Fuse’s Hot Takes from the 2023 M+R Benchmarks
Each spring, we anxiously await the release of the M+R benchmarks to see what our friends at M+R found across the industry and how that lines up with what we’re seeing across our client programs.
This year, M+R provided more data than ever – compiling 2022 digital data from 215 nonprofit organizations of various sizes, spanning across 9 different sectors. And, before we dive into our takeaways, we’d like to give a huge shout out to M+R for this incredible reporting, and to all the organizations who participated this year! We appreciate your work in establishing these benchmarks.
Now, let’s dive in.
Bottom line: Overall, online revenue decreased by 4% from 2021-2022. But, let’s not forget that for many, 2021 was an outlier year as we saw the height of pandemic fundraising throughout that calendar year.
The Hunger & Poverty sector had the biggest drop (14%) and has seen 2 consecutive years of decline. (This is also the only sector that decreased from 2020-2021.) This sector was likely impacted the most by the immediate response to the pandemic in early 2020 so a steeper revenue decline here is not all that surprising and will be important to monitor in the year ahead as new baselines are established.
And, as always, there are some exceptions. In response to the war in Ukraine and other disasters the Disaster & International Relief sector saw revenue increase of 8% year-over-year.
Speaking of emergency fundraising … retention is going to be a big challenge for organizations that brought on an influx of emergency donors to their file in 2022. Determining the right strategy to ensure these donors continue supporting your organization will be critical to keep these metrics high in 2023.
The all-important Giving Tuesday and Calendar Year End
M+R’s reporting on these end-of-year timeframes only encompasses data from the day of Giving Tuesday and the last day of the year.
Giving Tuesday 2022 underperformed compared to Giving Tuesday 2021.
The team at M+R pointed out that this may be contributed to the fact Giving Tuesday is marketed weeks before the actual event day, with many organizations increasingly promoting “early giving” which can space out donations. So, if you’re looking at campaign revenue year over year and you’re seeing something different in your trends, that’s likely why and is what we found for many of our clients this year as they remained inline with prior years’ Giving Tuesday results when looking holistically at the entire campaign.
Email revenue was down by 22% on December 31, 2022 compared to December 31, 2021.
The day of the week likely matters! December 31 fell on a Saturday in 2022 – which likely was a contributing factor to this performance. As you plan for your year-end 2023 communications, keep in mind that this year December 31 falls on a Sunday. Ensure you are giving your donors who may not check their email on the weekends opportunities in the days leading up to 12/31 to make their end-of-year donation.
An uptick in monthly giving (!)
One-time donors are down 12% YOY, while monthly donors are up 11% YOY.
Disaster & International Aid and Wildlife/Animal Welfare sectors are the only sectors to see an increase in both one-time and monthly donors YOY.
Monthly donors accounted for 28% of online revenue in 2022.
How does your sustainer program compare to the industry? There are many reasons to prioritize monthly giving program strategies, with stability and reliability of revenue being at the top.
In fact, even if your organization has a healthy sustainer program, there are likely opportunities to enhance your program even further with specific business process improvements and/or strategic adjustments … check out our blog post on this topic to learn more.
If you haven’t been able to prioritize monthly giving as an initiative for your organization - now is the time!
And what about email?
If your organization saw a decline in email metrics last year, you aren’t alone.
Email revenue was down 4% YOY - but email still accounted for 14% of overall online revenue.
Practically every email metric was down in 2022.
Fundraising email click-through rates declined 15% and fundraising email response rates dropped a staggering 18%.
So, how do we increase these metrics in 2023? We recommend going back to the basics:
Review your segmentation and consider adjusting your strategy for certain groups of donors.
Check your bounce rate – are your messages hitting inboxes? Do you need to verify your email address, or remove some spammy language?
Test, test, and test again! Subject lines, CTA buttons, and imagery are all simple tests that can yield huge results.
Now, on to digital advertising.
Nonprofits of all sizes spent about 1/3 of their fundraising ad budgets on search in 2022.
And the data backs it up - nonprofits of every size, across each sector, saw the highest ROAS of any channel in search ads. This is right in line with what we’ve seen for many of our partners as well.
Thinking about new platforms? It will be essential to invest to reach new audiences.
While TikTok had the highest cost-per-lead of all channels in 2022, it is a rapidly growing platform that may be worth the investment to reach the younger demographic. If your organization can afford it, we encourage a test.
Nearly half of the responding nonprofits worked with influencers in 2022.
We’re continuing to hear more and more about organizations leveraging influencers to help spread brand awareness and we strongly encourage reaching out if this makes sense in your overall strategy.
In most cases, influencers that care about your cause are happy to leverage materials you give them to share with their followers – and they might just do it for free! Out of all the nonprofits who noted to M+R they worked with influencers in 2022, only 13% of those actually paid the influencers.
Don’t expect these influencer-driven donors to stick around like your more mission-centric donors. These strategies will bring in some surges of giving but it’s not likely a strategy that will sustain your file in the long term.
Google Grant: We’re all aware the return on Google Grant is much less than that of paid search ads – just the way that Google wants it.
However, we are strong believers that Google Grant is still worth including in your overall advertising mix – but it is critical to establish the most optimized way to set up your Grant account to complement your paid account.
We recommend optimizing your paid search ads with keywords to generate revenue, while leveraging your Grant ads to drive site traffic and lead people to informational areas of your site (like your blog!). The site visits from Google Grant ads can generate email signups, petition signatures, and volunteer recruitment. Be sure to have a journey ready to pull in these engagers once you have that information!
Where are people coming from?
57% of website traffic comes from mobile & tablet devices. (!!!)
However, mobile & tablet users are less likely to give than desktop users. And when they do give, they are converting at a lower average gift value than desktop users.
How do we increase mobile device conversion rate?
First, ensure your landing pages are optimized for mobile users.
What online payment methods are you offering your donors? Payment options like Apple Pay and PayPal make it easy for donors to make an online donation quickly and efficiently without having to get up and search for their credit card. Including a variety of options can help increase that conversion rate from mobile devices.
And lastly, ensure you are evaluating your results by device, especially when evaluating the performance of a test.
Information overload? We get it. But now is time to ask – what’s next? We recommend starting by evaluating your organization’s metrics from 2022 and comparing them to the benchmarks from M+R.
How are your trends aligning with what similar organizations saw in the industry last year? What needs immediate improvement now and what can wait? What strategies need to be in place before the all-important year end time frame? Believe it or not, it’s time to start thinking about that now.
We’d love to connect on your findings – reach out to us and share what you uncover!
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