We’re into the final weeks of another interesting but glorious year. Over the past month, a flood of new benchmarks, case studies, trends, and more were released. Grab your favorite beverage and get ready to dive into this digest.
A few weeks ago I caught a thought-provoking post by Dennis Hoffman on LinkedIn about the concept of attention that I wanted to share. He had just read an article about how different cultures express the concept of "attention." His post went on to say, “In Spanish, we "lend" our attention; in French, we "make" it; in English, you "pay" attention; in German, attention is a "gift." … Each interaction is an opportunity to make our case compelling and worth their investment, whether it's seen as a loan, a creation, a payment, or a gift. Our language confirms the importance of crafting messages that not only inform but also engage and resonate on a deeper level….” Thank you for sharing those thoughts, Dennis.
With emojis everywhere on social media these days, I recently had an eye-opening moment. While watching an episode of The Lincoln Lawyer, I was surprised to learn that the thumbs-up emoji can sometimes be interpreted as passive-aggressive, sarcastic, or even rude—depending on context and the age of the user. Naturally, I had to look it up, and it was quite a revelation. So, if you had not heard about this shift, consider yourself updated.
Thanks to The Wall Street Journal, I've learned a new term: HENRY—short for "High Earner, Not Rich Yet." Even with a substantial salary, being a HENRY means financial freedom is still out of reach, and financial pressures are very much a reality. New census data show 14.4% of U.S. households bring in $200,000 or more a year, a near record. HENRYs describe feeling stuck on a hamster wheel—a nice one that other hamsters envy—but running in place nonetheless.
Some interesting studies and trends released last month include:
Now for a monthly digest of articles. Are you ready?
Keeping up with donor trends is crucial. Dollars and Change, a new report from Candid, GivingTuesday, and Network for Good, takes a deep dive into eight years of data, shedding light on the patterns in charitable giving—and the factors that drive those patterns. Here’s a look at select key findings fundraisers should consider when planning their strategies.
3) Giving priorities vary by donor type and grantmaker size: The differences in giving priorities between individual donors and institutional funders and between grantmakers of varying sizes.
4) Economic factors affect giving: Both individual and institutional donors showed increased donations during strong economic periods. While microeconomic factors, like household income and stock market performance, have a more immediate and direct impact on giving, macroeconomic factors, such as GDP, influence giving with a delay.
Next up: DAF Day 2025 is slated for Thursday, October 9th of next year.
Chariot is covering 5 key aspects of DAF fundraising at year end, with specialized experts leading each free webinar.
A recap of the Nonprofit & DAF roundtable at the 2024 DAF Giving Summit, here’s 7 practical steps to improve the nonprofit experience with DAF giving.
Fundraising trends appear promising as the nonprofit sector continues to make strides with dollars raised, according to the Fundraising Effectiveness Project’s latest figures. Though a moderate spike in donor dollars is promising, the trend of those dollars coming from fewer donors has continued, according to the quarterly report. Additionally, donor retention’s downward trend maintains its year-over-year trajectory, though the data indicates the rate of decline is slowing. This plateauing suggests that the heightened focus on retaining donors is producing results, demonstrating the kinds of approaches the sector should be taking to further solidify donor engagement.
Here are four key points about the data to keep in mind:
1. Dollars Return to Charitable Causes: Charitable giving continues to increase moderately. The 3.7% rise in the second quarter is slightly less than the first quarter’s leap; however, it is the largest second-quarter jump in four years.
2. Donor Retention Remains a Struggle: Even though more dollars are going to great causes, donor retention has lowered by 4.5% — slightly worse than in the first quarter. Only 11.1% of new donors were retained through June, resulting in a 9% decrease over the same period in 2023. Researchers found repeat donors are still more likely to give additional gifts, with 35.3% of repeat donors retained in the first half of the year. The most significant retention rate decline happened in the recaptured donor group, which holds a 1.5% retention rate and 18.2% decline over 2023’s midyear point.
3. Recurring Donors Become Less Active: Nonprofits experienced a 5.8% dip in dollars raised from repeat retained donors. This is significant because this group accounts for 60.1% of total dollars. The highest donor decline (14.4%) and dollar drop (6.5%) came from those who gave seven or more gifts. Both new and newly retained donors — those who gave for the first time last year, saw the largest drops, with 11.8% and 13.3% dips, respectively. Researchers emphasized the need to strengthen donor participation as first-time donors (33.8% of all donors) and repeat retained donors (43.8% of all donors) account for three-quarters of the decline in donors.
4. Small-Dollar Donors Are Often Not Loyal Supporters: At the halfway point, the number of donors is down 3.9% year over year. Though that drop is larger than in the first quarter, this has been a consistent trend since 2021, according to the report. Monthly totals between 2023 and 2024 are virtually identical until May 2024, which saw a 8.6% drop at the same time last year. The second quarter routinely experiences steep donor declines, causing researchers to indicate a growing donor engagement problem at midyear. On the other hand, fewer larger donors are giving, but the rates of decline are much less severe.
FEP Q2 2024 Report Key Takeaways:
The Indiana University Lilly Family School of Philanthropy released, “The Giving Environment: Giving During Times of Uncertainty.” The study uses data from the Philanthropy Panel Study, which followed specific families during the pandemic. Giving patterns during that time offer important lessons for today, the report contends — chiefly that people give, even in times of economic uncertainty, when they understand there is a pressing need.
The report found that the decades-long trend of fewer donors giving more dollars continued throughout the pandemic but that some new donors emerged. “This new group of donors may be more responsive to rapid community support, nonconventional forms of philanthropy, and digital fundraising efforts,” the report says. The panel data doesn’t go beyond 2020, but anecdotal evidence suggests that engagement tailored to those donors’ needs helps them stick around.
The Fundraising Effectiveness Project identifies similar themes, including donor fatigue is a myth. This data suggests nonprofits need to do more to engage their donors. Donors want to “maintain a dialogue that isn’t always just asking for money. Organizations need to give people an opportunity to be part of their mission.
Other findings from the Giving Environment report:
Only 12% of all donors, meaning people who have made any kind of gift in the past 12 months, have made a spontaneous gift during the same period. Spontaneous giving is not just about emergencies—wide range of causes benefit from this kind of giving.
On average, the donors surveyed gave spontaneously to two organizations within the last year, and 88% gave to four or fewer organizations. Two-thirds of these gifts were under $100. But as we will explore in this report, many of these donors are open to repeat giving, paving the way for possible upgrades.
Spontaneous gifts, while unplanned, aren’t uninformed. From the spontaneous, first-time donors surveyed, 48% reported doing some research/due diligence before making their gift.
More than three-quarters of donors approaching retirement and those who have already retired say charitable giving plays a significant role in their lives, according to a new report, Charitable Living and the New Retirement from Fidelity Charitable.
Researchers surveyed 2,512 donors ages 50 to 80 who had given $500 or more in the previous year. They found that those donors are also interested in volunteering: Seventy-four percent of pre-retirees and 55 percent of retirees reported volunteering in the previous year. Nearly all — 97 percent of pre-retirees and 93 percent of retirees — also donate money to at least one of the organizations at which they volunteer, the report found. Sixty-eight percent of committed givers donate more than $1,000 annually, and 72 percent have volunteered in the past 12 months.
(Wakeup call!) The report found that respondents were unaware of many of the tools they could use for philanthropic giving.
Smart nonprofits are using their websites and other channels to educate donors and be very open and inclusive about ways that you can donate: stocks, IRAs, bequests through a will, a donor-advised fund, payroll deductions.
The annual report includes a comprehensive analysis of giving data from 370 nonprofits across the Human Services, Education, Faith, and Healthcare sectors. Findings underscore the significant role that donor retention, gift size growth, and recurring giving programs play in nonprofit resiliency and how even small changes in these areas can lead to exponential growth in fundraising outcomes.
Key Findings from the Report include:
A new integration between GoFundMe and Meta will allow nonprofits and donors to share causes they care about through Meta social media platforms. The aim of the new partnership is to drive more nonprofit donations, which has raised more than $8 billion via Instagram and Facebook fundraisers to date.
Classy clients now have access to this new feature on Instagram. Integration with GoFundMe and Facebook will be added in the coming weeks. Nonprofits must be registered for Meta fundraising tools to benefit from these features.
The new capabilities will help nonprofits transform supporters into brand ambassadors with sleek, shareable fundraiser creative that can be shared as posts or stories to showcase progress on campaign goal metrics in real time. In addition, a new donate button will direct potential donors to the nonprofit’s website or donation page, providing Classy customers with coveted donor data and insights from these off-channel donations to better nurture donor relationships.
New research from GoFundMe found half of Gen Zers are sharing causes or fundraisers at least weekly, while a similar percentage of millennials and Gen Xers are doing so monthly. “The Social State of Giving” report also found that social media directly influenced a quarter of Gen Zers to research or donate to a cause.
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.
Nonprofit managers are scrambling to get clarity on how to proceed regarding the Federal Trade Commission’s (FTC) new “click to cancel” provisions requiring businesses to make it easier for consumers to cancel enrollment in recurring billing, such as memberships.
In the case of nonprofits, it could mean anything from making it easier to cancel recurring gifts, to getting out of gym memberships or membership of any type to any pausing ongoing donor relationships. Most of the final rule’s provisions will go into effect 180 days after it is published in the Federal Register.
Leaders at constituent relationship management (CRM) platforms nonprofits contacted by The NonProfit Times declined to comment on the new rules except to say that they advise transparency when dealing with donors and are evaluating the challenges. A leader at donation and donor relationship platform Fundraise Up was not as coy. The platform requires users to be upfront regarding recurring gifts and contact from a nonprofit.
While nonprofits are referred to in the FTC rules as not being directly impacted, businesses with which nonprofits contract are subject to the regulations. FTC staff has developed a fact sheet summarizing the changes to the rule.
Let’s talk vibes. A prominent feature of the economy over the past year or so has been the “vibecession,” whereby individuals’ feelings about the economy are trending far worse than official data would suggest. But even the vibes seem to be improving. The Conference Board’s Consumer Confidence Survey jumped in October to its highest monthly level since March 2021. The University of Michigan survey of consumer sentiment also ticked up in October to its highest reading since April.
The preponderance of evidence from official data, company earnings and even consumers points to a strong, if gradually slowing, economy. No one should panic about the October employment report, which showed the economy adding just 12,000 jobs for the month. There were multiple distortions bringing it down, including a strike at Boeing and two major hurricanes. These affected not only the number of people working but also the survey collection methods of the Bureau of Labor Statistics.
The GDP (gross domestic product) grew at a respectable 2.8% annual rate in the third quarter, adjusted for seasonality and inflation, down only slightly from 3% the prior quarter. The U.S. economy continued its recent strong stretch this summer, bolstered by hefty consumer and government spending. The July-to-September period marked a continuation of a roughly two-year streak of strong growth for the U.S. economy even in the face of historically high borrowing costs.
Consumer spending, which makes up the bulk of economic activity in the U.S., picked up to a 3.7% growth pace in the third quarter. Strong exports and government spending on defense were also tailwinds for growth.
Another useful indicator is also currently at hand: Markets are currently in the middle of earnings season, when the bulk of publicly-listed American companies report their results for the quarter ending in September. They have been highly encouraging.
A one-off miss in jobs doesn’t change the overwhelming message being sent from many sources. The American economy is in good health. Inflation data released the last week of October showed that prices have increased by a mild 2.1 percent over the past year.
RKD Group: Thinkers Monthly LinkedIn Update:
Remember to update Candid/Guidestar and make sure your data is accurately represented. This is the time of year the highest traffic on both platforms takes place as donors are visiting to assess and make their year-end donations.
If you’ve been feeling more negative than usual, it could be your brain’s natural negativity bias (an ancient survival mechanism) in overdrive. Many fundraisers find themselves in a similar state—juggling the demands of year-end campaigns, preparing for the next quarter, filling team gaps, and handling holiday family dynamics. This combination can heighten anxiety and disrupt sleep. When you start to feel overwhelmed, pause and step away. A quick five-minute walk, deep breathing, or a gratitude countdown can help ground you, making you less susceptible to those “paper tigers” our minds can create.
Please don’t hesitate to reach out – even if it’s just a need for encouragement. Your RKD team is always here to support you.
Thank you for our partnership! Cheers to an incredible finish line ahead!