The latest Blackbaud report indicates that giving in the U.S. went up 4.1% in 2017.  (Yay!)

But inflation was 2.1% and the number of nonprofits (in the last year for which I could find data) went up 3.1%.  Thus, 4.1% is a net loss in real terms.  (Boo!)

It feels like that, doesn’t it?  Like we are not expanding the charitable giving pie, but rather fighting over how to divide it?

And, since charitable giving has stayed at or around 2% of GDP in the US since such things were measured, this feeling is often right.

There are two great reactions to this news.  One is to work on how to expand the pie.  This is a noble pursuit.  Given that you can buy a baccarat crystal clock on Amazon for $119,600.01 (but the shipping is free), we as a society can probably afford to give more of our bounty to help those with less.

That’s not this post, however.  This post is about how to increase your piece of the pie.  Thankfully, the University of Kent did the heavy lifting on this in their report “How Donors Choose Charities.”  They found:

“people do not give to the most urgent needs, but rather they support causes that mean something to them. In particular, the study finds four non‑needs‑based criteria that commonly influence donors’ decision‑making:

• Donors’ tastes, preferences and passions, acquired as a result of an individual’s social experiences. These motivate many giving decisions, even among donors who perceive themselves to be motivated by meeting needs.
• Donors’ personal and professional backgrounds, which shape their ‘philanthropic autobiographies’ and influence their choice of beneficiaries.
• Donors’ perceptions of charity competence, notably the efficiency with which they are believed to use their money, often judged on the basis of the quality and quantity of direct mail.
• Donors’ desire to have a personal impact, such that their contribution makes a difference and is not ‘drowned out’ by other donors and government funding.”

I’d like to highlight this second point.  We’ve talked frequently about donor identity – how people give to you not because of who you are, but because of who they are.  That’s exactly what they found in their research, with comments like:

• “My son had meningitis so I give to the Meningitis Trust.”
• “My brother died of bowel cancer so I give to cancer research”
• “My mother became disabled and needed wheelchairs and things like that, and I realised what a difference it made, so I’ve been keen to give to charities that provide wheelchairs in the third world’
• “[My husband and I] work for the music business and so we support music charities and music causes”

These donors are the ones that will stay with you through thick and thin.  And trying to determine who will retain by looking at an RFM analysis or demographics will ignore these most salient of identity points.  Only by asking donors about themselves will you get these data and be able to act on them.

Another interesting point from this study is that donors want to be able to assess competence but, given the difficulty in assessing that, use marketing as a proxy for this.  Comments include:

• “If they send too many I feel they’re just wasting the money, not spending it properly and so we cut them out”
• “One likes to think that one can sift the charities that are top‑heavy from the ones that really do the work, because it seems to me the less flashy the communications, they’re the ones I really do think pull their weight. One does get a feel for which charities spend a lot on public relations or things one doesn’t approve of so much.”
• “I suspect that a lot of charities are there just to raise money and use most of it for administration. You get certain charities that write to you every six or seven weeks and often include gifts, which infuriates us. They’re not really being very efficient in my view.”

With 1.5 million charities in the United States, a savvy donor will use mental strategies to reduce their consideration set down to a manageable number.  What this research shows is that donors use whether you can activate their personal identity, your adherence to their preferences, and your perceived wastefulness in communications as filtering criteria to see if you make the cut.