image by 10ch

I’m at the NTEN 2009 Conference attending the session “What It’s Worth: The Value of Online Fundraising.” The session is presented by Allison Van Diest of Blackbaud and Clinton O’Brien, VP for Nonprofit Services with Care2. . Nonprofits use Care2 to recruit new donors and supporters and advocates for their organizations.

Goals of the session:

Why would you benchmark? How to make the case for fundraising tactics using measurements.

Purpose and value of benchmarking web metrics.

Review some 2008 industry benchmarks. from a March 2009 survey. What the data reveals, or doesn’t.

Case studies.

Purpose of benchmarking

Need them for goal-setting, comparison, prioritization, to make a case for resource utilization, forecasting results.

Sources that informed this benchmarking:

-1200 responders to State of Nonprofit Industry Survey 2008

-Blackbaud client data

-Care2 community data

-Q1 2009 State of Nonprofit Industry Survey: Return on Internet Investments:  93 valid responses. 97% of respondents had a website. 56% held email marketing or fundraising. 52% participate in social networks. 1/3 had revenue under $1mil, and 1/3 revenue over $10 million. Good mix of verticals in type of organization (largest group type was health care orgs at 17%). Most responders are fundraisers at the organizations.

Below is analysis of data from the Q1 Survey (93 responders), but integrated with other data from Blackbaud when noted:

Website benchmarks:

• 52% had a positive ROI on investment
• 26% made no investment
• 22% had negative ROI
• median amount collected through website transactions was $5,000 (this included organizations that didn’t collect any money also).
• Median ROI of website value was 110% (took the number in the center to get the median vs. mean number).
• From those that collected at least $1 in website transactions: $20K was median dollar amount collected through website transactions and 37% median ROI from website transactions .
• NOTE – Definition of “investment”: asked orgs to give a $ amount for website building and consulting amount and HR related website costs which was the self-reported “investment” from 2008

Need to consider the source: how did people get to the website?

• 63% of those with positive website ROI conducted email marketing or fundraising campaigns
• 46% of orgs with positive website ROI reported participating in social networks.

Note: these organizations may not have had a positive ROI of each channel, but did for the website, so reconsider how look at ROI for channels is a thought.

Email Benchmarks

Asked people to figure out value of an email: of those who reported doing email marketing, median number was 290,000 emails sent in 2008. Average return per email sent was $8.16  But-. average website return per email was $18.37.ISSUE:  How to differentiate whether email sent brought the money in or the website brought the money in? That is to be addressed. Most orgs aren’t sourcing if email drove the donation at the point of site.

(A side note: bulk of email campaign responses should be within 48 hours of email sent! However, it could different by audience, as an audience member notes. This audience member notes one of her clients receives the buik of return after two weeks! So there are exceptions.)

Median amount dollars collected as a result of email marketing is $1,000 (including those that don’t collect any money).

Median ROI from email marketing is 53%

Median amount collected from orgs that collect at least $1 from email marketing is $10,000.

NOTE:

• Only 18% of organizations credit positive ROI on email programs, but 63% of organizations with positive website ROI say they send email campaigns. Question is are they tracked properly?
• Orgs with positive website ROI who sent email campaigns brought in 2.8 times the website revenue -takeaway is that targeted asks might be more effective than just having a donate now but’ont.
  
• Orgs that have 6 – 10 events “a-thons” a year averages $60K in online event revenue. All other orgs averaged $39K. Implications? Maybe affected by size or client reach of the organizations.

The amount of revenue earned TRIPLES if an organization engages in email campaign versus just offering the “donate now” button on the website.

Online Event Benchmarks

Only 15% of orgs offer online participation in an “a-thon” or “friends asking friends” type of event. But arts/cultural orgs are more likely to hold them. Median amount raised is $11,000 online.

Blackbaud additional data from its clients:

• friends asking friends  (FAF) emails have a 90% greater open rate.
• Average online gift size is $59.40.
• 32% of FAF emails resulted in a transaction.
• average participant sends 27 emails.

Social Media ROI

Remember: about half of those surveyed use social media. 17% of them put money into using the networks.

• Of the 17% investing resources in social media, 63% reported positive ROI.
• 92% participated in Facebook, 44% use Twitter, 33% use Linkedin, 29% use MySpace, 13% use other networks.
• Of organizations participating, they averaged participating in 2.4 networks each. Of those participating in only one network, all but one use Facebook.
• Median ROI was 125%, median dollars raised was $200, and AVERAGE revenue raised was $41K from those reported raising money.
• Orgs connect with a median of 600 individuals through social networks.
• Average value of networking individual was $1.60

Social Networks = Free Donors? (Clinton O’Brian from Care2)

The purpose of today’s session is to look at the monetary value of social networks, but we recognize there are other values.

Facebook Causes Report just published March 2009.

25 million users reached through FB Causes. It has raised $7.5 milion in 2 years.

179,000 causes participate. 46K participate. # people who have donated = 186K (.7%)

Only two nonprofits have raised more than $100,000 through Causes.

Average gift =$ 40.54. Less than 50 nonprofits raising more than 10,000.

From 2007 to 2008: Average money per user donated has increased from $.21 to $.31. Average amount per cause has increased from $31.25 to $41.

List of several case studies: Susan G. Komen Foundation, Save Darfur, and Birthday Causes. None of them raised a lot of money.

One interesting tool to help you figure out ROI of Social Network Investment is the Care2 tool. (Their blog is www.frogloop.com which engages with nonprofit professionals and share best practices.) It asks user to provide inputs on their social newtowrking and email investment and gives ROI for outputs, along with four-year ROI projections.

Commentary by Care2′s Clinton O’Brien- most organizations aren’t going to see a positive ROI from this calculator. The thing you need to think about is the opportunity cost by investing employee time in social networks. Question: What aren’t you doing?

Audience question about choosing among the different social networks:

Answer: MySpace is for a younger group, Facebook has the numbers and users, and a good activ base. One audience member offers that alumni groups are using Linkedin very effectively.

My Takeaways:

1. Email campaigns (and email related activities for raising funds) are still the most proven and effective investment an organization can make.

2. Don’t rely on social networks for fundraising, but they may very well drive people to donate on-site.

3. Track where every person comes from and why they decided to donate on the website. Are they a network member? Could this have raised their awareness and encouraged them to donate on the website?