Online Giving, Ad Spending Growing Significantly

Total online revenue continues to grow at an accelerated rate, with charities raising a median of 23 percent more online last year than in 2016, according to a new study by the communications agency M+R.

The annual M+R Benchmarks Study includes data from 154 nonprofit participants across nine sectors, covering key metrics for email, website traffic, social media, digital advertising, and more. The study analyzes the results of almost 4.7 billion email messages sent to over 53 million list subscribers; 528 million web visits; more than $738 million of online revenue from nearly 12 million donations; and 17 million advocacy actions.

Researchers estimate that on average, 38% of donors who made an online gift to a nonprofit in 2016 made an online gift again to that nonprofit in 2017.

“You can expect that a substantial majority of your first-time donors this year, the ones you worked so hard to acquire, will not return to make a second gift next year,” said Will Valverde, M+R Vice President and lead author of the Benchmarks Study. “But those who do, those who renew their commitment to your cause, are more likely to come back again and again. These dedicated donors are the backbone of your fundraising program, the reliable revenue your nonprofit needs to develop long-term sustainable growth.”

Some of the key findings in the study include:

• Nonprofits received an average of 28% more online gifts in 2017 than 2016.
• Revenue from one-time gifts increased by 19%.
• The average retention rate for online donors was 38%.
• Digital ad spending increased by 24%.
• Desktop users accounted for half of all nonprofit website traffic – and over two-thirds of all donations. But mobile usage is growing fast as a proportion of overall traffic.
• Each post a nonprofit made on Facebook only reached 7% of its fans in 2017.
• For every 1,000 fundraising messages sent, nonprofits raised $42.

Social Media & Ads

For every 1,000 email subscribers, nonprofits have:

• 474 Facebook Fans
• 186 Twitter Followers
• 41 Instagram Followers

This year, for the first time, M+R reported benchmark metrics for return-on-ad-spend, including display, social media, and search ads. Here’s how nonprofits allocated their digital ad budgets:

• Display Ads – 25%
• Search Ads – 28%
• Social Media Ads – 44%
• Other – 3%

Individual Email Metrics

Nonprofits are reaching more people through digital channels than ever before, as reflected in the data. While email lists grew by 11%, that growth rate was surpassed by list growth in major social media platforms—Facebook, 13%; Twitter, 15%, and Instagram, a staggering 44%!

Despite these encouraging results, key metrics in the report point to a few minor concerns. For example, just about every individual email metric declined:

• Open rates for fundraising and advocacy emails shrank by 1%.
• Fundraising email click-through rates dropped 6% (to 0.42%).
• Page completion rates were down 6% for fundraising messages (to 17%) and 4% for advocacy messages (to 76%).
• For fundraising messages, email response rates dropped to 0.06%; for advocacy messages, email response rates dropped to 2.2%.
• Overall, 1.0% of nonprofit website visitors joined an email list, and 1.1% completed a donation.

Obviously, email is just one dynamic that connects supporters to the causes they care about. As noted in the study, messages that land in an inbox may be clicked on less frequently than before, but they are supplemented by hashtags, News Feeds, web visits, banner ads, and more.

The 2018 M+R Benchmarks Study is available to explore online and download free at www.mrbenchmarks.com.

Check out the interactive Benchmark Yourself feature that allows you to add your stats for fundraising and advocacy and other metrics to compare with the Benchmarks in the report.