KPIFundraising & Income

Fundraising Return on Investment (ROI)

Revenue raised for every dollar spent on fundraising activity

What is Fundraising Return on Investment (ROI)?

Fundraising return on investment is the income raised for every unit spent on fundraising. It shows how much a charity gets back from its fundraising budget.

It is the reverse of the cost ratio, and helps decide where to put fundraising resources.

How this KPI is measured

Function
Fundraising & Income
Sub-function
Campaign Performance
Industry
Not-for-Profit / Charity
Type
Lagging
Impact
Financial control
Unit
x
Measurement frequency
Quarterly / Annual
Formula
Total fundraising income / Total fundraising expenditure

How to calculate it

Divide total fundraising income by total fundraising expenditure.

For example, if a charity raised 1,000,000 by spending 250,000, the return is 4, meaning 4 raised for every 1 spent.

Calculate it by channel and campaign, and remember that some investments, such as donor acquisition, may be loss-making at first and pay back over the donor's lifetime.

Where it is used

  • Allocating fundraising budget

    Invest where returns are best.

  • Evaluating campaigns

    Compare results.

  • Making the case for investment

    Show trustees and funders.

How to improve it

Tips and common mistakes

  • Acquisition often costs more than the first gift raises.
  • Use a consistent cost definition.
  • Look at multi-year returns.

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