The seeds of many post pandemic trends were established before COVID hit. While donor behavior has been changing since 2020, many of the fundamental principles of fundraising like donor engagement and stewardship are continuing to be true. What has changed is the pace of change and the rise of technological sophistication in the donor public. In addition, donors are looking to more more engaged, in new ways.
Setting the stage - Pre-COVID trends
Pre-COVID acquisition rates were dismal. From 2011-19, giving to new organizations was down 33% and the number of donor households was down 5%. These trends clearly show, we have not been paying attention to the next generation of donors. As a fundraiser, you cannot ignore acquisition if you want long-term growth.
In addition to terrible acquisition rates pre-COVID, there was also inadequate donor retention. Specifically, only 29% of first-time donors were retained by charities and only 59% of multi-year donors were kept by charities. This is unsustainable for charities.
Pre-COVID, there was enhanced demand for impact sparked by movements. This increase in civic engagement led to new donors. In 2017, there was a 10% spike in new donors as the public engaged more fully in the existing #MeToo movement. However, by 2018, that new group of donors had attritioned.
The goal of the #MeToo and of #BlackLivesMatter movements is not about small issues of discrimination. The goal of these movements is deep, systemic change. People who are tired of waiting for change and tired of big institutions not taking action. Importantly, all ages are leaning into this. This has set the stage where donors are thinking of their whole engagement with a cause. Rather than passive participants, donors are looking to be the driver of engagement.
The big bets moving forward - Post-COVID
During COVID we have seen that some sectors have over-performed others. We also need to look at historical trends. Right now, there are thriving subsectors and languishing subsectors. Recovery is not one-size fits all. Regardless of your organization's individual success, retention could not be more important.
Giving by individuals remains the largest segment of donors. It is up to us to build lifelong relationships. Building these relationships includes shoring up your major donors and digging into your file to find donors to be upgraded. In addition, you will want to make sure to give attention to converting donors to sustaining giving.
Many organizations got a flood of new gifts in 2020. Early research by AFP shows that the COVID donors are already starting to attrition. In your role, you need to be doubling down on prospecting and retention. It is not too late to give these donors a welcome series and the case for support to sustain them with your cause.
In Canada, there was a 24% increase in online giving in 2020 and it is now 11% of all giving. Interestingly, this is lagging behind the consumer market. This has been a particularly dramatic disruption for major donors.
With this rise in digital, we have more insight of how donors found our charity online and then use those insights to leverage better responses. Failures can be even more valuable than successes in terms of understanding how to work effectively in this area.
It is worth noting that donor research finds that organizations that are seem as tech-savvy are performing better with the donor public. In this vein, two relevant trends are the exponential rise in crowdfunding and that, the younger the donor, the more channels they are willing to try.
Building on the momentum of civic engagement noted in pre-COVID times, the donor public is showing up in new ways for new causes. As Canada shifts demographically, organizations need to adopt culturally competent perspectives to meet Canada's evolving needs. Constituents are looking to be part of the call for change. As a result, charities can't be at the centre of donor's engagement.
It is an old adage that, if you are not failing, you are not growing. This is a time where you have to be willing to focus going forward on taking risks and making mistakes. As noted above, the leadership model for the sector needs to change to be more constituent-led. In this vein, the donor public and charities are looking to break down silos and traditional ways of working.
Finally, it is important to note that, in this era of enormous growth, professional development is more important than ever. Through professional development, fundraisers can rise to the challenge of our new era.
Ashley Thompson is the managing director for the Blackbaud Institute. She is responsible for driving Blackbaud’s extensive research, thought leadership, and best practice content. Through this role, she builds thoughtful strategies and solutions for the philanthropic sector. She also manages internal and external relationships for the Institute, including convening the Blackbaud Institute Advisory Board. Ashley is active in the Austin community, participating in numerous groups as a volunteer, active board member, and collaborative partner. She is a regular contributor to sgENGAGE and is a member of the NonprofitPRO Editorial Advisory Board.
Session summary by Ann Rosenfield who thanks AFP for the media pass for Congress 2021.