The 80/20 Rule Is Alive And Well In Fundraising

We have all heard some form of the 80/20 rule as it is mentioned so many times in our daily lives. Some examples heard over the years include:

  • 80% of the crops harvested come from 20% of the farms
  • 80% of sales come from 20% of the sales force
  • 80% of TV is viewed by 20% of the viewing audience

Now we can boldly and accurately make the same type of claim in regards to fundraising dollars raised by small and medium size nonprofits in the United States!

Thanks to incredible efforts of the Urban Institute and the Association of Fundraising Professionals these findings are readily available via the Fundraising Effectiveness Project.

The Two Most Enlightening Findings

The entire FEP report is filled with marvelous insights taken from actual data from thousands of individual donor databases.  If you are a data analyst at heart this could be the report you cannot put down.  However, if you are like most fundraisers who are not hard-core statisticians the two key findings below can be quite useful.

First, even stronger than the old 80/20 rule:

88% of Gifts Come From 12% of Donors

Second, as if that was not enough, look what just 3% of the donors provide:

76% of Gifts Come From 3% of Donors

Here is a link to the full infographic from which the section below was taken from.

What Can The Findings Mean?

A single word is used over and over as these findings are discussed with fundraisers and fundraising consultants. The word is FOCUS.

When so much in the way of revenue can be derived from either 3% or 12% of any donor database, extra focus on identifying and building relationships with both groups is time well spent.

Just imagine the additional success forthcoming if even better relationships are in place with the 12% providing 88% of the funding already!

We sincerely hope these key findings as well as the wealth of other information in the current Fundraising Effectiveness Report prove to be invaluable evidence in shaping your future fundraising success.

In future posts we will explore other aspects of the report and share more comments from the field. Please stay tuned!

Bill Levis
Bill is Project Manager of AFP’s Fundraising Effectiveness Project (FEP) and an Affiliated Scholar in the Center on Nonprofits and Philanthropy at the Urban Institute in Washington, D.C.He has a long history of investigation into fundraising costs and productivity with numerous articles, papers and projects going back to the 1970s, when he organized and directed the NSFR Fundraising Cost Study (1975–1981).
Posted in Fundraising.

4 Comments

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