Nonprofit fundraising has always been a challenge. Convincing audiences, even your most passionate supporters, to donate their hard-earned money is never an easy task. It takes careful strategy, relationship-building, and (increasingly) the right tech toolkit.
In 2020 and beyond, fundraising won't get any easier, but that doesn't mean you can't continually improve your strategies and approach! In fact, tech developments and current events all point to exciting new opportunities for nonprofits that are ready to rise to the challenge. Consider these points:
- Don't forget that it's an election year! Your supporters and donors certainly won't. As social, environmental, and political issues are at the front of people's minds, organizations with related missions can see significant boosts in engagement thanks to this "election effect."
- According to these statistics compiled by NP Tech for Good, Americans gave upwards of $427 billion to charity in 2018, mostly through individual donations. Though individual giving has continued to decrease slightly over recent years, recurring giving options have become more popular. Revenue from recurring donations has grown by roughly 18% and is expected to continue growing. Understanding shifts in donor preferences will be essential for success in 2020!
- Social media and online communication are more central to our everyday lives than ever before. Peer-to-peer fundraising and other decentralized, people-centric strategies continue to be extremely effective at reaching wider audiences and raising support. 55% of donors to P2P campaigns report that they were motivated to give because they care about the friend who asked them to. Building strong relationships with donors and then empowering them to spread your mission will be a winning strategy in the coming years.
Changing trends and tools certainly affect the nonprofit fundraising landscape in ways that are important to recognize and then adapt to. However, fundraising professionals have also nailed down a core set of tried-and-true best practices over the years that can strengthen any strategy.
If you're new to nonprofit fundraising (or just want a quick refresher), you've come to the right place. We'll walk you through the essentials of nonprofit fundraising. Let's start by breaking down the process into these core steps, presented in a checklist for easy downloading or reference:
Nonprofit Fundraising Checklist
Or, if you want to jump ahead to a specific section, use these links:
- Purpose and goals
- Fundraising toolkits
- Nonprofit audiences
- Fundraising strategies
- Campaign planning
- Getting started
Before diving in headfirst, start by double checking that your organization is set up to begin accepting donations online. That basic function is essential to start building more advanced strategies down the line. Ready to get started? Let's go.
1. Define the purpose and goals of your nonprofit fundraising campaign.
Prior to getting started with any type of nonprofit fundraising campaign or project, it's essential that you determine some concrete goals and define your overarching purpose. Why?
Without a clear target, it's incredibly easy for even the most experienced fundraisers to lose focus. For nonprofit teams and resources already stretched thin, you can't risk derailing your efforts that way. Plus, without concrete goals, how will you measure your success and work to improve your campaigns in the future?
You probably already have a purpose for your nonprofit fundraising campaign in mind. Whatever the reason you need to raise funds, it can likely be broken down into one of these main categories:
- Raising money for a specific project (restricted funds)
- For a particular initiative, event, or program related to your mission
- For major internal development, also called a capital campaign
- Raising money for general operating support (unrestricted funds)
- Typically for your annual fund, also called an annual campaign
If you're fundraising as a 501(c)(3) organization, understanding the differences between these types of campaigns will be important since you can only use restricted funds for the specific project that you promoted to your donors. Unrestricted funds can be more difficult to raise, but they go towards any more general operating expenses that your nonprofit needs to cover.
Pro tip: your year-end fundraising campaign is a great time to raise some unrestricted funding from generous donors!
Next, you'll need to determine specific goals for your nonprofit fundraising campaign. Use key performance indicators (KPIs) to measure them. KPIs are the particular metrics that help you gauge progress towards those goals and that you'll ultimately use to determine whether or not your campaign was a success. Typical KPIs for nonprofit fundraising include:
- Total amount raised
- Number of individual contributions
- Number of new donors acquired, or number of previous donors retained
- Amount raised through specific channels, like online donations or text-to-give
- Conversion rate of a particular outlet, like your donation page, emails, or social media promotions
- Total event registrations or ticket sales
- Cost per dollar raised, or overall return on investment for the campaign
The particular KPIs that you use to measure your progress towards your goal will depend on the nature of your campaign. The most important thing to remember, though, is to simply give yourself a way to measure it!
This is one reason why fundraising technology is such a gamechanger for nonprofits. Digital tools and online fundraising generates discrete points of data that make it incredibly easy to measure, track, and analyze your campaigns. We'll touch more on the importance of fundraising data in a later section. For now, let's review the types of fundraising tools that you might want to utilize in your campaign.
2. Build your nonprofit fundraising toolkit.
If you're new to nonprofit fundraising, specifically online fundraising, you'll want to start building your toolkit now. Getting set up with easy-to-use fundraising tools early in the process can give you a serious leg up when you begin nailing down the specifics of your campaign.
If you already have some fundraising tech at your disposal, take the time to review your current toolkit before launching a campaign. Is there anything missing that you'll need? Does anything need an upgrade? Fill those gaps ahead of time to ensure more seamless fundraising.
For smaller nonprofits, remember that you don't need to sacrifice quality for cost. There are plenty of professional-grade tools on the market that are well-suited to the needs of growing organizations, many of which (like the Soapbox Engage suite of apps) come as part of a ready-made toolkit! Look for these pre-configured sets of tools to save your team time and money down the line.
Types of Fundraising Tools for Nonprofits
As you begin your search, familiarizing yourself with the different types of fundraising software and platforms out there can help guide the process:
The essentials for any organization:
- Online donation tool. This is your main donation form where supporters make online donations to your nonprofit. Ideally, this tool will save the transaction data in intuitive ways to help you learn more about your campaigns. Learn more with our guide to donation apps.
- Database software. Also called a constituent relationship manager or CRM, your central database is where you store important data about donors, their donations, and your campaigns. A comprehensive database is an invaluable asset for growing organizations. Even if a dedicated CRM isn't in the cards for your nonprofit yet, you should still take pains to develop a way to track important data and keep it organized.
- A functional, well-designed website. These days, every organization needs a great website that works well, hosts your donation tools, is organized intuitively, and functions on screens of all sizes - desktop and mobile. Nonprofit web design projects can be very smart investments for some organizations.
- Event registration tool. Most nonprofits, large or small, host events of one kind or another. If yours does, you need a way to allow supporters to register online without having to constantly go through a third-party platform. Keep it simple by handling the registrations yourself on a branded page. Plus, this gives you easier access to your event engagement data.
- Form-building tool for surveys. Online surveys are one of the most effective ways to get direct feedback from your donors and volunteers. With an easy-to-use form builder, you can ask your supporters exactly the question you need and be sure that their answers will get saved properly for you to review later.
Extra tools to consider as you grow:
- Advocacy tools. If your mission relates to social, environmental, or political issues, advocacy could be a very smart way to make an impact in 2020. Look for tools that let you set up online petitions and configure target actions. Learn more with our before-you-buy guide.
- eCommerce functions. The ability to sell merchandise, memberships, and other goods on your organization's website may come in handy down the line! Keep eCommerce in mind as you plan your campaigns since branded items are a relatively low-stakes add-on for all kinds of projects (especially events).
- Class registration tools. Like event registrations, class sign-up tools could be useful if your organization offers classes or courses to its members or community members. These are great ways to deepen relationships with your supporters, especially if you're a smaller, community-focused or advocacy-oriented organization.
- Physical POS tools. Point-of-sale or POS tools allow you to collect card donations in-person at events or meetings. The most popular options will connect directly to a smartphone or tablet. Make sure to look for the tools that offer payment processing options in line with your own needs. Inflexible options or unreasonably high fees can take huge bites out of your donation revenue.
Nonprofit fundraising technology has come a long way in just a short amount of time. There are so many options out there, so it's important to have a general understanding of both the field and your own needs. Always take the time to research your options and get a feel for the providers available.
Want to see a few of our top picks on the market? Check out today's top donation software options here.
3. Understand your nonprofit's audience.
This step is crucial, and it's also one that too many smaller nonprofits tend to neglect when fundraising online.
Think carefully about your organization's audience and ideal donors. Who are they? Why do they support your cause? You'll need to think long and hard about these questions and more before you begin blindly asking for donations. Understanding the emotional connection that draws supporters to your cause makes for much more compelling asks, and it greatly boosts your chances of fundraising success.
Why? Because blanket requests and one-size-fits-all messages do not effectively motivate donors to give. We're bombarded with tons of advertisements, emails, and online content these days. Your own fundraising campaign has to stand out, especially when you're promoting it online or through social media. The best way to do that is to target your messages specifically to your donors, not to a general audience.
Your supporters engage with your nonprofit because they believe in your cause, so make the most of that emotional connection with storytelling techniques, high-quality photos, and personal stories about your impact. Check out our longer walkthrough of nonprofit marketing strategies for more in-depth tips and resources!
For growing organizations with larger contact lists, there are extra steps you can (and should!) take to focus your efforts even further. Targeting specific segments of your donor base when promoting your nonprofit fundraising campaigns will greatly boost the impact of your messages and lead to more donations.
"Segmenting your donors" basically means breaking down your list of supporters into different categories in order to better target your marketing efforts to catch their attention. Nonprofits typically break down their lists into categories based on:
- Demographics, like age, gender, and location. These will help you focus your messages to have the most impact for particular groups of your donor base. If you're hosting an event, focusing your efforts on those who live close enough to attend is a best practice, too.
- Engagement history. Being able to sort your supporters by their past interactions with your nonprofit is invaluable. For instance, you'd probably want to target loyal repeat donors, lapsed donors, volunteers, and non-donor subscribers in completely different ways.
- Donation preferences. If someone has never given to your nonprofit online before but does send you checks and attend your events, you might not spend much time promoting your donation page to them. Understanding how a donor likes to give lets you actively promote the ways that you know they'll most likely engage with.
- Additional factors. Any other information that you may know about your donors can be useful for marketing purposes later on. Their employment info can open up huge corporate philanthropy opportunities, for example. Data points like these become particularly important if you're conducting prospect research before asking for a major gift.
When developing your nonprofit fundraising campaign, think about who your donors are, how you can focus your messages to appeal to them, and where they'll be most likely to see your work.
This concept is part of why having a central database to store data about your donors is crucial! An organized, professional-grade database or CRM (like Salesforce!) can unlock serious growth for your nonprofit if you track plenty of data, set up filters and segments, and put those insights to work in your communications.
4. Review some top nonprofit fundraising strategies.
Next, let's review some of the most popular and effective nonprofit fundraising strategies out there. These are a few of the different ways that nonprofits fundraise online and in-person:
Online Fundraising Campaigns
For many, online campaigns are now the first thing they think of when they hear nonprofit fundraising. The internet has definitely opened up new ways to raise money for good causes by connecting more audiences, creating new platforms, and making it easier to spread the word quickly. Generally speaking, there are three different ways you might fundraise online:
- Direct campaigns with your donation app or page. Set up your donation page, plan your marketing strategy, and start promoting your campaign directly to supporters via email, social media, and more. This approach requires plenty of planning, but it also gives you more control over the specifics of your campaign versus using a third-party platform.
- Crowdfunding. You've probably seen crowdfunding campaigns online before. The basic idea is that you set up a fundraising page on a third-party platform and describe your project. Then, you and your supporters share the page online and ask for donations, which all get pooled towards your specific fundraising goal. This is a popular choice for individual fundraising, but it doesn't give nonprofits a ton of options to really make the campaign their own.
- Peer-to-peer fundraising. This nonprofit fundraising method has become extremely popular in recent years. You develop your campaign and either configure it with your own peer-to-peer fundraising tools or a third-party platform. Then, your volunteers create their own individual pages (attached to your central campaign), which they then promote to their own network of friends online. This method is highly engaging, but you'll want to take the time to plan extra elements like contests and P2P events to really maximize results!
Fundraising Events
Hosting events is a perfect way to engage directly with your community of support while raising money. Get creative to come up with the right event that suits your nonprofit's mission and your community's interests. Or, be on the lookout for other organizations hosting events soon and opportunities to partner with them.
Before diving headfirst into an event, just make sure you've got easy-to-use registration tools set up on your site. This will help ensure you can hit the ground running once it's time to begin promoting your event. Then, study up with our complete event planning guide for nonprofits!
Advocacy and Pledge Campaigns
We touched on advocacy campaigns in an earlier section. If your nonprofit's mission relates to current social, political, or environmental issues, conducting an advocacy campaign can be a great way to raise awareness and some extra support for your work. Use an engaging petition or call campaign to reach a wide audience online, and be sure to include a simple donation ask and link to your donation page on all your posts.
Similarly, you may use a pledge-style nonprofit fundraising campaign to raise support quickly. This fundraising method involves securing pledged donations from supporters and then following up with them later to ensure they're fulfilled. Pledge campaigns are a great choice if your nonprofit wants to quickly raise support around a recent issue, like a natural disaster. Some organizations also get great results from pledge campaigns for their annual funds, too - think public broadcasting annual pledge drives!
Grants and Startup Funding
Grants are packages of financial support given by grantmaking organizations (like foundations, government bodies, or even corporations) to nonprofits that propose winning programs or projects. Grants play a huge role in nonprofit fundraising, and they're often the most important sources of support for very young nonprofit organizations.
It's definitely worth your team's time to study up on the grant seeking and grant-writing processes. Check out these pro grant writing tips if you decide to start researching your funding options.
Merchandise Sales and Partnerships
Selling your own merchandise is a reliable nonprofit fundraising strategy, especially if you host popular community events. You can't go wrong with a well-designed t-shirt!
Plus, online platforms have made it easier than ever to design and offer custom merchandise online without needing to invest in a large inventory that you might get stuck with.
Alternately, consider partnering with local businesses and merchants to boost your visibility in the community. Has a grocery store cashier ever asked if you'd like to add a donation to your total? That's a classic, effective, and low-effort way to raise some money while building relationships with local businesses.
Matching Promotions
This nonprofit fundraising strategy can be added to other campaigns or could even stand on its own depending on the specifics of the promotion. Arrange a special matching period with a partner (usually a business or extremely generous donor) during which they'll match the donations that you receive. This can be very effective during high-energy fundraising seasons, like Giving Tuesday and the end of the year. A special matching day backed up with tons of online promotions and marketing can yield amazing results!
Investing in corporate philanthropy tools that help you learn and raise more via your donors' professional connections is the best way to begin building the relationships that can eventually grow into these kinds of partnerships.
5. Craft your nonprofit fundraising campaign plan.
Now, it's time to fit all the pieces together! To recap:
- Clearly define the purpose and goals of your nonprofit fundraising campaign. Set some specific KPIs to help you measure your progress.
- Build your fundraising toolkit, starting with the basics like a donation tool, a website, and a way to record your important data.
- Think about your nonprofit's audience and brainstorm ways to target your messages to their preferences and interests.
- Brush up on top nonprofit fundraising strategies, and build your campaign around the strategy that best suits your goals and audience.
Now that you've determined these essential elements for your campaign, there are a few additional steps to take to develop a more concrete plan.
Create a campaign timeline.
Having a specific start and end date in mind for your campaign will be invaluable for keeping you on track. Plus, the countdown to the deadline can be a great motivator for donors to help you reach and surpass your goals.
Pro tip: Create benchmark periods or pick specific days during your campaign to check in on its progress. This will help you to adapt your strategies as needed while still ensuring you can focus on actually running the campaign, not just analyzing data. Just be sure you're tracking data to measure the KPIs that you've already determined for your campaign's goals.
Develop a multichannel marketing strategy ahead of time.
Many nonprofits jump into new campaigns without having put a ton of strategic thought into their marketing efforts. When it comes to fundraising (and especially online fundraising), being more prepared is always a plus.
Pro tip: Though it might sound complicated, a multichannel marketing campaign is actually fairly simple. The idea is that each of your marketing outlets, like your website, emails, and social media, should all point traffic to a central action (which will most likely be making a donation). Check out this guide for a more detailed overview of this strategy.
Take the time to customize your toolkit.
Fundraising technology has come a long way in recent years, and you have to make sure you're making the most of your tech investments. Customizations, including branding your campaign pages to your organization, making small tweaks on your donation forms to boost conversions, and updating your CRM to capture custom data points, can all make a huge difference in your ability to fundraise in the long run. Before launching any campaign, especially major ones, take some time to review your toolkit and find any potential customizations or improvements that might help.
Pro tip: Cloud-based CRM platforms (like Salesforce!) are becoming increasingly popular with nonprofits because they offer a highly-customizable, modular approach to building out your data, fundraising, and engagement toolkits. Salesforce apps can address practically any need your nonprofit might have. A broader CRM upgrade might make more sense for some organizations than tons of smaller updates.
6. Get started and review your data.
Once you've covered all the bases and nailed down the specifics for your nonprofit's fundraising strategy, it's time to launch the campaign!
Make sure to lead up to the launch with plenty of promotions to your audience, donor base, and community. Get them excited to get involved on day one! That kind of energy and momentum will be invaluable as the campaign wears on.
Hopefully, you've set benchmark periods for your team to check in on your progress. Take these opportunities to review your engagement data as it comes in and make strategy adjustments as needed. For instance, if your campaign relies on email to reach key segments of your donor base but you don't seem to be getting much engagement with your emails so far, identify that problem early and then make changes to address it.
With the right tools, this kind of analysis doesn't have to be intimidating or a hassle. By using tools that integrate directly with your CRM, you'll have real-time access to this data organized in customizable, filtered ways. Again, Salesforce is a great example of the level of functionality to look for in this type of toolkit.
As your campaign draws to a close, make sure to thank everyone who played a role. How you thank supporters and close out your campaigns plays a large role in determining your retention rates, after all! Communicate your successes with your community and make sure they understand the crucial roles they played in helping you reach them.
Wrapping Up
As you get started planning your nonprofit fundraising campaign, remember to take your time! When it comes to fundraising, success requires strategy and focus, not a one-size-fits-all approach.
Bookmark this guide and review the checklist of core steps.
Get started early, and make sure you've got your toolkit ready to go ahead of time whenever possible. Nothing derails a fundraising campaign quite like a malfunctioning tool or missing function! It's easier than ever for organizations of all sizes to get set up with professional-grade fundraising tech, so there's no reason to be unprepared.
Best of luck! You'll be raising more for your mission and projects in no time!
For more guidance and ideas, be sure to continue your research:
- Nonprofit Payment Processing: A Complete Guide and Glossary. Payment processing is essential for converting donors' gifts into actual financial support for your cause. Understanding how it works will empower you to pick the right tools best-suited to your own projects and campaigns.
- Salesforce Advocacy Software: The Before-You-Buy Guide. Does an advocacy campaign sound like a smart choice for your organization? Make sure you've got the right tools to back up your strategy and maximize your impact.
- Peer-to-Peer Fundraising: What You Should Know + Quick-Start Guide. Peer-to-peer fundraising is an extremely popular choice among all types and sizes of organizations. If you've never conducted this type of campaign before, study up with our guide.