Donations to Nonprofits Increased by Three Percent in 2016
The 2017 Fundraising Effectiveness Report Also Reveals Declining Donor Retention Rate
According to the recent 2017 Fundraising Effectiveness Survey Report from the Fundraising Effectiveness Project, overall donations to nonprofits in the US increased 3% in 2016 over 2015, while the retention rate of donors--that is, the percentage of donors who gave in 2015 and again in 2016 to the same organization, decreased slightly to 45%.
This retention rate, similar to customer retention rates measured in other businesses like NetFlix and Verizon, continues its long-term slide and shows just how hard it is for nonprofits to keep donations flowing from their supporters.
The study, in its 10th year of release, encompasses 10,829 nonprofit organizations across the US with 8.9 million donors and more than $9.1 billion dollars in contributions. It is the world’s largest database of actual nonprofit donation history.
Erik Daubert, Chair of the Fundraising Effectiveness Project, said, “While the overall growth in giving of 3% is positive, the millions of donors who do not repeat their giving is very concerning. The fact that nonprofit organizations are losing 55% of their donors from one year to another is not a sustainable strategy. If nonprofits were a business where the majority of customers do not return, the business would quickly be out of business.”
The report also highlights the struggles of small nonprofits. For example, nonprofits with less than $100,000 in contribution income declined 10.4% from 2015 to 2016. Meanwhile nonprofits with more than $500,000 in contributions increased 8.6% in the same time.
Another highlight of the report was the average gift amount, which was $419 in 2016 vs. $400 in 2015, or a 4.75% increase.
Jason Lee, interim CEO and President of the Association of Fundraising Professionals, remarked, “Tracking actual nonprofit transactions collectively is a relatively new trend. While similar data has been available in the for-profit world for years, analyzing donation history from thousands of nonprofits has finally created benchmarks that nonprofits can use to compare themselves to their peers. Nonprofits can now make better decisions based on this big data analysis, which helps all nonprofits raise more money they need to execute their missions.”
Daubert concluded, “Now more than ever it’s important to make smart decisions around fundraising and retention efforts. Quite literally, the growth of the Growth in Giving database allows for groundbreaking research that was never before possible.”
For more information on the 2017 study and download a free summary report and learn about other tools to help measure effectiveness, please visit www.afpfep.org.
About the Fundraising Effectiveness Project
The Fundraising Effectiveness Project was created in 2006 and includes the collaboration of the Association of Fundraising Professionals and the Urban Institute. The Growth in Giving database, with more than 110 million donation transactions, is continuously updated monthly by leading fundraising software thought leaders Bloomerang, DonorPerfect, and NeonCRM. Additional partners and data providers include the 7th Day Adventists, DataLake, DonorTrends, eTapestry, ResultsPlus, and ClearViewCRM. For more information and how to have your fundraising software provider participate, visit www.afpfep.org.
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