Why the second gift matters more than the first: donor retention for Malaysian NPOs

The number behind "most of them don't come back"

Every committee has felt this: a big appeal or festival brings in a wave of new givers, the following year's appeal rolls around, and most of those names are gone. It's tempting to read that as a fundraising failure specific to your organisation. It usually isn't.

The Fundraising Effectiveness Project (FEP) — a joint initiative of the AFP Foundation for Philanthropy and GivingTuesday — tracks giving data pooled from a panel of nonprofit donor-management platforms (its Q4 2025 report lists BetterUnite, Bloomerang, Bonterra, DonorDock, DonorPerfect, Donorbox, FundraiseUp, Givebutter, Givesmart, GoFundMe Pro and Neon One as contributing data providers) ^[1]. For full-year 2025:

A first-time retention rate of 18.9% means roughly four in five people who make their first gift to an organisation never make a second one ^[1]. Repeat donors — the ones who've already crossed that line once — come back at over three times the rate. FEP's own framing of the 2025 data is blunt: converting a first-time gift into a second one, not acquiring more first-time donors, is the sector's actual bottleneck ^[1]. (FEP now also publishes rolling quarterly year-to-date figures, on a refreshed methodology from Q1 2026 — not directly comparable to the full-year numbers above, so a lower figure on FEP's live dashboard isn't a correction to 2025's annual result.)

Read this data as US-centric, not Malaysian. Every listed data provider is a US-market donor-management platform, so the panel is overwhelmingly US nonprofits. Malaysian giving — shaped by festival and ritual cycles, zakat and religious obligation, and a different donor base — may look quite different. Use these figures for the shape of the problem (first gift to second gift is the hardest conversion) rather than as a Malaysian benchmark.

Older research points the same direction. Adrian Sargeant's 2008 literature review for Indiana University found a typical UK charity loses around 50% of its cash donors between first and second gift, and cites AFP data putting US first-gift attrition as high as 80% ^[2] — the same order of magnitude as the larger, more recent FEP dataset. Sargeant groups what makes a donor reconsider the relationship into situational triggers (life circumstances, outside your control), influential triggers (a competing cause), and — the one you actually have power over — reactive triggers: how the organisation communicates, recognises and thanks the donor after the gift ^[2].

Practical tips:

• Don't panic at a low first-appeal repeat rate on its own — compare it against your own history year to year, and treat 15–25% as roughly in line with what a large international sample shows, not a sign something is broken.
• Put your effort into the first-to-second-gift conversion specifically, not into acquiring even more first-time donors — FEP's own reading of the data is that acquisition alone doesn't fix a leaking base ^[1].

The pain of the thank-you that goes out late — or never

The auditor doesn't ask about this one, but the donor who calls to check "did you get my donation?" does. A thank-you that goes out weeks late, or not at all because whoever normally handles it was on leave during the festival rush, is one of the most preventable reasons a donor doesn't come back.

Sargeant's review is explicit that acknowledgement matters as more than politeness: genuine, organisation-specific recognition is linked to higher subsequent giving and lifetime value, and donors who find communication inappropriate are more likely to lapse ^[2]. What the primary research does not give is a validated number for exactly how many hours a thank-you should take — so treat "thank within 48 hours" as good practice, not a cited statistic. The reasoning: a donor's memory of why they gave is freshest in the first day or two, so a receipt that lands while it's still warm reads as attentive, not administrative.

Practical tips:

• Separate "the receipt went out" from "the donor felt thanked" — a correct, on-time tax receipt and a warm thank-you can be the same email, but only if someone wrote the wording with the donor in mind rather than leaving it as a bare transaction record.
• If your thank-you depends on one person being at their desk, it will fail exactly when you need it most — during a festival rush when that person is busiest.

The pain of not knowing who gave last year

"Are we allowed to email everyone who gave last Vesak?" is really a data problem before it's a policy one — last year's givers live in a paper receipt book, this year's live in a spreadsheet, and nobody has compared the two lists. Without that comparison, every appeal starts from zero: no one flagged as a first-timer to treat differently, nobody flagged as a lapsed regular worth a personal call. A donor who gave once last year and nothing since looks, from the inside, exactly like a stranger — so they get the same generic appeal, instead of a message that says "we haven't seen you since [event]." (Separately, see What must be on a valid donation receipt for what the receipt itself must show.)

Practical tips:

• At minimum, keep one running list of donors and the date of their last gift — even a spreadsheet — so "who gave last year but not this year" is a lookup, not a memory test.
• Segment your outreach into at least three groups before you send anything: first-timers (need a welcome and a clear thank-you), regulars (need recognition of their history), and lapsed donors (need a different message than either — an update on what's changed since they last gave, not another generic ask).

The pain of proving the gift mattered

The question every donor is really asking, whether or not they say it out loud, is "did my money do anything?" An organisation that only contacts a donor to ask for the next gift trains them to see every message as a request, not a relationship — Sargeant's review flags inappropriate communication as a reason donors lapse, and separately ties donor trust and future giving to the belief that an organisation uses funds efficiently and achieves real impact ^[2].

Reporting back before asking again is its own topic with its own playbook — see Reporting impact to donors for what to say and when to say it. The point for retention specifically is sequencing: a donor who hears what their last gift achieved before the next appeal lands is being treated as someone with a stake in the outcome, not a line in a spreadsheet.

Recurring giving as a retention strategy, not just a payment method

One structural fix beats almost any amount of manual follow-up: getting a donor onto a recurring gift converts "will they remember to give again" into "will the card still work" — a much easier problem. That's a full topic on its own — see Monthly giving and recurring donations for how it works and how to ask for it.

Measuring your own retention

You don't need FEP's dataset to know your own number. The standard calculation:

Donor retention rate = (donors who gave last year and this year) ÷ (donors who gave last year) × 100

To use it: pull every distinct donor who gave at least once in the prior 12-month period, then check how many of them also gave at least once in the current period. Divide the second number by the first. Do this on your own calendar — a temple's natural year might run festival to festival rather than January to January, and the number only means something if you compare it against your own organisation's figure from a year before, not against the US-centric FEP benchmark above.

Practical tips:

• Calculate this once a year on a fixed date, not whenever someone remembers to — otherwise you can't compare year to year.
• Track first-time and repeat retention as two separate numbers, exactly as FEP does ^[1] — a healthy repeat-donor number can hide a genuinely weak first-to-second-gift conversion.

What this means for your organisation

1. Expect most first-time donors not to return — that's the sector norm, not a local failure — and put your energy into the first-to-second-gift conversion specifically.
2. Get the thank-you out fast and make it personal, not just correct. A receipt and a thank-you can be the same message, but only if someone wrote it for the donor.
3. Keep one list, updated, of who gave and when — so you can tell a first-timer from a regular from someone who's gone quiet, instead of treating every appeal as a blank slate.
4. Report back on what the last gift achieved before you ask for the next one.
5. Offer a recurring option so a donor's continued giving doesn't depend on remembering your next appeal.
6. Calculate your own retention rate once a year, split by first-time versus repeat, and track it against your own organisation's history.