September 2011

BACKGROUND

In mid-August, Dunham+Company released the results of a study conducted on our behalf by Campbell Rinker of 497 adults nationwide who had donated at least $20 to charity in the previous 12 months. All responses were gathered online from August 12-15, 2011. The purpose of the study was to try and understand the potential impact of the continuing economic turmoil on charitable giving.

The study found that nearly 7 in 10 Americans (68 percent) said they would give more sparingly to charity in the coming months and another 1 in 10 planned to stop giving altogether until the economy got back on track. In addition, only 22 percent said they would consider supporting a new cause.

The top three reasons donors said they would pull back on giving were:

     1. Reduced income due to job loss;

     2. The rising cost of personal or living expenses; and

     3. Uncertainty over the economy.

The good news was that nearly 8 out of 10 donors said they would continue to give to the charities they had supported in the past, even though they will probably decrease their level of support.

So what should charities do in light of the rough economic times that don’t seem to be going away any time soon? Following are three recommendations based on further insights from our August research, testing and 30+ years of experience in fundraising.

1. YOUR DONORS STILL LOVE YOU SO KEEP THEM ENGAGED AND INSPIRED

You need to assume that your donors still love your organization even though they may be feeling the pinch financially or are concerned over what the future holds. Those donors who have given over multiple years are especially committed, so make sure you prioritize your communication to them.

But it is up to you to keep your donors engaged — and even inspired — through regular and strategic offline and online communications that highlight the impact of your organization… impact that is made possible by the support of your donors. In your communications make sure you clearly connect the dots between organizational outcomes in the lives of people and the donors’ support. And give donors reason to maintain and even increase their support through new and exciting funding opportunities. Resist the temptation to tell them, “We need….” but rather keep your communication donor-centric, “Through your gift today you can….”

2. GIVE SPECIAL ATTENTION TO YOUR ONLINE DONORS

According to our August study, online donors are much more likely to stay engaged. Only 6 percent say they will stop giving compared to 15 percent of those who don’t give online. Nearly 9 in 10 online donors (85 percent) say they will continue to assist the causes they have supported in the past, compared to only 71 percent of those who don’t give online.

Give priority to the cultivation of your online donors. If you haven’t done so already, we recommend you design a very specific online communication strategy that not only reflects the offline communications from your efforts based on the first point above but also gives them reason to engage with you. Testing has proven the power of short (60-90 second) video content.

If as an organization you find yourself responding to a disaster, make sure you give major focus to your online donors as there is a 55% higher likelihood they will respond to such a request than those who give offline. In addition, online donors give over 50% more than their offline counterparts.

3. CREATE OPPORTUNITIES FOR YOUR DONORS TO VOLUNTEEER

Again, our August research pointed to the significance of volunteers as donors. The non-volunteers indicated they are nearly three times more likely to stop their giving in these hard economic times (15 percent vs. 6 percent) and more likely to pull back on giving (71 percent vs. 64 percent) compared to volunteers. And volunteers give nearly three times as much per household each year ($3,488 vs. $1,300 for non-volunteers).

But don’t make the mistake that many charities make in thinking that if you can get someone to volunteer they are more likely to contribute financially. Although this does occur, what we find is that when you are able to move a donor to become a volunteer it increases the donor’s commitment to the organization.

So find ways to motivate your current financial supporters to invest time volunteering time to your organization. This will move them into a deeper relationship with you and motivate them to stay connected to your organization for a longer period of time and to ultimately increase their giving.