Fundraising’s Solid Ground

As I write this, we literally live in a world filled with uncertainty. While us analysts cannot predict the future of fundraising, we are pretty good at studying past donor behavior, and that can help us better understand how we should respond in times of uncertainty. In my career as a fundraising analyst, there have been numerous “hold your breath” moments: The dot.com bust, Y2K, 9/11, the anthrax scare, and the Great Recession. Each of these events did adversely affect fundraising. But after each event, donors and revenue rebounded. In the past days, I have gone back into some of our data vaults and have studied each of these events, and here’s what I learned that may help us in the months ahead: Overall, fundraising revenue declined in the year of these events. In the worse cases, by up to 20%. But most organizations were in the 3-5% range.There were fewer large gifts secured in the year of the crisis.New donor acquisition suffered the most, dropping as much as one-third.Multi-Year donors continued to give faithfully throughout the period of uncertainty. Multi-Year donors – those that have given to your organization year in and year out – typically generate two-thirds of a nonprofit’s revenue. They also provide the best return on investment. However, they can only do that if you continue to communicate to them and ask for their support. Your Multi-Year donors know you. They believe in you. It’s now time for you to believe in them and give them the opportunity to help your organization through this period of...

Fundraising in the Time of Coronavirus

As all of anxiously watch the spread of COVID-19 from China to the rest of the globe, we are all holding our breath on how this is going to affect donor behavior. Fortunately, December 2019 giving was particularly strong for most organizations. However, early data suggests that first quarter trends are soft. Anytime there is uncertainty, and the virus is contributing to stock market volatility, giving declines. It’s possible a recession, which is defined by lagging indicators, is already here. While there is no need to panic, it might be wise to start doing some contingency planning. If the virus continues to gain a foot hold in America, one of the first places nonprofit organizations are going to feel it is in their fundraising events. As big sporting events and large conferences, like SXSW, are cancelled this spring, you can expect that people are going to be hesitate to attend your galas and run/bike/walk events – even if they are not outright cancelled. Your organization may want to consider substituting in-person events with “virtual” online events. Of course, your organization will have to communicate potential changes to your events to your donors. And while e-mail is inexpensive, the medium is particularly crowded and easy to miss. In our view, more emphasis is going to be placed in direct mail both as a communication tool and as a fundraising tool. Many organizations still rely on this tried and true channel for a large chunk of their revenue. In these uncertain times, it likely that direct mail will become an even more important tool in your fundraising arsenal. Hopefully, we will...