Great effort is usually invested into every nonprofit’s fundraising. Of course, how else do you want your organization to fund the many causes you’re rolling out.
From funding community-oriented courses to running events, fundraising helps nonprofits achieve a lot of their visions.
However, fundraising doesn’t stop once you get the desired results. Your organization needs to measure the performance of every fundraising round you implement – against certain indicators and of course, against your own objectives.
These key performance indicators or metrics help you measure the impact of your fundraising activities. It also gives you insights into what should constitute your future fundraising campaigns.
Without further ado, let’s look at the most important fundraising metrics that your nonprofit should be measuring.
The average fundraising amount
This is one of the most important fundraising metrics to track when doing fundraising.
Your nonprofit’s average fundraised amount is derived by dividing the amount raised by the total number of givers.
This average is a strong metric to help you determine when to start future fundraising events and where to focus your resources for maximum returns.
Total number of donations
This might seem obvious, but it isn’t. When doing fundraising, donors don’t just come from one source. Some donate through your website. Others through social media platforms like Facebook. Some may send their donations directly to your bank account.
Tracking the number of donations helps you determine the most successful “channels”. You can then use this information to determine where to focus your attention in future fundraising rounds.
Cost per Dollar Raised (CPDR)
This is one of the most important fundraising metrics that your nonprofit should never fail to track.
To determine CPDR, you divide the expenses by the revenue for a given fundraising round or period. The goal is to give you insights into: whether you raised money, made a loss, or broke even.
These expenses are the costs you incurred to build and launch the fundraising campaign. The revenue is the amount you are able to raise through the fundraising.
If expenses exceed revenue, it means you spent more on the campaign than you raised. Thus, you made a loss. If revenue exceeds expenses, it means you raised more revenue than the expenses you incurred. You made a profit/gain. If expenses and revenue are the same, it means you’re breaking even.
This example from donorsearch.net is a great example of the CPDR
How successful is a particular fundraising campaign able to get visitors to take action: donate or volunteer? In short, that’s how successful your campaign is multiplied by 100.
To calculate the conversion rate, you need to divide the number of people who were able to complete your goal (volunteered, donated, etc) by the total number of people given the opportunity to do so.
Let’s look at an example from donorsearch.net
Recurring gift percentage
There are usually two main parties in a fundraising session: recurring donors (those who have been donating to your cause) and new donors (those who just joined your donation list).
To find these recurring donors, you need to divide the number of recurring gifts by the total number of donations/gifts.
The goal is to know your recurring givers. This allows you to craft different messaging for them in your email campaigns, in order to show your appreciation for their loyalty.
Major gifts are usually special. They bring in some of the highest return on your fundraising sessions. Some nonprofits set the bar at $10,000 for major gifts. Others put it at $30.
And so any gift that meets this threshold is deemed a major gift. Nonprofits treat the persons and organizations that fall into these categories.
Donor growth rate
One important metric you should be tracking is the growth rate of your donors. Are your donors increasing every year? Are they decreasing?
This metric measures the rate of change or increase and decrease in the total number of donors.
Every nonprofit would love their organization’s donors to grow. But that path requires that you track your donor growth rate and determine how often you’re adding new donors. This is a great metric in helping your nonprofit plan for future activities.
Of course, you have the total metrics that your organization needs. However, you need to know where your fundraising came from.
Many organizations make this division by considering the following main groupings:
- Individual givers
- Corporate partners giving
- Institutional or company givers
- Donations from Government.
Making this distinction is the best way to know where to focus your fundraising campaigns in the future.
Other important fundraising metrics
Donor Acquisition Cost: how much your nonprofit spends to acquire a donor.
Fundraising participation rate: a metric that shows the rate at which the people donating to your cause are fundraisers themselves.
Gift secured: a measure of the total number of gifts your nonprofit received in a fundraising event.
Conversion rate by channel: measures the number of donors and the channel they came from (social media, radio, TV, email, etc).
Fundraising is becoming easy as a result of the many digital tools available. But it’s also becoming difficult, especially for small nonprofits without the right funding.
However, if you want your nonprofit to progress, you need to measure every fundraising action you take. These measurements and KPIs are the best ways to keep track of your donors and to make the entire process better in future.