A Comprehensive Guide to Understanding Donor Recognition

What would you do if your organization hit a record number of new donors within a year?

Celebrate! But what about after the initial excitement wears off? Discovering that donors share the same values and passion for your cause is exhilarating. However, many organizations fail to communicate their appreciation adequately which can have negative retention effects. 

In fact, lack of recognition is one of the top five reasons why donors chose to stop giving. That said, donor recognition is a key part of donor stewardship which can usher first-time donors into long-term supporters. 

In this guide, we’ll explore the ins and outs of donor recognition and discover how your organization can create an effective recognition strategy. Let’s dive in!

What is donor recognition?

Donor recognition describes the process of thanking your organization’s donors for their gifts to your nonprofit. Many nonprofits separate recognition into tiers (more on this later) based on the type of gift and amount given by a donor. Nonprofits refer to this tier system to ensure their recognition level matches a donor’s generosity.

There are several methods for recognizing donors. Everything from a simple phone call to a fancy outdoor display falls under this category. However, the purpose of every donor recognition strategy is always the same: to acknowledge a donor’s generosity.

Why does donor recognition matter?

Donor recognition should be a priority for your organization as it helps you retain and upgrade donors. Additionally, donor recognition has benefits for both nonprofits and donors.

For nonprofits, donor recognition accomplishes 5 objectives:

1. Donor recognition increases donor retention. Recognizing donors makes them feel like they are making a difference. It also indicates that your organization prioritizes showing appreciation regardless of the gift amount.
2. It encourages recurring giving. Donors who feel recognized are more likely to give more and give more often. When you take time to recognize a donor’s gift, you indicate that they’ve made a smart choice to donate to your cause.
3. It helps you acquire more donors. Recognizing donors publicly can act as a form of social proof. When people see their friends donate to a cause, it motivates them to explore the organization and maybe get involved themselves.
4. It promotes a positive brand image. Organizations that prioritize donor recognition further their positive perception in people’s minds. People notice when nonprofits go the extra mile for their supporters.
5. It encourages an atmosphere of gratitude. Staff, volunteers, and other supporters want to work for an organization that expresses gratitude regularly. The positive emphasis on appreciation creates a vibrant work culture.

For donors, recognition accomplishes 5 objectives as well:

1. Donor recognition makes donors feel valued. Donors like knowing that their gift is appreciated. Frequently showing recognition makes them feel valued as important contributors to your organization.
2. It affirms their decision to give. Donors could have given to any cause, or not given at all. When you recognize their contributions, you reassure them that they made the right choice.
3. It deepens their connection with your organization. When organizations recognize donors individually, it makes them feel like a part of the team. This deepens their connection and can even encourage them to get involved in other ways like volunteering.
4. It reminds them of their impact. With plenty of distractions, donors can easily forget to support your organization regularly. But, when you recognize them, you remind them of their special part in driving impact.
5. It offers community connections to like-minded people. Recognition policies, especially event-oriented ones, allow donors to make connections with like-minded individuals and expand their personal and professional networks.

As you can see, consistent donor recognition accomplishes both nonprofit-related and donor-related objectives. That’s why creating a robust recognition program now can cause positive ripple effects for your organization for years to come.

Who should your nonprofit recognize?

Your goal should be to make all supporters feel recognized and valued for their contributions,

regardless of the size of their gift.

But, it’s important to choose recognition strategies that adequately address the level of a donor’s generosity. Responding with an unexpected abundance or limited amount of recognition can throw your donor relationships off-kilter, leading to feelings of dissatisfaction.

To avoid this, you’ll need to create donor recognition levels based on donation type, donation amount, engagement level, and donor type. Let’s explore each in more detail below!

Donation Type

There are several different donation types, from matching gifts to in-kind donations. Generally, donors give through one of the following donation methods:

• Cash: Direct monetary deposit to your nonprofit organization.
• In-Kind: Food supplies, medical supplies, or other tangible goods.
• Time: Donors can choose to devote part of their time to volunteering with your organization and may even apply for volunteer grants to help you raise more funds. 
• Matching Gifts: Many corporations offer matching gifts as a part of their philanthropic initiatives, meaning they match their employee’s donations at a 1:1 or 2:1 ratio.

Depending on the type of donation, you can organize your recognition program to acknowledge their specific gift. For instance, if a donor opts to give through a matching gift program (or takes advantage of matching gift autosubmission), your recognition should acknowledge their thoughtfulness in doubling their donation. 

Donation Amount

Many nonprofits segment their donor tiers by donation amount. How you determine the tiers will depend on your organization’s average donation size. A smaller nonprofit’s average donation size might be $200 while a more established nonprofit’s average donation size might be closer to $2,000. 

For example, a community-based nonprofit’s donation recognition levels might look something like this:

• Friends: $100 – $499
  • Tax receipt and handwritten thank you note from the Executive Director
  • Recognition in annual report

• Believers: $500 – $4,999
  • All the benefits of the Friends level
  • Exclusive updates on nonprofit activities, impacts, and forthcoming initiatives
  • VIP experiences and behind-the-scenes access or unique networking opportunities

• Advocates: $5,000 – $19,999
  • All the benefits of the Believers level
  • Website or newsletter recognition feature
  • Named sponsorship recognition

• Visionaries: $20,000 – $49,999
  • All the benefits of the Advocate level
  • Press release and major publication recognition
  • Special event recognition 
  • Naming opportunities
  • Ongoing personalized stewardship

You can also organize these levels based on impact. For instance, a food pantry might categorize amounts by their ability to feed five families, fifty families, or two hundred and fifty families. Adjust the amounts and the recognition titles to best suit your organization’s average donation size and missional impact. 

Engagement Level

Donors can also be categorized by their engagement level with your organization. This identifier will significantly impact how you decide to recognize them. Here are the various engagement levels to consider:

• First-time donors: It’s important to promptly recognize first-time donors to affirm their decision to give to your cause and welcome them to your organization. Welcome packets full of fact sheets about your organization, branded merchandise, a thank you note, and upcoming volunteer opportunities are a great way to recognize new donors. 
• Repeat donors: Currently active donors that know your organization well are also worth recognizing. Show them your appreciation with personalized phone calls, exclusive nonprofit updates, and event invitations tailored to their interests. 
• Major donors: Donors who give significant amounts of money to your cause definitely deserve thoughtful recognition. Keep them in the loop with specialized impact reports and dedicated donor thank you events as a part of your stewardship efforts.
• Legacy donors: People who decide to dedicate their life’s earnings through planned gifts or estate plans qualify as legacy donors. These generous individuals should be included in legacy society publications and given exclusive updates on their future gifts’ impact. 

You can categorize this donor data within a dedicated CRM so that your team can reference and update it throughout your relationship. That way, you’ll never miss a beat when recognizing new or long-time donors. 

Donor Type

Donor types differ across three major categories:

1. Individual donors.
2. Corporate donors.
3. Foundations. 

Your recognition efforts will need to be adapted for each donor type. For example, personalized acknowledgments and donor spotlights are suitable for individual donors, while corporations might benefit from specialized CSR employee engagement programs. Foundation recognition, on the other hand, would take the form of grant acknowledgments. 

Top Donor Recognition Ideas

Depending on the above considerations for each donor, there are several ways you can recognize them. As always, you’ll need to match the strategy to your relationship with the donor for maximum impact. Here are some top recognition ideas based on engagement levels and donation amounts:

Digital eCards

To make your recognition both prompt and personalized, use digital eCards to send a branded thank you to donors. These digital tools make it easy to honor donors and spread the word about your cause. It’s as simple as logging in, customizing your design, drafting a thank you, and sending it to your donor’s social account or inbox. 

Phone Calls

Simple and straightforward, a phone call from your nonprofit’s Executive Director is a meaningful way to recognize a donor. This strategy will make donors feel seen by your nonprofit’s efforts. Be sure to have the donor’s donation type and amount handy so you can express gratitude for their specific gift. 

Branded Gifts

Send your donor nonprofit branded merchandise as a thank you! Blankets, T-shirts, hats, and hoodies all make for fabulous donor recognition gifts that will make your donor feel welcomed into your organization. If your nonprofit has an online gift shop, consider sending a donor a discount to choose a branded gift that best suits them. 

Social Media Spotlights

Looking for a way to make an individual donor feel special? Social media spotlights are an effective option for highlighting your donor’s generosity. First, make sure your donor follows you online and regularly engages on the platform you choose. Then, with their permission, feature an image of them with a caption describing the impact of their generosity and why your team is grateful for their support. Or, host a livestream during a big campaign to thank donors. 

Appreciation Videos

Appreciation videos are great for social media posts and blog posts on your website. These do not need to be long. However, be sure to include your executive staff thanking individuals for their support. You can also include, with their permission, a thank you from the beneficiaries who your donors have helped. Doing this will help your donors understand the importance of their gifts. 

Donor Lunch

Invite your donors to a dedicated lunch to celebrate their generosity. Send an invitation in advance and keep the invite list smaller to focus on a couple of key individuals. This option is great for donors who would appreciate more than a thank you note but are uncomfortable attending a large dedicated event. 

Outdoor Displays

Take your recognition outside with a vibrant outdoor display to honor your donors. A nonprofit-specific monument or statue outside your facility can be a valuable addition to your headquarters. Consider partnering with design and construction partners to ensure that your display can withstand weathering and is designed to inspire. Include donor names in a plaque beneath the display.

Donor Plaques or Walls 

Probably the most well-known recognition practice, donor plaques and donor walls are popular strategies. Donor plaques honoring the sole donors of a nonprofit project are often posted outside of buildings that the donors funded, for example. Donor walls can display several names and are best unveiled following a capital campaign. 

Appreciation Events 

Host a virtual happy hour or in-person dinner as a way to say thank you to donors. This can provide a valuable opportunity for donors to network with other supporters and discuss your cause. You could even run an online cooking class or informal craft tutorial. Or, you can make your event larger scale and host a fancy gala, just be sure to keep the focus on donor appreciation. 

When should you recognize donors?

The short answer: as soon as the gift is received. Expressing acknowledgment and gratitude promptly is what makes recognition matter. After all, saying thank you a few weeks or even a few days later does not carry the same meaning. Instead, aim to recognize a donor within 48 hours of receiving their gift.

Of course, more involved recognition strategies like a naming opportunity will take longer to complete. However, all donors should receive a prompt and personalized acknowledgment. More specifically, plan to thank donors at every touch point. For example, capital campaigns should use donor recognition strategies that actively support the larger campaign purpose and complement each stage of the project. 

Final Thoughts and Additional Resources

Donor recognition is directly tied to donor retention and acquisition. Acknowledge your donors often and authentically to convey your nonprofit’s appreciation for them. Be sure to always ask for their permission for public recognition and mention how their specific gift impacted your mission. Thoughtful recognition paves the way for future relational success. 

Did you enjoy this guide to donor recognition? Check out these resources to learn more:

• How to Write The Perfect Donor Thank You Letter – Do you want to make sure you get your thank you note just right? Follow Kwala’s thank you note guidelines for tips!
• Donor Data Management: A Quick Guide for Nonprofits – Keep your donor data clean, organized, and accessible with NPOInfo’s guide to donor data management.
• Matching Gifts: your Guide to Growing Revenue with Automation – Did you know that you can double your supporter’s revenue through matching gifts? Learn how in this short guide by 360 Match Pro.