Rossi’s Roundup: DAF tips, crypto reminder, patterns in philanthropy

So much has happened since my last touchpoint. Hurricane Helene has caused mass tragedy across five states and has severely affected several of our partners. Our hearts go out to everyone who has been touched by this catastrophic disaster.

On a good note, there will not be a postage increase in January! And, The Federal Reserve voted to lower interest rates by a half percentage point, opting for a bolder start in making its first reduction since 2020.

DAF Day is almost here.  It’s Oct. 10—are you ready? 

The International Longshoremen’s Association, which represents 45,000 dockworkers from Maine to Texas went on strike October 1st and there is great hope it will be settled quickly with the upcoming election.  RKD Group is prepared and does not anticipate any disruptions for our fall campaigns or early 2025 work. We, of course, are staying vigilant and monitoring the situation closely with our production partners. 

FYI, the FEP Q2 2024 Report, offering expanded materials and insights, will be released on Oct. 30. The AFP Foundation for Philanthropy and GivingTuesday have announced a new governance structure and strategic vision for the Fundraising Effectiveness Project (FEP), following two years of research and development.  

If any of you watch The Voice, you might have recently heard Michael Bublé share a memorable experience with Tony Bennett. I absolutely love this quote: “If you steal from one, you’re a thief. If you steal from everyone, it’s research.” For those who know me well, you may have heard me say, “idea expansion” which builds on, but does not plagiarize a product/strategy/quote, etc. 

Hope you’re enjoying the insights on the Thinkers Newsletter on LinkedIn. This month Ronnie covers football, 3 fundraising trends we’ve seen in our data, digital tracking changes, overcoming ‘overwhelm’ with Mallory Erickson, and how strategic shifts drove a global lift for the Pancreatic Cancer Action Network.  

Lots to cover this month!  Grab your favorite beverage and kick your feet up! 

1. The Hidden Patterns Shaping American Philanthropy 

Where do the country’s charitable dollars really flow? A new collaborative report reveals the impact of wealth concentration, geography, and economic factors. 

The newly released study by GivingTuesday, Candid, and Network for Good combines multiple datasets to piece together a nuanced — if not yet complete — picture of charitable giving across the United States. The analysis reveals stark contrasts between individual and institutional giving priorities, distinct geographic concentrations of philanthropic dollars, and the significant influence of economic factors on giving patterns. 

1. A mere 0.3 percent accounted for 45 percent of all donations to nonprofits from 2015 to 2022. The majority of Americans who give less than $100 a year, by contrast, account for less than 3 percent of overall philanthropy. 
   
   
2. The average grant size increased from $53,000 in 2015 to nearly $98,000 in 2022, while the median grant size increased from $4,200 in 2015 to $10,000 in 2022. 
   
   
3. Foundation dollars went largely to education and health-related causes; individuals of all donation levels prioritized giving to human service organizations, like food banks or homeless shelters. The proportion of grant dollars going to education dropped from 32 percent in 2015 to 24 percent in 2022. 
   
   
4. California and Texas retain the most nonprofits in absolute terms, but Washington, D.C., Vermont, and Montana lead in nonprofits per capita. 
   
   
5. States with higher median household incomes tend to receive more charitable dollars per capita, and states with higher poverty rates tend to receive less. However, Nebraska shows giving rates significantly higher than expected based on its wealth and nonprofit density, an anomaly attributed in part to Warren Buffett’s longstanding presence in Omaha. 
   
   
6. While foundations have tended to increase their grant sizes in response to rising costs, the same was not true for individual donors. For example, a small donor who gives $250 a year was likely to do so consistently regardless of economic conditions, whereas large donors might change the size of their gift depending on, say, the state of their stock returns. 
   
   
7. Religious organizations saw the greatest decline in the share of individual donations, from 13 percent in 2015 to 10 percent in 2022. 
   
   
8. Institutional grant makers in Delaware, Nevada, and Washington ,D.C., allocated over 70 percent of their grant dollars across state lines, while most states focused on intrastate giving.

2. Seven (7) Takeaways from The DAF Donor Satisfaction Survey by Giving Compass & The Lilly Family School of Philanthropy 

Giving Compass partnered with Dr. Sara Konrath from the Lilly Family School of Philanthropy to release a landmark new study: “Donor Satisfaction and Unlocking Public Sector Funding from DAFs.” The study explores the psychology of DAF donors, identifying the key factors that propel DAF giving  – and what hinders it. I encourage you to go read these seven takeaways and the wonderful actionable items recommended! 

Key findings include: 

1. 97% of DAF donors do some kind of diligence before giving. The two most popular ways donors sought information were word of mouth and Google search. 
   
   
2. 68% of DAF donors are motivated by long term impact. Donors focused on the sustained long term effects of their donation – the top three answers were improving people’s lives, advancing a nonprofit’s mission, and contributing to long term change. 
   
   
3. 37% of DAF Donors didn’t use their DAF to make their most recent donation, citing extra steps. Many DAF donors use DAFs for their planned annual gifts. However, when they come across a worthy cause more spontaneously, they give with a credit card instead of a DAF due to the extra steps required. Ensure that the process of giving to your organization through a DAF is a breeze! 
   
   
4. 84% of DAF donors who chose not to use their DAF for their most recent donation were making a gift to a local organization. This highlights a huge opportunity for locally-based nonprofits. The best way to get those donors to use their DAF is to remind them and make it easy.   
   
   
5. 98% of donors were positively impacted when shown a video about an organization they might give to. When participants watched a video about an organization, 15% more people felt they had sufficient information to donate compared to when they only read an excerpt about an organization’s mission. Video storytelling is highly motivating to DAF donors, particularly for smaller organizations that are new to them. 
   
   
6. 54% of DAF Donors view themselves as experts – and experts give more. These findings are also an important reminder that DAF donors identify as “smart” givers, and as that sentiment grows, gift size increases!   
   
   
7. Only 10% of “affluent” households use DAFs –  we’re at the very beginning of this wave! While DAFs are increasingly accessible to all types of donors, there’s still a huge growth opportunity among their traditional audience: affluent households. 

A few more tips from head of strategy at Chariot Mitch Stein: Make DAF Giving Easy for Donors 

Include DAFs on your donation page. DAFs should appear right alongside credit card and bank transfers as an option on giving pages, fundraising experts say. There are some products that work like Google Pay or Apple Pay to allow DAF givers to donate directly on the website, rather than having to go back to their DAF account website, log in, and set up the transfer from there. 

Get educated, so you can educate donors. “Giving is just getting more and more complicated,” says Anna Pruitt, managing editor of “Giving USA.” “Understanding how to talk to people about it; it’s just going to be an important part of the work going forward.” 

Provide Your EIN number on DAF donation pages. The EIN is a unique number provided by the federal government that identifies charities and other businesses. Because charities can have similar names, including the EIN, and not just the charity name, can help donors avoid costly mistakes, says Mitch Stein, head of strategy at Chariot. 

Top 4 DAFs Distributed $27 Billion To Nonprofits 

Human services, religion and education held the top-three positions as causes supported in 2024 as they did in 2023. The five nonprofits that received the highest number of individual grants were Médecins Sans Frontières, also known as Doctors Without Borders, World Central Kitchen. Planned Parenthood Federation of America, St. Jude Children’s Research Hospital and CRU (Campus Crusade for Christ). 

Fidelity Charitable-assisted funders granted $11.8 billion to charity during 2023, up from $11.2 billion for 2022. More than 322,000 donors made contributions to nearly 199,000 nonprofits, up from just under 304,000 and 189,000, respectively. Funders made 2.3 million individual grants, compared with 2.2 million in the previous year. 

Schwab Charitable funders allocated $6.6 billion during its fiscal year 2024 (the 12 months prior to June 30, 2024), surpassing the organization’s previous high of $5 billion during the previous fiscal year. Donors supported more than 141,000 charities, up from more than 120,000 during fiscal year 2023. During fiscal year 2023, seven in 10 donors made grants to charities they had not previously supported, and 79% of donors issued grants to nonprofits they had previous supported. More than one third (36%) of grants were automatically recurring, and nearly three quarters (72%) of these grants were unrestricted, more or less in line with the previous year. 

National Philanthropic Trust (NPT) donor-advised fund participants granted $5.49 billion to 41,217 qualified charitable organizations during its fiscal year 2024 (July 2023 through June 2024), as previously reported in The NonProfit Times. The total amount given increased from fiscal year 2023, when the NPT coordinated $4.52 billion in grants to 36,361 nonprofits. Between FY 2023 and FY 2024, the number of grants made increased from 107,000 to 129,000. 

Vanguard Charitable FY 2024 (July 2023-June 2024) distributed more than $3 billion during its fiscal year, which ended June 30, 2024. That figure marks a 45% gain over the previous fiscal year, when distributions topped $2 billion for the first time. As part of its disbursements, the DAF coordinated a record $1 billion grants to 13,000 nonprofits through its Grant Payments with PayPal solution. In all, funders made more than 222,000 grants to just under 60,000 nonprofits during FY 2024, up from 195,000 grants made to more than 53,000 nonprofits a year earlier. 

3. Five (5) Big Learnings From the ‘GivingPulse Q2 2024 Report’ 

GivingTuesday recently released the “Giving Pulse Q2 2024 Report,” offering an in-depth analysis of giving behaviors and perspectives from April to June 2024. The report presents valuable opportunities to refocus efforts and develop strategies that can adapt to these changes.   

Here are five key learnings from the report:

1. Giving Dropped This Quarter.  (Ok, make sure you have your boots on… this finding is profound.) Total giving across all gift types and recipient categories reached its lowest point of the year during this quarter. Fewer people donated, and those who did gave in fewer ways. More donors focused on just one type of giving, bringing the total to 45% of respondents giving to only one type of recipient. 
   
   
2. Solicitation Rates Also Dropped. Despite a consistent response rate of around 35%, the decrease in solicitation led to a decline in overall generosity. Looking at a more granular level, solicitation among individuals over 30 dropped by 14%, bringing their rate down to 25%, matching that of donors under 30. 
   
   
3. In-Person Donations Decline Yet Online Remains Stable. Additionally, mail-in donations surged by 36%, particularly among households with incomes under $50,000, where donating by mail rose from 7% to 14%. Drops of 10% or more in giving at live events, religious services, and directly to individuals. On a more positive note, online donation methods saw only minimal changes. 
   
   
4. Crisis Response Surges in the US.   For crisis responders their giving within the United States but outside one’s local community increased substantially to 39%, while international giving dropped from 17% in Q1 to just 6%. 
   
   
5. Urban Donors Show Greater Generosity. Suburban residents strongly favor giving to registered organizations (42%) over informal groups or individuals (both at 29%). In contrast, urban residents give almost equally to registered organizations (46%) and individuals (44%), while rural residents show less disparity between recipient types. 
   
   

4. America’s Giving Crisis — and the Plan to Fix It  

The Generosity Commission concluded a three-year study with a roadmap to boost charitable giving and volunteering in the U.S.  The Generosity Commission, composed of 17 experts across the philanthropic sector, has spent the last three years dissecting Americans’ dwindling participation in formal charitable giving and volunteering.  

Their findings suggest that the decline in everyday generosity may be both a symptom of the country’s social ills, from social isolation to political polarization, and — if nonprofits can reverse the tide and embrace new forms of American generosity — a possible antidote. 

Indeed, 74 percent of Americans say they aspire to be generous, according to a 2022 survey by the Generosity Commission. The share of U.S. households that donated to a charity fell from 65.4 percent in 2008 to less than half of households — 49.6 percent — in 2018, the last year for which such data exists, according to the Philanthropy Panel Study by the Lilly Family School of Philanthropy at Indiana University. 

Rates of formal volunteering have seen similar declines, falling from 30 percent in 2019 to 23 percent in 2021, according to AmeriCorps, the steepest drop since the federal agency began collecting data in 2002. 

Donors are disappearing. In other words, though Americans seem eager to exercise generosity, they do so at lower rates each year.  

“I don’t think we’re experiencing a crisis of generosity — I think generosity is abundant,” said Asha Curran, CEO of GivingTuesday and a commission member, whose hashtag-driven collective campaign brings in billions for nonprofits each year — albeit from a dwindling number of donors.  

When asked how they give to make the world a better place, only one-fifth of Americans cited monetary donations at all, according to a survey funded by the Generosity Commission. The rest mentioned a mishmash of altruistic activities, like being environmentally friendly, giving to a food pantry, “sharing kindness,” or buying ethical products. 

9 Ways to Increase Everyday Generosity: 

1. Increase the depth and breadth of data on giving and volunteering 
   
   
2. Close the generosity evidence-to-practice gap 
   
   
3. Encourage public figures and leaders to speak openly about their generosity 
   
   
4. Take youth seriously as givers and volunteers 
   
   
5. Use all of philanthropy’s resources in support of everyday generosity 
   
   
6. Help community foundations take a leading role 
   
   
7. Encourage businesses to promote volunteering and giving in the workplace 
   
   
8. Increase the availability of the charitable contribution tax deduction 
   
   
9. Sufficiently fund federal and state charity regulators and simplify compliance 

5. Reminder: Crypto Donations And The IRS 

The chief counsel of the Internal Revenue Service (IRS) provided two important reminders for both donors and charities regarding qualified appraisal rules governing cryptocurrency contributions.  

A qualified appraisal is required for donations of cryptocurrency for which a charitable deduction of more than $5,000 is claimed under Section 170(a) of the Internal Revenue Code (IRC).  

As defined in section 170(f)(11)(E)(ii), a “qualified appraiser” is an individual who (1) has earned an appraisal designation from a recognized professional appraiser organization or has otherwise met minimum education and experience requirements set forth in regulations prescribed by the Secretary, (2) regularly performs appraisals for which the individual receives compensation, and (3) meets such other requirements as may be prescribed by the Secretary in regulations or other guidance. 

Even though cryptocurrency assets are traded on public exchanges and have easily referenced fair market values, the appraisal requirement remains in effect without exception. 

6. Charity Navigator Launches Causeway Ahead of Giving Season 2024 

Originally launched in 2022 and acquired by Charity Navigator in 2023, Causeway has been integrated into Charity Navigator, offering both new and existing users an easier way to make a meaningful difference.  

Similar to investing in mutual funds, donors can create a giving portfolio of specific cause funds. 

Informed by survey data and giving insights, the Causeway launch will include managed charitable funds focused on pressing issues such as Hunger, Homelessness, Animal Welfare, Global Health, Global Poverty, and Education. Each Causeway fund includes a mix of charities using proven strategies, from direct services to policy reform, all chosen for maximum impact. Donors simply choose which fund they want to add to their portfolio and donate one time or choose a recurring donation to the fund(s). 

7. Apple’s iOS 18 update: The end of email preheaders and what it means for your email strategy 

With the new update, Apple will remove standard preheaders from its Mail app, replacing them with AI-generated summaries tailored to each recipient.  

With approximately 50% of email users utilizing Apple’s native mail client, this change has the potential to change how emails — including important year-end fundraising emails — show up in supporter’s inboxes. 

Here are 3 strategies to consider:  

1. Write compelling, unique subject lines. 
   
   
2. Start your message with a strong hook.
     
3. Test, test, test! 

Will this change ultimately affect open rates and fundraising results? We don’t know yet! But it does give us an opportunity to focus on writing meaningful content that drives action and deepens connections with donors and advocates. 

8. Report Reveals Nonprofits Are Adopting AI in CPaaS Faster Than Private Sector 

Twilio, a customer engagement platform that drives real-time, personalized experiences for brands, released its State of Nonprofit Digital Engagement Report which highlights the impact of new technology on engagement in the nonprofit sector, including public sector, healthcare and education institutions classified as 501c(3) organizations. In its second edition, the report reveals how nonprofit organizations are embracing and implementing new technology, such as AI, to engage their end users. 

Twilio’s research shows that 90% of organizations surveyed in the nonprofit, education, and healthcare sectors are leveraging AI for one or more engagement and marketing use cases, including customer engagement platform, contact center, survey platform, customer analytics, and more. Nonprofits are integrating AI faster than the private sector, with 58% of nonprofits using AI with their CPaaS solution, compared to 47% of B2C businesses in the private sector. Further, 68% of nonprofits are using AI to analyze end user data to understand their needs and pain points, compared to 64% of B2C brands. Strong digital engagement is critical to success, according to 87% of nonprofits, to better reach, enroll, and serve new users, and they are turning to AI to accelerate and improve these efforts. 

The report found that most nonprofits are aware of the need for better personalization, as 71% of organizations say personalized communications is a top priority in 2024, with AI boosting efforts. Across sectors, organizations are seeing success implementing AI. 

9. Economic Headlines 

Inflation eased to new three-year lows, teeing up the Fed to begin gradually reducing rates. The Federal Reserve voted to lower interest rates by a half percentage point, opting for a bolder start in making its first reduction since 2020. The long-anticipated pivot followed an all-out fight against inflation the central bank launched two years ago. Consumer sentiment climbed to 4-month high as inflation eased. Yet Americans are still “guarded” in their views about the economy.  

Lenders continue to see a rise in late payments on credit cards and auto loans. The Conference Board's consumer confidence index dropped more than expected, marking the biggest decline the metric has seen in three years. Digging deeper, it seems that good news on interest rates and inflation is being outweighed by an increasing sense that it's going to get tougher to find a job despite what the Feds and unemployment rate say. Unemployment has steadily risen throughout 2024 and sits at 4.2%, just below its highest level in almost three years. Meanwhile, job openings declined in July to their lowest level since January 2021. 

The S&P 500 rose 0.4% September 30th to close at a new record of 5,762, capping off a 5.4% quarter for the index. Looking back, the Dow led with 8.2% as the Nasdaq posted a quarterly gain just shy of 3%. It’s the best year so far since 1997! 

The personal consumption expenditures price index, a gauge the Fed focuses on to measure the cost of goods and services in the U.S. economy, rose 0.1% for the month, putting the 12-month inflation rate at 2.2%, down from 2.5% in July and the lowest since February 2021. The Fed targets inflation at 2% annually.  Personal income increased 0.2% on the month while spending rose 0.2%. The respective estimates were for increases of 0.4% and 0.3%. Stock market futures were positive following the report while Treasury yields were negative.  In recent days, Fed officials have switched their focus from inflation fighting to an emphasis on supporting a labor market that has shown some signs of softening. At their meeting last week, policymakers indicated a likelihood of another half percentage point in cuts this year then a full point in reductions for 2025, though markets expect a more aggressive path. 

10. Visit the RKD Resources Website Page for some great insights

Blog updates:

• Dynamic creative automation helps nonprofits reach the right audiences 
• Fact vs. fiction: Digital tracking changes nonprofits should know about
• New research: What drives people to donate to missions 
• Rossi’s Roundup: Bite-sized media, bigger gifts and texting 
• It’s time to modernize your fundraising creative for performance 

RKD Group: Thinkers Monthly LinkedIn Update:

• Cooler weather, football and—gulp—here comes giving season! 
• Bro, it’s all about the audience 
• A new recipe for growth: The GivingPulse Field Guide 
• Not just for kids: What board games can teach us about fundraising 

Podcast updates:

• Thinkers: The ups and downs of your data with Steve MacLaughlin 
• Thinkers: The big deal about monthly giving with Dana Snyder 
• Thinkers: Overcoming overwhelm and scarcity mindset with Mallory Erickson 
• Thinkers: Revolutionizing creative: Matt DiBenedetti’s audience-first approach at RKD Group 
• Chat: Meet Vivian Borja from Food For The Poor
• Thinkers: From IT to AI: Transforming nonprofit fundraising with Cherian Koshy 

eBooks and Research: 

• GivingPulse Field Guide in cooperation with GivingTuesday 
• The 2024 Nonprofit Marketer's Compass 
• Solid Gold: The Nonprofit Marketer's Guide to Trust 
• Listen Up: The Nonprofit Marketer's Guide to What Donors Want 

Oh – and did I report that postage is not increasing in January?  I did?  Well, I’m repeating it because that’s how excited I am that we won’t have a postage increase. 

The editor in chief of Entrepreneur magazine, Jason Feifer has a weekly newsletter, One Thing Better. Last week he covered, Protect Your Time: How to Say No Without Feeling Guilty.  Jason learned a simple framework from Brian Lee, the cofounder of LegalZoom. And Brian learned it by accidentally almost killing the company. I encourage you to go read the story, which is not long. Ultimately, the strategy after you understand it is: 

• Today’s one thing: Saying no to new things. 

• That one thing, better: Saying yes to existing things. 

Please remember to take time for a breather and replenish your heart and spirit. You’ll come back refreshed to tackle all that’s ahead of you. Your RKD team is always here to support you so please don’t hesitate to reach out. 

Thank you for our partnership!