Just like that, the fundraising world has been served up another set of fundraising benchmarks from M&R, the highly respected & mission-focused digital marketing/pr/social media firm out of Washington D.C./New York.
The 2023 edition, which took data from 215 unique nonprofits, focused on providing insight into the data trends across many key parts of fundraising - email, website, P2P, and what we at GoodUnited is most interested in, Facebook fundraising.
There is SO MUCH to unpack in this benchmark report, so we’re going to stick to taking a look at the parts around social media fundraising for the most part, while touching on tangential topics that our team members are passionate about: email and the role it continues to play in digital fundraising.
Before we get into the data dissection, let’s get a baseline of what was published for Facebook fundraising from the 215 nonprofits that contributed.
The Bottom Line(s) Up Front
Facebook Fundraising Down, But Hope is Still Alive
1 key factor worth noting upfront: There was no delineation provided by M&R regarding fundraiser type (Facebook Challenge, birthday fundraiser, or the “Donate” button).
M&R Findings for Facebook Fundraising:
- No surprises on this one - Facebook fundraising took a 35% nose-dive YoY in 2022.
- The average Facebook fundraiser generated $136 in 2022 across 4 gifts ($34/gift average)
- The health sector saw the lowest average gift ($26) while disaster/international relief saw the highest ($38), largely driven by the events in Ukraine.
- 1.1% of total online revenue was driven on Facebook - a decline from 2021.
- The largest upside with Facebook fundraising still lies in the sheer reach (2.3 billion users and counting) that the platform provides to those looking to support their mission of choice.
Email Metrics Down Across the Board; SMS Adoption Growing Steadily
- Email revenue declined by 4%.
- For every 1,000 fundraising messages sent, nonprofits raised $90. This marks a 15% decrease from 2021.
- Nonprofits sent an average of 60 email messages per subscriber in 2022, a 15% increase in volume from the previous year.
- The average response rate for advocacy email was 1.31%, an 8% decline over the previous year.
- The average response rate for fundraising email was 0.09%, an 18% decrease compared to 2021.
- SMS subscriber list size increased by 11%. Nonprofits had 236 mobile subscribers for every 1,000 email subscribers.
- On average, nonprofits sent 21 text messages per subscriber per year, a 28% increase in volume from 2021.
OK, we’ve got a solid baseline pulled out and we’re ready to go. First up, turning this one over to Ben Jones, one of our resident Facebook ad experts here at GoodUnited, to kick things off with a passionate hot take - Email isn't the answer for repeat supporter engagement.
Thoughts on the 2023 M&R Benchmark Report
Facebook Messenger: The Answer for Supporter Engagement
According to recent data, Meta return on ad spend (ROAS) is not accurately reflected in the metrics being used. The reported sub $1 lift on driving supporters through social media is misleading as it doesn't take into account nonprofits that drive challenge acquisition. In reality, the average ROAS for these nonprofits ranges from $3-4, which is much higher than the reported metric of $.50.
Furthermore, the return on investment is even greater when considering repeat actions from social supporters. These supporters return on average 2x per year based on Messenger stewardship campaigns, proving the importance of engaging with supporters in the channels where they spend time.
M+R's statement regarding the need to look beyond the first interaction and find ways to engage with supporters in order to increase their lifetime value is spot on. Messenger stewardship, email campaigns, retargeting activity and ongoing relationship building are all important in order to cultivate and engage with supporters over time.
This quote from M&R is spot on, just replace Email with Facebook Messenger: “So we have a situation where it can be costly to acquire donors directly from advertising, and in many cases the costs outweigh the immediate return. That means that in order to see positive net revenue from these new donors, we should be looking beyond that first interaction and seeking ways to motivate additional gifts (including recurring giving). That’s where email comes in — the welcome series, the follow-up appeals, the cultivation and engagement messaging, the ongoing work of building and feeding relationships.”
In conclusion, while the reported ROAS for Meta may be low, it doesn't accurately represent the true value of social media fundraising for nonprofits. The key is to engage with supporters in the channels where they spend their time, build relationships, and find ways to motivate additional gifts and recurring giving.
A Cross-Channel Approach is Essential
According to GoodUnited (GU) data, challenge performance across mission area of focus follows closely to the trends reported by the M&R report. However, understanding the context of the post-Covid time frame is vital to interpreting performance changes over time. For instance, organizations focused on issues such as Hunger/Poverty and Cultural causes saw a decrease in performance from 2021 to 2022 due to shifting priorities in the aftermath of the pandemic.
As reported by M&R, nonprofits need to think strategically about their goals. For organizations who saw a lift in fundraising efforts due to Covid-time priorities, now is the time to shift strategies from acquisition to retention and reactivation. Conversely, with the fundraising market normalizing, we can expect mission areas that were put on the back burner during Covid to have more opportunities for Facebook fundraising in the next year.
Regarding challenges, the Cost per Donation was $15 in 2022, up by 50% from 2021. The average donation size remained steady at $38, and there were an average of 4-5 donations per fundraiser, which also remained stable YoY. However, given Challenges on facebook reach fundraisers in the immediate, and their networks as donors indirectly, it is essential to look at the Cost per Fundraiser (CPF) as well. CPF increased in 2022 ($66 vs. $44), mostly due to changes in the cost of acquisition (Cost per Lead). As the market normalizes and more demands are placed on people's time and money, there will be an increased need for reactivation/retention to prompt leads to take additional action over time, to boost Lifetime Value of a supporter, both throughout Challenges and beyond. This is one place the GoodUnited can step in to strategically reactivate folks in channel and ensure those supporters are not lost when the immediate fundraising opportunity provided by the Challenge ends.
Average Raised (the average amount raised by fundraisers) also follows closely to the mission area of focus trends reported by M&R; the change has been less than 3% on average from 2021 to 2022 ($177 to $173). Overall, it is important to understand trends in challenge performance in light of the broader economic and social landscape. This additional context coupled with a strategic focus on retention and reactivation, will be vital for nonprofits to succeed in future-proofing fundraising efforts as the post-covid market normalizes.
2022 Facebook Challenges Data Missing, Leads to Incomplete View of Fundraising Data
As per the latest M&R report, nonprofits face a significant challenge in achieving a lower cost per donation. The average cost per donation across the board is steep at $126, which has been a significant roadblock for nonprofits in the past year. However,Facebook Challenges executed with GoodUnited in 2022 observed cost per donation at $15. By partnering with GoodUnited on Facebook Challenges, nonprofits typically achieved seven more donations with the same $126 that they are currently spending in 2022.
The M&R report highlights the importance of driving a lower cost per donation for nonprofits. Achieving a lower cost per donation results in more efficient revenue generation for nonprofits. For instance, the return on ad spend (ROAS) for Meta is coming in at $0.5, while GoodUnited is achieving a ROAS of $2.65. This discrepancy is a direct reflection of the work that GoodUnited is doing to drive down the cost per donation. By implementing GoodUnited's approach, nonprofits can not only raise a significant amount of funds but also generate warm leads who are self-selecting to support each nonprofit.
The M&R report indicates a steady number of donations per fundraiser at four. While this is a strong effort, GoodUnited is driving more donations per fundraiser, achieving a rate of 4.5. This means an additional $19 per fundraiser, resulting in an additional yearly revenue of $5 million across challenges.
The Wrap Up
Nonprofits face unique challenges in achieving lower costs per donation, but recent data shows that fundraising efforts can be more efficient when implemented strategically. Both data sources in this blog (M+R and GoodUnited) don’t mince words with what nonprofits should be focusing on for their end game: driving repeat donors is the key to winning in 2023 and beyond.
The M+R report emphasizes the need to look beyond the first interaction and find ways to engage with supporters to increase their lifetime value. The report also highlights the importance of understanding trends in challenge performance in light of the broader economic and social landscape.
GoodUnited's data provides valuable insights into how Facebook Challenges can drive donations more efficiently for nonprofits. By partnering with GoodUnited, nonprofits can achieve seven more donations with the same $126 that they are currently spending. GoodUnited's approach not only raises significant funds but also generates warm leads who self-select to support each nonprofit. Additionally, GoodUnited is driving more donations per fundraiser than the industry standard, resulting in an additional yearly revenue of $5 million across challenges.
Engaging with supporters in the channels where they spend their time, building relationships, and finding ways to motivate additional gifts and recurring giving is the clear path way to do that. However, there’s some very real questions about how to best do that (Hint: It’s not by sending 60+ emails a year to each subscriber, just to see $90 in revenue.)
I’m not sure about you, but leaving that kind of fundraising revenue on the proverbial table isn't something that most nonprofits can afford to miss out on - no matter the size or footprint of your brand and mission.