272: How much should nonprofits budget for ads? The Nonprofit Ad Study

The study was conducted from Form 990 data from 7,171 U.S. 501(c)(3) organizations with $1 to $10 million in revenue from 2018-2019 courtesy of Cause IQ (filing years 2019 and 2020). The goal was to create a large enough sample size to answer questions about advertising size for nonprofits that rely on common funding methods. 

There are 1.44 million 501(c)(3) nonprofit organizations, about 5% (72k) are between $1M and $10M in revenue, 1.5% (21.5k) are above $10M. 

This study represents a full population of nonprofits that fit the study criteria. The study criteria removed chapter organizations, childcare educational institutions, organizations with no employees, and hospitals because of their different revenue-generating operating structures. 

This study relies on the reported advertising field in the Form 990. The IRS defines the advertising field (line 11 on section 9 of Form 990), as ad spend itself and direct costs for independent contractors executing said ad spend. However, line 11e may also include some of the costs associated with advertising consultants and is determined by the organization’s filing decision. 

This study is a partnership with Whole Whale, a B Corp digital agency that helps nonprofits use their resources wisely and Cause IQ, the leading nonprofit data platform.