ROI in Digital Fundraising and Online Giving

When it comes to return on investment for a nonprofit's online fundraising and donations program, there’s no hard-and-fast digital metric that serves as the gold standard … yet.

While some fundraisers have struck gold — generating 10 times their online investments in as little as three months — others just break even after three years of hard work.

It's important that nonprofits and their teams have some shared perspective and collective agreement.

Digital return
What is the value of an online donor? How about an online volunteer fundraiser?

We have seen the average size of an online donation rise over the past 10 years. Last year, the average online gift across all of Artez's clients (from the U.S., Canada, the U.K., Australia and the Netherlands), for example, was $68.

Now, in isolation, that doesn’t mean much. But what is interesting is the comparison of an average gift online to an average gift offline. Take, for example, a participant in a walk-a-thon. If she registers online and fundraises both offline and online (as the best fundraisers will do), it provides us with a great petri dish to examine. The fundraiser/solicitor is the same in both cases, as is the cause and the event.

But in almost every case, the average donation online will be twice as much as the average gift offline.

Why? It’s most likely the credit card effect: When someone is asked to fish out cash from his pocket, $20 seems like a lot. Putting that same amount on a personal credit card is nothing.

Add to that the high propensity for credit card-using, Web-surfing donors to select recurring or monthly giving, and you’re starting to see what gets digital fundraisers excited about the future.

How about the value of an online fundraiser? Take the online registrant for the walk-a-thon described above. Let’s say she sends 20 solicitation e-mails to her friends, family and colleagues. Let’s assume she has a high response rate — which we’re still seeing in 2008/2009 — of 60 percent. Let’s be conservative and give her social network an average gift size of $50.

Using that math, the value of that online fundraiser is 20 e-mails x 60 percent response x $50 = $600. And that’s just one campaign! What if you could recruit her to fundraise for multiple campaigns this year? What if you could retain her for a few years?