4 Top Essential KPIs to Evaluate Your Nonprofit
The present informed charitable donor wants increased transparency on how nonprofits spend every dollar received. That explains why Key Performance Indicators or KPIs have become more prevalent in business management. They monitor and track the performance of an organization, focus on its goal, and guide on corrective actions.
Unfortunately, measuring KPIs in charities is not an easy task because there are no distinct metrics for success. However, some key metrics help capture the critical part of your story without wasting time or money. Whether you intend to attract a potential donor or anticipate retaining old ones, the following KPIs can help determine where your efforts rank on the success spectrum.
1. A rise in the number of people served
An increase in the number of clients served is a common standard of success in most organizations. Nonetheless, the impact you create in communities is more significant for charity groups. The challenge, however, is finding accurate statistics that reflect your company’s charitable efforts in the competitive world.
You need to move an inch further and prioritize making your organization thrive through the following strategies.
A reliable nonprofit should capture the hearts and minds of its target audience. In short, they are the lifeline of the less privileged in society. They provide infrastructure, funding and help promote various activities in their endeavors.
Nevertheless, achieving these goals becomes impossible with insufficient funds. In such a scenario, decision-makers should focus on attracting more beneficiaries. You can accomplish this by showing your brand personality through consistency in your work. Moreover, get creative with catchy campaigns that attract your audience’s attention.
Target Leaders On the Ground
We often see nonprofits targeting leaders at national and international levels.
Although there is nothing wrong with this tactic, they overlook a more credible asset of engaging with local leaders.
Remember, your programs will achieve maximum impact on community needs by reaching out to individuals who understand where the shoe pinches most.
Create Mutually Beneficial Opportunities
At some point, every nonprofit seeks to make a change in its line of service. However, you can only achieve success by joining forces with the government, community, and businesses. As a result, the development team creates a tool that helps the nonprofit community understand how to create mutually beneficial opportunities.
By engaging everyone at the various levels of society, nonprofits provide helpful services to people who need them most. In addition, initiating mutually beneficial opportunities will incentivize donating money or support.
2. Fundraising Efficiency
Evaluating fundraising efficiency can help identify areas where your organization could improve. Remember that a nonprofit’s success relies heavily on fundraising, publicity, and managing grants. Therefore, each area of efficiency can be a unique source of success or failure.
If a nonprofit fails to focus on monitoring these metrics, they will never know what areas to improve, which eventually dent their return on investment (ROI) and efficiency. For this reason, there is more pressure than ever for nonprofits to take full advantage of modern marketing strategies.
More importantly, they need to create a solid system to raise funds in today’s competitive fundraising environment. The first part of setting up such a plan is to understand your organization’s current fundraising efficiency metrics. From here, you can increase your fundraising by following these critical tips.
- Create a solid relationship with your donors
- Focus on creating optimistic public opinion
- Give incentives to your fundraising staff
- Invest in sophisticated advertisements to attract donors
- Craft clear cases for funds
- Instigate donor identification programs
- Use innovative engagement technology to expedite fundraising strategies
- Split-test donation pages digitally
- Upgrade your website
- Enhance your social media fundraising game
- Improve mobile responsiveness
- Use smart engagement and artificial intelligence
- Influence celebrity endorsers
- Consider online affiliation programs
- Host fundraising events
- Embrace innovative opportunities
3. Donor Retention
Donor retention is a percentage of donors who return to offer more donations over a specific timeline. The donor retention rate is an essential metric to measure your nonprofit’s success.
It is no surprise that most dependable charities measure donor retention annually.
Still, nonprofit organizations toil with the constant battle of staying relevant to donors/supporters. Thus, they spend considerable time searching for new ways to retain and engage their audience, grow their base, and assess their effectiveness.
It is easier said than done, but donor retention can be a tricky metric to evaluate. While you might feel that many donors are essential, what matters more is the number of donations from each contributor.
Fortunately, charities can utilize great avenues to identify, track, and improve donor retention. Here are some prominent points of attack.
Be Appreciative of your Donors
We know that the donor relationship is not complete when somebody donates. Their first donation means nothing if they do not come back and make another donation in the future. Unfortunately, this is where many nonprofits fail because they fall short in giving their donors the dignity they deserve from the beginning.
At all times, let your donors know you appreciate them. Then, follow up, say thank you, and be consistent in your donors’ lives.
Create Reports or Blog posts on how you Spend Donor Funds
Charity and nonprofit organizations need to be accountable for funds donated by generous individuals. This transparency is good for donors and can help charities raise funds.
Proper reporting makes donors feel more connected to a charity’s mission and encourages engagement. It does not have to be a weekly or daily thing. A single mention in your end-of-year report can do magic.
Invite Donors to Other Events
Events are opportunities for you to bring in the most qualified funding sources. However, not all donors feel comfortable attending every event you or your organization hosts. Therefore, narrow down your focus to the events that hold their interest.
It is essential to know that not all donors have the same passion. Therefore, your approach needs to alter depending on the type of donor you intend to reach out to.
Embrace Virtual or Digital Events
Reliance on offline and conventional methods of raising money is changing positively with the advancement of emerging technologies. Successful fundraising campaigns now use the latest technological tools and platforms to appeal to donors across the globe.
4. Charity’s Results
Every organization should offer unique and much-needed value to the community and beyond. For charity groups, it is indispensable to know that you have a tangible impact on the social good. But, more importantly, it would help if you made a lasting difference in the lives of others.
Consider that it is hard to get donors if you do not have tangible results. You can do this by tracking key performance indicators (KPIs) that highlight your nonprofit success in achieving goals. Overall, measuring nonprofit results is a tricky business. They have all these extra variables that could increase or decrease donations. Even so, you can measure charities’ performances through
Charities are always looking to improve how they help their communities but often find it challenging to get feedback from the people they help. As a result, customer satisfaction becomes a critical aspect of a company’s success.
With the emergence of the internet and its possibilities, everything is possible. As a result, it becomes more manageable and less expensive for charities to measure customer satisfaction from social media, online surveys, and more complex software solutions such as CRM systems and donor relationship management.
Donor engagement levels are decreasing year on year. You can revolutionize the situation by altering how donors interact with charities by building a more transparent platform. This approach allows greater engagement, control, and flexibility when making donations.
You may have heard of the term “patient capital in nonprofits.” The idea is that money can provide social good through the financial results it would generate and its capacity to educate, mobilize, and empower.
Measuring financial results is inherently more tangible than evaluating non-financial ones. Yet, failing to consider qualitative data can be costly to your short and long-term operations.
With increased focus on results, the question arises around the best ways to measure management effectiveness. Measuring management effectiveness in nonprofits is critical to evaluating your organization’s success.
Examine critical levels of management effectiveness, such as with individuals, teams, departments, and corporate governance performances.
The Bottom Line
Too often, a nonprofit’s success gets determined by the total amount of money raised or beneficiaries accumulated. While there is nothing wrong with these determinants, other critical factors can determine your nonprofit’s success. Looking at the range of success stories among different nonprofits, you may realize that there is no “one size fits all” answer for the equation.
Even when constantly juggling tasks, thinking about future goals, and trying to keep donors happy, you need to measure your success progress routinely. Make the process more impactful and less strenuous by analyzing the success metrics mentioned above.