The most recent Fundraising Effectiveness Report from The Urban Institute and Association of Fundraising Professionals contains some good news and some bad news – in the same sentence. It’s good news that in 2015, for every $91 in income nonprofit organizations lost because of gift attrition, they gained $100 through gifts from new, renewed and reactivated donors. And it’s more good news that for every 96 donors lost through attrition, 100 were gained through acquisition and retention (after all, in 2014, for every 100 donors gained through acquisition and cultivation, there was a loss of 103 from attrition).
But the bad news, we’re essentially standing still when it comes to sustainability. We’re not growing enough as an industry to meet the continuing demand for services.
If we were, say, addressing the nation’s need for coffee or tennis shoes, that would be a concern – especially among shareholders. But when we’re addressing finding a cure for cancer, teaching children to read, building affordable housing, saving endangered wetlands – and so many more critical challenges facing society today – it’s a crisis.
American’s support for nonprofits is basically flat – and it has been sitting at around 2 percent of the Gross Domestic Product for years.
For the next few posts, we’ll look at concrete ways to address this challenge by finding out where your danger zones are – and suggesting how you can address those challenges. Start by calculating your own attrition rate and your loss/gain of dollars and donors over the last two years. Are you moving forward – or slipping backwards? After all, when it comes to fixing what’s wrong in a nonprofit organization, the first challenge is to measure the scope of the problem.
Albert Einstein said, “Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.”
That’s good advice in fundraising. And the first step in learning from yesterday is to figure out what happened then. Did you gain donors? Lose donors? Grow your income or decline? Don’t be afraid to run the calculations; if the picture isn’t as rosy as you’d like, it doesn’t make you a failure – it gives you a path for your next great success.