Fair, Flexible, and Purpose-Driven: 10 Ideas to Increase Your Nonprofit's Fee Revenue and Reach

Apr 25, 2025

It's a good idea to define your fee objectives before setting your fee. What do you hope to achieve by charging a fee?
It doesn't matter whether your fee objectives are financial, non-financial, or some combination.
Knowing your objectives will help you make important decisions like: (1) Should we even charge a fee? (2) How much should we charge? (3) Should we charge everyone the same fee or different people different fees?

There is a risk in charging your users or clients a fee. You'll reduce the use of your services and thus your desired impact.
This risk is greater (1) the lower the income levels of the people you serve, and (2) the more uncertain they are about the value of whatever you're charging for.
Condition 1 means they can't afford to pay your fee. Condition 2 means they won't think it's worth it, even if they can afford it.
The following ideas discuss things you can do to reduce this risk.

Whether you realize it or not, your users differ in their ability and willingness to pay.
You can use that to the benefit of your organization and all of your users.
You can generate more revenue from those able and willing to pay more.
At the same time, you can make your fee less of a barrier for other people.
Charging different fees to different users can be a smart way to balance revenue and reach.

It's common to offer some groups of people a discount but not others. (E.g., senior citizens)
But, before you do this, consider these potential pitfalls.
Are the groups to be charged a lower fee more budget-conscious than other users?
If not, you could end up sacrificing revenue without increasing your reach.
Are your criteria for a discount legally sound? Socially acceptable?
If not, you could face legal challenges and negative publicity.

Targeted free access sits between "everyone pays" and "no one pays."
Compared to “everyone pays,” targeted free access helps those who need it the most.
Compared to “no one pays,” targeted free access can generate some fee revenue from users able to pay.
You might use the revenue you collect to help cover the cost of free access to the targeted group.
This is a form of group-dependent fees, so the same warnings apply.

A tiered fee menu gives users two or more options at different fee levels that any user can choose. Each user then selects the option that best suits their needs and budget.
Done well, a tiered fee menu can increase your revenue because it gives users the option to spend more.
It can also increase your reach because it provides every user with an affordable option.
Because every user has the same opportunities to pay less, fairness is less of an issue.

Adding a free option to your fee menu is another way to cater to budget-conscious users.
You avoid pricing anyone out. And you generate revenue from users willing to spend more.
Because any user can select the free option, you don't have the fairness question.
However, the free option must be less desirable than the non-free options.
If not, you run the risk of not enough users selecting the non-free options.

Offer every user the exact same thing, and accept any amount they want to pay. That includes nothing at all.
The expectation is some users will choose to pay nothing. But other users will have the desire and means to pay more.
However, be careful of moving from a mandatory fee model to a pay-what-you-want model. Be ready to see a significant drop in revenue.
This model works best when the cost of serving another user is low.

Transparency builds trust and makes your fee structure understandable.
Communicate your different fee levels and their corresponding value and/or conditions.
Fairness bolsters user satisfaction and avoids resentment.
You will increase perceived fairness when you give all users the same options to pay less.

Don't view your fee decisions as permanent. Things change over time, and so can your fees.
Test and adjust your fees until you find the best fee structure for fulfilling your mission.
Communicate fee changes to your users in a clear and timely manner.
Explain the rationale behind any fee adjustments.

This post is public so feel free to share it.

Pricing Pointers