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Higher-ed fundraising up, donors down

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Higher-education fundraising

Higher-education fundraising

Higher-education fundraising in 2011 generally improved from 2010, according to key performance metrics, with revenue generally growing but donors declining  in the wake of the recession, a new report says.

Revenue at over 100 public and private colleges and universities posted median growth of 6.1 percent, and overall retention rates grew slightly, says the 2011 Index of Higher Education Fundraising Performance from Blackbaud.

“Most measures were in positive territory compared to 2010 results, and there is evidence that the worst of the economic decline is behind us and programs are beginning to grow again,” it says.

Still, rates for reactivation and participation of donors continued to fall, the report says.

Median rates for reactivation of lapsed donors fell 6 percent, while overall alumni donor counts fell 1 percentage point to 10 percent overall after two years at 11 percent.

“This returns us to the trends that pre-dated the great economic recession with donors down, dollars up,” the report says.

The results suggest that “recapturing these lapsed donors in mass will not occur and they are lost indefinitely,” it says.

“Reactivation continues to be the biggest challenge facing higher-education annual-giving programs,” it says

Revenue

Revenue per retained donor grew to $584 in fiscal 2011 from $549 in fiscal 2009, with public and private schools both posting increases each of the past three years.

Median revenue among all donors grew to $474 per donor in fiscal 2011 from $400 in fiscal 2009, although it fell to $583 in 2011 from $591 in 2010 for private schools after growing from $550 in 2009.

Median revenue per donor grew to $416 in fiscal 2011 for public schools from $356 in 2009.

Overall median revenue per new donor fell slightly in 2011 compared to 2010 and 2009, growing to $136 from $120 for public institutions, while falling to $100 from $117 for private schools.

And median revenue per reactivated donors grew to $387 in fiscal 2011 from $314 in fiscal 2010 at private institutions, while falling to $271 from $274 at public institutions.

Donor retention

Retention rates for first-time donors have stayed flat for the past three years, growing slightly each year for public institutions, to 27 percent in 2011 from 25 percent in 2010 and 24 percent in 2011, while dipping to 27 percent in 2010 from 30 percent in 2010 for private schools and then growing to 30 percent in 2011.

Still, overall first-year retention rates are down from the levels a decade ago, when they typically totaled in the mid-30-percent range, the report says.

“First-time donors are more difficult to retain,” it says, “and as more schools focus on senior-giving programs, these rates have gone down in general, in large part because retaining senior-class donors in their first year as alumni is particularly challenging.”

Median retention rates for multi-year donors were flat at 66 percent in fiscal 2011, compared to 2010, , and up only slightly from 64 percent in 2009.

“Despite the economy, in general, retention rates, particularly among the most loyal donors, have been fairly consistent,” the report says.

Still, it says, private and public institutions had their weakest year in 2009, when each was three percentage points lower than in 2010, when retention rates rebounded.

Overall retention rates for all donors were consistent for the past three years, up slightly each year.

After falling to 59 percent in 2009, the median donor retention rate grew to 61 percent in 2010 and to 62 percent in 2011.

The median donor retention rate grew to 66 percent in 2010 from 65 percent in 2009 at private institutions, and to 67 percent in 2011, while it grew to 58 percent in 2010 and 2011 from 55 percent in 2009 at public institutions

“Looking back to the weakest year in history, 2009, donors were retained at their lowest rate in the three-year timespan, but only modestly lower, which indicates despite the economy, donors were mostly consistent in their behaviors,” the report says.

Alumni

Overall donor counts fell 1 percent in fiscal 2011 from fiscal 2010, when they dipped 0.5 percent.

“Acquiring new alumni donors continues to be difficult,” the report says.

In fiscal 2011, the overall change in the number of new alumni donors fell 2.1 percent, following losses of 1.9 percent in fiscal 2010 and 3.5 percent in 2009.

“Many programs find it more challenging to acquire new alumni donors, but others have shifted away their focus from alumni to other markets, such as parents and friends, for acquisition efforts,” the report says.

So the negative trend “is being influenced by a shift in strategy for some institutions, but also marks the continued challenge with acquiring new alumni donors, especially true among younger alumni,” it says.

It also says the impact of the younger generation of alumni “less inclined to support higher education continues to erode overall participation rates.”

Participation rates fell 33 percent in fiscal 2011 in the wake of declines of 2.9 percent in fiscal 2010 and 6 percent in fiscal 2009.

“The opportunity to bolster participation rates has all but disappeared in an era where younger alumni are not inclined to support higher education as the same rates as their parents and grandparents,” the report says. “This trend, for most programs, is likely not reversible and we’ll continue to see participation rates decline.”

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