I have bad news and, well…

November 30, 2017      Kevin Schulman, Founder, DonorVoice and DVCanvass

I’m generally an optimist. Not a Panglossian “we live in the best of all possible worlds” optimist, but I think we can get to that world in the long term.

But I’ll be darned if many of the fundraising trends seem to be pointed in the wrong direction. Here’s what I’ve been seeing; please leave any good news you’ve seen in the comments to help cheer me up:

General

  • Charitable giving as a percent of GDP is and has been constant(ish) since it has been measured
  • There are more nonprofits than ever before and that number is increasing
  • The pie of charitable giving is expanding and not as a much as the number of nonprofits are expanding. Thus, the average nonprofit’s funding will be going down
  • The number of households donating has declined 7% over the past decade
  • The amount given by the average household is on a decade-long slide from $1024 in 2005 to $872 in 2015
  • Revenue is down 4% and donors are down 5% year-over-year through Q3

Acquisition

  • Households have decreased in their willingness to give to new organizations
  • New donors to organizations are down 14% year-over-year through Q3

Retention

  • Retention through Q3 is down 1.9% year-over-year (at 33%)
  • Retention of new donors to organizations is down 33% year-over-year through Q3
  • Fewer than 18% of new donors will make a second gift the next year
  • Donor reactivation has fallen every year for the past four years
  • All of this might be salvageable if large donations were increasing, but $1000+ gifts are falling by 8%

I’d love to hear stories of folks who are bucking these trends to restore my optimism. (Giving Tuesday stories need not apply – while it’s great to get the donations, I’m not certain that the sector needs more transactional giving.)

I’ll make a prediction in advance – we won’t hear a story that involves communicating in the same way to a transaction-based segmentation of donors. The success stories I’m seeing are those that are looking at new ways of giving (e.g., multigift programs, designated or quasi-designated giving, etc.) and aggressive donorcentricity beyond a “you” focus (e.g., building around donor feedback, capturing and using donor identity, accommodating donor preferences, abandoning a volume-based business models).

Agree? Disagree? What are you seeing?

Sources: Blackbaud’s Vital Signs report, Fundraising Effectiveness Project reports, and the Generousity for Life Generosity Reports