Online fundraising revenue stayed flat in 2023, declining by an average of 1 percent from the previous year, according to a new report by M+R, a consulting firm that works with nonprofits. The annual “Benchmarks” report analyzed data from 225 nonprofits, most of which are not M+R clients.
One explanation could be that nonprofits are still recalibrating from the high highs and low lows of 2020 — when the pandemic rocked revenue models and supercharged demand for services. Donors responded to the profound need and racial justice protests nationwide, funneling dollars into social services and civil rights groups, in particular. That first pandemic year saw online giving soar 32 percent over 2019 levels. Online gifts to hunger and poverty organizations grew an astounding 173 percent.
In the shadow of that unprecedented year, nonprofits have been searching for a new normal. Giving grew 3 percent in 2021 and fell 4 percent in 2022.
Pandemic giving reset the baseline for expected online revenue at many nonprofits, says Will Valverde, creative director at M+R. “The changes have been pretty small over the last couple of years, based off of that 2020 baseline.”
Monthly Giving Up; Email Gifts Down
A bright spot during the last few years has been recurring giving, a growing source of revenue for nonprofits. In 2023, nonprofits received 6 percent more, on average, in revenue from monthly gifts. What’s more, these contributions represented 31 percent of all online revenue last year.
The growth in monthly giving revenue has appeared on M+R’s annual survey since the pandemic. “I do think that trend is going to continue, I do think it’s important, and I think it’s good,” Valverde says. “Being able to predict that revenue allows for planning.”
Email revenue, however, was a different story. Revenue from donors who clicked on an emailed donation link fell 7 percent, on average, according to the report. On December 31 — arguably the most important fundraising day of the year — email revenue fell 10 percent.
The email revenue decline occurred even as nonprofits sent more emails — an average of 59 messages per supporter on their distribution list. That’s 12 percent more than were sent in 2022. Despite the higher volume of appeals, nonprofits raised just $76 for every 1,000 emails they sent — a 20 percent decline from the previous year.
“The challenge of running an email program is: Just sending a lot more emails is not a solution in the long run,” Valverde says.
Email remains a significant source of revenue — attracting 16 percent of all online revenue in 2023 — so nonprofits still need to stay in the game. However, Valverde encourages fundraisers to search for other means to appeal to supporters, such as mobile messaging and social media fundraising.
The Value of Mobile Messaging
For the most part, mobile messaging is under-utilized by nonprofits, although some groups — such as civil rights groups — have invested heavily in it. The report found that nonprofits had 158 mobile subscribers, on average, for every 1,000 email subscribers.
However, the lists of people signed up to receive text messages from nonprofits grew 5 percent last year. And while the number of text messages sent in 2023 varied greatly from group to group, the report noted a 40 percent increase in texts sent. Mobile messages, on average, brought in more money for nonprofits than emails did. In 2023, nonprofits raised $92 for every 1,000 text messages sent. What’s more, total revenue from mobile messaging grew 14 percent.
“This is about the diversification; it’s meeting people where they are,” Valverde says. “The biggest thing that is holding nonprofits back is just not having the lists. The mobile list growth is really, really important to be investing in.”
A good place to start, Valverde says, is adding a mobile phone number field to your donation or volunteer forms. When nonprofits collect email addresses at events, he says, they should also start collecting cellphone numbers.
Roughly half of the nonprofits in the dataset said they worked with social media influencers to reach new audiences, particularly Instagram, in 2023. Nonprofits also turned their focus to TikTok last year. The number of people who followed nonprofits there grew 112 percent — far outpacing audience growth on Instagram (11 percent) and Facebook (6 percent). The number of individuals who followed nonprofits on X declined an average of 1 percent.
Although TikTok grew in popularity, it’s important to note that nonprofits still have relatively small followings on the platform. On average, nonprofits have a larger following on Facebook than on X, Instagram, or TikTok. They have an average of 1,041 Facebook fans for every 1,000 email addresses they have on file. On X, they have 527 followers for every 1,000 email addresses. On Instagram that ratio is 251 followers per 1,000 email addresses. TikTok is the smallest, with 36 followers per 1,000 email addresses.
As we inch closer to the presidential election, it will be essential for nonprofits to identify ways to meaningfully connect with their supporters online, Valverde says. “The quality of the messaging is so important.”
Among the other findings:
- Fifty-two percent of visitors to a nonprofit’s website arrived via phone while 48 percent used a computer. Donors still overwhelmingly prefer to donate by computer: 78 percent of all revenue came from these devices and 67 percent of all donation transactions happened on them.
- Nonprofits spent 12 cents on digital ads for every $1 they raised online.
- Many nonprofits offer donors the option to give through digital wallets. Sixty-seven percent accepted PayPal donations; 38 percent accepted Apple Pay donations; and 30 percent accepted Google Pay donations.