Growth in Giving
As the end of the fiscal year approaches for most organizations, you might be feeling an intense focus on making your fundraising goals. As professional fundraisers, we live and die by achieving the dollar goals we committed to during budget planning. How many of us have felt an intense sense of relief once that number was achieved?
I have always believed it is important to think about both dollars and donors equally. Yes, achieving the cash goal that your organization expects is of paramount importance. However, increasing the number of donors is also important – you’re pouring water into the long-term pipeline.
A bigger question I challenge my clients to think about is if your organization is actually growing fundraising revenue? It is admittedly a hard concept to consider when you’ve achieved your goal, allowed yourself five minutes to celebrate before already starting to panic about achieving next year’s goal. However, the Growth in Giving metric is a powerful metric that every organization should be using.
Simply stated, your organization’s growth in giving is the sum of gains from new donors, recaptured donors, and increases from existing donors versus the losses from downgraded donors and lost gifts from new or repeat donors.
Senior Leadership and Boards of Directors are infamous for subjectively setting goals. “Last year we raised $500,000, so… let’s shoot for $600,000.” Is it realistic for any organization to project a 20% increase in fundraising revenue ever, let alone in one year? Especially given the fact that the average growth in giving rate is 3%?
If your growth in giving rate is averaging 3.5% every year, you’re actually outpacing both inflation and average growth rate across all non-profits. If so, a more realistic goal in my example is $517,500. That doesn’t sound like a powerful number, but realistic goals that are surpassed are far better than ambitious goals that fall short.
I also cringe when leadership says, “Well, we have to raise that amount of money (in this case, the $600,000). We need it, and our donors will understand.”
Simply stated – donors do not care what your needs are. Donors care what needs you are meeting, how you’re fulfilling your mission, and if you’re being a good steward of their support.
And even if you’re able to create an incredibly persuasive case, is it fair to assume every donor will increase their gift an average of 20%? Your growth-in-giving rate is a true indicator of the capacity of your program.
About the author
Michael J. Buckley, CFRE is a career fundraising professional and Founder and Managing Partner of The Killoe Group. His firm assists nonprofit organizations increase revenue, exposure and capacity through smart, data driven, successive decisions and effective planning. Mike’s experience and passion for the profession of fundraising have made him a sought-after speaker, consultant and presenter. The Killoe Group’s broad experiences include annual campaign audits and management, capital campaign leadership, feasibility studies, interim program leadership, board governance, strategic planning and capacity building.