GuideStar and Hope Consulting have released the results of new study, Money for Good II (MFGII).
The findings suggest that if nonprofits are more transparent in sharing information about their results online that they could attract more donors. The research found that two-thirds of individuals do not typically research the organizations they donate to compared those that advise donors and foundation grant-makers do due dilligence on every dollar they contribute. Despite these different approaches – giving from the heart versus the head – both groups want a broad range of information on the nonprofits’ impact, financials, anad legitimacy.
The study also states that donors want to be able to obtain this information from third-party portals and 53 percent of donors survyed want to use such sites. There is a high demand for data that shows how the nonprofit has been effective and made an impact. The research also suggests that if donors had better information to make their decisions and 5% used it to donate to the most effective nonprofits, this could lead to shift of $15 billion in contributed income to be invested in high performing nonprofits.
The study states that these findings offer an opportunity for nonprofits to better connect with donors by providing more detailed information about their performance and it is also an opportunity to educate donors about the need to research before donating.
The study points out that nonprofits can increase their fundraising and improve operations through an intentional focus on measurement – that helps them determine impact, effectiveness, and efficiency. After financial information, individual donors want information about how nonprofits are getting their results. (See above).
Does your nonprofit have a measurement system in place so that you can communicate results to potential donors?