How nonprofit management software keeps finances in order
More often than not, nonprofit organizations deliver fundraising messages through multiple channels. There's no single magical strategy that guarantees charitable groups will achieve the objectives they establish before activating a pledge drive. As a result, many groups send appeals through social media, direct mail and email in an effort to thoroughly capture their donors' and prospects' attention. To go along with this, financial management should be in the foreground of any effective fundraising initiative.
Looking at assets and ROI
One idea that's important to keep in mind is depreciation, the Nonprofit Quarterly explained. This is pretty fundamental to nonprofit management, but many organizations don't properly keep record of their assets, which include computers, software and anything else the organization buys. As with most purchases, the value decreases with time because, especially with technology, new things are being invented continuously making your existing equipment functionally obsolete.
However, many kinds of nonprofit management software are a unique asset in that they are upgraded regularly to ensure organizations are using the most up-to-date version. As long as nonprofits maintain computer equipment that can handle the software, there should be very few if any lapses in functionality. Organizations can continue aggregating data they can use to drive more effective fundraising and outreach.
In fact, the Philanthropy Journal recently emphasized the importance of measuring return on investment of multichannel fundraising campaigns. Nonprofit software plays a key role in collecting much of the data needed to effectively record revenue drawn from a pledge drive. The Journal indicated nonprofits need to keep track of costs associated with a fundraiser – salaries paid to staff members or consultants, price of resources needed to create the appeals and distribution expenses, for example. With limited staff, having a software platform that can record this information makes it much easier to compare expenditures and revenue.
What are the considerations?
However, a multichannel campaign can be complicated. Consider the following questions when attempting to measure ROI:
- How much was spent on telephone appeals?
- How much did direct mail appeals cost?
- How much did you spend on online advertising?
- Was social media a significant part of the fundraising initiative?
Depending on the depth of detail an organization wants to achieve, these various channels should be considered with respect to the cost per donor. This will make it easier to discover how much each channel costs to earn a contribution per individual donor.
Keeping accounting and financial books in order can be a difficult task for many short-handed nonprofit groups. However, nonprofit management software can help many organizations keep more accurate and updated records of their assets and expenses.