Donor Letters for Nonprofits

What are donor letters?

Donor letters, also known as donation letters, are a form of direct mail that you send to your supporters to solicit a donation or cultivate your donors. Direct mail is a type of communication that can help generate funds and affirm donor relationships.

Even with a growing focus on digital communication, many nonprofits send direct mail in addition to other communication methods like phone, email, and text message.

How do nonprofits use donor letters?

Kindful’s 2020 Fundraising Confidence Report found that nearly two-thirds of nonprofits solicit donations through direct mail. While only 17% of respondents said direct mail was their most effective fundraising tactic, many organizations use direct mail for other purposes too. For example, nonprofits can use direct mail to cultivate supporters.

What’s the difference between solicitation and cultivation? Cultivation letters include newsletters, updates, financial reports, and opportunities for supporters to get involved with the organization. Solicitation letters include a specific ask for a donation, purchase, or other fundraising opportunity. We recommend using both solicitation and cultivation letters to see what works best for your organization.

How do you track the success of donor letters?

While it’s not easy to track who opens and engages with direct mail, there are strategies to see how successful your direct mail campaigns are. In order to do this, you’ll need to include calls to action. You can use tools like QR codes and short links to make it easy for your supporters to shift from paper to online. If applicable, use UTM variables in your links so you know exactly where your supporters are coming from.

You could use a URL like this to track users who visit your website from a monthly newsletter:

https://mattshands.org/?utm_source=newsletter&utm_medium=direct_mail&utm_campaign=january_2022

You can also use a service like Bitly to shorten the URL, so it’s easy for supporters to type it into their browser while still tracking where they come from. You can generate URLs with UTM variables using Google’s Campaign URL Builder.

If you’re using a solicitation letter, there are two other ways to track the success of your direct mail campaign:

1. Include a text-to-give option on your letter.
   You can create a specific text-to-give campaign to track who gives in response to your direct mail.
2. Include a special field on your donation page.
   Consider adding a field to your donation form that asks, “How did you hear about this giving opportunity?” This allows your donors to tell you directly what led them to donate. While direct mail may not be the only way they heard about the giving opportunity, it could be a significant factor.

Keep in mind that you can also ask your supporters about their communication preferences. Consider sending a survey to see which supporters prefer direct mail. You can provide an opt-in opportunity for mail just like you do for email subscriptions.

What are different types of donor letters?

Nonprofits use letters to solicit and cultivate their supporters. Here are some specific types of donor and donation letters:

Welcome letter

A welcome letter provides you with the opportunity to establish a relationship with new supporters. This is especially important for first-time donors and new recurring donors.

Donation acknowledgement letter

A donation acknowledgment letter is a donation receipt letter that nonprofits send to their donors to thank them for their gift. The IRS requires nonprofit organizations to provide a formal acknowledgment letter to donors who give more than $250 for tax purposes.

Donation request letter

A donation request letter is a type of fundraising appeal in which nonprofit organizations ask for financial support from potential donors. Nonprofits send donation requests to motivate donors to give, which makes sending them an important part of an organization’s fundraising strategy.

Year-end giving letter

A year-end giving letter, or end-of-year donation letter, is a type of donation request letter that you send during the last few months of the year. It’s a good way to solicit donations in time for December 31, which is typically the largest giving day of the year.

Lapsed donor letters

A lapsed donor letter is a letter you send to a donor who has stopped giving. Typically the goal of the letter is to ask them to give again or reconnect to your organization. You may also have lapsed volunteers or lapsed members that you send letters to as a way of inviting them to get involved again with your organization.

Thank you letters

A donor thank you letter is an opportunity to show your gratitude to a donor. Acknowledgement letters can also serve this purpose, but you may want to send more general thank you notes to affirm a donor’s relationship with your organization. For example, you might send a thank you letter at the end of the year to thank all your supporters for what you’ve accomplished that year.

Newsletters

A newsletter provides donors and subscribers with updates about your organization. Nonprofits can include information like beneficiary stories, team updates, financial status, program updates, and upcoming events. The goal of donor newsletters is to keep your donors informed and engaged with your organization.

Is it worth it to send direct mail to your donors?

Sending letters may sound like a painstaking process, especially for smaller nonprofits. While it may not be as easy as sending an email, there are several ways you can use your donor management system or nonprofit CRM to streamline the process.

1. Use automatic acknowledgment lists to automatically prepare your donor acknowledgment letters.
2. Use a tax summary generator to instantly print tax summaries for your donors.
3. Eliminate contact duplicates so you don’t send duplicate letters.
4. Use mail merge to segment your donor letters, envelopes, and labels.
5. Use group segmentation to help target your communication.
6. Create templates for different types of donor letters.
7. Keep track of contact relationships so you don’t send multiple letters to donors in the same household.
8. Keep a record of important contact details like their preferred name, giving history, communication history, and location so you can personalize your letters.

With the right systems in place, you can save hours on sending direct mail, allowing your organization to take advantage of another communication channel and affirm your relationships with your supporters.

See more donor management features from Kindful

Bottom line

Over 63% of nonprofits use donor letters to solicit donations and even more organizations use them to cultivate donor relationships. You can use a donor management or nonprofit CRM platform to create a system that makes it easy to generate all different types of letters for your supporters.