EXPECTATIONS
September. I expect the days to get cooler, but my expectations do not meet the reality of ever hotter days. And the one thing I, here in California, love to lord over my New York relatives is our lack of humidity. Alas, some days are positive sultry—and I do not mean that as a good thing. Weather, as we’ve all been reading and talking about, just ain’t what it used to be.
Then again. Maybe nothing is.
For as long as I have been involved with nonprofits, funding has been moving up. In years where the dollar amount isn’t higher than it was the previous years, then the number of donors has risen. Except this year. Donors are down and so are dollars.
Key takeaways from Q1 this year, according to the Fundraising Effectiveness Project, are dismal:
Over the last ten years, the stability of donors who contributed over $5K drove a 69% increase in total donations. Now, these major donors are also demonstrating significant decline, donating nearly 10% less in Q1 2023. As these donors account for nearly three quarters of total dollars donated, their decline will amplify volatility and uncertainty for charitable organizations in 2023.
While total new donors continue to decline, donor retention has also shown significant weakness at the beginning of 2023. Retention decreased across all donor categories in Q1, with recaptured donor retention falling almost 20% from an already low level.
The weakness in donor retention was compounded by a steep drop in new donors and dollars given by new donors, creating a troubling paradigm for charitable organizations. New donor counts fell by nearly 20% and new donors gave 34% less in Q1, reinforcing sector reliance on long-standing donors (though this group also declined by 5%).
What does this mean for you?
No. Not panic. To me, it means opportunity.
The first opportunity is in your existing and lapsed donors. Now, more than ever (though it has always been critical), you must think of ways to continuously connect and create closer ties with your donors, past and present. Stop asking them at every opportunity for a gift. Instead, thank them for all they’ve done, and tell them how much you value their partnership with your organization. And hey, board members—remember them? They are donors, too. If they are not giving you money (which they should, at any level that has meaning to them), then they are giving you their time (and if they are giving neither—why are they on your board?
The second opportunity is to reach out to those who have yet to become donors. No, I’m not talking about an acquisition mailing. I am talking about asking each of your donors, every one of your staff members, all of your board members to “each one, bring one.”
his doesn’t mean that they have to ask their friends for money. Not at all. What they do need to do is to provide those friends an opportunity to learn more about this place they consider so special.
They can do this in an email, a text, a phone call, or more personally, at a party or a meeting. However they do this, it should be intentional. “Friend, can we set up a time to talk about something that is very dear to me?”
When you do have that date, remember that old adage about two ears and one mouth. Introduce what you want to talk about, and then give your friend space to give you the information you need to get them connected.
“Friend, tell me, do you know anything at all about my organization?” Then, once they have told you what they want to tell you (and only then), fill in some blanks. Where possible, tell them “I love that you…..” and confirm the great fit of your organization with their values, dreams, philanthropic intent. Then ask, “How can I connect you more with our organization?”
You job at this point is not to raise dollars. It is to bring supporters to the table and allow them to chose to become a donor.