Donor Lifetime Value Calculator
Donor Lifetime Value, or LTV, is a prediction of how much money you can expect to receive from a donor during the lifetime of their giving to your organization (from first donation to last donation, acquisition to lapse). This information can help you make important decisions about your fundraising budget.
Monthly donors often have the largest donor LTV. Make it an easy and obvious option for your donors to choose “monthly” when donating. Donorbox has one of the easiest ways to collect recurring donations
How to use this calculator
A donor’s lifetime value calculation is relatively simple, but it relies on a few other metrics that can be tricky to calculate. To calculate your LTV you’ll need to know how long your donor has been giving to your organization, their average donation amount, and frequency of donations (the number of gifts a donor makes in one year).
Pro Tip
Calculating donor lifetime value helps your organization determine what return to expect from supporters in the short-term. This informs how much you’re willing to spend to acquire them and how much you can spend to retain them. Each donor will have a different donor lifetime value and will require a unique strategy.
Frequently Asked Questions
What does Donor Lifetime Value mean to my organization?
Donor Lifetime Value helps you determine if you are creating sustainable long-term growth for your organization through strong donor relationships.
If your lifetime donor value is high, it indicates that you are not only raising substantial gifts, but you are also bringing back your donors to your organization for repeat gifts. A low lifetime donor value indicates problems like too many small gift donations and infrequent engagement with donors.
How do you calculate the lifetime value of a donor?
To calculate the lifetime value of a donor, you need to know how long they’ve given to your nonprofit, how much they’ve given, and how often. Therefore, before you can solve the equation for a donor’s lifetime value, you must first figure out their average donation size.
To determine a donor’s average donation amount, use this equation:
Donation Revenue / Number of Gifts = Average Donation
Once you have this number, you can enter this average, how long they’ve been giving, and their average number of gifts per year to Donorbox’s donor lifetime value calculator, right here on this page.
How do I apply the donor's lifetime value to my fundraising strategy?
Donorbox’s donor lifetime value calculator can help you prioritize where donors fit within your fundraising strategy. Segment donors based on their lifetime value, gift amount, and frequency. Determine the best communication for each donor type. Remember to thank your donors and continue building those relationships over time!
What Donorbox tools are available to increase donor lifetime value?
Donorbox’s donor lifetime value calculator is a simple tool that nonprofits can use to help segment donors and create a fundraising strategy - but we also have tools to help you put this knowledge to work.
Use the determined lifetime values to choose suggested donation amounts for each of your donor segments. Then, use Donorbox to create customized donation forms for each donor type, adding increasing donation tiers that start with the average donor lifetime value.
Do larger donors have a higher lifetime value?
Not necessarily. If a donor has regularly given several smaller gifts for many years, you may be shocked to see that their lifetime value is a significant amount.
Knowing this information can empower you to strengthen relationships with these donors and increase their participation with your organization. One of the best ways to do this is by thanking them for their years of support and introducing them to your recurring or membership programs.