If there were any doubt that charities have had difficulty raising funds in recent years, these should be dispelled by a new report on 2011 fundraising performance by the Association of Fundraising Professionals and the Urban Institute.
The 2012 Fundraising Effectiveness Report showed that gains of $1.1 billion in gifts from new, upgraded current and previously lapsed donors were offset by losses of $1.1 billion through reduced gifts and lapsed donors.
This meant that every $100 gained in 2011 was offset by $100 in losses through gift attrition—even though there was a tiny positive $1 million net growth-in-giving.
The study further determined that gains of 1.3 million in new and previously lapsed donors were offset by losses of 1.4 million in lapsed donors. That is, every 100 donors gained in 2011 was offset by 107 in lost donors through attrition.
Growth-in-giving performance varied considerably depending on organization size (based on total amount raised), with larger organizations performing much better than smaller ones:
- Organizations that raised $500,000 or more had an average 10% net gain.
- Charities that raised $100,000 to $500,000 averaged a net gain of 0.8%.
- Those in the under $100,000 groups had an average net loss of 9.6%.
The largest growth in gift dollars and donors came from new gifts and donors, with the pattern most pronounced in charities with the highest growth-in-giving ratios.
Conversely, lapsed new gifts/donors accounted for the greatest losses in gift dollars/donors, particularly in organizations with the lowest growth-in-giving ratios.
In previous years of the study, particularly in 2005–2007, the offset ratios looked better. In 2005, $81 was lost for every $100 raised; in 2006, $93; and in 2007 $86.
The 2012 Fundraising Effectiveness Project report summarized data from 3,184 survey respondents received as of February, covering year-to-year fundraising results for 2010–2012.
The report noted that the report was intended to make it possible for fundraisers, management and boards of nonprofit organizations to compare not only the performance of their organization from one year to the next, but also with the performance of other organizations in terms of total dollars raised and total number of donors in a variety of categories.
These organizations can then make more informed, growth-oriented decisions about where to invest increased resources and effort to improve their fundraising effectiveness, it said.