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AFP Announces Initiation of First Fundraising Effectiveness Survey

October 1, 2006

The first annual Fundraising Effectiveness Survey will be initiated on Nov. 1, 2006 in conjunction with the Fundraising Effectiveness Project (FEP).  The FEP is cosponsored by the Association of Fundraising Professionals in collaboration with the Center on Nonprofits and Philanthropy at the Urban Institute in Washington, D.C; the Center on Philanthropy at Indiana University in Indianapolis; the National Committee on Planned Giving in Indianapolis and other nonprofit sector organizations.  The survey, designed to help nonprofits increase giving at a faster pace, will measure growth in giving from 2004 to 2005.

Respondents to the survey will get back decision-useful comparative fundraising performance data that will support growth-oriented strategic planning and budgeting for their fundraising programs, enabling them to raise more money for their organizations. Access to the survey performance data will be free to survey respondents, and all nonprofit organizations are welcome to participate.

Nonprofits will be able to compare their growth-in-giving performance with the performance of like organizations as determined by total amount raised, average gift size, type of organization, age of development program, geographic location, fundraising budget and number of personnel, as well as combinations of these criteria.  In subsequent years, AFP plans to collect more detailed information, including costs (by fundraising method), gift type and other variables.

Enormous Untapped Potential

For decades, research has repeatedly indicated that there is an enormous potential for giving in the United States.  Why hasn’t the sector been able to tap this potential and increase the rate of growth in giving?   One reason is that nonprofit fundraisers, CEOs and board members lack the performance data they need on fundraising effectiveness in order to make informed, growth-oriented budget decisions that can increase giving at a faster pace year after year. 

During the next few years, the annual Fundraising Effectiveness Survey will fill this performance data gap.

How It Works

The basic concept for the survey is that an organization’s overall growth in giving from one year to the next is actually the net result of gains minus losses.   Thus, growth in giving is increased both by maximizing gains and by minimizing losses.

Gains consist of increases in gift amounts by upgraded donors and gifts by new donors and recaptured lapsed donors.  Losses consist of decreases in gift amounts by downgraded donors and lost gifts from lapsed donors.  Figure 1 illustrates how nonprofits will be able to compare their growth-in-giving performance with benchmarks and performance statistics of similar organizations.

Figure 1
   Comparison of NPO’s Growth-in-Giving Performance to
   Illustrative Fundraising Effectiveness Project (FEP) Averages

Gains, Losses & Net

Gain/Loss categories and definitions

 Gains:  
    New donors who never gave prior to current period
    Recapture previously lapsed donors who gave again in current period
    Upgrade donors who gave more in current period than in previous period
 Losses:  
    Downgrade donors who gave less in current period than in previous period
    Lapsed new new, first-time donors in previous period who did not give in current period
    Lapsed other other prior donors who gave in previous period but not in current period
 Net growth total of all gains in giving minus total of all losses in giving

Nonprofits need to track the gain/loss performance indicators in Figure 1 to ensure that their growth-in-giving goals are achieved.

Basically, nonprofits are not investing enough money in efforts to raise their share of the untapped giving potential.  Growth-oriented budgeting for fundraising requires that, year-after-year, nonprofits make significant, incremental increases in their fundraising budgets, by categories of fundraising effort.  Then they need to measure the corresponding incremental increases in results by categories and make additional incremental increased investments in fundraising effort, category by category, based on the performance of previous fundraising activities.

Software Community Pitching In

To make responding to the survey as easy as possible and eliminate the need for each nonprofit to figure out how to extract the needed data from their respective donor databases, we are asking the donor software community to provide assistance to their clients.

AFP has sent several emails to every donor software firm we can identify, inviting participation. So far, the following firms have joined the Donor Software Workgroup:

  • Blackbaud (Raiser’s Edge)
  • Donor2/Campus Management Corporation
  • DonorOne (ResourceOne Technologies)
  • DonorPerfect Fundraising Software
  • eTapestry
  • MatchMaker FundRaising Software
  • PledgeMaker (SofTrek)
  • Sage Software

These firms are assisting with the design of the 2006 survey and are ready to help their clients respond to the survey.  AFP and the Urban Institute encourage participation by other software firms.  Nonprofits are encouraged to contact their donor software providers and inquire if they will be able to assist with the survey.

For a copy of a concept paper for the survey or more information about the project, please contact Bill Levis, Project Manager at The Urban Institute (qrlevis@aol.com) or Cathlene Williams, Ph.D., CAE at AFP (cwilliams@afpnet.org).

Work on the survey began after AFP emailed its members and asked if they would participate in an annual web-based Fundraising Effectiveness Survey. With more than 1,500 responses indicating overwhelming support, AFP began work with the Center on Nonprofits and Philanthropy, other nonprofit sector associations and the donor software community.

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