Wednesday, July 17, 2013

The Irregularity of Regular Giving

We love our regular donors. As nonprofit professionals, we just love to look over our donor rolls and know that there's a good percentage of those listed who will give again and again, year after year, and all we have to do is send them a nice annual letter. Maybe there's even a few of those donors who have trusted us enough to let us charge a small amount to their credit card every month without even asking. Man, do we love them! But don't get too complacent.

With each successive generation, giving is changing. New technologies play a roll in that, but so do overall trends in society and culture. Changing economic realities affect not only the amounts given, but the level of scrutiny and revue a donor puts an ask through. The loss of trust in institutions along with increased access to a world of information are changing the types of asks donors respond to.

There is a growing body of research into these generational differences. The Next Generation of American Giving by Convio, Edge Research, and Sea Change Strategies (2010 - download here) breaks donor groups down by the Matures (born before 1945), Boomers (1946-1964), Gen X (1965-1980), and Gen Y (1981-1991). One of the problems that becomes evident in this study is that most of our accepted knowledge and best practices around fundraising were designed to appeal to the Matures, who now account for only 21% of donors. Gen X outnumbers them at 25% of donors, with Gen Y (19%) coming up right behind (and growing). Boomers are the largest cohort at 35%, but are outnumbered when you consider Gens X and Y together.

Among the differences in donor attitude between these groups are the way in which donors give. 77% of Matures send checks through the mail, while only 26% of Gen Y donors have. Meanwhile, 14% of Gen Y donors and 13% of Gen X have donated by text, while only 2% of Matures have done so.

As to the type of requests younger donors respond to, the 2010 Millennial Impact Report by Achieve and Johnson, Grossnickle, and Associates (download here) found that more than half of respondents were likely to respond to a specific request, while less than 8% were likely to respond to a general request (such as an annual appeal). This feeling was repeated in their 2012 survey which identified "not knowing how my gift will make a difference" as Millennial's biggest pet peeve.

Younger donors are also less likely to take your word for it that your organization is doing great work. They need to be able to know who the end beneficiaries are, and what impact their donation will make. They do, however, trust their peers: 74.6% said they would give if asked by a family member and 62.8% would give if asked by a friend.

Younger donors are not just more responsive to appeals from friends and family; they are also more willing to take part and help spread the word about your organization once they are on board. 19% of Gen Y and 14% of Gen X donors are willing to promote their chosen charities online compared to only 9% of Boomers and 5% of Matures.

So, what does all this have to do with regular, annual giving?

The bad news is that donor engagement is going to require more work going forward. The good news is that this engagement will be more meaningful and keep you focused on your mission.

In a world where you cannot rely on your annual holiday letter (delivered via USPS) to generate a flow of checks, your organization will need to engage across multiple channels, and communicate consistently throughout the year.

Your focus also has to shift to be more future oriented. Rather than looking back at the good work you've done, asks will need to be forward looking and explain how the next donation will be used. These asks will need to demonstrate impact and explain exactly who will benefit. You will need to experiment with new tools and trust your current supporters to make the pitch to new potential donors.

In a sense, the traditional annual campaign ("Remember us? We do great things, and you always support us: Time to send your check.") is dead. And, frankly, it's about time.

In this new world, every ask is a first ask. Yes, it will take more work than just updating last year's letter. But it will be relevant, it will be inspiring, and it will be empowering. In the end, it will make us better fundraisers and advocates for our causes.

And, if we do it right, it will keep donors coming back to us, year after year.

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NOTE: The day after I posted this blog, the Millennial Impact Project released their 2013 report. Among the findings, the respondents said, "they were turned off when a nonprofit's Web site had not been updated recently." 60% wanted information and success stories about the people served by their donation. While 52% would be interested in making monthly gifts, 70% said they would be willing to raise money for an organization they cared about, and 64% have raised money in a fundraising walk or race. The full report can be downloaded here.

1 comment:

  1. Thanks Ken for the post! I agree that nonprofits need to make an investment in updating their websites and social media tools to keep them current. Organizations need to recognize the shift in how donations are being made, which is via websites and text messaging. In order to keep continued support, nonprofits should feel very encouraged to share how the donations are being used to further their mission.

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