Index of Higher Education Fundraising Performance 2007

HIGHER EDUCATION ANNUAL FUND REVENUES RISE SHARPLY WHILE PARTICIPATION WAVERS

Read a complete summary of the Index of Higher Education findings (PDF).

Cambridge, MA (March 24, 2008) - Strong annual fund revenue growth, despite declining participation rates and flat donor counts, were common patterns among colleges and universities in fiscal year 2007, according to the Target Analytics Index of Higher Education Fundraising Performance.

Median revenue increased by an impressive 9.5 percent in 2007, building on 7.3 percent growth in 2006 and another 5.6 percent in 2005. This strong performance is likely influenced by both external and internal program factors, including but not limited to a strong economy, greater focus on upgrading donors, and the implementation of ‘second ask’ programs in many annual funds. The median revenue growth rate was more pronounced for public institutions, whose 10.3 percent increase was the largest since the Target Index was launched several years ago.

Both public and private programs remain challenged, however, with flat or declining participation rates and donor counts. Median participation rates were down 1.2 percent to 26.8 percent for private institutions and down 0.6 percent to 10.5 percent for public institutions. Small participation rate declines highlight the continuing difficulty schools face as they try to engage young alumni as new donors. There is also evidence that fewer schools use participation as a key benchmark for success as they increase their reliance on more sophisticated program metrics. The median change in donor counts for most institutions was flat, with an overall very modest 0.1 percent growth after a 0.5 percent decline in 2006.

The Index points out several differences between public and private institutions relative to trends in 2007. Private institutions posted a significant 4.9 percent decline in new donor retention rates, compared to only a 0.5 percent decline for public schools. Private institutions also saw a decline in the median change in retained donors, while publics experienced slight growth in donor retention. Additionally, public institutions posted a strong 11.5 percent spike in median change in revenue per retained donor, while privates saw growth of 7.1 percent in 2007. Another trend shows private schools moving closer to parity with public institutions as median new donor retention rates declined from 37 to 35 to 32 percent respectively in each of the last three years, while publics remained flat at 31, 29, and 30 percent in the last three years.

Target’s Index confirms that increasing donors, and thus participation rates, continues to be a serious challenge for these programs. However, revenue is on the rise across the board among retained and reactivated donors while remaining flat or modestly declining among new donors. For more information, please click here to download full report (PDF).

For more information about the Target Analytics Index of Higher Education Fundraising Performance, contact Deborah Kerr at Deborah.Kerr@Blackbaud.com or (617) 583-8669.