How gratifying and wonderful it has been to see the overall nonprofit industry collaborating together and gathering around the need to #QuitBadFundraising, recognizing the urgency for radical change in fundraising practices. Meetings, workshops, lunches, coffee shop gatherings and more are taking place across the nonprofit industry with authentic conversations, and we’re all working together to find new solutions.
Over my coffee this morning, I started thinking about how we build this next chapter. Then, it occurred to me that we just need to follow the ABCs. (OK, maybe I had too much coffee, but bear with me as I’m about to get a little squirrelly with acronyms.)
In order to ALTER the donor experience, we must be ...
If we do those things, it PAVES the pathway to a strong donor relationship by
This might sound like a broken record, but let me emphasize once again: stewardship. Please work your plan/build a plan! Donor trust is key to retention and growth. Prepare your case now for your board of directors and committees for why you and your team need specific resources to retain your organization’s most precious asset.
Speaking of which, RKD Group has just finished a new research study on this topic. We surveyed 1,630 U.S. donors to gain a deeper understanding of what forces drive trust. Get ready to dig in!
How did we get here? How can nonprofit organizations build back up that trust with donors going forward?
Don’t stop now—go read! I’m just whetting your appetite! There are a few surprises …
Key Takeaways:
What’s most interesting is that 42% stated that they planned to increase their giving. Here were some of their reasons for giving more:
Only 6% plan to give less, and 10% indicated they are not planning to give this year at all. When asked why donors were planning to give less, here were there reasons:
Results show 60% of surveyed donors plan to donate online. 37.8% intend to mail checks to charities. A smaller number of respondents plan to give through means other than cash: donor-advised funds (9.2%), stock transfers (4.4%), and cryptocurrency (2.2%). Almost 25% of donors are planning a recurring gift.
While that probability is still high by historical comparison, it represents the largest month-over-month percentage-point drop since August 2020 when the economy was recovering from a short but sharp recession induced by the COVID-19 pandemic. It reflects the fact that the economy has kept growing even as the Federal Reserve has raised interest rates and inflation has declined.
Nearly 60% of economists said their main reason for optimism about the economic outlook is their expectation that inflation will continue to slow.
The survey of 69 economists was conducted July 7-12. That means their optimism was recorded even before new GDP reports showing the U.S. economy grew more than expected in the second quarter this year.
More than a third of millionaire investors (34%) report keeping more of their money in cash, according to the survey, which surveys households with $1 million or more in investible assets. They now have 24% of their portfolio in cash, up substantially from the 14% they held in cash a year ago.
Of the survey respondents, 28% said they have purchased more fixed income as they expect interest rates to remain high.
The results echo a recent survey by Capgemini that found global high-net-worth investors had a record 34% of their portfolios in cash or cash equivalents, such as money markets, CDs and other vehicles.
“These investors are moving from growth to value, to protecting their assets,” said Elias Ghanem, global head of Capgemini Research Institute for Financial Services. “Right now, it’s better to be safe than sorry.”
What if organizations were more integrated? What if they could provide the gratitude given to major donors to everyday donors, too? What if the thank-you message was as important as the “can-you” message?
Data shows these are more than what-if questions. They are what it takes to grow efficiently and effectively.
It’s important to dig into your technology stack. Understand it. Use it to the fullest. To think about creating personalized experiences at scale across your digital ecosystem. To connect and engage with your audiences where they are. To look at donors and what their actions are telling you.
Create a thank-you culture. We’re halfway through the year, but I want to challenge all nonprofits to create a thank-you culture across their ecosystems this year.
This was more than five times the increase than that in households earning less than $50,000. Moreover, the 30-state sample might understate the increase in high-wage earners receiving unemployment benefits because it didn’t include California (which issues benefits via prepaid debit cards), home to many of the tech companies where layoffs have been concentrated.
A tight labor market and in-demand skills mean that many well-off workers who lose their jobs can probably find new jobs fairly quickly—but maybe not at the same level of pay.
The survey found 30% took a loan and 21% took an early and/or hardship withdrawal.
Generation Z are somewhat more likely than Millennials, Generation X and Baby Boomers to have taken an early and/or hardship withdrawal (28%, 24%, 19% and 12%, respectively).
And in the first three months of 2023, the number of plan participants taking hardship withdrawals jumped 33% from the same period a year earlier, with workers taking out an average of $5,100 each, according to a Bank of America report.
The biggest roadblock for the majority (53%) of workers to retirement savings is crystal clear: debt, the Transamerica survey found. There is, however, a sharp split across generations. Millennials, Gen X and Gen Z are more likely to say that’s the issue than Baby Boomers (58%, 56%, 54% and 34%, respectively).
Other reasons for hardship withdrawals:
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