Nonprofit Success by the Numbers: How Fundraising Metrics Drive Donor Retention and Performance

Data is the foundation of fundraising and donor retention. You collect, store, and analyze information about your donors to better understand their needs and tailor your outreach accordingly. But you’re only getting half the picture if you’re not tracking and measuring every aspect of those initiatives.  

That’s why you need to set and study nonprofit fundraising metrics—or KPIs—for all your outreach efforts. They can help you see what is and isn’t working, and ensure your time, effort, and money are going to campaigns, donors, and channels with the best potential fundraising ROI.  

What are fundraising KPIs?

Nonprofit key performance indicators (KPIs) let you measure your fundraising activity performance. They take the guesswork out of designing and executing your strategies. With the right KPIs, you can adopt a data-driven approach, make more informed decisions, and increase fundraising efficiency. The same metric-based benefits apply to other operational aspects, from choosing which kinds of events resonate with donors and selecting the right communication channels to, most importantly, overall donor retention.

How do you set and track KPIs?

There’s no hard and fast rule on which KPIs should be on your radar, as they’re based on individual organization needs. The standard approach is to apply the SMART KPI rule: selecting KPIs that are specific, measurable, attainable, realistic, and timely. 

So, the real answer is another question: What do you need to know and understand about you and your donors? Even more, do you want to know more about your past performance (lagging KPIs, like past donations, gala attendance, and overhead costs), peer into a fundraising crystal ball to frame the future (leading KPIs that can include donor engagement and retention, and fundraising efficiency)—or, most effectively, a combination of both?  

All roads lead to donor retention

Ultimately, the point of all data collection, research, and analysis is improving your donor retention rate. You’re not realizing holistic fundraising ROI if you’re only getting one-time donors who don’t remain engaged, develop a lasting relationship with your organization, or create warm pathways to other prospective donors.  

There’s a reason donor retention is a critical leading KPI. Ensuring your organization’s mission and financial health and stability relies on understanding each donor’s motivations and successfully engaging with them over time. Tracking and nurturing existing and new supporter relationships strengthens your donor development, outreach, and fundraising, giving you: 

• A more predictable funding pipeline 
• Increased donor lifetime value 
• Improved fundraising efficiency 
• Higher chances of identifying or cultivating major donors 

Your donor retention rate is a percentage that shows how many donors continue to give to your organization over time, typically measured year over year, and helps you assess donor relationship strength and your stewardship effectiveness. 

How to calculate donor retention rate

Acquiring and sustaining donors is one of your organization’s greatest outlays of time, effort, and financial investment. Measuring and monitoring your donor retention rate should be a prime KPI target when developing your overall strategy.

Being SMART about KPIs

 Before diving into KPIs that can have a demonstrable impact, it’s important to return to components of the SMART rule—particularly “attainable” and “realistic.” If you’re getting started on your KPI journey, you don’t want to just collect the right metrics: You want to collect the right amount. 

Too much data can be as bad as too little, as your team struggles to sort through and make sense of tons of information—not to mention putting off addressing the data elephant in the room entirely. Put the “key” in KPI and target the top indicators in different categories to get a holistic view of how your organization and initiatives are working. 

While the “timely” in SMART is crucial—you don’t want initiative or donor data to become stale or miss an opportunity to make the most of a finding—giving your KPI strategy time to come together may be more critical.   

Data trends take time to develop—many become more meaningful as time and information accumulate. Performance patterns become clearer when you have more data to study over a range of giving/participation cycles. The result? Greater accuracy in your decision making and better ROI from your operations and fundraising.  

KPIs that can drive insight and initiative improvement

The world of nonprofit KPIs is broad and diverse, with metrics ranging from high-level donor demographics, total annual giving, and number of asks made, to more complex measurements. We’ll look at a few metrics every organization should consider incorporating into its fundraising strategy.

Donor KPIs

There are several different donor KPIs you can use to track and measure donor behavior and donation changes.

Donor growth rate

Adding and losing donors over the course of a calendar year isn’t a metric in a vacuum—it matters because it indicates areas of success on which to capitalize or weaknesses on which to improve. If your donor base is shrinking, it’s a metric that requires cross-analysis with other potentially underperforming KPIs to pinpoint and correct the central issue or issues. The converse applies to a growing donor base—you want to find your strengths and apply them to other functional areas.  

Donor retention rate and donor growth rate demonstrate why KPI context matters. Growth can increase year over year while retention decreases. Translation: Your strong donor acquisition efforts are running cover for weak donor retention.  

How to calculate donor growth rate:

Donor Lifetime Value (DLV)

Donor lifetime value (DLV) is a measure of the total amount you can expect a donor or subset of donors to give over the life of your shared relationship. This lets you make more informed decisions on your fundraising and donor engagement—for instance, how you design monthly and annual donor giving programs, which communication methods to use, etc.

How to calculate Donor Lifetime Value:

Donation Growth and Churn Rates

Donation revenue growth alone doesn’t tell the full story. Reviewing donation trends alongside donor retention metrics reveals where your donor stewardship needs improvement. 

How to calculate donation growth rate:

Just as important as donor growth, the donor churn KPI—or the number of donors lost over a calendar year—can give you critical insight into the effectiveness of your engagement and stewardship efforts.   

General/financial KPIs

Organizations use general and financial KPIs to monitor revenue creation, governance contributions, and overhead costs.

Fundraising Return on Investment (ROI)

Understanding campaign performance is essential for future campaign strategies—knowing what does and doesn’t work ensures you’re putting your effort where it matters and produces the most. Fundraising ROI highlights which efforts succeed and which need recalibration. The calculation is simple: divide campaign revenue by expenses. In a best-case scenario, a campaign that costs $100 and raises $1,000 delivers an ROI of $10—earning $10 for every $1 spent. 

Cost Per Dollar Raised (CPDR)

Cost per dollar raised (CPDR) is a fundraising ROI-adjacent metric that highlights where your campaigns are making and losing money. CPDR reverses the fundraising ROI formula by dividing campaign expenses by revenue. While CPDR helps teams assess overall campaign cost and investment levels, fundraising ROI guides strategic planning. 

Conversion Rate

There are several conversion rates you can measure:

• General conversion rate shows how effectively you drive individuals to take a specific action, such as subscribing to emails, volunteering, or inquiring about board service. 
• Event conversion rate indicates how well your event succeeded in turning attendees into donors. 
• Channel conversion rate lets you know which platforms—social, email, broadcast, web, referral—have the highest engagement success. 

E-delivery KPIs

Email, web, and social media are vital sources of engagement information. Setting KPIs associated with each can provide mineable data that can help organizations shape their online fundraising and outreach strategies. 

Social Media Engagement

As your primary engagement channel, social media demands ongoing measurement to deliver meaningful, actionable insights. These can include:

• Applause measures social media “likes” and other positive interactions with your posts. 
• Amplification measures social media post shares and re-posts. 

Email Engagement

Email is a key communication channel that requires a combination of skill and sensitivity for maximum engagement. Several metrics indicate the quality and performance of your content and delivery frequency, including open rate, link clicks, and unsubscribes. 

Putting nonprofit fundraising KPIs to work

Data only creates value when teams apply it. People across your organization should help set KPIs and goals, review results, and adjust strategies based on what the data shows.

KPIs in concert

When establishing KPIs, you need to view them as parts of a whole, not as disparate datapoints in a vacuum. Your KPI strategy should weave together metrics that tell both individual and holistic stories and act as “fact checks” for one another. 

The example of fundraising ROI and cost per dollar raised is one. Another would be running an online/email campaign and finding fundraising ROI doesn’t positively align with the campaign goal. You can look at associated electronic performance KPIs for insight into where the strategy may be lacking and in need of adjustments—email open rate, email click-through rate, social media conversion rate, and others. 

KPIs in action

A robust, long-term KPI approach powers your operational and fundraising strategies and empowers your organization to confidently develop and execute data-based initiatives.

• Take trends in donor growth, retention, and giving and translate them into powerful engagement and stewardship programs. 
• Use campaign and event insights to develop effective initiatives with less waste and greater ROI. 
• Apply conversion rate metric data from multiple KPIs to improve communications across all channels and maximize your event, fundraising, and online outreach and interaction. 

Final thoughts

A KPI strategy takes time to implement and maintain. However, it delivers actionable intelligence that strengthens every area of your organization, including administration, fundraising, outreach, and operations. Your KPI journey starts with a thoughtful audit of your existing data, staff, systems, and budget to determine where your organization needs to improve—or what strengths on which you want to capitalize—and the available time, people, and financial resources to make the most of the metrics you want to measure. 

From a financial standpoint, there are powerful CRM systems that can make better and quicker sense of—and connections between—your KPIs for maximum fundraising performance. Consider researching systems to find one that would be best for your size, budget and objectives, and unlocking your full fundraising potential. 

Frequently asked questions

What are nonprofit fundraising KPIs?

Nonprofit key performance indicators (KPIs) help organizations measure and improve fundraising, operations, and overall performance. KPIs help organizations collect data across fundraising, donor retention, operations, finance, giving, communications, and more. 

How do KPIs help my organization?

KPIs measure the financial and performance indicators you choose, letting you see where you’re succeeding and where you need to improve. By looking at KPIs holistically, you can spot trends that isolated data points often miss and make stronger, more informed connections. They can improve your strategic approach to campaign and fundraising initiatives and donor retention, and both current and long-term performance. 

Why is donor retention a critical KPI?

Donors are vital to mission and operational health and success. Donor retention provides a view into their behavior and motivation—critical information for nurturing and maintaining relationships. In addition, it provides insight into how to strengthen donor development, stewardship, and outreach, and how to design fundraising campaigns that resonate with donors.

How do I choose the right KPIs?

Start by being SMART: Select KPIs based on your needs and goals that are specific, measurable, attainable, realistic, and timely. Then, focus on collecting the right number of metrics to gain the clearest view of your overall approach to operations and fundraising. Too much data can be off-putting and make you reluctant to approach it. You should also give your KPI strategy time to develop so you avoid making mission-critical decisions based on incomplete data.