You work tirelessly on multiple donor campaigns, hoping your efforts produce the fundraising results your organization depends on. But how do you know which of your activities have the most impact? By testing and measuring your campaigns.
There is more to campaign success than simply the final amount raised. To truly understand the health of your efforts, you’ll want to get deeper into the data. You can use a donor management system (DMS) to track donations and activity, but really digging in to your data will give you a better idea of what your strengths, weaknesses and opportunities look like.
Before we can measure the success of a campaign, let’s begin by testing it. You can apply this approach to almost any fundraising method.
1. Establish a Plan – Before you begin, start by getting clarity on the one question you’re trying to answer. For example, what is the success of sending out donor emails on Tuesday versus Friday? Choose one question to answer with your hypothesis. Also, determine your timeline so that you know everything you’ll have to accomplish and when you’ll have enough data to begin analyzing it.
2. Identify Test Donor Pool – Pull a segment of your donors to do a test on. The more people you use, the more significant your results. Make this a representative or random sample of your overall list.
3. Separate Donors into Two Random Groups – Divide your group into two separate lists (simplest to divide them down the middle alphabetically) and send each list a version of the campaign built around the test. If you use an email service provider or marketing automation tool, it can do a random split test for you.
4. Tracking – After a predetermined amount time passes, start tracking responses. Normally you will want to track the engagement (email opens and clicks, phone calls answered, visits to a web page) and the donations you receive. If this is an email campaign, your ESP will help you identify which donors belong to which test group. If you’re not using an ESP, you can manually track responses in a spreadsheet.
While testing is critical, the results of those tests really help us understand what works and what doesn’t. Here are some of the most important things we want to be sure to measure:
1. Return on Investment (ROI) – Probably the most obvious thing we can do is test our ROI. Knowing your net return is imperative. You absolutely must know how much of an investment it took for you to raise the money you did. Count up your net returns and subtract the amount you invested in running that campaign. Don’t forget to include hours worked, ESP software subscriptions, and any documents you produced in your investment calculations.
2. Growth Rate – It’s important that you understand whether or not your fundraising results are increasing, declining, or remaining the same. Look at your year-over-year (YOY) contributions and compare them to analyze the trends and understand your growth rate.
3. Retention Rate – How many of your donors are new, and how many are returning? This lets you know which of your strategies are working, and which ones may need to be changed. It’s best to have a blend of both new and returning donors to ensure continued growth.
4. Average Donation Amount – Knowing the average size of your donations helps you understand your donor cultivation success. To better understand this number, divide the number of gifts into the total amount donated. In order to have a more accurate number, you may want to leave out any one-time gifts of a significant amount that could skew your numbers.
5. Conversion Rate – This is one of the most important aspects of testing and measuring your donor campaigns. You can define a conversion as any significant action a donor takes that indicates interest in your cause or willingness to donate in the future, from signing up for an email list, volunteering for an event, or donating money. Calculate the conversion rate by dividing the number of website visits or event participants by the total number of donors. The percentage result measures how successful a specific task was.
The Conversion rate is one of the strongest effectiveness metrics you can calculate. Be careful, however, not to put too much stake in any one effort. Fundraising activities often have to fight hard for attention, especially online. People may need to hear from you multiple times and in many ways before they respond.
Test, measure… succeed
Rather than blindly trusting that your efforts are going well or solely looking at the final dollar amount you raised, it’s important to understand which of your efforts has the most impact. Through testing and measuring your donor campaigns, you’ll have clear data to help you understand where you’re having the most success, and where you have some opportunities for growth.
Jessica Barrett Halcom is a writer for TechnologyAdvice.com, with specializations in human resources, healthcare, and transportation. She holds a bachelor’s degree from the University of Wisconsin, Green Bay and currently lives in Nashville, TN.