Certified Fund Raising Executive (CFRE) Practice Test

What can be an effective strategy for improving donor relationships?

1. Hosting large fundraising events

2. Regularly communicating about impact

3. Offering gifts in return for donations

4. Limiting communication to major donors only

The correct answer is: Regularly communicating about impact

Regularly communicating about impact is a highly effective strategy for improving donor relationships. Consistent communication helps keep donors informed about how their contributions are making a difference, fostering a sense of belonging and connection to the organization's mission. This transparency not only builds trust but also reinforces the value of the donor's investment, leading to greater satisfaction and the likelihood of continued support. When donors see the tangible results of their contributions, it enhances their emotional engagement with the organization. It demonstrates that their donations are making a real difference, which can lead to deeper donor loyalty and increased willingness to support future initiatives. In contrast, hosting large fundraising events may engage donors initially but does not provide the same ongoing relationship-building opportunities as regular communication. Offering gifts in return for donations can sometimes lead to a transactional relationship rather than a meaningful connection. Limiting communication to major donors may alienate smaller donors who also want to feel valued and informed, ultimately weakening the broader donor base. Thus, focusing on regular communication about impact is the most constructive approach for nurturing and enhancing donor relationships.