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Article posted on Philanthropy.com by Raymund Flandez 21 June 2012
Fundraisers who are still using the bad economy as a way to persuade donors to give, be forewarned: That won’t work this year.
Donors are tuning out to that kind of plea as they become more financially stable and want to support organizations that achieve strong results, according to a new study of more than 15,000 donors to a wide range of charitable causes.
“Relying on tough times is a really weak argument,” says Penelope Burk, a veteran fundraising researcher and author of the study. “It worked for a while, but for Americans, it only worked for 18 months.”
Instead, she says, fundraisers need to “do something wonderful” that will carry a message to donors that the charity is fulfilling its mission.
Fundraisers who take that advice will be rewarded, she says, because four out of five Americans plan to give at least as much this year as in 2011.
What’s more, charities that make the right moves have a chance to win gifts from 44 percent of donors who said they could have afforded to give more last year.
The study, which has been conducted three other times, also found that 7 percent of donors plan to cut back on their donations this year, and the poor economy isn’t the main reason.
Instead, most of those donors pointed to changes in their financial situations because of a divorce or college tuition, for example. Only one in four said the economy was hampering their ability to give.
When charities do make the case that they deserve support because of the recession’s continued aftershocks, they find older donors—those age 65 and up—to be most receptive. More than any other age group, these supporters cited nonprofits’ need as a reason to give.
But middle-age donors are demanding results from nonprofits in exchange for their gifts, the study found. They want to be offered a clear idea of where the money is going, and they want to know that the charity is the best of all organizations working on that mission.
“Showing how a not-for-profit has adapted in order to remain successful during the recession is a constructive argument that speaks to innovation and cost-effectiveness,” Ms. Burk writes.
Donors under age 35, while also concerned about results, are interested in building a community of like-minded givers: They want to get their friends and family to support a cause they believe in. They are also more apt to give to new causes.
The online survey was conducted by Cygnus Applied Research, the Chicago fundraising consulting firm headed by Ms. Burk.
Among the other key findings of the study:
Over-solicitation bothers many donors. Almost two-thirds of charity supporters say they have been asked too often to give.
Of those who contacted a charity to ask them to reduce the number of solicitations, only one in four people said the nonprofit scaled back its requests.
As a result of this barrage of appeals, 45 percent of donors say they have stopped supporting or reduced their gifts to nonprofits over the past five years.
Yet with more than two out of five donors saying they could have given more than they did last year, fundraisers may be leaving money on the table, the study suggests.
To garner a bigger share of donors’ discretionary budgets, the study urged charities to move quickly to deal with complaints about the frequency of the mailings. Fundraisers should also include the date and amount of the donors’ most-recent gifts in appeals and remind them why they need the money, Ms. Burk says.
Young supporters are untapped and eager. Donors under 35 were more likely than older people to say they plan to give more in 2012 than they did last year: About 46 percent of young donors intend to step up their donations, compared with 30 percent of middle-aged donors and 15 percent of those 65 and older.
Young donors said they would have been more willing to give last year if they had been asked and if fundraisers had sought bigger gifts.
The report underscores the potential of young donors, saying that 40 percent of those under 35 who are not full-time students have household incomes of almost $75,000.
But, the study cautions, traditional fundraising approaches that may have worked on older donors do not work for younger ones.
For instance, young donors often don’t read fundraising mailings—because they’re the least likely of all adults to get mail. They also don’t get many telemarketing calls, because they use their cellphones rather than landline phones.
As a result, fundraisers need to find new ways to pitch giving ideas. “An approach through social media using peer influence may work better for younger donors who communicate differently and are influenced by their network,” Ms. Burk writes.
Web sites are the gateway to winning support. Most donors are getting savvier about their philanthropy, the survey found, often researching causes before they make their gifts.
Instead of turning to charity-rating agencies online, they often go directly to the charities’ Web sites to dig for information, looking at what the charity has done with donors’ money previously and what it plans to do with new contributions.
Five years ago, only two out of three donors conducted research before they gave, but now more than four out of five do so. Only 3 percent investigate charities by reading mailings and other print materials that the groups provide.
About 62 percent of donors said they turn to charity Web sites for information, while nearly half said they made a gift online during their most recent visit to a charity Web site.
Perhaps most surprising, 32 percent of donors said they hadn’t planned to give the last time they visited a charity’s site but were persuaded to do so.
Donors plan their giving—but there’s wiggle room. About 60 percent of donors said they budget for their giving at the beginning of the year, but some don’t stick to it. About 55 percent of those who budget never waver from it, 35 percent give more than planned, and 7 percent give less.
Those who budget tend to give more than those who don’t, and they give to more causes, 10 on average.
“Fundraisers should not assume that donors have locked themselves into a specific list of charities,” Ms. Burk writes.
Donors may be enticed to give more by how well charity officials and other fundraisers pitch the cause, she adds. In fact, of those donors who gave more than they anticipated in 2011, 25 percent said they were simply persuaded to step up their support.
Monthly giving may be overrated. Donors who give monthly through automatic payments don’t necessarily turn into major donors, the study says.
Because monthly giving is so removed from the act of personally writing a check, Ms. Burk warns that “the emotional, joyful sensation is simply not there when gifts are quietly deducted from donors’ accounts or charged to their credit cards.”
If fundraisers want to seek monthly gifts, the study says, it’s smarter to request them for a specific cause so they can see how their gifts make a tangible difference.
An executive summary of “The Cygnus Donor Survey: Where Philanthropy Is Headed in 2012” is available free online. A copy of the full report may be purchased for $75 at cygresearch.com/downloads or by calling (800) 263-0267.
Send an e-mail to Raymund Flandez.
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