Growth Trends in Nonprofit Sector Revealed by Performance Data Research
Many nonprofit organizations (NPO) have struggled to scale their organization, according to a research project conducted by Social Finance. Only 200 NPOs have reached the benchmark of $50 million in annual revenues – that’s 0.1 percent of nonprofits that were founded between 1975 and 2008.
Thankfully, a shift is finally happening for the nonprofit sector. Unique fundraising models and best practices have gone a long way to help nonprofits meet donor and customer expectations. In response to the new level of competency and responsiveness, nonprofits are growing their operations and reaching greater levels of social impact.
Every year, Classy, a nonprofit fundraising application, publishes a list of the top 100 growing nonprofit organizations. In order to determine the top 100, a growth score is created based on absolute dollar amounts, factoring in a percentage of growth.
For each organization included in the research, a percentage of Gross Transaction Volume (GTV) or amount of money raised, was assessed. Growth trends that were common among the top nonprofits were identified. Here are the top 4 trends that were leveraged to grow results in nonprofits in 2017.
- Evaluate and adjust existing tactics
The majority of top growing nonprofits worked on improving their existing strategies. Rather than reinvent the wheel, smart nonprofits are measuring performance and refining their approach to maximize results.
- Experiment with new campaigns
Nonprofits in the top-growth category changed their highest grossing campaign type. A large group simply changed their donation pages to crowdfunding, and another large subgroup mainly switched from peer-to-peer to donation pages.
- Expand geographical territory
Organizations that are successful increased their percentage of out-of-state donors. The median percent of gross transaction volume increased by 11 percent. Furthermore, the increase in out-of-state donors performed better on a month-to-month basis. There seemed to be a trend towards an increase in mid-2017 across the board. The improvements do not appear to be in response to a change in campaign types.
- Recurring donor pool growth
A number of agencies increased their recurring donor pool growth. Some of the organizations brought in the most money from recurring donors campaigns. In addition to bringing in more donors, the dollar amount of donations was much higher in 2017 than in 2016, suggesting that recurring donations will produce even higher rates in future years.
Nonprofit organizations that are growth-oriented should track their growth using various performance indicators, gift ranges and gain/loss categories. These types of data reports can provide performance for the nonprofit organization overall, and for each fundraising activity, such as direct mail and major gifts. Detail-level strategies can be assessed based on performance reports and actionable strategies that fit the mission of the organization can be implemented to foster growth and effective use of resources.
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