly keep track of your donors’ contributions because over time they may decline or increase their donations. Therefore you need to continually update their status, this will allow them to see that you notice their contribution and value to your organisation. This will push them to even consider increasing their donation further. 

Keeping up to date will also allow you to make sure you don’t waste any time and money thanking donors who have stopped donating or decreased their donation. It is important to keep track of your donors’ donation contribution as it will allow you to know who to contact if they cancel their donation so you can ask them why and potentially change their mind. 

Separating your donors into groups may seem harsh but it will save you time and money in the end and will ensure that each donor feels appreciated. 

Tiering donors also will help you to stay better informed about your donors’ value to your organisation so you can better manage your relationship with them to improve your organisation’s overall reputation to increase giving.

Want to increase your donations? Take a  tour to find out how Generous can help you get started.