The sirens lure sailors to their deaths. A mirage tricks the parched man crawling in the desert. The shape shifter deceives another victim. And, vanity metrics keep trapping helpless nonprofit boards with their bright, shiny, deceptive aura of significance.
But like the sandcastle that washes away in the tide, vanity metrics hold no water and have little lasting value. Yet, nonprofit boards continue to put them on the agenda and admire them.
Like everyone in the nonprofit world, board members are busy, and board meetings have limited time to complete all their tasks. One of the worst ways to use that time is to spend it fawning over vanity metrics that have little to say about your nonprofit’s fundraising efforts.
Let’s take a look at six vanity metrics your board would do well to start ignoring – at least during official meeting time.
Social Media Followers
You could probably guess this one would be on the list. While it feels great to have lots of followers, we all know – because we follow other accounts too – that the vast majority of these followers will never do anything, ever, with regard to your organization.
The greatest value of having a large follower count is, in theory, that your posts will get seen by a wider audience. And that’s not nothing. We’re not saying vanity metrics have zero value or significance, just that it’s minimal and not worth devoting any official board meeting time talking about.
On social media, engagement metrics such as shares, comments, and actual conversations matter much more. If you’re hoping your social followers become donors one day – not counting those who already are – those metrics speak much more highly to that.
Website Traffic
Ah yes…Google Analytics. We all love seeing how much traffic comes to our websites from all the various sources it tracks.
But if you’re going to look at website traffic, you have to also look at your bounce rate. If your bounce rate is 70% or higher, that means the great majority of your website traffic is visiting just one page and then leaving. Web traffic alone doesn’t do much for you on its own.
What matters more is how many site visitors convert by taking some sort of action. That action could mean they joined your email list, downloaded an eBook or other resource, filled out a form or survey, donated, or even just visited a bunch of pages and spent quality time on your site.
Another good web traffic metric to track is how many visitors end up on your donation page, even if they don’t make a donation. Visiting the page means they had enough curiosity to at least look at it. That means, if whatever brought them here brings them back again, they could become a donor.
Number of Donors
Wait, what?
Isn’t it good to have a larger number of donors?
Yes, of course it is. But if you overly fixate just on this metric, its value diminishes to the level of vanity. Why? Because the number of donors only matters when paired up with average donation amount or donor retention.
Suppose you had 1000 donors last year, and this year you doubled it to 2000. In one year! Amazing! Well, maybe not. Someone got you to act on an idea to run a fundraising drive at a local school, and a bunch of kids participated. Most of them gave less than five bucks. So yeah, you got a lot of donors, and it’s great to get the kids involved in any level of giving. But as a metric, that doubled donor count doesn’t mean much.
If your average donation amount increases in tandem with your number of donors, now you have something a little more firm to talk about. This is why tracking your donors at five giving levels is so smart, and is a key feature of the Fundraising Report Card.
You want to know how many donors are giving more than $5000 per year, between $1000, and $5000, between $250 and $1000, and between $100 and $250. Tracking the number of donors in these giving levels reveals much more valuable information.
In the previous example, nearly all the new donors would fall into the under $100 level. And most would be one-time donors too, with practically zero donor retention. Even with a low giving amount, if low level donors turn into repeat or monthly donors, now you’re building a relationship that could turn into something bigger later.
Event Attendance
This one is tricky, because well-planned events can result in a substantial return on investment. The problem is, many event attendees end up being one-time donors. That means you have to find a good number of new people to show up next year to repeat the previous year’s success.
Your goal from events isn’t just the immediate donations, but long-term engagement and follow-up. New donor relationships. Word of mouth. New volunteers. Get them into your email list and in your donor database so you can work on forging a real relationship with some of these people, one that lasts for years.
Email Open Rates
Open rates are valuable in terms of maintaining good email deliverability. That means fewer of your emails get blocked or end up in spam folders. So, like social followers, there is a benefit to this. But in terms of dollars raised, open rates mean little. Just opening an email doesn’t even mean the person reads it, let alone acts on it.
What matters more are click through rates, click to open rates, and conversion rates for people who click the link in the email and take action. That action could be donating, filling out a survey, signing a petition, or various other actions.
And to be clear on these terms – ‘click through rate’ means the number of people who clicked compared to the number who received the email. If 1000 people get the email and 20 of them click on a link inside it, that’s a 2% click rate.
Now, if 400 people opened that email, that means 20 out of 400 of those clicked. You can’t click if you don’t open. So, the click to open rate is helpful because it speaks to how well your email engaged the people who actually saw it. In this example, the click to open rate would be 5%.
You’re probably seeing a pattern here.
The more valuable fundraising metrics are the ones that speak to engagement, relationship, financial transactions, commitments, and other actions that advance your mission in significant ways. Here’s the last vanity metric you can stop giving attention at board meetings:
Press Coverage
It sure feels good to get your name in the news. And when your nonprofit is in the news – in a positive light – this can work wonders in raising awareness for you and your mission.
But once again, does that heightened awareness translate to more donors, more volunteers, or more supporters? Can you leverage this attention while it lasts and win some new loyal followers? It’s not easy to do.
You need a plan that seizes the moment and converts all that extra attention into something that lasts. Media coverage comes, and then most of the time, it goes away and never returns. You need to capitalize on it when it happens or it becomes just another vanity metric – a great story you like to tell people.
A Better Set of Fundraising Metrics
What fundraising metrics actually give you information you can act on, build on, and respond to with real strategies? Which metrics speak to your financial growth or decline?
The Fundraising Report Card produces a great number of them in seconds. A few of these valuable metrics include:
- Donor lifetime value
- Donor retention rate
- Average donation value
- Donor churn rate
Other valuable metrics you can track yourself include actual funds raised in a particular campaign, and donor acquisition costs.
These and other fundraising metrics enable you to craft new strategies because you know what worked and what didn’t. That leads to more sustainable growth.
So, have fun with vanity metrics if you want. But don’t waste your board meeting time talking about them. You can play with your vanity metrics when your chores are done.
