Every year around this time, I watch for the most delightful of all reports: The “How the Hell Did We Do?" Fundraising Report from Giving USA.
Welp. It’s here.
And while it’s not the cheeriest of reads, it’s packed with insights that every fundraiser, board members, and donor needs to know.
Spoiler alert: charitable giving took another hit in 2023, with a 2.1% drop after accounting for inflation. Booooo!
But fear not, there’s cautious optimism in the air for 2024, and we’ve got the lowdown on how fundraisers might just turn the tide. Hooray!
First, let’s talk about inflation. It’s still a big deal. And it knocked nearly every organization back and blew away the gains in giving. Donors felt the squeeze in their wallets, and nonprofits, such as emergency food pantry’s felt it even more acutely. They faced a double whammy: uncertain donor contributions and rising costs for food, all while trying to feed more people in need.
Here’s the hard truth from the report: individual giving dropped 2.4% in 2023, continuing a now nearly two-decade old worrying trend. Individual donors, who used to account for 73% of overall giving in 2013, now make up just 67.2%. Foundations, bequests, and corporations chipped in their shares, but it wasn’t enough to offset the decline from individual givers.
Despite the gloom, there are glimmers of hope. Despite a slight decrease in giving attributed largely to economic factors like inflation, we’re seeing some positive signs early in 2024, with donor confidence on the rise as the economy stabilizes. While there are a bunch of reasons for reduced giving, the stock market’s strong performance has provided some relief, especially for wealthier donors.
Speaking of those wealthy donors, they played a crucial role in buoying certain causes. Education, arts, culture, and public-society benefit organizations saw significant gains, thanks to high-net-worth households who had robust savings and strong balance sheets.
That would be great news if your entire donor base were wealthy individuals and corporations.
However, the broader picture isn’t as rosy—everyday donors are falling away, and nonprofits need to work harder than ever to bring them back.
And this is reflected in the numbers that are critical for smaller and medium sized nonprofits: while giving grew in current dollars, it actually fell 2.1% after adjusting for inflation.
So, what’s the strategy for turning things around in 2024? Well, it starts with understanding your donors and how they feel. Yes. How they FEEL.
The upcoming election and global uncertainties could impact giving patterns, but nonprofits can’t just sit back and hope for the best. You need to actively engage donors, keep them connected to their missions, and adapt their messaging based on the evolving political and economic landscape.
Does that mean you have to pick a red or blue strategy and move your mission’s sails where they wind blows?
Absolutely not.
But is does mean acknowledging that uncertainty moves your donor management more slowly. And that urgent need you have at your organization, may not be able to spur giving as quickly as it once did.
Patience. Consistency. Transparency.
Use these soft skills will allow your nonprofit and solicitation to be more aggressive by simply being more authentic to those who love you the most.
Grant seeking is another bright spot. Foundations, particularly private ones, are expected to increase their grant making in 2024. For nonprofits, this means focusing on building strong relationships with these institutional funders, even though the reporting requirements can be demanding.
However, grant writers beware. This positive news comes with a big caveat: foundations are niching down, which means those that were friendly to your cause in year’s past – may be looking in a different direction. Your diversifying of gifts will be your saving grace in the fundraising realm this year.
The key to all of this? nonprofits need to broaden their donor base and find ways to re-engage those everyday donors who have drifted away.
As we look ahead to the rest of 2024, it’s clear that the landscape is still challenging. But with strategic engagement, innovative fundraising models, and a focus on building strong donor relationships, nonprofits can navigate these turbulent times. It’s about showing up, staying connected, and proving to donors that their contributions, no matter the size, make a real difference.
So, here’s to turning the tide in 2024. Let’s roll up our sleeves, get creative, and keep the enthusiasm of your mission and how you make your community a better place in the forefront of your messaging and programming.
To read the full Chronicle of Philanthropy article – CLICK HERE.
To get ahold of us to help navigate what this all means for your nonprofit, and how we can help you solve your seemingly unsolvable fundraising issues? – CLICK HERE
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