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Measuring The Effectiveness of Your Fundraising Appeal

It’s always exciting to count the floods of money arriving from your year-end appeal.

While its a pretty safe bet to say that most organizations know how much money their appeal brought in, there are other important metrics that are largely ignored.

Neglecting to thoroughly measure and analyze your appeal results means you’ll miss critical information that would have helped you raise more money next time around.

Before you rush off to start your next fundraising activity, take some time to review your appeal’s performance.

Add these items to your list of things-to-do:

Measure NET revenue, not just gross revenue.

For a true picture of your appeal’s performance, make sure you’ve subtracted the costs of your appeal (such as designing, mailing & printing) from the total amount of contributions you received in your final analysis.

Often, I see nonprofits report results solely as gross revenue. Tempting though it may be to use this higher figure, it’s an inaccurate representation of your results.

For example, if your total contributions are $20,000 but you spent $10,000, this is clearly not as good than bringing in the same amount by spending only $3,000. That’s a net revenue of $10,000 verses $17,000.

Calculate response rate, average gift size,  cost per donor, and return-on-investment.

These important metrics, especially when considered together, tell a deeper story of how your appeal performed. They serve as a baseline for predicting results of future appeals as well as a comparison from year-to-year.

Let’s say that, sadly, your most recent year-end appeal’s net revenue was lower than in the year before. You need to understand why. 

You notice that in the prior year, your response rate was much lower, but your average gift was significantly higher than this year.  Now you might hypothesize that the lower average gift of your more recent appeal was due to the lower gift range suggestions on your reply card.

Consider contributions made via channels other than mail.

Many of us actively promote online giving on our snail-mail appeal, which is good because direct mail is in fact, an important driver of online giving.

In a recent study by Dunham & Co., 50% of donors reported that they have given online in response to a direct mail appeal.  Direct mail is six times more likely to drive online giving than email.

So, take a closer look at gifts that were made online, over the telephone, or even in person. Those gifts may actually be a result of your direct mail and should be considered a part of its success.

Evaluate responses by segment.

I am a huge advocate of managing your donors by segment. This means you also need to evaluate your appeal (not to mention other activities) based on those segments.

For the sake of donor retention, it’s important to understand how many lapsed donors, severely lapsed donors, first-time donors, and loyal donors responded, their average gift size and total contributions. If your major donors were included, you need to make sure those who responded get an appropriate follow-up.

Document all of this in an old-fashioned, three-ring binder.

You’ll also want to include a hard copy of your final appeal package, budget, invoices, and final mailing list. Yes, store them electronically, too, but nothing substitutes for a hard copy of side-by-side, year-by-year appeals all in one place.