ONWARD ONLINE

Online fundraising is one of the fastest growing sources of new income for non-profit, for-profit and political organizations. M+R Strategy Services in Seattle, WA (www.mrss.com) has just issued a new study with very significant information for online fundraising and advocacy. According to M+R, the total amount raised online by their study partner organizations grew by 19 percent from 2006 to 2007.

As much as the new advocacy technies may not want to hear this, to a large extent online fundraising strikes me as very similar to direct mail marketing… response rates, monthly and yearly giving patterns, average gift size, issue identification. Everyone who is concerned about the base of their fundraising pyramid ought to read this report.

Key findings from their 2008 eNonprofit Benchmarks Study present important fundraising, advocacy and messaging metrics. Between 2006 and 2007:

- The number of online gifts went up 24 percent in 2007, and the total amount raised online increased by 19 percent!
- Email open rates have fallen from 21.3 percent to 17.6 percent, and click-through rates have dropped from 4.9 percent to 3.8 percent.
- Their average nonprofit study organization sent an average of just over 4 emails per subscriber per month in both years.
- The annual churn rate, or the rate at which an email list “goes bad” in a year, dropped two percentage points (from 21 percent to 19 percent), a positive trend.
- The average advocacy email response rate in 2007 was 7.5 percent. The average fundraising email response rate was .13 percent.
- While $1,000+ gifts made up just 1 percent of overall online donations in 2007, these gifts made up 20 percent of the amount raised online.
- Almost 60 percent of the participants’ subscribers did not take any online advocacy actins in 2007.
- “Super activists,” the subscribers taking 6 or more online actions in a year, made up just 5 percent of the total email list size but accounted for 42 percent of the organizations’ total actions.

While response rates declined across all study organizations from 2006 to 2007, the amount raised continued to go up due a great deal to the fact the average email list has grown larger than the rate of decline.

The average gift size for all the nonprofit organizations included in the study was $87. International organizations reaped larger average gifts ($123). Environmental, health and rights organizations’ gifts were about half that, in the $65 - $70 range.

The findings in this 41 page report should raise lots of questions for today’s nonprofit organizations concerning yearly giving patterns, average gift size considerations, monthly revenue supporters, as well as fundraising and messaging strategies, and technology issues like pixels and spam.

Not surprising to most fundraisers, forty percent of online giving occurs in the last quarter of the year, too. How can you encourage contributions at other times during the year? Do you tie fundraising appeals to your advocacy action requests, identifying what inspires supporters and raising money at the same time?

Are you sending emails too often – the most common complaint site subscribers cite for unsubscribing -- or not enough, so they aren’t tethered to you? How can different graphics impact your activism and response rates? Does your site have powerful, engaging content? These are key questions for list management.

M+R Strategic Services’ suggestions for improving online giving growth are worth considering:

Optimizing the sign-up mechanisms on your organization’s web pages.
Earned outreach
List chaperones with other like-minded organizations
Viral marketing
Paid advertising

If you’re going to do online fundraising, you might as well know what you're doing and do it right!