Another Unsustainable Trend
I open the emails I receive from Analytical Ones with great trepidation. These folks are masters of bad news, as The Agitator has previously reported here and here.
Their latest message didn’t disappoint me. [Is that the correct thing to say?!] Their apparently endless reservoir of bad news is yet to run dry.
Here’s the latest gloomy trend they’ve spotted. It looks at the percentage of total revenues in the ‘typical’ nonprofit from donors who were acquired in the last three years. In other words, are your newest donors carrying the same weight as they have in the past? Their data says: no way.
Or, another way of looking at it, says Analytical Ones: “Less acquired today = Less to cultivate tomorrow.”
So get out your data and calculate this trajectory for your own nonprofit.
I sincerely hope you’re bucking the trend.
Tom
5 responses to “Another Unsustainable Trend”
Behavioral Science Q & A
Integrating an individual giving appeal with other communications from a charity can have both positive and negative effects, and the outcome largely depends on how it’s executed. Advantages of Integration Brand Consistency: Maintaining a consistent appearance and messaging across all communications can reinforce the org’s brand identity and strengthen brand recognition and trust among your […]
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I’m not aware of any in-market tests specifically comparing recurring vs. gift frequency language. I suspect the answer might not be the same with all gift frequencies, nor with all people. It sounds like a great opportunity for you to test and find out what works for your audience. Based on the literature, here’s a couple […]
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Based on what we know from existing data, those renewal notices can actually be pretty effective in getting people to donate. They tap into our psychology – creating a sense of urgency, reminding us of past support, and using personalization to make the message hit home. They’re playing on our natural tendencies to feel obligated […]
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Interesting question. I had a quick look at the testing done on this topic. On the positive side, in all cases, over half of donors decide to cover the fee. In some cases, it goes as high as 65%. Not a negligible percentage at all. Here’s another test from iRaiser showing consistent results (see point […]
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There’s just one thing to consider when designing a supporter journey: the supporter. More specifically, you need to take into account: Who the supporter is i.e. their identity, which is the reason they support this cause, and their personality, which describes the way they “see” and process the world. These will determine the kind of […]
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I’m not an expert in this but a quick search surfaced this article on the effect of tax reforms on 2019’s charitable giving. The researchers didn’t find a reduction. Actually, they observed an “increase in charitable contributions in 2019, even with the lower tax rates and the dramatically smaller number of taxpayers who itemize their […]
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Thanks for sharing this info from Analytical Ones.
I am new to the non profit world. As I understand there has been tremendous growth in the quantity of non profits over the last 20 years.
There will always be non profits starting, and non profits going by the way side. Economically some will succeed, some will not.
Could this be a inevitable season of purging?
Trends are not to be ignored.
Do you know quantitatively if non profits are dropping like flies? Or is there still growth in number
Is this not GOOD news? It would make sense that a smaller slice of the pie comes from new donors. Hopefully, that means long-term faithful donors are accounting for more of fundraised revenue. That in turns means it’s more stable, and has a greater RoI than costly, churn-and-burn acquisition.
Did I read this wrong??
This is validation of the long overdue discussion of the declining effectiveness of direct mail. We are facing (as Jim points out) huge growth in the number of new NPOs but in large measure they raise money 100% online. The old-guard of established NPOs divide the shrinking direct mail universe (that grows older and older by the day) pie further and sets up the reality that Analytical Ones is observing and pointing out … We have crossed the line into the Unsustainable Zone.
Not so fast, Tom.
The other possibility is that the percentage of revenue from longer term donors (3+ years) is increasing. Longer term donors do tend to give more and are more likely to renew. Maybe some organizations out there are listening to Roger (and/or others of us who are advocating taking care of your base)…
Mike, do you have any data to back up the trends you describe? Since the data Tom presents in this post has nothing to do with channel, I don’t think you can make conclusions about the effectiveness of direct mail vs. online here.