Most fundraising professionals know that having good info is the key to elevated income, stronger relationships, and extra profitable appeals. By analyzing the donor knowledge you will have accessible, you may study volumes about donor motivation and habits, then use this info to information your fundraising method.
Donor knowledge may also help you with segmentation, advertising, stewardship, and extra. Ideally, you’re working with a strong donor administration system that may monitor all of your engagements with and donations from every supporter, each on-line and offline. This engagement info is among the strongest instruments you will have for driving your mission ahead.
Particularly, a handful of fundraising knowledge factors may also help you monitor efficiency, illuminate alternatives for development, and set bold but lifelike objectives.
At SalsaLabs, we equip nonprofits with the data-driven instruments they should work effectively and make sensible fundraising selections. We’ve helped hundreds of profitable nonprofits perceive the fundraising metrics that are most crucial to crafting a profitable fundraising technique. And now we’re sharing these suggestions with you.
On this article, we’ll discover the next 6 fundraising metrics:
- Fundraising ROI
- Donor Retention Price
- Common Reward Measurement Development
- Proportion of Presents Matched
- Giving Capability
- Conversion Price
For every certainly one of these key efficiency indicators, we’ll discover what it’s, why it’s necessary, and how one can calculate it. Then, you’ll be capable to leverage this info to maximise your fundraising potential transferring ahead. Let’s dive in.
1. Fundraising ROI
Your fundraising return on funding, or fundraising ROI, is a big-picture metric that captures the general effectiveness of your efforts. Basically, this metric reveals how a lot cash you raised for every greenback you spent on fundraising.
Your fundraising ROI ought to consider all of your fundraising prices, together with these for occasions, enchantment mailings, and software program options. For instance, whereas your nonprofit’s donor database helps you higher attain your viewers with appeals that resonate with them, it does value cash. Due to this fact, you’d embrace this expense as part of your fundraising prices.
Whereas this metric is helpful, don’t depend on it because the end-all-be-all technique of evaluating your success. The fee to lift a greenback can fluctuate broadly based mostly on the maturity and dimension of your nonprofit in addition to the character of your trigger. Use it as a useful single indicator alongside different, extra detailed metrics.
Methods to Calculate
To seek out your fundraising ROI, divide your whole fundraising value by your fundraising income. Be sure you embrace each expense to get probably the most correct image of the place you stand. The calculation appears like this:
Fundraising ROI = ((Complete Funds Raised – Complete Fundraising Bills) / Complete Fundraising Bills) x 100
A constructive quantity right here represents a constructive return in your funding. If the results of that calculation is 70%, your fundraising returned $1.7 for each greenback spent.
Calculation: (($170,000 – $100,000) / $100,000) x 100 = 70. This represents a 70% RO.
If the quantity is destructive, like -25%, which means you spent extra money than you raised.
Calculation: (($75,000 – $100,000) / $100,000) x 100 = -25. This represents a destructive 25% ROI, or a lack of 25% in your funding.
You may calculate ROI for a selected fundraising marketing campaign or occasion, or use a 12 months’s value of knowledge to find out an annual metric.
2. Donor Retention Price
Your donor retention fee refers back to the share of donors who give 12 months after 12 months. Because the value to amass a brand new donor is greater than the associated fee to retain an current one, retaining extra donors will enhance the sustainability of your fundraising efforts. Plus, retained donors usually give at greater ranges than first-time donors, so the next donor retention fee is often correlated with a bigger general fundraising yield.
To extend your donor retention fee, you must deal with stewardship and relationship constructing. These are the elements that may encourage supporters to return again time and again. Be certain your recognition program is up-to-par and that you simply’re often speaking the affect of your work and that half your donors play in that success.
Methods to Calculate
Discover the variety of donors who gave this 12 months who additionally gave final 12 months, then divide that quantity by the overall variety of donors you had the earlier 12 months.. Multiply this quantity by 100 to get a share in your donor retention fee.
Should you had 620 donors who gave final 12 months and this 12 months, and also you had a complete of 1,000 donors who gave final 12 months, your retention fee is 50%. Calculation: 620/1000 x100 = 62%
Based on the Fundraising Effectiveness Mission, the typical donor retention fee is round 43%. In case your retention fee is under the trade common, think about how you might modify your outreach efforts to enhance responsiveness and engagement. Maybe you might want to attain out extra (or much less) often, or you might want to modify the language of your fundraising letter to attach extra deeply with first-time donors.
3. Common Reward Measurement Development
This metric measures how your common reward dimension adjustments over time. In fact, bigger presents are at all times higher for growing your general income, however the significance of this metric is about greater than merely your end-of-year whole.
This KPI may also help you measure long-term enhancements (or lack thereof) in your fundraising technique. If this quantity stays stagnant, it’s a sign that your fundraising capability can be remaining flat slightly than growing.
Methods to Calculate
Discover the typical reward dimension from the final two years—for readability, we’ll use 2020 and 2019. (Keep in mind—common reward dimension is the sum of donation greenback quantities divided by the variety of donors.)
For instance: in 2019 you acquired $200,0000 in whole donations coming from 5,000 donors which represents a median reward dimension of $40. (Calculation: $200,000 / 5,000 = $40).
Subtract 2019’s common from this 2020’s common, then divide this distinction by 2020’s common. If you multiply by 100, you’ll be capable to see your % enhance. To scale back the variety of steps, you may enter the typical reward sizes right into a % change calculator.
In case your common donation in 2020 is $50, and your common donation in 2019 was $40, your common donation development fee was 20%. Calculation: ($50-$40) / $50 x 100 = 20%. Meaning your common donation dimension grew by 20% over the past 12 months. Once more, any constructive quantity right here means there was development, 12 months over 12 months. A destructive quantity means your common donation per donor has gone down.
To extend this metric (and develop your fundraising), your group ought to deal with cultivating relationships with current donors and specializing in those that have the capability to offer bigger presents over time. A superb place to start out is conducting prospect analysis to establish potential mid-tier and main supporters, then creating an applicable stewardship technique for these supporters. A superb fundraising CRM is important right here and may also help you automate appeals with the suitable ask quantities based mostly on earlier donations and even article intelligence algorithms based mostly on new earnings and demographic knowledge.
4. Proportion of Presents Matched
With a view to maximize the affect of donor generosity, take full benefit of matching reward applications. These applications are designed by companies which can be dedicated to company social duty to match worker donations at a sure ratio, often 1:1. Imagine it or not, many potential donors are unaware of those company philanthropy applications which may have a major affect in your annual income.
Based on Double the Donation, someplace between $4 and $7 billion in matching reward funding goes unclaimed yearly. By analyzing your share of presents matched, you will get a greater understanding of whether or not you may be leaving cash on the desk.
To extend this metric, deal with spreading consciousness about matching reward applications amongst your supporters. By including a search instrument in your donation web page, supporters will simply be capable to test their eligibility whereas making a present. Alternatively, you may spend money on automated matching reward software program that identifies potential match alternatives and automates advertising to seize as many of those matches as doable.
Methods to Calculate
Discover the overall verified variety of potential presents matched, then divide this by the overall variety of presents acquired. This metric is most simply calculated when you’ve got entry to automated matching reward software program as a result of the answer can establish potential matches that haven’t but been secured. Should you assist extra of your supporters turn out to be conscious of matching reward applications, you must begin to see the distinction between potential matches and secured matches diminish, maximizing income.
5. Giving Capability
Whereas this quantity might not be a metric that’s immediately calculable or ready for you in your CRM, it’s a worthwhile instrument to tell your fundraising efforts.
Giving capability is a measurement of the potential quantity that every of your supporters are in a position to donate. Whilst you could not have perception into the contents of every supporters’ checking account, their previous habits and private particulars can reveal sufficient to create a ballpark estimate of their giving capability.
This info may also help you establish probably the most probably worthwhile donors or main reward prospects. Then, your improvement group can prioritize outreach accordingly and higher inform their ask quantities.
Nonetheless, it’s necessary to notice that this metric doesn’t inform the entire story. It will probably present how a lot a donor might give, not how a lot they’re keen to offer. For a extra holistic understanding of every supporter, have a look at giving capability alongside with one other key issue, generally known as affinity to offer.
Methods to Calculate
Use accessible details about supporters’ giving historical past, work affiliations, and extra to create an knowledgeable estimate of their whole wealth. You might also think about using a prospect analysis instrument or working with a screening service to entry a extra complete database of knowledge exterior your personal CRM.
6. Conversion Price
At its most simple degree, conversion fee is a measurement of what number of donors took an motion when prompted by your group. Each the motion and the immediate could be outlined broadly—perhaps it’s how many individuals signed up in your publication after seeing a Fb put up, or perhaps it’s the variety of donations made after you despatched your year-end fundraising enchantment letters.
As just a few examples, you might calculate a selected conversion fee to judge the efficacy of:
- Your donation web page
- Your social media posts
- Your e-newsletter
- Your junk mail outreach
It is best to use your engagement software program to calculate your conversion fee and enhance it over time. Utilizing expertise like automation, A/B testing, and extra, you may make smarter selections about which ways generate one of the best outcomes. At Salsa, we name this technology-powered and data-driven method SmartEngagement.
Methods to Calculate
Divide the quantity of people that took an motion (like donating, signing as much as volunteer, or registering for an occasion) by the quantity who acquired the decision to motion (like receiving an e mail or seeing a social put up).
For instance, you ship an donation enchantment e mail to 500 potential donors. 100 of them click on in your e mail and go to your on-line donation web page. Of these, 40 of them truly make a donation.
- The conversion fee in your e mail is 8%. Calculation: 40/500 = 0.08 = 8%.
- The conversion fee in your donation type is 40%. Calculation 40/100 = 0.4 = 40%.
Completely different communication strategies will end in various conversion charges, so use these calculations as a relative metric slightly than an absolute one. In different phrases, don’t examine apples to oranges! When evaluating your efficiency, search for an trade common that applies to the platform in query or on the identical metric over time in an effort to measure enchancment.
By harnessing the data accessible in your donor database and different software program options, your nonprofit can increase funds extra successfully. Calculate and monitor these metrics over time to see how your technique evolves and improves. Keep in mind—you may solely obtain a objective or cross a milestone in the event you set one up!
Concerning the Creator: Gerard Tonti
Gerard Tonti is the Senior Artistic Developer at Salsa Labs, the premier fundraising software program firm for growth-focused nonprofits.
Gerard’s advertising deal with content material creation, conversion optimization and fashionable advertising expertise helps him coach nonprofit improvement groups on digital fundraising finest practices.
