As a nonprofit leader, you know that you must constantly evaluate your fundraising data and monitor your performance to identify areas for improvement. However, we often get so caught up on identifying what is wrong that we forget to take notice of what is going well. Fundraising data can reveal your nonprofit’s successes, too, and help you build upon your fundraising strengths.
While analyzing fundraising data will illuminate areas that require attention, such as declining returns from a specific type of direct mail appeal, it can also help you optimize your efforts by identifying areas where you can do more of what’s working. If, for example, your data reveal surge in funds raised from a particular demographic, you might double down on outreach to that group, or spend more money on donor acquisition campaigns targeted at that demographic. Without examining the data, you might miss these opportunities and fail to capitalize on your fundraising strengths.
But how should you determine what data to monitor? With an overwhelming amount of data at your fingertips (and more coming in all the time), you may be unsure where to start. Today, we’d like to simplify the confusion by sharing the three essential categories of fundraising data that your nonprofit should pay attention to in order to identify fundraising strengths you can build on.
Fundraising KPIs
In order to maintain focus, every nonprofit should identify 3-5 key performance indicators (KPIs) or objectives and key results (OKRs) that are understood across the organization as the most important measures of fundraising success. These KPIs or OKRs will be unique to your organization, and should be based on the role fundraising plays in driving forward your strategic plan. They might include performance indicators or key results such as:
- Total funds raised: This number includes the value of all gifts. If you set fundraising goals at the beginning of a campaign or fiscal year, this is the number you’ll want to use to measure your progress and determine the likelihood of reaching your goal.
- Donation growth rate: Calculated by comparing your total donations in one year to the previous year, this number helps you track fundraising progress over time, set goals, and identify trends in donor behavior.
- Average donation size: This metric gives you insight into your donor behavior. Do you rely on many small donations, mid-level donors, or several large gifts? Understanding how your donations trend helps you optimize your fundraising strategy.
- Cost per dollar raised: Also known as the cost of fundraising, cost per dollar raised measures how efficiently your organization uses its resources to generate funds. The lower this number is, the better. You also want to observe this metric over time and aim to spend more efficiently as your organization becomes more sophisticated at fundraising. If efficiency isn’t currently one of your fundraising strengths, you may want to spend some time studying how you can reallocte your budget toward the most effective channels.
- Event attendance: Not only does event attendance measure the effectiveness of events as a fundraising tool, but it also helps you see which events are the most popular with which audience segments.
Don’t stop at measuring each of these metrics just once—It’s important that you track performance year over year. This can help you identify patterns and keep a close eye on the metrics that are moving so you can build on your fundraising strengths.
Once you’ve identified your current fundraising strengths, you’ll be able to apply these insights to future financial decisions. For example, you can better predict fundraising revenue for certain types of campaigns with data from previous fundraising efforts.
As CharityEngine explains, your fundraising software is not just a place to store contacts; it should be used as a centralized database where all your nonprofit’s vital fundraising data is stored, including fundraising KPIs or OKRs like these. Your fundraising software should be set up to accurately track metrics that show you the overall health of your efforts, as well as zero in on some specific data points like those highlighted above.
Donor data
Donor data is the cornerstone of successful nonprofit fundraising. A close study of the data surrounding your donors and their behavior can greatly influence the way you design and execute your fundraising campaigns.
Additionally, diving into the habits and preferences of your donors can help you segment a large group into several similar, smaller groups. As Double the Donation explains, the more you personalize communication with your supporters, the more you can tap into and learn about their interests, which, in turn, will allow you to build long-term relationships with them.
The data you focus on will depend on the makeup of your donors. However, the following data points can be particularly helpful for honing in on your fundraising strengths:
- Demographics: Analyzing your donors based on where they live, their age, income, or employment, or other demographic criteria can help you target your messaging. Local donors can be invited to events. Those with strong corporate ties can be approached for corporate partnerships. Even the way in which you communicate can be altered for each segment—Some donors love direct mail while others want to click on a link in a text.
- Giving history: Tracking how much and how often donors give can illuminate fundraising opportunities for you. For example, donors who give sporadically throughout the year may be willing to donate a little less but more often. Or, a regular donor who suddenly drops off might be a strong candidate for a re-engagement campaign.
- Giving motivations: Aside from who gives and how much or how often they give, your donor data can also reveal why they give. Some donors respond to an emotional appeal, while others are tied to social, economic, or political motivations.
You can also use data to understand how effectively your nonprofit stewards its donors. Crafting a comprehensive stewardship plan tailored to each donor segment will allow you to intentionally strengthen relationships with your donors. If stewardship isn’t currently one of your fundraising strengths, this may be a good place to focus.
Engagement data
Donor engagement can vary widely across your nonprofit’s various traditional and digital content channels. Learning which content and which channels most effectively engage different donor is vital to developing a strong fundraising strategy.
Today, it is possible to use a single fundraising platform to centralize all your engagement data. In an ideal world, data from every engagement–whether on social media, email, direct mail, your website or elsewhere–will flow into one holistic database.
The alternative is a system that integrates with third-party partners to provide some visibility across platforms. If your system integrates with third-party tools, you may need to go into some of your platforms directly to see some engagement data. For website data, for example you may need to log directly into Google Analytics.
No matter your tech setup, you’ll want to choose a few key engagement metrics to track based on where your organization is spending its fundraising time and money. You might track engagement metrics like:
- Email open rates measures the percentage of recipients who open an email you send. If this number is low, you might want to focus on crafting more effective subject lines or consider a “friendly from” rather than a formal email address. Alternatively, if some types of subject lines tend to work well (such as those with action words), you will want to use more of that type.
- Click-through rates (CTR) measures engagement with your emails, ads or other digital content. When you measure this metric, you’ll see how effective various calls-to-action are, and you can use more of the ones that work best.
- Website traffic is a number you can measure overall and then break down into subsets of data. The “users” metric in Google Analytics will tell you how many people visit your website, while metrics like page views, session duration and behavior flow can tell you how they interact with your site once they get there. For example, you can glean how many people land on your homepage versus the number of visitors who navigate to your fundraising campaign website and interact with key fundraising calls-to-action
- Social media engagement is an excellent engagement metric if your nonprofit is active on channels like Instagram or TikTok. Tracking metrics such as comments, shares, clicks, and likes (or combining them all into a social engagement rate metric) can reveal the messaging and approach that work best with your audience.
Through engagement metrics like these, you can identify the most engaging messaging and the most popular channels for your nonprofit overall, and among specific subsets of donors and supporters. This data can create focus for your fundraising strategy, strengthening your campaigns and leading to more effective and efficient fundraising spending.
Without focusing in on the most important data, it’s impossible to build on your fundraising strengths and do more of what’s working. But when you can point to numbers that show something is working and warrants additional budget or attention, it’s easier to pitch ideas to your team or board and foster buy-in. Make some time before the busy end of year fundraising to take a close look at the data your nonprofit is tracking, and make sure you’re focused on the right things so you can build on your successes.
