The Surprising Truth About Digital Metrics for Nonprofits
I want you to picture two organizations in your mind’s eye for a moment.
Each organization is not particularly special. One is not meaningfully larger than the other, better-staffed, or well-established. They are in geographically similar areas. Neither has access to fancy consultants or some secret technology or cutting-edge strategy.
Now take a look at these actual, real-life stats:
Last year, one organization experienced a 4% loss in online revenue while the other a 20% gain.
One organization raised nearly 6X more per fundraising email.
One organization lost 28% of its email list while the other gained 7%.
What on earth is the difference between these organizations? What is driving the massive spread in results?
There’s one major difference:
Their sector. The issue space inside which the nonprofit operates. And when it comes to digital metrics, your organization’s sector matters—a lot.
How to evaluate performance inside your corner of the nonprofit universe
But once you have your metrics in mind, knowing what numbers to shoot for and what’s supposed to be “good” is a huge exercise in guesswork (especially in the midst of COVID-19 when I’m writing this).
Honestly, once you see the massive differences in metrics between issue spaces—let alone the benchmarks floated in the for-profit universe—it’s not difficult to see why.
Even after working with nonprofits for years, it wasn’t until Brooks Digital began to further specialize inside the health issue space that I saw these patterns for the first time. It wasn’t that the data changed—I just started to see it through the lens of a particular type of nonprofit. And it was pretty shocking.
Because we specialize in helping health organizations, let me share some examples of
Monthly giving for health organizations in 2019 comprised, on average, only 4% of their total online revenue. (The average across all nonprofits is 17%.)
Email lists for health organizations shrunk by 18% in 2019-20 (compared to a 2% decline for the entire nonprofit sector.)
Organic traffic, as a percentage of total traffic, averaged 53% for health organizations (compared to the overall average of 44%).
The average health organization reduced its digital ad spend by a whopping 52% in 2019. By comparison, the entire nonprofit sector averaged a 17% increase during the same time period. (My hypothesis, by the way, is that it’s because the cost per digital advertising lead of health organizations is more than double the nonprofit average at $5.06 per lead.)
My main point here is that your own performance evaluations may be radically different once you consider available information for your sector. For example, if your nonprofit health org’s email list grew even 1% in 2019, you not only beat out your issue space by a large margin, but the nonprofit universe as a whole.
Why it’s actually a bad idea to use benchmarks as goals
I’ve been waiting to tell you this until the end, but I don’t think you should use benchmark metrics like these to set your future goals. At least not in the traditional way.
The fact that I’m writing this in the middle of COVID-19 should be proof enough that using last year’s numbers to set this year’s goals is a total moonshot. Although your issue space is an important piece of context, it’s not the only piece of context (global pandemic, anyone??).
In fact, I would advocate—especially this year—that you use last year’s benchmark metrics as “focus indicators” to highlight where your organization may be underperforming (or doing really well), and steer your organization using those indicators.
Let me give a practical example. If your health org is sitting at 40% organic traffic share and increased its digital ad spend last year (two metrics that are intimately related, by the way), it may be worth evaluating whether a shift in investment to SEO this year would be a better strategy. It may or may not be—but it provides a clue to start with.
And if you decide to move ahead with SEO, you can set more specific goals related to that work than just organic traffic share and digital ad spend. Because ultimately, benchmarks are just trends. Their value is to let you know where you may be way off base, fix it, and then focus on beating the trend.
But all this happens inside the ecosystem of your issue space. When you understand what’s going inside your corner of the nonprofit world and what the numbers say about your individual organization, you will be better equipped to chart a course through the uncertainty ahead.