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Performance measurement is the most crucial instrument in every nonprofit’s fundraising toolbox. In order to improve the results of your fundraising endeavors, you must measure performance, examine the results, and improve your performance over time.
Measuring pivotal fundraising metrics can clarify where you have been, where you are ,and where you are going with your nonprofit’s fundraising efforts. Analysis of your organization’s fundraising performance is something that is used internally by management. It is also used by potential donors enthusiastic to support organizations that offer the biggest impact for their donation.
Measurements Prior to Collection of Cash
For your campaign, you first need to understand that several factors will help you acquire your funds. Sit back and ask yourself – What is the factor that works best for you and your campaign? To figure that out, you need to focus on your fundraising strategies and goals.
Once the factors have been noted, begin with the measurements. After the measurements have been made, you can easily evaluate the performance of your project. In the process, your marketing channels will be assessed too; for example, your social media involvement and your website’s performance. Furthermore, you could judge your overall interaction with the donors.
Metrics for Assessing Your “Top Fundraiser” Chase
These metrics are straightforward. They could very well generate important insight into what fundraising activities work and which ones don’t. The measures can give you eye-openers about the best ways to manage, allocate and leverage funds and efforts.
The metrics will help you to look behind the raw sum of all donations. This ensures that you truly comprehend what operates your fundraising project, where you should expend your fundraising dollars and how you should plan and budget your efforts in the future. By using these 3 basic metrics, you can measure your fundraising effectiveness and unveil the truth behind the numbers.
Let the Right Donor In
Retention of donors is necessary, being considered the chief metric for any organization. It has been proven that keeping already existing donors is less expensive than acquiring new donors. It is not that you should stop acquiring new ones; after the right amount of time and experience, your campaign will automatically receive innumerable contributors. Needless to say, you must put a considerable amount of effort into keeping the donors that you have been blessed with. You need to understand that not every donor has the potential to outdo themselves, becoming your favorite contributor. The reason you should keep the old donors around is that, they can be amazing advocates for you. They will not take sudden actions when they are moved emotionally, unless they trust the organization or people they are taking action for.
Donor maintenance would aid in understanding whether a donor, who had contributed to previous activities, is doing the same right now. Moreover, it reveals whether the donors are investing the same time on the campaign as they did previously.
One of the biggest aspects of fundraising in the right manner, is to continue bringing in contributors year after year. While you might come across a donor or two who does not give to your cause loyally, you will most certainly find a couple others who are willing to donate more than you are expecting. Your relationship with your donors is based on trust. The more you can get these people to trust you, the more likely it is for things like peer-to-peer fundraising to occur.
Rates that Tell You How Efficient You Are
Also known as conversion rates, these let you know how effective your activities are at encouraging donors to complete activities. Things like individuals visiting your website, donating to your project or even opening a link on your website, are all part of conversion rates. Having a higher conversion rate shows the success and effectiveness of your organization’s fundraising actions.
Conversion rate is pivotal for planning and budgeting, and should also be utilized for learning. You can also use this metric to determine what went wrong, compared to similar or past activities. It also lets you know if your activity, campaign or effort was below or above your expected conversion rate. This way you can regulate and improve your strategies to make them more successful in the future.
Minimal Amount of Cash Required to Ensure Success in the Fundraising Business
The most crucial metric to keep track of, this is the cost per dollar raised. This metric calculates the amount of money it takes to raise a dollar for the project. It could be tough to collect the information for calculating this cost. Aggregating all the information may require you to team up with your finance or accounting department. Therefore, make sure that you have a couple accounting savvy employees.
The cost per dollar raised tells you how much you have spent implementing a specific strategy. Also, it tells you about the total revenue you receive from putting that same strategy to use. As a result, you get an idea of the estimate of total cost, necessary to earn you an income of one dollar. If the result of this calculation comes to more than 1, it’s time to give each of your members an congratulatory pat on the back. And, if the result of the calculation is less than 1, the strategy used was a failure. Needless to say, it’s time to up your game. If tracked in real-time and measured routinely at the end of each year, the cost per dollar raised is accurate. This is advisable for your organization, at all times.
The Bottom Line
There are a number of tools and strategies that can be used to calculate the efficiency of your fundraising. The metrics above highlight strengths and weaknesses within your project. They also aid in showcasing opportunities to stun your contenders.
If your fundraising isn’t working or is becoming stale, then choose some different fundraising metrics to improve your efforts. But, with these 3 basic metrics you can easily get started and know whether your fundraising efforts are succeeding and improving or not, with substantial proof. Clearly, this will provide you and your organization with an idea of where you stand in the food chain of fundraisers.