5 Most Important Fundraising Metrics You Need To Track

In the nonprofit world, fundraising is the lifeblood that keeps an organization moving towards its mission. After all, if you don’t gather donations, you have no money for your cause. And if you’re looking to improve your efforts, you need to start with fundraising metrics.

Today we are covering why fundraising metrics matter, as well as the five every nonprofit should be tracking. We’ve also included advice on how to improve each one.

Why Fundraising Metrics Are Important

Fundraising metrics are more than just arbitrary numbers. Track them accurately, and they give you insight into donor behavior, the effectiveness of your campaigns, and your organization’s financial health.

Need more convincing? Here are four reasons you should take your fundraising metrics seriously:

• Data-driven decisions. Smart decisions are decisions based on data. When you track fundraising metrics, this is data that you have access to. This leads to evidence-based insights and smarter decisions overall.
• Transparency. Your donors need to see proof of impact. This is the only way to keep them donating continuously, as well as win new donors. Anybody can make claims about the effect of peoples’ donations. Fundraising metrics are how you actually prove them.
• Progress tracking. Every nonprofit has goals that they want to achieve. If you lack data, however, these goals are nothing more than vague plans. Fundraising metrics show you where exactly you’re making progress. This keeps your team accountable and focused on your “needle movers.” 
• Efficiency. By understanding a variety of fundraising metrics, you have insight into how effective your efforts are. Are you overspending on certain campaigns? Should you double down on particular platforms, or completely scrap others? These are questions you can answer if you track your numbers, and once you do, you become more efficient as a result.

Now that we understand why these metrics matter, let’s dive into the most important ones every nonprofit should track.

5 Essential Fundraising Metrics + How To Track them

#1: Total Funds Raised: The total amount of money raised during a specific period.

Why It’s Important: Our first metric is the most basic. Still, it’s essential. Measure the total amount of funds that you raise and you have a general picture of your overall fundraising success. It’s also important to measure if you want an indicator of how much your grow over time. 

How to Track It: Track funds raised by campaign, month, or year to identify trends and measure the effectiveness of your fundraising efforts.

#2: Donor Retention Rate: The percentage of your donors that continue to donate over a specific period of time – typically year-over-year).

Why It’s Important: Getting donations from existing donors is cheaper (and quicker) than searching for new ones. A high donor retention rate means people are giving more than once. This is a strong indicator of high satisfaction and engagement among your supporters. 

How to Track It: Divide the number of repeat donors by the total overall amount of donors in any given period. To improve it, be sure to focus on a variety of retention strategies. 

#3: Average Gift Size: The average dollar amount donated per transaction)

Why It’s Important: How much do people give when they do donate? That’s what this number is for. It gives you an idea of the overall generosity of your donors. This is essential for two reasons: it helps you plan better, and it also allows you to pinpoint particularly generous donors for personalized outreach. 

How to Track It: This fundraising metric is quite simple. Simply divide the total funds that you’ve raised by the total number of donations you’ve received. After you’ve measured this, it’s helpful to compare your average gift size across different campaigns. This gives you an idea of what truly resonates with your audience. 

4: Donor Growth Rate: The rate at which your overall donor base is either growing or shrinking over a specific period)

Why It’s Important: Every nonprofit wants more donors. But it’s not enough to know that you’re adding more donors – you also need an idea of how fast you’re adding them. A positive growth rate shows you that what you’re doing is working. 

How to Track It: Subtract the number of donors at the beginning of a period of time (we recommend at least a few months) from the number at the end. You then need to divide by the starting number + multiply by 100 to get a percentage. Be sure to continually measure this metric, as this will give you an idea of how your donor growth rate is changing over time. 

5: Cost Per Dollar Raised (CPDR): The cost of raising one dollar through a specific campaign or initiative.

Why It’s Important: CPDR shows you the efficiency of your fundraising efforts. A lower CPDR means that you are more efficient with your marketing efforts and, most importantly, that more of your donations go directly to your cause.

How to Track It: Divide the total cost of a fundraising campaign by the total funds that you raise. You can lower this metric by optimizing campaign costs (consider automatizing campaigns as much as you can, for example). Obvious point here: the lower this number is, the more of your donations your organization actually gets to use. This should be a fundraising metric you try to lower constantly.

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