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Should your nonprofit bother with an annual report?

Producing an effective annual report takes time, effort, budget and other resources. Sometimes it might not feel worth it. But with the right approach, your annual report can be a fundraising powerhouse that generates much more value than you spend creating it.

I sometimes hear nonprofit communications and development folx talk about giving up on producing an annual report. They say “Meh, it takes so much time and effort, it costs a lot, and in the end we don’t think anyone actually reads it.”

Ok, let’s break this down. They’re right about it taking time and effort to produce a good annual report. They’re also sometimes right about cost, though the perception of high cost can be relative and the actual cost is dependent on a lot of variables. And cost should always be balanced with value. If you invest to make your annual report engaging and compelling, it can easily pay for itself in supporter engagement (donations, volunteer hours, commitment and dedication, etc.).

The last point is worth digging into: “No one actually reads it.” If this is your problem, I’d invite you to explore a few layers down into why and think about how we can fix that. If you want to get started with this thinking, download my free assessment guide Rescue Your Annual Report for a step-by-step walkthrough to see what’s working and what’s not with your previous annual report.

It’s easy to get discouraged if you’ve put effort into past annual reports and gotten lackluster results. But your annual report really can be a unique and powerful tool for you to build engagement and help your organization grow. Not doing one is a huge missed opportunity!

Why is it worth it to produce a solid annual report?

  • Of all your other outreach methods, when else do you have the opportunity to showcase a snapshot of your organization’s accomplishments, victories, challenges and journeys over the past year and present it to people who want to learn about you? (Hint: Not your website—that’s different.) This is one of the few times when it’s completely acceptable—and actually welcomed — to send a nice little brag package to your audience. Take advantage of it!
  • It’s a unique chance to demonstrate your organization’s value and impact. Why did you spend your budget the way you did this past year, and what results came from it? Why is your organization a solid investment as you invite donors to partner with you to create change?
  • It’s a great excuse to reach out to supporters and stay in touch over time, particularly with long-term and lapsed donors who might fall out of touch and be pleasantly surprised to reconnect with you.
  • Your annual report can highlight hidden gems and expand the surface area of all the little threads that connect supporters to you. Some friends of your organization might only be familiar with one facet of your work. Your annual report can help them discover new reasons to appreciate you and support your mission.
  • It’s bite-sized and portable. Information is (ideally) easy to scan and digest. Your board members can send it to contacts with a personalized note via snail mail or email. You can create social media and email pushes to encourage people to download it. (Sidenote: I don’t think most nonprofits promote their annual report enough — they should! But that’s another topic for later.)
  • It focuses on a specific time period and walks readers through a sequential storyline you’ve crafted to engage them from start to finish. This is different from your website, which is useful for being evergreen and multipurpose while allowing visitors experience your content however they want to navigate it.
  • Over time, a collection of annual reports can be an important source of history and institutional memory for your organization. Because each one focuses on a particular year, looking at them together can show longer-term growth that’s particularly useful for anniversary retrospectives. New staff members may be interested to read through the past few years of annual reports to broaden their sense of the organization’s journey and vision for the future.
  • To your internal audiences (e.g. staff, volunteers), your annual report can be a helpful touchpoint to reinforce who you are as a group, your purpose and why the work they do every day makes a difference.

Once you understand the value of your annual report, you can see it’s worth exploring why people may not be reading yours and how you can improve that. There are a lot of potential reasons for this, all specific to your individual situation — audience, format, design, storytelling, messaging, structure, etc. When you’re off-target in any of these areas, it can turn supporters off and create missed opportunities for your fundraising.

The good news is no matter what the situation is with your previous annual report, every year is a fresh opportunity to do better!

I know it can be hard to know where to start in terms of assessing your current annual report and figuring out next steps. Check out my free downloadable assessment guide Rescue Your Annual Report to start thinking about the questions that will help you get on the right track. Try it out and let me know what you think.

Have questions or need help with your next annual report? Reach out and let’s talk!

Photo by Stephanie Margerin via Unsplash