Use Tech to Measure 11 Informative KPIs
by Karen Rosen
Mid-year is a great time (any time is a great time!) to check on the health of your fundraising. Measuring the same KPIs over time will set you up for year-round success!
Would you believe there’s something you can do right now to increase the chances of more successful year-end campaigns? Reviewing data measuring the health of your nonprofit can illuminate areas of strength and those that might need a little attention—giving you time to adjust your strategies before your next big campaign.
Robust fundraising software provides the data you need to know how healthy your nonprofit is. By checking your Key Performance Indicators, or KPIs, you’ll see if there are any areas you can shore up to increase your chances of fantastic future campaigns.
You can use this checkup at any time of the year. Periodically examining your KPIs will allow you to chart your progress and proactively address areas of concern.
11 Key Metrics Nonprofits Should Measure
We recommend keeping this list handy and always measuring the same metrics. This way, you can establish baselines and identify trends using identical data parameters. Here are 11 KPIs, easily measured with your CRM, that provide insight into your nonprofit's health.
1. Revenue from Donations
How much money has your nonprofit raised from donations? You can include individual donors, corporate sponsors, grants, and matching gifts. You can separate in-kind gifts and measure them separately. How closely are you following the progress you’d need to make to reach your fundraising goals?
2. Donor Retention Rate
What is the percentage of existing donors who continue to support your nonprofit through repeated donations? The higher your donor retention rate, the healthier your nonprofit. A commonly accepted average retention rate is 40% to 45%, so use that as a benchmark.
3. Cost of Fundraising Ratio
How much are you spending on fundraising versus how much you’re raising? For example, if you spend $10,000 a year on fundraising and you raise $200,000 in donations, your cost of fundraising ratio is 5%. Charity Navigator says your spending should be less than 10% of what you’re raising. If this number is high, it’s important to lower it for your nonprofit's health and increase the ratings prospective donors see.
4. Number of Beneficiaries
This metric looks at the reach of your nonprofit. Is the number of individuals, programs, or communities (your beneficiaries) you serve growing? If the number of those who directly benefit from your programs and services is increasing, it shows that your marketing and outreach are successful.
5. Number of Sustainers
We preach about the value of a strong sustainer program. Every nonprofit should start or maintain a comprehensive monthly giving program to keep engaging with sometime donors to make them regular donors. It’s these, with monthly gifts that can be counted on, that sustain a nonprofit. And if you have a strong sustainer program, make sure you’re retaining those donated funds as much as you can. An important sign your nonprofit is growing and future-proofing itself is an increasing number of sustainers.
6. Program Outcome Metrics
This is a metric that should be measured frequently. What are the goals for each program, and are you meeting them? There shouldn’t be a campaign, an event, or even an email without goals. It’s important to measure progress while events and campaigns are ongoing. For example, if you’re running an email campaign and your click-through rate is less than 2%, something in that email isn’t working and needs to be fixed. Set measurable goals and track outcomes.
7. Giving Frequency
How often are donors giving? If your monthly giving program is increasing, this number should also increase because it means you’re converting occasional donors into monthly donors with increased giving frequency. You can segment your donors into those who give monthly, quarterly, semi-annually, annually, and infrequently and target each group with a separate email campaign to improve this metric.
8. Volunteer Retention Rate
This metric doesn’t tell you much about the financial health of your nonprofit, but it tells you a lot about the culture. If your retention rate is about 65%—two of every three volunteers return to serve your organization—you’re doing well. If it’s lower than that, investigate why. Use a text survey to ask for feedback. A positive culture is a sign of a healthy nonprofit that will continue attracting supporters.
9. Donation Form Conversions
Your donation form is the most important page on your website, as it’s the last stop before the donation is made. This is when the website viewer converts into a donor, and knowing how effective that page is counts as one of the most critical metrics you can see. If the number is lower than 15% to 20%, you might want to consider optimizing your donation form to increase your conversions and raise more money.
10. Website Traffic and Engagement
Common metrics tracked by for-profit companies can inform nonprofits, too. These include number of visitors, page views, time spent on the site, bounce rates, and clickthrough rates. Your website doesn’t have to be sophisticated or complicated, but it does have to be engaging, easy to understand and navigate, and offer a clear path to donation.
11. Social Media Engagement
Savvy nonprofits know social media is a great way to engage certain demographics. It’s also an excellent strategy to extend your reach, increase your fundraising, and have a little fun with your supporters. Measuring follows, likes, shares, and even conversions from social media can tell you how your digital marketing efforts are working.
This list of KPIs, while certainly not exhaustive, will give you a good report on the health of your nonprofit. The results will also quickly illuminate any areas needing attention or modification, keeping your nonprofit ahead of potential problems before they materialize.
What Does a Healthy Nonprofit Look Like?
A healthy nonprofit is showing growth across many areas. It also has an engaged and productive board of directors steering it, knowledgeable staff dedicated to its mission, and a culture that reflects the heart of the nonprofit. And, importantly, a healthy nonprofit has leaders who are always learning and willing to try new things that can increase success.
Each of these metrics can be found easily in a solid CRM; they aren’t expensive feature add-ons. If you’re curious about what a complete, natively built fundraising system looks like, give CharityEngine a call. We’d love to share some of the incredible successes our clients enjoy.
