How to Evaluate Fundraising Effectiveness and Strategy

Though every army starts with a single warrior, you need a dedicated core group to promote your fundraiser to get off the ground. These are the people who will typically provide the initial capital and help spread the word about your campaign. Word of mouth is critical to building momentum early in your fundraising. Even with digital technology, there is still no substitute for old-fashioned personal endorsements. Person-to-person, human recommendations carry a significant amount of weight for many people and are an integral aspect of non-profit solutions.

Once your fundraiser has begun and donations start coming in, you need to be capturing that data and analyzing it. Data points, such as donation demographics, growth circles, and average donation amounts, can provide useful information that adds to the larger picture. With this data, you can begin building a model of how your fundraiser performs overall, as well as assess your strengths and areas with room for improvement.

Over time, this data can construct reliable estimations of how your fundraiser might perform in the future. While never 100% accurate, forecasting can help you prepare against foreseeable economic downturns or drops in donor revenue. Return on investment (ROI) is another crucial metric you should track. Knowing precisely how much your organization is spending in relation to how much revenue you are receiving gives you a quick “snapshot” of general success.

One of the main pillars of fundraising strategy is setting focused goals, with emphasis on focus. Your goals should always revolve around your core mission. Obviously, any fundraising operation’s primary goal is to raise funds, but there is more to it than that. For example, you can set a series of smaller goals that act as checkpoints towards a larger target goal. In this way, you can keep your team organized, encouraged, and productive without being overwhelmed. Your fundraiser will generally have financial and non-financial goals. The financial goals would be budget targets for costs such as advertising and revenue goals for each campaign and demographic segment.

Non-financial goals would be things such as the responses from your donors. In fact, one could say that these goals are paramount since the relationship between your organization and your donors leads to revenue generation. It’s necessary to define all of these goals ahead of time so that you can have a clear roadmap for your fundraiser. Lack of coherent plans often causes confusion, delays, and failure in projects. And studies have shown that when teams aren’t given a clear direction, performance and efficiency are greatly hindered. 

Once you have all of these “pillars” of analysis and strategy in place, you might be tempted to let the operation run itself semi-autonomously. We can’t stress enough the need for continual evaluation. Ongoing analytics are a vital part of monitoring fundraising effectiveness. By continually monitoring fundraising operations, you can effectively graph over time how performance is trending.

If you notice the trend-line falling, you will be able to ask “why?” and get a meaningful answer from the collected data metrics. Did revenue fall off in a particular region? Perhaps a notable donor moved or decided to stop their support. You need to know these things and make adjustments, sometimes rapidly. 

Ongoing evaluation gives you that quick feedback that allows you to make course adjustments when required without too much delay. Without ongoing evaluation, you will never have a specific point in time to reference a growth peak or valley.

Continual evaluation of your fundraising performance also plays a crucial role in strategy development. The more data you can gather, the better plans you can create. The goals you set are the destination, and the information you collect is the compass that helps steer you in the right direction.

By analyzing your data continually, you will have reliable indicators of which strategies work well and which of them need improvement (or dropped entirely).

Also, consider that even if your current campaign performs well, there could still be areas for improvement. Continual evaluation gives you that window of opportunity to examine the present data to see what is happening where and make shifts as desired. Beyond the financial aspect, you should also keep regular time records. If you notice that fundraising consistently takes more time in a particular area, you may want to examine why. As the adage says, “time is money.” In fundraising, this is especially true.