If you are not paying attention to your donor retention numbers year over year, then you are probably pretty delusional about your fundraising success. It is easy to say “our bottom line increased $100,000 from 2013 to 2014.” What if you lost donors and their charitable gifts in the amount of $60,000? That means your real net increase was only $40,000. That paints a much different picture of your fundraising success.
The 2014 Fundraising Effectiveness Project report summarizes data from 3,576 survey respondents covering year-to-year fundraising results for 2012-2013. The report shows that:
- Every $100 gained in 2013 was offset by $92 in losses through gift attrition. That means the net increase was only $8.
- Every 100 donors gained in 2013 was offset by 102 in lost donors through attrition. The result is a negative gain which is a loss.
- Growth-in-giving performance varies significantly according to organization size (based on total amount raised), with larger organizations performing much better than smaller ones.
- Organizations raising $500,000 or more had an average 10.5% net gain.
- Organizations raising $100,000 to $500,000 had an average 1.9% net gain.
- Organizations in the under $100,000 groups had an average 2.4% net loss.
- The median donor retention rate increased from 39 percent in 2012 to 43 percent in 2013 and the gift or dollar retention rate increased from 40 percent in 2012 to 46 percent in 2013. However, over the last nine years, donor and gift retention rates have consistently been weak — averaging below 50 percent.
Some of those numbers may have you reeling and wondering. How do I measure my donor retention? There is a tool, the Fundraising Fitness Test (FFT), and it is available to all nonprofit organizations.
The Fundraising Fitness Test is the results of efforts that began in 2006 by the Association of Fundraising Professionals, the Center on Nonprofits and Philanthropy at the Urban Institute, and the following fundraising software companies/products: MatchMaker FundRaising Software, Donor2/Campus Management Corporation, DonorPerfect Fundraising Software, eTapestry, GiftWorks, Results Plus, PhilanthrAppeal, The Raiser’s Edge, ROI Solutions, and Exceed!. In 2012 they were joined by Philanthropic Services for Institutions (PSI).
Randy Fox, a PSI staff member, has developed a streamline process of benchmarking a nonprofit’s fundraising data for all nonprofits, large or small, to use.
FFT enables a nonprofit to select specific data – perhaps the annual giving campaign or a membership program and compare how it did year over year. The Fundraising Fitness Test allows the nonprofit to look at the whole database or a particular segment. FFT will generate a set of 76 indicators segmented by five gift-ranges.
To utilize the Fundraising Fitness Test, you need to access the following information by going to http://afpfep.org. You do not need to be a member of AFP (the Association of Fundraising Professionals) to access FFT. On the website, click Tools, under Downloadable files download and save to your desktop item 1 the GiGi Fundraising Fitness Test and item 4 the Instructions for Fundraising Fitness Test and GiG Reports templates. Follow the instructions and you will be wowed by the information generated.
The end result is an extensive amount of information spread over 10 reports. The information within the reports can help your organization develop fundraising strategies based on facts, not speculation.