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Donor Numbers and Revenue Per Donor Shrink in First Quarter ‘09

(July 7, 2009) Not only is the United States seeing a drop in donor numbers since their peak in 2005, the economy has left those donors giving less.

According to the Index of National Fundraising Performance published by Target Analytics, first quarter 2009 saw the first overall decline in revenue per donor since the study began in 2002. Revenue per donor declines were experienced by two-thirds of the organizations in the index.

As each donor gives less, the problem is compounded by falling donor numbers in the U.S. that have taken place for more than three years (since the Gulf Coast hurricanes of 2005). The study indicates that in the last quarter of 2008 and the first quarter of 2009, this gradual fall in donor numbers has increased in magnitude, suggesting that the recession is accelerating the rate of decrease in donor numbers.

"These numbers continue to underscore the extraordinary situation and challenges the charitable sector faces now," said Paulette V. Maehara, CFRE, CAE, president and CEO of AFP. "However, it's important to remember that overall, the economy currently seems to be steadying itself, albeit very slowly. While we still have a long ways to go, we are hopeful that this report represents the absolute worst of the recession's impact."

Fewer Donors—Giving Less

Declines in the number of donors overall are due primarily to declines in new donors, which are falling faster than overall donor numbers, particularly since the recession began. In fact, over the past five years, new donor numbers have fallen a median 13.8 percent, or 2.6 percent annually over that period.

New donor declines have been particularly steep since the start of the recession, the study shows. New donor numbers have fallen 9.4 percent since the recession began in the fourth quarter of 2007.

Revenue per donor has generally increased for the past five years, the study notes, but with some slowdown in growth in 2008. In the past, revenue per donor has increased so as to counteract the longer term trend of decreasing donors. However, in the first quarter of 2009, revenue per donor declined 2.1 percent from the same period in 2008.  Just 34 percent of the organizations had revenue per donor increases from first quarter 2008 to first quarter 2009.

Performance By Sector

The report notes that in the first quarter of 2009, almost all of the industry sectors in the index exhibited the trends that were seen in the index as a whole: declining revenue and donor numbers precipitated primarily by declining new donor acquisition.

All sectors experienced decreases in revenue from the first quarter of 2008 to the first quarter of 2009. The religion and animal welfare sectors had the smallest revenue declines and the arts and culture, health and societal benefit sectors had the largest revenue declines.

The international relief sector was the only sector to have an increase in donor numbers this quarter, in contrast to the rest of the index. As with revenue, the arts and culture, health, and societal benefit sectors had the largest donor declines.

Click here to download the complete report of Target Analytics’ Index of National Fundraising Performance: 2009 First Calendar Quarter Results.

For ideas and tips on overcoming the challenges of the economy, click here for AFP's Fundraising in a Difficult Economy Tookit.

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