6 trends from the 2023 M&R benchmarks report, to boost any digital fundraising strategy
Christmas has come early, fundraisers: the UK M&R benchmarks have landed, and it's jam-packed with takeaways to supercharge any digital fundraising strategy. If you missed yesterday's webinar, fear not: here's a roundup of key insights, and what it means for charities right now.
+5%
Online income rose again, suggesting the pandemic-era shift in donor behaviour has not simply reversed.
+14%
Monthly giving increased year on year, becoming the main driver behind overall online income growth.
41%
Of UK online income came from monthly donors, putting the UK ahead of non-UK benchmarks for monthly giving propensity.
The rise in digital income is here to stay — rising by 5% this year. If you’re not already testing your way into digital, you need to start to do it, now.
Yet again, online income has risen. This year, by 5%. While this year’s rate is nowhere near the year-on-year revenue change we saw during the pandemic, which saw increases of 43% (2018-19) and 55% (2019-20) respectively, it’s not done a u-turn. Which is, itself, huge: showing the change in donor behaviour is very likely here to stay. Despite increasing costs for so many of us, people are turning up more generous than ever, which is also heavily contributing to rising income — with the average cash donation increasing from £56 to £61, and for monthly donations, from £10.79 to £11.49.
Digital fundraising is no longer the emergency channel.
The pandemic accelerated online giving, but the important signal is that income has not fallen back to where it was before. Digital now needs to be planned as a permanent fundraising system, not a temporary response.
Monthly giving has increased by 14%, marking a seismic year-on-year shift for the UK which now outpaces the USA for monthly giving propensity.
What’s even more fascinating is where the online income’s coming from. The rise of 5% cannot be explained by cash income alone, which has only risen by 1%: it’s largely down to monthly income, which has increased by 14%. This is a huge shift, for the UK – and one that contradicts fears at the onset of the cost of living crisis, that monthly donations would be too high a barrier for donors during a period of financial instability. While non-UK charities observe 27% of online income coming from monthly donors, for the UK it’s huge, at 41%, presenting the UK market as one that’s set to lead the way with monthly giving. Looking ahead, it’s going to be more important than ever for charities to shape tailored strategies and segmented programmes to delight and retain their most reliable supporters or risk losing them for good.
Benchmark signal
Monthly giving is becoming the growth engine.
When cash giving is only inching up but monthly income is rising sharply, the lesson is clear: regular giving needs dedicated propositions, journeys, stewardship and retention strategy.
Health oriented charities remain strong but saw a 4% drop in income — with data suggesting their donors may be giving to hunger and poverty organisations helping fight the cost of living crisis
Historically, health charities have dominated the landscape: and still, they make up the lion’s share of charitable income. However, while their average gifts grew the most (19%+ in cash donations and 9.5%+ in monthly donations), their online income dropped by 4%. This is the only issue area that saw a notable decrease in this year’s M&R benchmarks, and though it sounds small, given the scale with which health charities operate, this 4% represents a large chunk of displaced income. It seems donors may be looking elsewhere. While wildlife and animal charities continued to rise, it’s interesting to see charities helping with Hunger and Poverty saw an 11% rise in online income too — and an increase of 8% in average monthly gifts. While it’s too early to tell the longevity of this switch, this may indicate the rising awareness among the public of the protracted nature of the cost of living crisis and the need for ongoing community support.
Health still dominates
Health charities remain a major force in online income, with strong average gift growth and large established donor bases.
Need is shifting attention
Growth in hunger and poverty giving suggests some donors may be responding to the cost-of-living crisis by supporting more immediate community need.
Increased email churn and declining revenue could be counterbalanced by us being a little less British and asking donors for cash a little bit more
While email churn increased from 5.9% to 6.8% this year, and email revenue decreased by 19%, this mainly affected small and medium charities — with email revenue increasing by 150% in large charities with a £3M+ income. As discussed in the M&R webinar, the issue may be in our nervousness about making the ask in the UK — we are, after all, a very polite nation. This year’s benchmarks revealed that, as a nation of email fundraisers, we’re very conservative in our fundraising: sending, on average, only 6 fundraising asks a year compared to our non-UK counterparts, who send on average 29. With unsubscribe rates on fundraising messages being lower than last year (decreasing by 10%), donors know as charities we need to make the ask, and don’t necessarily unsubscribe when we do — we shouldn’t be afraid to ask more often, to counterbalance the decline in revenue each email typically receives.
Being polite is not a fundraising strategy.
If donors understand the need and unsubscribe rates are not spiking, the answer is not to avoid the ask. The answer is to ask with relevance, clarity and respect — then measure what actually happens.
Charities are shifting more of their brand awareness spend into lead generation and list growth activity, with lead gen rising to 15% of ad spend
Organisations are investing in list growth via Paid Media to counterbalance the decline in email income: with list growth activities continuing to rise, this year, by 17%. For every 100K email subscribers at the start of 2022, nonprofits acquired 24,000 new subscribers via ads. It seems charities may be shifting awareness activity into data-capture oriented activity: paid media spend on awareness campaigns decreased to 8% this year, while investement in lead gen increased to 15%. The 20% / 80% awareness split is a thing of the past, as organisations seek to drive multipronged awareness approaches through engagement mechanics that strategically capture data in one, fell swoop.
Reach
Use paid media and content to find people with a real connection to the issue, not just the cheapest possible audience.
Capture
Give people a reason to share their details through petitions, quizzes, guides, pledges, downloads or other meaningful engagement mechanics.
Nurture
Use welcome journeys, email sequences and retargeting to build trust before moving too quickly into a cold donation ask.
Convert
Make the ask when the supporter has enough context, belief and urgency to act — then learn which routes create real value.
While Meta and Search will remain leaders for some time yet, larger organisations are starting to diversify platforms — with TikTok one to watch, for lead generation
While for small charities 97% of ad spend went on Meta, for larger charities, it was a different story: with just 52% of their going on Meta. While the likes of TikTok aren’t yet strong advertising platforms for most charities, with the CPA for a lead being twice that of Meta (£5.75 versus £2.70), presence is growing — and we can expect to see more test and learn activity in this space, as you can read more about in my blog, The Dilemma of Diversification.
TikTok was an active platform for 30% of the nonprofits M&R surveyed this year, which is a notable growth — and something that, given time, will surely lead to increased digital budgets, which in the short-term will focus on driving traffic and leads accompanied by daisy-chain conversion activity. The writing’s on the wall, for Meta: while it’s still the best for social return on investment, returns decreased this year by 41% and charities will invariably start to look beyond short-term donate campaigns to longer-term nurturing which emerging, engagement based platforms are showing they’re able to acquire fairly effectively.
Meta still works
For many charities, Meta and Search remain the most immediate places to start because the returns are clearer and the mechanics are familiar.
But dependence is risky
Falling returns and growing platform diversification suggest charities need to test beyond the channels that have historically carried the whole programme.
One thing that’s clear, from this year’s report, is that any charity that’s not already investing in and prioritizing digital fundraising needs to adapt, quickly, or risk falling behind. As this year’s M&R report outlines, Meta and Search is the place to start, with these platforms commanding the strongest ROAS. If you’re not already testing your way into digital fundraising, check out Testing & Learning: a 5 Stage Checklist that Gets Results for tips to get started.
What the 2023 benchmarks are really saying
- Online giving is still growing, so digital fundraising needs proper long-term investment.
- Monthly giving is becoming a central income engine, not a secondary ask.
- Email programmes need more confident, relevant fundraising asks.
- Lead generation only works when there is a real nurture and conversion journey behind it.
- Meta and Search remain important, but charities should start testing a broader channel mix.
