5 Ways to Measure Fundraising Success of Your Nonprofit

Fundraising is such a crucial part of a nonprofit’s sustainability plan. And though it may seem like looking at the total amount of funds you’ve raised can show you the success of your effort, it’s a little more complicated than that.

We list five ways to measure fundraising success for your nonprofit so you can get a holistic picture.

1. Return on Investment

Return on Investment or ROI as it is commonly known is calculated by using the following formula;

ROI = Total Revenue/Total Expenses

If your result is greater than one, it indicates that you have successfully managed to raise funds. The higher the number, the more successful you have been in your efforts.

2. Average Gift Amount

The name is self explanatory. This value determines the average gift size you have received at the end of your fundraising. It is calculated using the following formula;

Average Gift Amount = Total no. of Gifts/Total no. of Donors

This is a good metric to use because it will reflect the efforts of your attempts at donor acquisition and donor cultivation. In an ideal universe, this amount should grow at a steady rate as you acquire new donors.

3. Donor Retention Rate

While this metric may not directly involve the value of the gifts you got, it is important to measure. You need to know how many donors of the previous years were you able to bring back to support your organization once again.

This is important to note because donor retention in the long run should be a part of your nonprofit sustainability plan. But in this context, if you see a high level of donor retention then it could indicate that you should begin to focus more on donor acquisition efforts now.

4. Conversion Rate

This metric is great way to measure donor acquisition, particularly any new tactics you have been trying out. It will give you a clearer picture of whether you attempts to convince people to join your cause were successful or not.

In order to calculate this, you will need to use the following formula;

Conversion Rate = No. of Donors Converted/No. of Potential Donors Reached Out To x100

5.  Cost Per Dollar Raised (CPDR)

This is similar to calculating ROI but instead of measuring how much money you raised, it measure cost of raising the money you did. It is calculated by the following formula;

CPDR = Total Revenue for Fundraiser/Total Expense of Fundraiser

Your results will give you a fair idea of whether you made a profit, broke even, or suffered a loss. Sometimes, you may have raised funds but when you look at the cost that went into raising those funds, you may find that you didn’t actually raise a profitable amount at all. This is why this metric is so important.

By keeping an eye on the metrics above, you will be able to gauge the success of your organization through a number of different lenses.