Nonprofit Data Analytics: Overview & How to Get Started
Many nonprofits collect data, whether it’s donor contact information, fundraising campaign details, or marketing success metrics. But few organizations know how to truly harness this information to better understand their community, measure progress, and make evidence-based decisions that increase their impact.
To get the most out of your data, you’ll need to leverage a practice called nonprofit data analytics. In this guide, we’ll walk you through everything you need to know to implement it at your organization:
To succeed with nonprofit data analytics, you must use the right tools to gather, manage, and analyze your data. As we get started, consider your current technology stack and how you could optimize it to support your data analytics goals. For example, you may want to learn more about the reporting capabilities in your marketing platform or work with experts to ensure you’re getting the most out of your Salesforce ecosystem.
Let’s dive in!
What is Nonprofit Data Analytics?
Nonprofit data analytics is the process of collecting data about different aspects of your organization’s operations, managing that information effectively, and analyzing it for helpful insights.
The ultimate goal of the data analytics process is to understand your organization’s performance in a variety of areas, from fundraising to supporter communications. With a clear picture of your organization’s current state, your team can then adjust its strategies to drive better results in those areas.
Examples of Organizations Using Data Analytics
Let’s look at two examples of organizations that understand how to make the most of their data:
Champlain Valley Office of Economic Opportunity
The Champlain Valley Office of Economic Opportunity (CVOEO) focuses on fundamental economic, social, racial, and environmental justice issues and strives to help people achieve economic independence.
This organization collects household, income, and visit data in Salesforce and a central data warehouse and then uses that information to improve its operations and further its mission. By adopting a data-driven mindset, CVOEO has made itself a dynamic organization that can quickly adapt and find creative solutions to issues its community cares about.
The Cowen Institute at Tulane University
The Cowen Institute works to equip leaders and practitioners with the skills and resources they need to increase educational and postsecondary success among students in New Orleans.
One way the Cowen Institute fulfills its mission is by curating and sharing a public-facing data resource that provides detailed information about New Orleans’ charter schools. Parents, researchers, and policymakers can all access this data to help make New Orleans schools better for all.
Types of Data Analytics to Know
As your nonprofit begins to use data analytics to achieve its goals and make organizational improvements, you’ll need to know four key types of data analytics.
The first two types focus on the past:
Descriptive Analytics: This type of data helps describe what happened over a specific period of time.
Example: For its most recent fun run fundraiser, a nonprofit had 150 volunteers sign up to assist with participant check-in, run water stations, and provide refreshments at the finish line. It can compare this number to volunteer counts at past fun run fundraisers.
Diagnostic Analytics: This type of data helps you understand the “why” behind specific trends or patterns.
Example: A nonprofit notices its email newsletter open rates and click-through rates have increased. Looking at the data, its leaders see that the positive change directly correlates to changing their approach to writing subject lines and incorporating more eye-catching graphics in their messages.
The second two types focus on what could happen in the future:
Predictive Analytics: This kind of data analytics helps you use past data to anticipate future outcomes.
Example: A nonprofit seeking to raise major gifts during the quiet phase of a capital campaign uses predictive modeling to determine donation ask amounts for its major donors. By analyzing donor behavior, financial capacity, and affinity for the cause, the organization successfully asks several donors to make gifts of $15,000.
Prescriptive Analytics: This kind of data analytics simulates or suggests different strategies to help organizations understand the risks and benefits of different decisions.
Example: An organization focused on serving people who are unhoused wants to maximize the effectiveness of its housing assistance program. By analyzing historical data and leveraging predictive models, the nonprofit determines that short-term rental assistance coupled with job training will yield the highest success rate for most of its beneficiaries.
It’s essential to use all four types of data analytics to improve your organization’s operations. By learning from the past and looking to the future, your organization can understand its starting point, its potential, and the steps it needs to take to reach the next level of success.
Benefits of Leveraging Data Analytics for Your Nonprofit
You know that having data on hand is useful, but what specific benefits will your organization see as it learns to fully leverage data analytics? Here are a few to keep in mind:
Improved decision-making: It’s risky to make decisions based on assumptions, and you don’t want to take unnecessary risks when it comes to your organization’s important work and the communities you serve. Data analytics provides accurate insights that help you make informed, strategic choices that truly enhance efficiency and maximize impact.
Enhanced donor engagement: Some of your nonprofit’s most important data is donor data. Insights about their behavior, preferences, and giving patterns can help you personalize communications, design exciting fundraising campaigns, strengthen relationships, and maximize contributions.
Increased program effectiveness: Delivering high-quality programming and services requires an agile strategy that you regularly adjust. Using your data empowers you to track program outcomes, identify trends, optimize resource allocation, and optimize resource delivery so that you’re helping beneficiaries the way you want to.
Transparency and accountability with stakeholders: Sharing data that provides a clear picture of your organization’s performance, finances, and impact helps you build trust and credibility with your stakeholders. As a result, you’ll secure more support for your cause.
Better understanding of community needs: Your work is all about the communities that you serve. By analyzing demographic trends, service usage, engagement patterns, and beneficiary feedback, you can identify gaps in services and emerging issues that need your attention. Then, you can better tailor your services to meet your community’s needs.
Improved marketing efforts: Data can help you identify the best channels, messaging, and timing for your outreach work based on what you know about your audience.
Easier time planning for growth: You have to know where your organization has been before you can map out where you want it to go. Leveraging data analytics gives you the background information you need to successfully and strategically plan for the future.
Common Metrics for Nonprofits to Track
As part of your nonprofit data analytics strategy, you’ll need to track metrics (measurable values) in several different areas to get a full picture of your organization’s performance. Let’s look at some of the most common and useful metrics your organization can track:
Donor Metrics
Donor Demographics: The measurable characteristics of your nonprofit’s donor base, such as age, gender, income level, marital status, geographic location, education, and occupation
Industry Standard: Though specific demographics will vary by organization, Double the Donation reports that the average donor in the U.S. is 64 years old and makes two charitable gifts each year.
Donor Retention Rate: The percentage of donors that continue giving after giving once. Calculate your donor retention rate by dividing the total number of repeat donors by the total number of donors and multiplying the resulting number by 100.
Industry Standard: The average donor retention rate is around 40-45%.
Donor Lifetime Value (DLV): The overall dollar value an individual donor or group will provide your organization over their lifetime. To calculate DLV, multiply the donor’s average length of time as a donor by their average donation amount, and then multiply that number by the average frequency of giving.
Industry Standard: Though your specific DLV may differ based on a number of factors, research from Virtuous shows the average DLV for nonprofits is $648.
Fundraising Metrics
Average Gift Size: The average dollar amount donors give to your nonprofit. Calculate it by dividing the total number of funds raised by the total number of donations made.
Industry Standard: The average size of a one-time nonprofit donation is $115, according to M+R Benchmarks.
Cost Per Dollar Raised (CPDR): How much money your organization has to spend to bring in one dollar through fundraising. Calculate this by dividing total fundraising expenses by total funds raised.
Industry Standard: Typically, nonprofit leaders try to shoot for spending only 20 cents for every dollar raised.
Matching Gift Rate: The percentage of charitable contributions matched through corporate philanthropy programs. Calculate this by dividing the number of donors who secured a donation match by your total number of donors. Then, multiply the resulting number by 100.
Industry Standard: Matching gift rates vary by organization. However, an estimated $2-3 billion is donated through matching gift programs annually.
Marketing Metrics
Sources of Website Traffic: How visitors get to your nonprofit’s website. Common types of traffic include organic traffic (users who land on your site after a Google search), referral traffic (users who click on a link on another site and land on your website), and social traffic (users who follow a link from social media to your site).
Industry Standard: Organic traffic is the biggest source of nonprofit website traffic, with 44% of website visitors coming from search engines.
Email Open Rate: The percentage of recipients that open your organization’s emails. Calculate this by dividing the total number of opens by the total number of recipients. Multiply the resulting number by 100 to yield a percentage.
Industry Standard: Mailchimp reports the average email open rate for nonprofits is about 26%.
Conversion Rate: The percentage of marketing material recipients that take a desired action after receiving one of your messages. Calculate this by dividing the number of recipients who took a desired action by the total number of recipients. Multiply the resulting number by 100 to yield a percentage.
Industry Standard: You can measure your conversion rate for several different actions. As an example, the average conversion rate for nonprofit donation pages is 16% for desktop users and 10% for mobile users.
Using and Analyzing Your Data Effectively
Are you ready to get started with nonprofit data analytics?
The good news is this: Your nonprofit likely already has a lot of useful data it can use! Here’s how:
Make the most of your existing data by first auditing and cleaning the information. Not all the data you have stored will be useful for your nonprofit. Plus, some of it may be incorrect or outdated. Take the time to comb through the information and ensure all of it is useful. Going forward, you can standardize what types of data your team collects and how it is input into your database so that you can keep your data clean.
Next, collect any additional data you may need. There are several ways to do this, from sending out custom surveys to your donors and beneficiaries or turning to the reporting features in your marketing tools. You may also want to leverage publicly available datasets from government agencies or academic institutions to further contextualize the information your own team gathers.
From there, you can begin analyzing your data. This will involve looking for trends and patterns, or the stories that your data is trying to tell you. Can you pinpoint why your fundraising revenue dipped last year? What do the numbers have to say about your volunteer retention rate? Looking for simple cause and effect will help you gather the insights you need to make improvements to your operations.
This process can become increasingly complex as your organization and its data collection grow, and you may soon need to turn to more robust data storage, management, and analysis tools rather than relying on a mile-high pile of spreadsheets.
We recommend using a nonprofit database, also known as a CRM, such as Salesforce!
At Deep Why Design, we specialize in helping nonprofits make the most of their data using the many tools Salesforce has to offer. Here are some services we offer for nonprofits:
Office Hours: This flexible support arrangement empowers your organization to tap into expert Salesforce assistance when it needs it.
Advanced Office Hours: Have more complex Salesforce needs? This service gives you access to our senior team’s expertise in complex architectures, tricky problems, and enterprise solutions.
Custom Projects: We work with you to create unique solutions in the Salesforce ecosystem that meet your specific needs.
Wrapping Up: Getting the Insights You Need to Succeed
When you know how to harness the power of nonprofit data analytics, there’s no need to stumble in the dark when it comes to making decisions for your organization. Use this guide to kickstart your data analytics journey, and consider investing in robust tools (such as a Salesforce CRM) to make the process easier for your team. The experts at Deep Why Design stand ready to help!
To learn more about using your data effectively, check out these additional resources:
Nonprofit Data Sharing: What Your Nonprofit Needs to Know. Sharing data is essential for building strong relationships with your stakeholders and the broader community. Learn more here!
How to Use Salesforce for Nonprofits: A Complete Guide. Ready to get started with Salesforce? Get all the information you need in this article.
Nonprofit Collaboration: A Guide to Successful Partnerships: Can collaborating with other organizations increase your organization’s capacity for good? Find the answer to this question in our full nonprofit collaboration guide!