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Fundraising Tuesday: How to Choose Metrics for Your Nonprofit to Measure

August 22, 2023 by Dennis Fischman Leave a Comment

A guest post by Sarah Tedesco of DonorSearch

Picture this: Isabella is the executive director of Academic Stars Network, an organization dedicated to tutoring at-risk high school students in STEM subjects. She’s worked for years to deliver high-quality programming and services to local students, teachers, and parents.

One day, during a meeting with the board of directors, a discussion arises about the need for more data-backed decision-making for the organization. Isabella realizes that Academic Stars Network lacks a strategic approach to evaluating the effectiveness of its initiatives and measuring its overall impact on the community. She and her team decide that it’s time to start tracking metrics for different aspects of their operations—but they aren’t quite sure where to begin.

Many nonprofits find themselves in this same position—wanting a better way to understand just how much of a difference they’re making, but unsure of how to measure success metrics, also known as key performance indicators (KPIs).

In this short guide, we’ll help you get started with choosing metrics for your nonprofit to measure its progress, whether you’re looking to improve your website’s performance or boost your donor retention rate. Let’s begin!

Review your long- and short-term goals.

When it comes to selecting metrics, it can be tempting to simply select a few and begin to gather insights just for the sake of having insights. But this can lead to information overload, giving your team an overwhelming amount of data to organize and analyze.

Instead, start the process by reviewing your organization’s long- and short-term goals. Aligning your metrics with these goals will help ensure that your team gets the insights that it needs on the most important aspects of your organization’s operations.

For example, say that you have a goal to increase the number of major contributions your organization receives each year by 20%. With this goal in mind, you could consider tracking metrics related to donor acquisition, average gift size, and donor engagement.

Similarly, if your organization wants to improve its Google Ad Grant results, you could start to more proactively track metrics related to your performance online, like the conversion rate on your website landing pages.

Selecting your metrics based on the goals you’re currently working toward will empower you to reach those goals faster as you track your progress and use what you learn to course-correct and improve your efforts to meet your goals.

Consider different metric focus areas.

You might be thinking, “I know what my goals are and what parts of my organization I’m hoping to improve. But what are my options for measuring my progress?”

It’s a good question. The short answer is that if it can be measured, it can be turned into a metric you track over time and use to work toward a goal. The long answer is this: There are many different metric focus areas that you can consider as you choose your own metrics to track.

According to DonorSearch, here are some of the most popular focus areas and a few examples of metrics within those areas:

General fundraising metrics: cost per dollar raised, fundraising return on investment (ROI), number of gifts secured, matching gift rate, pledge fulfillment rate

Donor relationship metrics: donor retention rate, donor churn rate, donor lifetime value, donor acquisition cost, demographic metrics

Giving level metrics: gift frequency, average gift size, average giving capacity

Engagement metrics: donor or prospect outreach rate, fundraising participation rate, number of asks made

Online performance metrics: online gift percentage, email open rate, landing page conversion rate, social media amplification rate, social media applause rate

In addition to these focus areas, you could also look at metrics related to your volunteer program, such as volunteer hours tracked or volunteer acquisition rate; or your events, such as number of event registrations, event attendance rate, and revenue raised. Or, if you’re looking to make improvements to your internal operations, you could focus on metrics like your employee retention rate.

Remember, you don’t want to try to track every metric at once—this will lead to the most important insights getting lost in a sea of information. Instead, choose one focus area to look at or a handful of metrics from a few focus areas.

Determine how you’ll measure your metrics and how often you’ll review them.

Once you’ve selected the metrics you want to track, you still have a few steps to take to set your team up for success. Prepare to get the most actionable insights possible by asking yourself these two questions:

1. What tools will we use to measure and calculate our metrics?

With the right tools, your team won’t have to calculate its metrics by hand and risk errors that could derail your insights. Choose your tracking tools based on the metrics you want to measure.

For example, if you’re tracking metrics related to your major donors and their capacity and affinity markers, you might rely on the help of a nonprofit-specific AI tool to help you gather those markers and make predictions about your prospects and donors.

2. How often will we review our metrics?

Dedicate time to reviewing your metrics on a regular basis. You may do this at the beginning of a fundraising campaign and then again at the end, or at specific times of the year, like at the beginning and end of each quarter.

It may also be helpful to set baselines and thresholds for certain metrics so that you know when to act on the information. For instance, if you start tracking your virtual event registration numbers and see a jump from your baseline number of attendees to your threshold for action, you could take the time to evaluate what made this positive change possible—and keep doing more of it!

As you begin tracking your chosen metrics and getting into the swing of consistently reviewing them, remember to give yourself enough time to see change. Just like waiting for a plant to grow or a pot of water to boil, time has to pass for you to notice changes in your metrics. Be patient as you start your tracking journey—it will pay off as you’re able to identify consistent patterns and trends that you and your team can act on.

Metrics empower your organization to point to specific, quantifiable measurements that illustrate your nonprofit’s progress toward a certain goal, whether it’s a goal related to fundraising or strengthening donor relationships.

Start your metric-tracking journey today by following the three steps outlined above to select the right metrics for your nonprofit and to set yourself up to see changes and trends over time that you can take action on. You’ve got this!

Sarah Tedesco is the Executive Vice President of DonorSearch, a prospect research and wealth screening company that focuses on proven philanthropy. Sarah is responsible for managing the production and customer support department concerning client contract fulfillment, increasing retention rate and customer satisfaction. She collaborates with other team members on a variety of issues including sales, marketing and product development ideas.

Beyond Your Logo, by Elaine Fogel: a review

January 7, 2016 by Dennis Fischman 1 Comment

You can’t turn over a rock these days without finding someone talking about “branding.” Most of them make it a mystery. In Beyond Your Logo: 7 Brand Ideas That Matter Most For Small Business Success, Elaine Fogel makes it simple.

If you are just starting out, this book will help you organize your business so that your every move says something about you that your customers like. It’s not just your marketing. Customer service, personnel practices, business ethics and small business social responsibility, and communications strategy all add up to the total picture your customers have of you. Do you want loyal customers? Elaine shows you just how to win their loyalty.

If your business is already a going concern, you should still read this book–for the helpful reminders and for the exhaustive lists of actions you can take to improve. Open the book to any page and you’ll find tips like these:

9 steps toward managing customer complaints
38 specialties within marketing and branding
20 questions you can ask customers and employees to gain insight into how well your business is doing

Nonprofit organizations can also learn from this book. By remembering that your “customers” include both your funders and your clients, you can translate Elaine’s advice into your own terms and use it for your work. (You will find that the book already defines a lot of the jargon for you: all you have to do is ask yourself, “How would I say that in nonprofit?”)

Canadian readers will benefit from Elaine’s bi-national identity. She makes sure to tell you when something applies in the U.S. but not in Canada, and vice versa.

If there is one weakness to the book, it’s that it relies too much on definitions, statistics, and list, and it doesn’t tell enough stories. I loved reading about the dairy farmers, Dane and Travis Boersma, who started Dutch Bros. Coffee. Reading their creed, I understood much better what it means to be customer-centric. I could wish for more moments like that in the book.

Overall, however, I would recommend this book to small business owners and managers of community-based organizations. And after you read the book, go to Elaine Fogel’s blog for more nuts-and-bolts advice, every week.

How to Measure Results–and How Not To

August 11, 2014 by Dennis Fischman 1 Comment

Should you measure the results of your blog and social media? Why?

In the for-profit sector, the answer seems obvious. “Executives and business owners sleep, eat, and breathe ROI,” or Return on Investment, according to Nichole Kelly.

But nonprofit organizations exist for different purposes and calculate value differently. If your small nonprofit is using social media, what is worth measuring, and what is not?

Your Goals Should Set Your Measures

What’s not worth measuring are the “vanity metrics” of followers, likes, and views. Sure, you can keep track of them because it’s so easy to do so. But they tell you nothing. As Julia Campbell points out, nonprofits don’t count their success by how many times they are mentioned.

Donations, email sign ups and event attendance are signs of success because they help you obtain the support you need to do your job. Reputation helps you get things done more easily, at less cost. And advocacy helps you make social change, which may be the reason you exist in the first place.

Julia suggest you take the following steps to measure the real value of your social media:

Pick a specific project. “The more specific you can be, the easier it will be to measure your efforts.”
Choose objectives. What do you want to see happen as a result of your blog, post, or tweet?
Only then, choose your metrics. Make sure you’re measuring what matters to you. Don’t bother measuring anything else.

Your Measures Should Live Within Your Means

Here’s a question I haven’t heard anybody ask: what is the ROI of measurement?

Certainly, you must make some well-planned attempt to figure out what you’re getting from your social media. But let’s be real. For many small nonprofits, it’s a stretch to DO the social media. Carrying out a methodologically sophisticated measurement of results may be a waste of precious time and money.

Consider harvesting some of these low-hanging fruit:

Listen for signs that people are paying attention to what you post. Are they commenting or sharing them online? Are they mentioning them to you? Is the conversation changing because of your efforts?
Ask people what they think. When they come to your office or to your events, take a minute to ask. If you can, send a survey or hold a focus group.
Read studies about what works. Adapt best practices to your own situation.

Your Measures Should Be Humble

Aristotle said it thousands of years ago: “Our measures cannot be more precise than the phenomena we are trying to measure.” Be cautious about reading too much meaning into a small statistical change. You’ll need to follow your social media results for months to be sure that what you’re seeing is real and meaningful.

Einstein said it best: “Not everything that counts can be counted, and not everything that can be counted counts.” How do you measure the value of building relationships with the next generation? By and large, Millennials use social media all the time, and if you don’t, you will have a hard time reaching them. Even if you can’t measure it, investing in social media now is like planting a tree. It will bear its fruit in the future.

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Fundraising Tuesday: How to Choose Metrics for Your Nonprofit to Measure

Review your long- and short-term goals.

Consider different metric focus areas.

Determine how you’ll measure your metrics and how often you’ll review them.

1. What tools will we use to measure and calculate our metrics?

2. How often will we review our metrics?

Beyond Your Logo, by Elaine Fogel: a review

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Review your long- and short-term goals.

Consider different metric focus areas.

Determine how you’ll measure your metrics and how often you’ll review them.

1. What tools will we use to measure and calculate our metrics?

2. How often will we review our metrics?

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