Estimated year-end campaign goals?

Hi Tristan,

This is a great question, and an important one.  There are several ways to estimate what you might raise from your end-of-year campaign.  Keep in mind, of course, that your results will also be impacted by the strength of your ask - meaning, are you introducing a matching gift opportunity?  How compelling is your case for support?

I'm going to outline several ways to estimate your EOY fundraising - I'm interested to hear which you think is most relevant for Indy Humane:

Method #1 - EOY Ratio Approach

We know that funds raised online in the month of December generally represent (across all Convio clients) about one third of all funds raised online in any given calendar year.  If you do major event (a-thon type) fundraising online, then this ratio won't be true for you (e.g. a dog walk in the spring with donations processed online), but otherwise it's a reasonable estimate. Keep in mind that only a portion of those funds will be trackable back specifically to your email messages, but to the extent that your end-of-year donors are already on your email list, they will be influenced by the messages you send.  So ... if by the end of November, you've raised $20K online from direct-response (not event-based) fundraising online, then a reasonable estimate for your total online fundraising in December might be $10K.  That would be $30K in total direct-response fundraising for the year, of which $10K in December represents one third.

Method #2 - Historical Approach

Another way to come up with a reasonable estimate is to look at your online fundraising for December from the previous year and use that number as the basis for a projection.  If you raised $15K online last year during the month of December, then it's reasonable to expect that you would raise at least that much again.  But you might be able to do better.  If you've redesigned your website, launched Convio as an improvement to your donor's online giving experience, and increased the size of your email list (all since last year), then you should definitely do better than the previous year ... but by how much?

It's possible, but difficult, to quantify the impact of a website redesign and a best-practices based giving process.  You have to get deep into the numbers and look at your website analytics to figure out your growth in site traffic and your donation form conversion rates.  An overhauled site might increase your traffic by 20-30%; a best-practices donation form might increase your donation form conversion rate from 10-15% to 20-25%.  But even once you've figured out these numbers, they still don't translate easily to a fundraising goal.

Here's a simple approach:  Take your last year's December online fundraising total, multiply by the size of your current usable email file, then divide by the size of your usable email file last December.  That's the simplest way to arrive at what might be a reasonable estimate.

So, if you raised $15K online in December of last year and right now you have 5,000 usable addresses and last year in December you had 3,000 usable addresses, then $25K might be a reasonable goal.  This approach makes a lot of assumptions, but the biggest assumption is that your file composition (percentage of donor/non-donor) has remained fairly stable as you've grown.

Method #3 - File Size Approach

If you don't have any online fundraising history at all, then you might be best off not setting a specific goal.  Your end-of-year fundraising will be a crap shoot:  if your list has active donors and supporters who are inclined to give, then you should see good results.  If your email list has not been solicited in the past (e.g. volunteers who don't receive direct mail solicitations, organizational contacts who are not good prospective donors, old addresses that you haven't communicated to in a long time, etc.), then you might raise little or no money at all - the only way to find out is to ask.

When you just don't have much to go on, it's safer not to set a goal.  If you do set a goal, it should be one that you're tracking towards internally as an organization, and not necessarily a goal that you communicate to your donors.  If you communicate a goal to your donors that turns out to be way too high, you'll be scrambling down the road to make the small amount you raised sound like a success.

If you absolutely have to set a goal, then a reasonable rule of thumb is $0.20 per usable email address on your list.  So, if you have 5,000 usable email addresses, $1,000 might be realistic.  This rule of thumb is helpful in the case where you just don't have any online giving history to use as a guide.  5,000 donors are going to respond very differently from 5,000 volunteers who have never supported you financially or 5,000 event participants who may identify more strongly with your event than with your organization.

The $0.20 number comes from a blended response rate of 0.3% (donor response rates are typically 1% to eAppeals, prospect response rates are typically 0.1%) and an average online gift of $65.

$65 per gift x 0.003 gifts per constituent = $0.20 per constituent

If you think your response rate will be higher (or lower) or that your average gift will be higher (or lower), you can modify the formula accordingly.

This approach assumes that most of your online giving is driven by email:  that you do not have a direct mail program driving donors to your site and that you aren't getting much website traffic that converts directly to donor.

So ... I'm curious to know what kinds of numbers you arrive at using these three methods and what kind of goal you ultimately set.  Please post back with your thoughts and questions!

-patrick

Tristan Schmid:

Patrick,

Thank you so much for your helpful answer! We're probably estimating based on #1 and #2.

We've had an online donations page for a few years, but have not aggressivly sought online year-end donations before. So this year will provide a nice benchmark for us in the future, especially when we consider using video or other methods to tell compelling stories. We're keeping it simple and within the Go! guidelines this year, though - basic mentions of what we've done this year, how people's donations help, and what we hope to accomplish in 2010.

Our email housefile has grown nearly 75% within the past year, so some of the equations you mention might not apply. Also, we've revamped our homepage, and grown our online social networking from basically nothing to over 5k Twitter & Facebook followers. But then again, as you mention, a lot of year-end giving planning is based on assumptions. On one hand, I'd assume that with the growth of our housefile and social networking, and the first aggressive year-end online campaign ever, our donations would skyrocket compared to last year. On the other hand, if our message isn't powerful, and if people's giving is reduced because of the economy (which fortunately we haven't seen too much of), our year-end fundraising might not improve much over last year.

For our budget estimates, though, I think a mid-range between some of the equations you give will suit us well. And at the very least we'll have a great benchmark for next year!

Thanks again for your terrific insights,

Tristan

Thanks for the feedback Tristan - I'm glad to help!

You've had some impressive growth over the past year and it's exciting to have expanded not only your email audience, but also your Facebook and Twitter audiences.  I have yet to see Facebook and Twitter growth translate directly into online fundraising success the same way that email list growth has, but I would definitely encourage you to post links to the web-viewable versions of your end-of-year email campaigns to both Facebook and Twitter.  This will allow you to take your end-of-year campaign to those two audiences without having to re-invent or re-write your content.

If you're not sure how to post a web-viewable version of your end-of-year appeals to Facebook and Twitter, don't hesitate to ask about it in one of your upcoming Expert Office Hour sessions.

-patrick