Four Tips for Analyzing Your Fundraising Effectiveness

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Editor’s Note: This is a guest post from Analytical Ones, the leading nonprofit donor data analysis firm. Bill, the founder and a personal friend, is an expert at helping you know what to measure in order to raise more money!

Four Tips for Analyzing Your Fundraising Effectiveness

In fundraising, there are just three strategies to increase your revenue: Win, Lift & Keep.

Win is acquiring first time donors or reactivating lapsed donors back; Lift is about your donors raising more money than they did the previous year; and Keep refers to retaining your donors from one year to the next.

The critical question is, which strategy should you focus on that will increase the revenue from your fundraising activities with the least amount of work on your part?

  1. Commit to Measuring Your Donors’ Fundraising Performance

    Peter Drucker once said, “If you don’t measure it, you can’t improve it.” If the goal is to raise money for your organization, then it is imperative that you spend the time to thoroughly measure the fundraising outcomes of your activities and compare it to previous years. If you don’t, then your fundraising won’t improve. It’s that simple.

  2. Study Your New or Reactivated Donors over the past 3 years

    Every fundraiser should be able to answer these WIN questions:

    1. How many brand-new donors did we attract this year? And how does it compare to previous years?
    2. How many lapsed donors did we reactivate this year? And how does it compare to previous years?
    3. What percent of new and reactivated donors from last year gave this year? And how does it compare to previous years?
  3. Analyze Donors Giving Trends over the past 3 years

    Focus on these LIFT questions for your organization:

    1. What percent of the participants gave more revenue this year than last? And how does it compare to previous years?
    2. What percent of your donors made 8+ gifts? (These are great sustainer and planned giving prospects). And how does it compare to previous years?
    3. How much of your total revenue is coming from donors giving $10,000 or more? How does this compare to previous years?
  4. Measure Donor Retention

    Make a plan to know these KEEP metrics:

    1. What percent of the donors who gave last year gave this year? And how does it compare to previous years?
    2. What are your donor retention rates by Lifecycle? Are they improving over last year?
    3. What are your donor retention rates by donor value? How does it compare to last year?

If you commit to measuring the effectiveness of your fundraising, these nine Win, Lift & Keep metrics, will help you improve your organization’s fundraising.

PS – If some of these terms or metrics are new to you, please download our free “Guide to Fundraising Metrics” from the bottom of our homepage at AnalyticalOnes.com.

Ed. Note: This week is the launch of 4 new products to help you raise more money at year-end than you ever have before. Visit our store to see how to Keep and Lift your donors before the end of the year.

If you track your Donor Retention you will improve your Donor Retention!

Our friends at Bloomerang recently surveyed several hundred nonprofits about donor retention.  Then they created this great infographic to summarize their findings.

First, I’d encourage you to take a minute to view the infographic.  The more time you spend thinking about donor retention, the better.  We think retention is the single biggest indicator of whether your organization is communicating well you’re your donors.

Next, look at the third pie chart.  This basically shows that if you measure your retention rate, you’re more likely to improve it.  That’s incredible.  But it proves the old quote right; “If you can’t measure it, you can’t manage it.”

Be sure to measure your organization’s retention rate at least once a year.  You’ll know whether your donors are finding value in their gifts to you – and you’ll likely improve your retention just by measuring it!