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Fundraising Intelligence: <br />Measuring Return on Investment and the Impact of Prospect Research<br />with <br />Sally B...
Sally Boucher<br /><ul><li>CFRE fundraising professional
Background in Higher Ed, the arts, and human services development
Fundraising & nonprofit management consultant
Primary author of Best Practices for Prospect Research in Higher Education Fundraising Report
Regular speaker with AFP, CASE, APRA, AHP, VA Fundraising Institute and others</li></ul>2<br />
Faön Mahunik<br />Director of Research Analytics at CCS<br />Oversees firm’s internal data analysis & tailored constituent...
Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Manageme...
The Non-profit Funding Model<br />5<br />Non-Profit<br />Mission<br /> PUBLIC = Funder + Beneficiary<br />
Return on Investment<br />Return on Investment, or “ROI,” is a simple calculation:<br />Net Revenue (Gross  Revenue – Expe...
Return on Investment<br />Annual Fund Mailing:<br />Assumptions:<br />1,500 pieces to loyal donors<br />Costs: 		Printing:...
Major Gifts for year-long period:<br />Assumptions:<br />2 Full-time MGO’s<br />Salaries average $90K/year<br />All other ...
Cost to Raise a Dollar<br />9<br />
Cost to Raise a Dollar<br />10<br />
Return on Investment<br />11<br />
Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Manageme...
What is Prospect Research?<br />Prospect Research helps to <br />Identify new prospects with wealth and inclination to giv...
The Value of Prospect Research<br />“Investment” in Prospect Research <br />More Donors = Increase in Revenue<br />Larger ...
Investing in Prospect Research<br />15<br />2009 Higher Education Report: Best Practices for Prospect Research in Higher E...
Conclusion: High-Performing Organizations invest in Prospect Research Personnel</li></li></ul><li>Investing in Prospect Re...
Investing in Prospect Research<br />Peer Screening<br />Reviewing of prospect lists by individuals or groups<br />Value: U...
Investing in Prospect Research<br />Modeling and Analytics<br />In-House or Outsourced modeling and data analytics<br />Va...
Investing in Prospect Research<br />Other Research Sources<br />Internet, Media and Data Sources<br />Value: Backbone of p...
Investing in Prospect Research<br />20<br />2009 Higher Education Report: Best Practices for Prospect Research in Higher E...
Conclusion: ROI of Wealth Screening can be significant</li></li></ul><li>Agenda<br />Introduction<br />Prospect Research a...
Metrics<br />Metrics Defined: “A business metric is any type of measurement used to gauge some quantifiable component of a...
Prospect Research & Prospect Management Goals<br />23<br />
24<br />Prospect Identification Metrics<br />Possible Metrics:<br /><ul><li>Number of Prospects Identified
Number of Prospects Identified by Source
Time spent by source</li></li></ul><li>Prospect Identification Metrics<br />25<br />
Prospect Identification Metrics<br />26<br />
Prospect Research Metrics<br />27<br />Possible Metrics:<br /><ul><li>Number of Prospects Qualified
Number of Prospects Qualified by Source
Number of Prospects Qualified by Capacity Level
Time spent by source</li></li></ul><li>Prospect Research Metrics<br />
Prospect Research Metrics<br />29<br />
Prospect Management Metrics<br />30<br />Possible Metrics:<br /><ul><li>Number of Prospects Assigned
Number of Prospects Moved to Cultivation
Number of Prospects Moved to Solicitation
Number of Gifts Closed
Length  of Time in Stages
Number of Contacts</li></li></ul><li>Prospect Management Metrics<br />31<br />Fundraising Pipeline Analysis<br />330<br />...
Prospect Management Metrics<br />32<br />
Prospect Management Metrics<br />Pipeline Efficiency<br />33<br />
Prospect Management Metrics<br />
Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Manageme...
Additional Measurements<br />Are ROI and CRD the only measure of success?<br />Rate of return %<br /># of Solicitations/# ...
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Fundraising Intelligence: Measuring Fundraising Return on Investment and the Impact of Prospect Research

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Presented by Sally Boucher and Faön Mahunik on 04/29/2011. This presentation defines fundraising return on investment and cover the components that make up the overall income and expense lines in the budget. It also discussed the differences between efficiency and effectiveness as well as the differences in measuring ROI and CRD. Topics that are also covered include: Keys to good metrics and important metrics to measure, Prospect research’s impact on fundraising ROI, and Management metrics and tracking. You can access the webinar recording here: https://wealthengineevents.webex.com/wealthengineevents/lsr.php?AT=pb&amp;SP=EC&amp;rID=3660437&amp;rKey=987a1f518451b890

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Fundraising Intelligence: Measuring Fundraising Return on Investment and the Impact of Prospect Research

  1. 1. Fundraising Intelligence: <br />Measuring Return on Investment and the Impact of Prospect Research<br />with <br />Sally Boucher and Faön Mahunik<br />
  2. 2. Sally Boucher<br /><ul><li>CFRE fundraising professional
  3. 3. Background in Higher Ed, the arts, and human services development
  4. 4. Fundraising & nonprofit management consultant
  5. 5. Primary author of Best Practices for Prospect Research in Higher Education Fundraising Report
  6. 6. Regular speaker with AFP, CASE, APRA, AHP, VA Fundraising Institute and others</li></ul>2<br />
  7. 7. Faön Mahunik<br />Director of Research Analytics at CCS<br />Oversees firm’s internal data analysis & tailored constituent strategies<br />Background in research and analytical experience in Higher Ed, development & fundraising<br />Previous experience in private consulting firm<br />3<br />
  8. 8. Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Management Metrics<br /> <br />Additional Measurements<br /> <br />Case Studies <br />4<br />
  9. 9. The Non-profit Funding Model<br />5<br />Non-Profit<br />Mission<br /> PUBLIC = Funder + Beneficiary<br />
  10. 10. Return on Investment<br />Return on Investment, or “ROI,” is a simple calculation:<br />Net Revenue (Gross Revenue – Expense of Investment) <br />Expense of Investment<br />Return on Investment (ROI) =<br />Expense of Investment<br />Net Revenue<br />Cost to Raise a Dollar(CRD) =<br />6<br />
  11. 11. Return on Investment<br />Annual Fund Mailing:<br />Assumptions:<br />1,500 pieces to loyal donors<br />Costs: Printing:$300<br /> Mailing: $200<br />Total Cost = $500<br />Results: 20% response=300 gifts<br />Average gift size = $8.33<br />Total Revenue = $2,500<br /> ROI: $2500-$500 = 400%<br /> $500<br /> CRD: $500 = $0.25<br /> $2500-$500 <br />7<br />
  12. 12. Major Gifts for year-long period:<br />Assumptions:<br />2 Full-time MGO’s<br />Salaries average $90K/year<br />All other expenses (travel, marketing, benefits, cultivation) = $100K<br />Total Expenses: 190K<br />Total Revenues: 30 gifts closed, average gift size $25K= $750K<br />ROI: $750,000-$190,000 = 295%<br /> $190,000<br />CRD: $190,000__ = $0.34<br /> $750,000-$190,000 <br />Return on Investment<br />8<br />
  13. 13. Cost to Raise a Dollar<br />9<br />
  14. 14. Cost to Raise a Dollar<br />10<br />
  15. 15. Return on Investment<br />11<br />
  16. 16. Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Management Metrics<br /> <br />Additional Measurements<br /> <br />Case Studies <br />12<br />
  17. 17. What is Prospect Research?<br />Prospect Research helps to <br />Identify new prospects with wealth and inclination to give<br />Segment and prioritize existing donors<br />Determine target ask amounts<br />Provide important background information to development officers<br />13<br />
  18. 18. The Value of Prospect Research<br />“Investment” in Prospect Research <br />More Donors = Increase in Revenue<br />Larger Gift Sizes = Increase in Revenue <br /><ul><li>Justify Prospect Research with Measurement</li></ul>14<br />
  19. 19. Investing in Prospect Research<br />15<br />2009 Higher Education Report: Best Practices for Prospect Research in Higher Education Fundraising<br /><ul><li>Average Number of Full-Time Researchers at HPOs: 2.51 (124% difference)
  20. 20. Conclusion: High-Performing Organizations invest in Prospect Research Personnel</li></li></ul><li>Investing in Prospect Research<br />Online Data Mining Tools<br />Databases and Aggregators <br />Value: Provides public record data on donors, corporations, and foundations<br />Cost: Varies (can be expensive)<br />16<br />
  21. 21. Investing in Prospect Research<br />Peer Screening<br />Reviewing of prospect lists by individuals or groups<br />Value: Uncovers relationships, details, and wealth<br />Cost: No or Minimal Cost<br />17<br />
  22. 22. Investing in Prospect Research<br />Modeling and Analytics<br />In-House or Outsourced modeling and data analytics<br />Value: Can answer specific questions<br />Cost: Varies (can be expensive)<br />18<br />
  23. 23. Investing in Prospect Research<br />Other Research Sources<br />Internet, Media and Data Sources<br />Value: Backbone of prospect research offices<br />Costs: Free or Subscription Cost (varies) <br />19<br />
  24. 24. Investing in Prospect Research<br />20<br />2009 Higher Education Report: Best Practices for Prospect Research in Higher Education Fundraising<br /><ul><li>Potential ROI realized over 1-2 years is great
  25. 25. Conclusion: ROI of Wealth Screening can be significant</li></li></ul><li>Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Management Metrics<br /> <br />Additional Measurements<br /> <br />Case Studies <br />21<br />
  26. 26. Metrics<br />Metrics Defined: “A business metric is any type of measurement used to gauge some quantifiable component of an organization’s performance”<br />22<br />
  27. 27. Prospect Research & Prospect Management Goals<br />23<br />
  28. 28. 24<br />Prospect Identification Metrics<br />Possible Metrics:<br /><ul><li>Number of Prospects Identified
  29. 29. Number of Prospects Identified by Source
  30. 30. Time spent by source</li></li></ul><li>Prospect Identification Metrics<br />25<br />
  31. 31. Prospect Identification Metrics<br />26<br />
  32. 32. Prospect Research Metrics<br />27<br />Possible Metrics:<br /><ul><li>Number of Prospects Qualified
  33. 33. Number of Prospects Qualified by Source
  34. 34. Number of Prospects Qualified by Capacity Level
  35. 35. Time spent by source</li></li></ul><li>Prospect Research Metrics<br />
  36. 36. Prospect Research Metrics<br />29<br />
  37. 37. Prospect Management Metrics<br />30<br />Possible Metrics:<br /><ul><li>Number of Prospects Assigned
  38. 38. Number of Prospects Moved to Cultivation
  39. 39. Number of Prospects Moved to Solicitation
  40. 40. Number of Gifts Closed
  41. 41. Length of Time in Stages
  42. 42. Number of Contacts</li></li></ul><li>Prospect Management Metrics<br />31<br />Fundraising Pipeline Analysis<br />330<br />250<br />210<br />170<br />60<br />40<br />
  43. 43. Prospect Management Metrics<br />32<br />
  44. 44. Prospect Management Metrics<br />Pipeline Efficiency<br />33<br />
  45. 45. Prospect Management Metrics<br />
  46. 46. Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Management Metrics<br /> <br />Additional Measurements<br /> <br />Case Studies <br />35<br />
  47. 47. Additional Measurements<br />Are ROI and CRD the only measure of success?<br />Rate of return %<br /># of Solicitations/# of Gifts Received<br />Average gift size<br />Average cost per gift<br />Fundraising costs/# of gifts<br />Overall Cost %<br />Fundraising costs/Total contributions<br />Basic Benchmarking<br />36<br />
  48. 48. Additional Measurements<br />AFP’s 2010 Fundraising Effectiveness Survey Report<br />Gain/Loss Ratio = current year gains/losses<br />prior year total results<br />$ gained/lost from New Donors<br />$ gained/lost from Recaptured Donors<br />$ gained/lost from Upgraded Donors<br />$ from Donors who gave the same amount<br />37<br />
  49. 49. Agenda<br />Introduction<br />Prospect Research and the Impact on Fundraising<br />Prospect Research and Prospect Management Metrics<br /> <br />Additional Measurements<br /> <br />Case Studies <br />38<br />
  50. 50. Case Studies<br />39<br />Barnard College<br />Parents Fund Program<br />2010 ROI = 12,285%<br />Christian Aid<br />The Ambassadors Programme<br />CRD = £.08 (~$.13)<br />
  51. 51. Barnard College (ROI)<br />The Barnard Parents Fund<br />Launched in 2009 <br />Increased relationship between Research and Parents Program Officer<br />Wealth Screenings since 2003 – implementation process varied<br />Prospect Research and Event Specific Research<br />Barnard Hosted Events<br />Parent Hosted Events<br />40<br />
  52. 52. Barnard College (ROI)<br />Identified Top Level Prospect for Parent’s Fund Council <br />FY2010: 36 Parent/Families<br />FY2011: 39 Parent/Families<br />Identified Top Level Prospects to serve as Event Hosts<br />4 Events Hosted in FY2010<br />6 Events Hosted/Planned in FY2011<br />41<br />
  53. 53. Barnard College (ROI)<br />The ROI of The Barnard Parent Fund was 12,285%<br />ROI = Net Revenue $589,724<br /> Total Investment $4,800<br />Wealth Screening 269 parents (~$300)<br />Barnard Hosted Events (Total Cost: $4,500) <br />Parent Hosted Events (Total Cost: $0)<br />42<br />
  54. 54. Christian Aid (CRD)<br />£5 million goal for “In Their Lifetime” campaign started in 2008 <br />~£4 million raised to date<br /><ul><li>Goal: Establish The Ambassadors Programme</li></ul>Mini Campaign aimed specifically at mid-level donors within the overall campaign<br />£10,000-£50,000 over 3-5 years<br />4 month work period<br />43<br />
  55. 55. Christian Aid (CRD)<br /><ul><li>Process:</li></ul>Wealth Screening<br />Determined UK donor “hot spots”<br />Additional prospect research and analysis<br /><ul><li>Results:</li></ul>10 Strategic Events held in “hot spots”<br />Engaged 28 Ambassadors<br />Raised £675,000 <br />44<br />
  56. 56. Christian Aid (CRD)<br />The CRD of the Ambassadors Programme was <br />£.08 (~$.13)<br />CRD = Investment £5,620<br /> Net Revenue £672,132<br />Wealth Screening (Total Cost: ~£620, $1,000)<br />10 Events (Total Cost: ~£1,000, $1,600)<br />Staff Travel (Total Cost: ~£2,000, $3,200)<br />200 Brochure Mailings (Total Cost: ~£2,000, $3,200)<br />45<br />
  57. 57. Questions?Contact Us:marketing@wealthengine.com<br />
  58. 58. Sally Boucher<br />Platinum Consultant, WealthEngine<br />sboucher@wealthengine.com@WealthEnginewww.facebook.com/pages/WealthEngine/60059589198<br />Faön Mahunik<br />Director of Research Analytics, CCS<br />fmahunik@ccsfundraising.com<br /> @CCSAnalytics<br />www.facebook.com/ccsfundraising<br />Contact Us<br />47<br />

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