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Does donor recognition actually work?

ByJesse Swingle

More than half of the people who gave to a US nonprofit in 2024 did not give again in 2025. The Fundraising Effectiveness Project, run by the AFP Foundation for Philanthropy and GivingTuesday, put full-year donor retention for 2025 at 43.3 percent, up slightly from 43.1 percent. Repeat donors held on a little better. Retention among new donors stayed essentially flat, and the FEP called converting a first gift into a second the most consequential unsolved problem in the donor pipeline.

The money is moving the other way. Giving USA 2026, from the Indiana University Lilly Family School of Philanthropy, put total US giving at $617.20 billion in 2025, the first year above $600 billion. Giving to arts, culture and humanities rose to $27.31 billion, up 7.5 percent (4.7 percent after inflation), ahead of giving overall. The FEP saw the same shape from the donor side: dollars up 5.0 percent, the number of donors down 3.6 percent. More money is coming from fewer people.

Museum directors expect that to matter. In the American Alliance of Museums’ 2025 National Snapshot, 63 percent named shifts in philanthropy as a disruption they anticipate in 2026, the most common answer and up from 48 percent a year earlier. Under that kind of pressure, it is fair to ask whether the physical side of donor and member recognition (the plaques, the premiums, the thank-you gifts) earns its cost. The honest answer starts with what has actually been measured.

Is donor recognition still worth doing?

Nobody knows, including the people arguing against it. What has been measured is narrow: a few experiments on gifts offered in exchange for a donation, and one very large test of thank-you calls. We found nothing that measures what happens to retention or lifetime value when donors receive something after they give.

That gap cuts both ways. A decision to drop recognition to save money isn’t supported by evidence, and neither is a promise that a well-chosen gift will keep a donor. What follows is what can be established, and where the evidence stops.

What does the research say about donor gifts?

The best-known field experiment found that offering a thank-you gift in a renewal mailing, in return for a donation of a set size, lowered response. A follow-up online experiment traced the drop to how prominently the gift was shown, and found it disappeared when the gift was more desirable. None of this tests thanks sent after a gift arrives.

The field study, by Matthew Chao of Williams College and published in PNAS in 2017, worked with a public radio station’s renewal mailings to 3,641 members. Members who received the standard letter responded at 6.9 percent. Those offered a tumbler for a gift of $180 or more responded at 4.0 percent, and those offered a donation of meals to a food bank at 3.5 percent. The drop came mostly from people who had given more the year before. In the online follow-up, showing a picture of the gift lowered donations only when the gift was undesirable; a more desirable gift caused no drop. Chao is explicit that this does not mean nonprofits should never offer gifts. His conclusion is that an incentive has to be valuable and desirable enough to outweigh the attention it draws away from the reasons people give.

The largest test of a stewardship gesture involves no object at all. Anya Samek of the University of Southern California and Chuck Longfield of Blackbaud randomly assigned nearly 600,000 new donors, across about 70 public television stations and a national nonprofit, to receive a thank-you call or not. About 30 percent gave again in both groups. Fundraising professionals asked to predict the result expected the calls to lift that to about 50 percent. The calls were made by paid callers several months after the first gift, so faster calls from board members remain untested. The finding still stands as a caution: the sector’s instincts about stewardship are usually reasonable, and they can be wrong when someone checks.

Neither study looks at recognition given after a gift, as thanks and not as an offer. The FEP’s own recommendations for converting first-time donors (prompt stewardship across channels, showing impact quickly, personal gratitude) don’t mention what donors receive. On objects given as thanks, the best donor data available is silent. No published research we found measures whether physical recognition given after a gift changes retention, upgrades or lifetime value, in either direction.

Are member premiums worth the cost?

For museums and similar institutions, members are where giving and the store meet. An IMPACTS analysis of eighteen cultural organizations, published in 2019, found the average member worth about four times the average visitor in a year, and spending about 61 percent more in the shop.

Members were worth $135.25 a year against $33.91 for visitors, and spent $13.12 a year on retail against $8.14. Over ten years the gap widened to about $727 per member against $160 per visitor. Member retention was 49 percent after the first year and averaged 58 percent in years two to ten. In a separate client case study, IMPACTS found renewed members generated 66 percent more net revenue than new ones. The data predates the pandemic, and it remains the best public evidence connecting membership to retail.

Institutions are putting effort into membership. AAM’s Snapshot found 46 percent of museums had created or revamped a membership program in the past two years; among new revenue approaches, only corporate sponsorship was more common. Members and shoppers are often the same people, even when membership and retail sit in different departments. A premium is one of the few places where the two meet in a single object.

Mount Vernon shows both running at scale in one institution. Its 2024 filing reports $43.0 million in contributions and about $10.0 million in net income from inventory sales, the store’s return after the cost of goods. Apart from the pandemic years, that retail figure has stayed between about $9 million and $11 million a year since 2015. That is an existence proof, not evidence that one causes the other.

What do long-term donors look like?

Few, and they carry the revenue. Neon One’s Generosity Report followed nearly 100,000 donors giving under $5,000 a year across more than 2,700 organizations from 2020 to 2024. The 11.7 percent who gave in all five years accounted for 45 percent of revenue, and gave 240 percent more in year five than in year one.

The same report found that first gifts looked much the same whether a donor stayed one year or five. Staying was what predicted value. That is the whole case for stewardship, and it is why what a donor receives in their first year or two deserves better than a guess.

How should we decide what to give donors and members?

Measure it. Record who received what and when, then compare renewal and upgrade rates against people who received something different or nothing. A year of that will tell an institution more about its own donors than any published study currently can.

We make these objects, so we have an obvious interest in the answer. That is exactly why we would rather see it measured than argued. The research that does exist points where our own work always has: the gift has to be worth wanting. A generic object offered as part of a transaction can pull attention away from the reasons people give. Our standard follows from that. If a gift isn’t something the recipient would be glad to own, it isn’t worth the money or the attention, and a pencil or an umbrella handed out because something was expected doesn’t pass. The same test applies to what goes on a store shelf. A gift that arrives as thanks, chosen for the institution and for the person receiving it, is a different thing, and it is the one we found no test of. Whether the institution is a museum, a civic institution or a performing arts organization, the method is the same.

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