Nonprofit budgets are often tight, and each of your campaigns should aim to hit as high a return on investment (ROI) as possible. For each of your online campaigns, your revenue goal should tie into your overall fundraising strategy. If these campaigns are falling short, you may end up with an unbalanced budget that impedes your nonprofit’s ability to fulfill and grow your mission.
With all of the new, innovative fundraising tools available online, the price of your campaigns may go up, making it challenging to actually get a return at all. So, it’s essential to understand how much you’re spending as well as how much revenue you generate per campaign, ensuring your efforts are well worth the spend.
To better analyze your campaigns, you’ll need to understand a few fundamental metrics, including ROI, cost per dollar raised (CPDR), and cost per acquisition (CPA). Metrics like these measure your digital marketing campaigns in different ways, but they all seek to answer the same question: “Are your campaigns raising or losing money?”
To help your nonprofit answer this question, this article will provide directions for how to use these metrics and offer a few tips for how to improve them from the world of nonprofit marketing and advertising
Measuring inputs and outputs
Calculating ROI and other relevant metrics requires measuring your campaign’s inputs and outputs.
A campaign’s inputs include all costs spent on running the campaign. This includes equipment purchased, staff compensation, advertising costs, and other investments. Additionally, to calculate ROI more broadly — for example, if you wanted to measure your ROI for an entire year — you would also need to factor in overhead costs, including office rent and utilities.
Consistently factor in what you do and do not count as inputs when calculating multiple campaigns’ ROI. For example, you might decide to consistently calculate the value of your employees’ time or forgo this value, instead counting it as a total overhead expense. Either way, you shouldn’t count this expense in one campaign but not the next. This will allow you to more accurately compare different online fundraisers and identify which ones are bringing in or losing money.
You’ll also need to measure your outputs. As inputs are everything you spend to run your campaign, outputs are all of the revenue generated by the campaign. In most cases, this will include all incoming donations that can be attributed to that specific campaign.
To calculate your ROI, divide your output by your input. You can then multiply the result by 100 to get your ROI percentage. The calculation looks like this:
ROI = (Output / Input) X 100
For example, if you spent $2,000 to run your campaign and earned $5,000 in revenue, your ROI would be 250% or 2.5X. The higher your ROI, the more efficient and cost-effective your campaign is.
You can also measure your overall effectiveness by calculating your cost per dollar raised (CPDR). To find your CPDR, divide your input by your output. Using the same numbers as before, the CPDR would be 0.4 or $1 raised for every $0.40 spent.
Be sure to always contextualize these measurements. Whether an ROI is “good” or “bad” will depend on the specific campaign’s goals and the timeframe for the impacts you’re looking for. For example, a campaign aimed at acquiring and engaging new mid-level prospects with the intention to steward them towards making larger gifts will likely have low initial ROI goals but its long-term ROI could potentially be much higher as the relationships develop.
6 marketing tips for improving ROI
Your marketing activity can directly influence and improve your campaigns’ ROI. Additionally, many useful marketing tips are interconnected and will reinforce one another when used together. Here are a few marketing tips you can use to increase your ROI:
1. Focus your campaigns on specific donor journeys
Segment your supporters based on where they are in the donor journey. This will help you push them toward the next step in the journey and increase their commitment and lifetime value with your organization.
For example, you might launch an initial awareness campaign to help attract new supporters. This campaign would primarily focus on educating donors and encouraging them to make small, initial steps of engagement — all of which can easily be hosted online. By contrast, a campaign focused on building relationships with major donors will likely include several one-on-one conversations about each donor’s individual engagement history with your nonprofit.
Creating focused campaigns can boost your ROI when the target donor group converts, whether it’s getting new supporters to make their first donation or persuading sporadic donors to join on a recurring basis.
2. Tailor your messaging as much as possible
Supporters respond better to messages that address them personally and align with their interests. While it may seem faster and less cost intensive to send out boilerplate messages to all of your supporters at once, you’ll get a higher ROI by personalizing each message as much as possible.
Getting Attention’s nonprofit marketing guide offers a few tips for how to create eye-catching, unique messages:
- Use storytelling strategies. Many supporters give to causes they feel an emotional connection with. Pull at supporters’ heartstrings while demonstrating the impact their donations make by telling stories about your beneficiaries, volunteers, staff, and others associated with your nonprofit.
- Pay attention to communication preferences. If a supporter indicates that there is a specific communication channel they would prefer to be contacted on, make note of it and use that channel as the primary mode of communication moving forward. Don’t drop other channels, though! Even your most dedicated supporters could still use a reminder now and then from advertisements, emails, and letters.
- Add visuals. Visuals grab attention, especially when your supporters are scrolling through text-only messages. Create images and videos that will encourage supporters to share them with their own networks and spread your nonprofit’s message even further.
Tailored messages that pull at your supporters’ heartstrings are essential for grabbing their attention. Once you have their attention, add a concrete call-to-action to your message with a button or image that invites them to click through and donate.
3. Modernize your approach to advertising
Nonprofit advertising has come a long way, and your online campaigns should make use of the most modern, effective software tools available. For instance, ad retargeting campaigns can help boost your ROI by encouraging supporters who previously visited your website, checked out your donation page, or interacted in any way with your website return and re-engage.
Feathr’s nonprofit advertising guide walks through how retargeted ads recapture your supporters’ attention:
- First, a potential supporter visits your website, particularly a page with a conversion opportunity such as your donation page or an event registration form.
- The supporter leaves your website without acting on the conversion opportunity.
- When the supporter visits another website with sidebar ads or ads that break up content in the middle or on the sidebar of an article, they will see ads redirecting them back to the page they last visited on your website.
- The supporter can then click on the ad to be easily redirected back to the page where they left off, increasing the chances they will complete the conversion opportunity.
Retargeting campaigns actively combat cart and page abandonment, increasing your campaigns’ ROI. After all, when a supporter reaches your donation page, event registration form, or e-commerce store check out page, they have gone through every step of your marketing campaign. Getting them to make that final step with retargeting ensures all of your prior work pays off.
4. Use an integrated multichannel strategy
To help move supporters through their donor journey, your nonprofit will need to create multiple touch points. Of course, the touch points that initially persuaded someone to check out your nonprofit may not be quite as effective for donors you’re focused on leading towards making a second donation.
Diversifying touch points based on the individual donor and where they are in the journey will lead to more conversions. When designing new touch points, consider what actions you are asking donors to take and how that action fits into where they currently are in their donor journey.
Spread these touch points across multiple channels. Doing so will help further diversify your communication while also building brand awareness. Here are a few channels you can use to communicate with your supporters:
- Online ads
- Social media
- Direct mail
- Phone calls
Consider which communication channels are the most relevant to your audience before writing out your messages. For example, it may make sense to use direct mail when extending a formal invitation for a supporter to attend an event or make a donation, but it’s more cost effective to use online communication when informing and educating supporters about your cause.
5. Ensure all donations are attributable
How can you know which campaigns cause supporters to donate? To measure your ROI and other impact metrics, ensure all of your donations are attributable. This allows you to see exactly how supporters found you.
This is easier to do in certain cases. For example, if your organization launches a text-to-give campaign and you spread the same number across multiple channels, you’ll likely have to use factors such as time of donation to infer which channel helped drive donations.
However, there are a few surefire ways to make donations attributable. For example, your nonprofit can use marketing software to promote an upcoming campaign event. You may start an email drip stream, use geofencing to target community members with advertisements, and run social media ads to encourage supporters to register. With effective software, you can see just how many registrants came from each marketing channel.
6. Continually learn more about your donor segments
You can improve your overall nonprofit marketing strategy by continually gathering information about your donors. Each campaign you run will likely generate new data about each donor, including their demographics, interests, and what messages they respond to best.
As you learn more about your individual donors, you can continue to improve the segments you’re targeting. This can include re-adapting your current donor segments to take new interests or donor groups into account, or even creating entirely new segments and crafting a strategy targeted to them.
After each campaign, take a moment to assess your data. Then, when you approach your next campaign, you’ll have the information you need to better reach your donors and continue improving your ROI.
The Bottom Line
Understanding if your campaigns are effective, why they’re effective, and how you can make them even more effective is essential to nonprofit marketing. Track each of your campaign’s ROI and put it in context to determine both its immediate and projected long-term impact. Additionally, experiment with new marketing strategies to boost your campaign’s ROI and make even more successful connections with your supporters!
About the Author
Aidan Augustin is the co-founder and president of Feathr, an industry-leading tech company building marketing tools specifically tailored to the needs of associations and event organizers. Feathr has helped over 800 associations and 5,000 conferences, trade shows, and virtual events grow attendance, member engagement, and digital sponsorship revenue. Based out of their Gainesville, FL headquarters, Aidan leads the sales and marketing functions of Feathr and spearheads industry engagement. He is an actively involved member of both ASAE and IAEE and a regular speaker on the topics of digital marketing and event/association technology.
Aidan Augustin is the co-founder and president of , an industry-leading software company making digital marketing more accessible to nonprofits and event organizers. Feathr has helped over 800 nonprofits and thousands of events know, grow, and engage their audiences. When he’s not steering the ship at Feathr, he’s playing strategy games, singing karaoke, or reading books about people who changed the world.