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With a new year comes a hopeful new outlook.  We’re all glad to see 2020 go.

What a year it has been: we suffered through a terrible pandemic, disruption of our lives, families, workplaces, a volatile political climate, and much more. What’s worse, these issues are not over. They will continue impacting our lives – and fundraising – well into 2021.

Yet there are some silver linings.

We saw immense dedication and dogged commitment on the part of nonprofit leaders and fundraisers. And, we saw creative fundraisers take advantage of new opportunities offered by the virtual environment.

Based on What’s Happened in 2020, Here’s our Forecast for Upcoming Fundraising Trends for 2021:

1. Giving is up.  And all signs are that it will remain up.

Many nonprofits experienced critical revenue shortfalls from reduced service fees, ticket sales, and admissions. As a result, donors responded with record amounts of charitable donations.

2020 saw a surge in the entire scale of giving – from small gifts to major donors to new estate commitments. More people than ever were giving and at greater amounts than usual.

The Fundraising Effectiveness Project of AFP found that the first 9 months of 2020 saw an impressive increase of 7.6% over 2019.

Big institutional funders and foundations also stepped up to increase giving in 2020. Through September, Fidelity Charitable grant volume increased 30% over the same time period in 2019.

In 2021, we expect that donors will continue to be interested, open to nonprofit messages, and willing to help.

2. Donor fatigue is a myth.

Asks were everywhere, and donors gave.

The successful organizations laid their cases for support out plainly. In addition, they explained their financial situations clearly. Even more, they pulled appropriate emotional triggers – and donors responded.

Again and again and again, donors responded.

Even with the vast amount of political fundraising going on all year, donors continued contributing to their favorite nonprofits – and new ones too.

Why do fundraisers complain about donor fatigue? It’s because of sloppy fundraising.

Fundraisers keep going to the same donors over and over, exhausting those donors. And fundraisers talk too much about the money, not about the impact.

We predict donors will continue to respond generously in 2021, if they are approached with finesse and skill. 

3. Organizations that continue to invest in fundraising will see solid returns.

Many institutions slashed budgets early in 2020, and furloughed their fundraising staff.

These organizations forgot an important point – their fundraising teams were nurturing generous revenue streams. So what happened when fundraising staff was furloughed? The revenue quickly dried up!

On the other hand, many forward-thinking nonprofits managed to keep their staff and continue operating their fundraising programs.

These groups were able to stay in front of their donors with solid asks. As a result, they were able to ride the surge in donations and keep essential revenue streams flowing in the door.

And, these nonprofits saw a very nice ROI on their fundraising expenses.

Organizations that invest in fundraising will see an even greater growth in fundraising revenue. This will be true for 2021, and will never change.

4. New respect for digital strategies in the major gift world.

The new virtual world threatened to upend major gift fundraising.

But our clients persevered. Surprisingly, we all learned that digital could be a highly effective major donor engagement tool.

What’s more, we discovered that donors were happy to engage with us on the phone or zoom. Even more, going digital meant we could save time while connecting with donors more deeply.

Now, fundraisers could no longer rely on donor parties, lunches and committees as engagement tools. In this new world, we had to personally connect with donors, and talk to them about what mattered.

We predict that major gift fundraising will never be the same. Donor engagement does not have to be face-to-face anymore.  

5. Capital campaigns can absolutely succeed in the digital environment.

We encouraged our capital campaign clients to keep moving forward and they did, with success.

Feasibility studies went smoothly in 2020. We found that donors were just as happy (some were happier!) to talk to us over zoom or the phone as they were in person.

We helped clients stage virtual campaign events. Even more, we delivered capital campaign training to board members. And we guided major asks  – all virtually, and all successfully.

In 2021 capital campaigns will now be organized and executed with a combination of virtual and in-person strategies. 

6. Fundraising continues to become more sophisticated.

New advances in knowledge are yielding helpful new advances in fundraising.

For example, artificial intelligence is just beginning to show us its benefits, especially in the area of identifying stronger donor prospects and saving us time.

And behavioral economics is revealing how to nudge donors toward a gift rather than turning them off.

We are all coming to understand donor psychology better: what really warms our donors’ hearts?  And what emotional triggers will encourage them to be generous.

We predict that these tools will help fundraising become even more successful in 2021 and the coming years. 

7. Giving Days just keep getting stronger and stronger.

2020 saw not one, but two Giving Tuesdays – and both were hugely successful.

In December, 2020’s annual Giving Tuesday yielded a whopping 25% more than the previous year, with 29% more donors participating.

In addition, many organizations and institutions are staging their own proprietary Giving Days with solid success.

Giving Days are successful because they:

  • Add a note of gamification and fun to the fundraising process
  • Reach new donors
  • Provide urgently needed unrestricted gifts

Since Giving Days are still somewhat new, they are gaining more and more visibility. They will continue to grow as important fundraising tools in 2021 and beyond.

8. Virtual events and galas can succeed nicely. 

We continued to be surprised by so many very successful virtual events and galas.

Several organizations in our Major Gift Intensive saw higher totals from virtual events than from previous in-person events.

Many unforeseen benefits occurred when pivoting virtual, including:

  • Event costs were slashed (no more flowers, food, venue, insurance or music)
  • Staff saved vast amounts of time
  • Loyal financial sponsors pulled through
  • Many more people could attend the event on a virtual platform

 

Thank goodness we may never see galas like before. Virtual events will become a reliable alternative moving into 2021.  

Bottom Line: Our Predictions on Fundraising Trends for 2021

There’s a lot of opportunity hidden within a disrupted environment. Smart institutions will be opportunistic, agile and creative  – and they’ll see tremendous success.

Follow these fundraising trends for 2021, and seize the opportunity!

 

As always, it is a pleasure to share our weekly news and insights with you. 

If you want to build and expand your major and principal gifts programs in 2021, keep an eye on your inbox. Applications will open soon for our 2021 Major Gifts Intensive.

Wishing you a prosperous and positive start to 2021!

Remember April, when we were all clenching our teeth and thinking “Oh wow, this is not the year for fundraising. How will we get through it?” 

Well, it turns out recent data proves that 2020 is actually a great year for fundraising.

So if you were one of those organizations who didn’t hold back and kept at your fundraising in the spring – Good Job! 

Why 2020 is a Good Year for Fundraising 

The Chronicle of Philanthropy recently reported that giving was up 7.5% in the first half of 2020 based on results from the widely respected Fundraising Effectiveness Project (AFP, 2020). This project works with over 25,000 nonprofits and donor software providers to track and identify quarterly gain/loss findings for the nonprofit sector. 

And what’s more, it wasn’t just the wealthy who were behind the rise. The Chronicle of Philanthropy reported gifts of $250 or less rose 19.2%, accounting for a big part of the growth (COP, 2020).

This means that donors are pouring out contributions to their favorite nonprofits – right now. This also means that your steadfast supporters are feeling generous – and they want to help. 

And, there’s more good news in this report: 

Major gifts are up by 6.4% compared to this time last year. And mid-level gifts are up even more – by 8.1%! 

“the number of mid-level gifts ($250 – $999) and major gifts ($1,000 or more) saw year-over-year increases of 8.1% and 6.4%, respectively, compared to 2019 data.” (AFP, 2020)

Wow. That is wild. 

What Does This Mean?

The fact that giving increased 7.5% over 2019’s first half is a huge indicator that donors are motivated and feeling generous. The giving climate for the 2020 year-end giving season is projected to be robust. 

All of the signals indicate that giving is still quite solid as we move into autumn. And even with all the noise surrounding the election and the pandemic, loyal donors are stepping up for the nonprofits they support. 

This is certainly a great time to be out there, in front of your donors. Remind them about the impact your organization creates, and invite them to contribute

Why are we seeing so much generosity now?

For some time, we’ve thought that donors are simply more motivated these days, especially as we watch new gifts flowing into the capital campaigns we counsel. 

Our interviews and focus groups with donors have solidified this thought, and it seems data is now showing this trend as well.

1. Donors want to do something positive

With all the disruption of 2020, not least of all the pandemic, donors want to take action and do something positive for their community, and the world. 

They are motivated to bring forward kindness and compassion. When they are aware of the needs, especially regarding causes they care about – they want to respond.

While many have been terribly impacted, both physically and financially, many other major and mid-level donors were less affected and are still quite well-off financially. For many, they want to reach out and help others who have been less fortunate, through supporting nonprofits. 

2. The stock market is up, which is good for year-end

The US stock market took a hit, but now it continues to soar. Donors with investment portfolios are feeling flush. In our opinion, when donors feel financially secure, they tend to be more generous. TIP: remind your donors they can donate appreciated stocks! 

Even when the stock market was low, many major donors did not feel the hit and were still donating. On top of that – major donors may have more to donate in 2020 because any  traveling or larger outings were most likely cancelled. 

Bottom Line: 2020 has Shown To Be an Enormous Opportunity for Fundraising – Backed by Data

I hope you have been making the most of this generosity this year. And if you haven’t, it’s not too late to start!

 

As always, it is a pleasure to share our weekly news and insights with you. 

If you are planning a capital campaign and would like to learn about our unique Capital Campaigns by the Numbers approach, let us know. You can also join our INSIDERS community for more fundraising training and content. We would love to have you! 

Hope you have a wonderful weekend.