The Fundraising Effectiveness Report
I am totally embarrassed to admit that I’ve just taken my first look at the 2010 Fundraising Effectiveness Report produced by the Association of Fundraising Professionals.
The Report is based on 1,982 responses from US nonprofits who collectively raised $1.5 billion in 2008-9.
What the Report provides is a focus on net gain (or loss) in fundraising results from this broad range of nonprofits. I don’t want to give the methodology short shrift, but essentially it compares dollar (and donor number) gains against losses in a variety of fundraising program categories, producing a net gain or loss for each organization, and the sector.
For example, ‘gains’ in giving include: $ from new donors, from recaptured donors (former donors who had lapsed), and from upgraded donors. ‘Losses’ in giving include: $ lost from downgraded donors, from lapsed new donors (new donors in the previous year who did not give in current year), and from lapsed repeat donors (repeat donors in the previous year who did not give in current year). Gains/losses in donor counts are measured in a similar manner.
The results in the 2010 Report are, well, depressing.
Bottomline: for every $4.50 that organizations raised in new gift dollars in 2009, more than $6 was lost through donor attrition. As a result, the year-over-year ‘growth’ in giving for 2008-9 was -8.1%. For the same period, there was a net decrease in donors of -0.8%, reflecting gains of 54.2% offset by losses of -60.2%. That’s a heap of churn, boys and girls!
What I like about this report and its underlying methodology is that it provides some detail as to where most of the gains and losses occurred. For example, for these organizations, 20% of their total gain in donors came from recapturing lapsed donors. One might ask … why lose them in the first place?!
This is a very meaty report. I urge you to download and study it carefully. And apply its methodology to analyzing your own nonprofit’s gains and losses. How do you compare with the sample?
The project and study are described in this article from SOFII’s Blog by Kirsten Bullock. Thanks for waking me up Kirsten!
Tom
3 responses to “The Fundraising Effectiveness Report”
Behavioral Science Q & A
Integrating an individual giving appeal with other communications from a charity can have both positive and negative effects, and the outcome largely depends on how it’s executed. Advantages of Integration Brand Consistency: Maintaining a consistent appearance and messaging across all communications can reinforce the org’s brand identity and strengthen brand recognition and trust among your […]
Read Full Answer
I’m not aware of any in-market tests specifically comparing recurring vs. gift frequency language. I suspect the answer might not be the same with all gift frequencies, nor with all people. It sounds like a great opportunity for you to test and find out what works for your audience. Based on the literature, here’s a couple […]
Read Full Answer
Based on what we know from existing data, those renewal notices can actually be pretty effective in getting people to donate. They tap into our psychology – creating a sense of urgency, reminding us of past support, and using personalization to make the message hit home. They’re playing on our natural tendencies to feel obligated […]
Read Full Answer
Interesting question. I had a quick look at the testing done on this topic. On the positive side, in all cases, over half of donors decide to cover the fee. In some cases, it goes as high as 65%. Not a negligible percentage at all. Here’s another test from iRaiser showing consistent results (see point […]
Read Full Answer
There’s just one thing to consider when designing a supporter journey: the supporter. More specifically, you need to take into account: Who the supporter is i.e. their identity, which is the reason they support this cause, and their personality, which describes the way they “see” and process the world. These will determine the kind of […]
Read Full Answer
I’m not an expert in this but a quick search surfaced this article on the effect of tax reforms on 2019’s charitable giving. The researchers didn’t find a reduction. Actually, they observed an “increase in charitable contributions in 2019, even with the lower tax rates and the dramatically smaller number of taxpayers who itemize their […]
Read Full Answer
Interesting report indeed. Thank you very much for sharing.
Thanks for the mention Tom. Glad I was able to prompt you to check it out. I’m a bit of a data geek, so I love those kinds of things.
I am so glad you finally found the FEP report! It is perhaps one of the most powerful and accurate indexes/reports in the non-profit field because it is produced from actual data contained in real fundraising software systems. More importantly, it truly reflects the entire market, not just the top 2,000 or 5,000 charities. There are NPO’s ranging from less than $100,000 in annual revenue and up. In fact, when I was last involved with it, due to about 60%+ of the data coming from eTapestry customers, the average size organization was probably less than two million a year in annual revenue.
There are few reports that truly reflect the ENTIRE market like this one! Please allow me to give a strong pat on the back to AFP for making this come to life. Now if we could just get more NPO leaders to act on it. It is such a shame that the charities do not all focus as much on retention rates as all of the software vendors in the world do. Most software executives would fire any customer support and account management team leaders who ever let the retention rate fall below 90%. Many software firms average 95% or higher! Could you imagine how much money would be raised in the world if we could even get the retention rate to 75%!!