It’s the most wonderful time of the year! No, don’t panic, it's not time to get your baubles out. But it is time to immerse yourself in the fantastic world of digital data. The third M+R and Rally UK (and now Ireland) Digital Benchmarks Study has just been released. Yes, this year we’re excited to include Irish organisations for the first time. Huge thanks to our friends at Ask Direct for making this happen.
The Study is a brilliant way to see up to date, comprehensive digital benchmark data, covering metrics as diverse as website conversion, fundraising revenue, email click rates, where charities are spending their digital ad budgets and the returns they are getting from that spend.
If you can’t measure it, you can’t manage it
We all know that better data makes better decisions. It means we can take opinions out of the mix and be guided by facts to make informed choices. And that’s because data tells us what good looks like so we can understand how we’re performing, where we could be doing better and what we can do to make our programmes more effective. It helps us work smarter too because it points to where we need to focus our precious time and budgets. All of this will enable us to inspire more people to actively participate in achieving our organisations’ goals to make change happen, which is really what we’re all here to do.
That’s why the UK and Ireland Digital Benchmarks Study is so important. So a massive thank you as always to M+R for bringing the Study to this side of the Atlantic once again. And an even bigger thank you to the 46 participating charities. Without them, the Study simply wouldn’t exist. As participants they all have access to their own specially personalised reports. But because we believe it’s so important for the whole sector to understand how it’s doing digitally, the summary data and report is available to all. Maybe it’s Christmas after all…
Our three big takeouts
Every time we do the Study it’s different: a different number and mix of participants and, of course, a different external environment. As always, there’s a lot of information to take in. But once again we’re struck by the fact that there are common themes that crop up each time and some of the biggest challenges and opportunities in the digital engagement space remain the same.
1. We’ve created - and sustained - a new normal for online revenue
The Study shows on average online revenue remained essentially flat in 2023. This might not sound particularly like cause for celebration until you consider the wider context. Only three years before, in the height of the COVID-19 pandemic, online revenue exploded, growing by an astonishing 86% vs. 2019. The following years each saw smaller levels of growth (5% each year). So we can now definitively say that there is no return to the pre-pandemic levels and that we’ve created a new normal for online revenue which we have stabilised, consolidated and sustained.
Even though we’ve not seen the explosive growth created by the unique conditions of the pandemic, to have maintained this level of revenue generation in a cost of living crisis is an achievement. But with revenue flat and the number of gifts down slightly, the question we should all be asking ourselves is how do we build from here? The data shows us that health charities have increased revenue by 9% and gifts by 13%. So growth is possible. A key takeaway is that each organisation needs to look at their data carefully to establish what is really driving or holding back their performance and take actions to grow that are right for its specific circumstances.
2. There’s still work to do to unleash email’s full potential
At Rally we’re obsessed with seizing the opportunity to unleash the full power of email as an incredible engagement and activation tool. It’s been a drum we’ve been banging for some time now. Why? Because we can control its performance so much more than any other digital channel. We know exactly which inbox it’s going to land in and when. And we’re not operating in an environment controlled by our ‘friends’ Mr Musk and Mr Zuckerberg who can change things on a whim. We just need to focus on the four key factors: the number of email subscribers, the frequency of communications, the quality of the content and the level of engagement. And it’s in our gift to change all four.
We’re pleased to see that for the second Study in a row charities have increased the size of their email lists (up 20%) and the frequency of communications (up 11%, although still well below average for US non profits). But once again engagement levels have fallen. While revenue from email overall has held steady year on year, there has, on average, been a 25% drop in revenue per 1,000 fundraising emails sent. The message is clear: we need to focus on making our email communications inspire more action and mobilise more support.
Again, the data shows that some organisations are getting it right: both large and small charities increased their share of online revenue from email year on year whereas it decreased for medium sized charities. These medium charities also raised less per 1,000 fundraising emails sent.
The data doesn’t tell us what is driving this but we do need to ask ourselves what it is that presents medium sized charities with additional challenges in their email marketing? At Rally, we still stand by our thoughts from last year: not all organisations have the budgets of large charities, but they should hold onto the strengths of small ones as they grow. Processes, structures and culture should empower charities to be agile and bold, not over-complicate decision making or slow things down.
3. When ‘good enough’ isn’t good enough
The Study shows UK and Irish nonprofits’ digital advertising spending continues to grow, this time by 23% year on year. But if we’re to make the most of this increased investment, we need to focus on constantly learning and finding ways to improve performance and returns.
At Rally we believe there is always room for improvement and that even if your organisation finds itself at the ‘median’ level, it shouldn’t be something we should celebrate or be satisfied by.
Take for example the cost per email subscriber from advertising on Meta platforms. The overall median value is £2.57 and for large charities this increases to £5.11. At Rally we are always amazed at how high this number is, given what we see some of our clients achieve. Dig into the data and you can see how the cost per subscriber differs widely across organisations. At the 25th percentile the cost per subscriber was £1.88 overall (£1.90 for large charities); at the 75th percentile it was £6.39 overall (a whopping £9.20 for large charities).
A bit of an eye opener, right? It all goes to show that we should never settle for ‘good enough’ but be mindful of what is possible and always challenge ourselves to do better.
Dive in and see for yourself
As always the data in the Study is thought provoking and shows performance varies significantly according to an organisation’s size and sector. So the best thing to do is dive into the data, compare your own metrics to those of your peers and come to your own conclusions for how your organisation is getting on and where you should focus. Do you have a competitive advantage you can exploit? Is there untapped potential where you can invest to improve performance? Can you spot inefficiencies where you can take steps to optimise?
Spread the word: make next year’s Study even bigger and better
The data is there to be shared and learned from so the sector as a whole has a better understanding of its digital performance. So please also tell your friends, colleagues and spread the word. The more people who see the power of Benchmarks and join the Study in 2025, the richer and more robust the dataset and so we can all make even better decisions in future. We’ll be launching the 2025 Study in August so make sure you keep an eye on our social media to get sign up news. Links to all our channels are in the footer.
Main Photo by Alexander Sinn on Unsplash