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How do you calculate fundraising ROI and cost to raise a dollar?

Brian Soucie

I'm curious about what others include in your revenue calculations for fundraising ROI and cost to raise a dollar (CTRD).

Most articles I've read on this use the term ‘funds raised’ when talking about revenue. But given that most of my career has been spent in higher education, I have a very specific frame of reference for what that means (thanks CASE!). For me, funds raised includes pledges but excludes pledge payments.

Does your revenue definition for calculating ROI and CTRD include pledges, or do you only consider actual amounts received into the bank?

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Comments

Alex Wong

@Brian Soucie
we calculate our revenue (now has been renamed by c-suite to contribution) with new cash and pledge, not payment.

as for ROI, we go step further to account for expense (non-personnel expense). FOr example, for our event (fundraising gala, golf tournament, etc), we reduce the expense from the contribution to consider's it's true fund raised.

Karen Diener

@Brian Soucie
I worked in a high school that followed CASE guidelines and there was a terrible pledge fulfillment rate. The CTRD was horribly inflated when based on pledges, and I always tried to focus the lens more on payments. To be fair, we didn't keep track of CTRD, but I pointed out A LOT of times that we needed to pay quite a bit of attention to following up on pledges.

I know you may not be able to change anyone's mind, but I do think this is really important. Are you measuring things just to measure them and because you have to report them? Does anyone at the organization act on those measurements and fully understand them? Rhetorical questions!

Karen

Lyngblomsten Foundation

@Brian Soucie
Make a decision whether you're going to include pledges OR pledge payments - and never both! Then you can run a very simple Appeal Summary and look at this view (RE does it all for you, as long as you add in the data about each appeal). If you use the Appeal Performance Analysis Report - you can run the same statistics very easily for all the appeals within a year, a campaign, by type of appeal, etc.

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Karen Diener

@Lyngblomsten Foundation:
@Brian Soucie
Make a decision whether you're going to include pledges OR pledge payments - and never both! Then you can run a very simple Appeal Summary and look at this view (RE does it all for you, as long as you add in the data about each appeal). If you use the Appeal Performance Analysis Report - you can run the same statistics very easily for all the appeals within a year, a campaign, by type of appeal, etc.

One of my absolute favorite reports. People are BLOWN AWAY when they see this!