Earlier this month, our team at CanadaHelps proudly published The Giving Report 2022. The fifth edition of the annual report published in partnership with Environics Analytics and Imagine Canada is a key sector publication which highlights the importance of the charitable sector, key trends facing charities, and challenges affecting the sector overall. After facing a global pandemic for more than two years, the report is more important than ever as it takes a pulse check on the sector in order to understand where we are and where we go from here.
While the pandemic continues and inflation reaches highs that have not been seen in 30 years, it’s no surprise that Canadians are feeling the pressure. In January, CanadaHelps commissioned an Ipsos poll which found 11% of Canadians are currently using charities to meet basic necessities such as food and shelter. If pandemic and inflationary pressures continue in 2022, that number could rise as high as 26%. That means one in four Canadians may need to turn to charities for basic support this year.
While this alarming rise in demand is putting extra pressure on many charities, donations are also trending in the wrong direction. Using a number of key indicators to project giving trends, our team has projected a -12% decline in total donations from 2019 to 2021. It is, however, important to know that these declining trends in the number of Canadians engaging in giving were taking place even before the pandemic. In 2006, 24.6% of Canadians made donations to charities. By 2019, that number dropped to 19% — a 5 point drop in participation rates in less than 15 years.
It’s not all bad news
There are a series of positive trends highlighted in the report, some of which can be leveraged by your charity right away to tackle key challenges facing the sector. With this in mind, here are three trends your charity needs to know in order to start implementing change within your organization today:
It’s more important than ever to diversify your fundraising revenue streams and leverage new ways of giving to reach younger donors. The theme of this year’s Giving Report highlights an important topic — how different generations are engaging in giving in different ways and supporting different causes.
For example, the report highlights how donations of cryptocurrency are growing in popularity among younger donors as 6.1% of Generation Z and 4.5% of Millennials have donated using cryptocurrency, compared to 0.1% of Baby Boomers and 0.3% of Generation X. Younger Canadians also have a strong affinity towards donations of securities, particularly Millennials as 13% of the cohort report that they have given using this method before, making them two times more likely than Baby Boomers to give in this way. Finally, monthly giving has proven to be very popular among younger generations, perhaps due to their ease and familiarity with other monthly subscription models such as Netflix, Spotify, and more. When asked if making occasional large donations or smaller monthly donors were more appealing, 31.8% of Generation Z and 30.6% of Millennials chose monthly donations, compared to 27.6% of Generation X and 20.3% of Baby Boomers.
What’s important to take away here is knowing how important it is for your charity to engage in new ways of giving and diversify your income sources. This is critical to acquire and engage younger donors who care deeply about causes, but are becoming increasingly interested in different means of giving.
Don’t forget your smaller donors. One of the surprising trends highlighted in this year’s Giving Report is related to trends in giving by income band. Families with an income of $150K or more were two times likely to give less, dropping from -3% in 2006 to -3.3% in 2019. Among families with an income between $20K and $99K, the annual growth rate in their giving only dropped from -1% in 2006 to -1.5% in 2019. Knowing this, it’s critical to engage and invest time in developing and stewarding a relationship with all supporters, even those who may not be lined up for a major gift.
Segmentation has never been more important. While this isn’t a new trend, it’s important to double down and address this head on, especially given the differences between generations outlined in the report. Understanding generational differences, giving habits, and ways your donors are giving is the first step. A Donor Management System can segment your supporters, capture all donor activity, and also send targeted emails to your supporters so you can strategically communicate with them, knowing their interests and preferences.
To learn more about generational giving trends, emerging challenges, and opportunities, download The Giving Report 2022.
Shannon Craig is the Chief Marketing & Product Officer at CanadaHelps, a public foundation advancing philanthropy through technology. For more information, visit www.CanadaHelps.org.
