Bizarre studies emerged this month such as When Inflicting Pain on Others Pays Off for Charity. Conducted by the Journal of Consumer Psychology, UC Riverside School of Business authors attempt to articulate and quantify the appeal of schadenfreude (“malicious pleasure” in German) through the lens of marketing psychology.
The New York Times Health & Science Section devoted the last week of June to Pets. Articles cover the gamut, from “Are we loving our pets to death?” to the expense of having a pet, plus fish behavior, cat behavior, canine cognition, animal hospital social workers and some of the hottest items on the pet market.
To ignite the imagination to global challenges, the 12th annual Core 77 Design Awards were recently announced. The concept of a scent camera was submitted by a student from Loughborough University. This innovative product is designed to help record and relive memories in a unique way.
Focused on scent as the primary medium, the product offers an enchanting way to reminisce about the best times of your life. You’re able to buy a scent recreation as a souvenir from a holiday destination and then use it in the future to recall your journey. You can purchase specific scent pods in each city, then dive into a multidimensional reminiscence with the Memory Station. This device, armed with ambient lighting, sound effects, projection and scent release, allows a holistic sensory recall of your cherished memories.
My mind immediately went to how wonderful this would be in hospitals, rehabilitation centers, missions and shelters, providing enrichment to both people and animals!
For another view, this month Ronnie Richard shares fundraising and marketing insights inspired by some of his favorite board games using strategy and execution and covers a few other subjects in the Thinkers Newsletter on LinkedIn. We’ve also got some great blog posts to incorporate into your strategies or help you launch with idea expansion.
It’s been another month of some great report releases. Grab your favorite beverage.
It’s time to update your organization’s profiles on Candid/GuideStar and CharityNavigator. While you’re at it:
The week of June 24 unveiled the key critical findings from Giving USA: The Annual Report on Philanthropy. I’m sure you’ve already seen the headline, “Giving Continues Its Decline, Down 2.1% in 2023. Can Fundraisers Turn the Tide in 2024?” or “Giving USA 2024: Donors Gave More, Inflation Deflated It” or something similar.
This is the second consecutive year Giving USA found that charitable giving has declined. In 2022, Giving USA reported the largest year-over-year decline since they began tracking giving in 1957.
Nevertheless, five of nine subsectors reached their all-time high in 2023, even when adjusted for inflation: human services; education; health; arts, culture and humanities; and environment/animals.
Strangely, most economic indicators were stronger in 2023. After all, the U.S. gross domestic product grew by 6.3 percent, the S&P 500 reached record highs and the inflation rate fell significantly. However, charitable giving did not even keep pace with inflation.
Individuals make up two thirds of total giving but declined by 2.4 percent in inflation-adjusted dollars. Coupled with the multiple-year trend of fewer Americans giving to charity, these findings reinforce the nonprofit industries concerns that lower- and middle-income individual donors are disappearing.
One area I continue to watch includes donor-advised funds (DAFs). DAFs remain a peculiar area in the “Giving USA” report. Donors’ gifts to national commercial DAFs like Fidelity Charitable and Schwab Charitable are counted (along with United Ways and voting groups) in the public-benefit society category. However, donors’ gifts to DAFs at community foundations fall under giving to foundations. So, we are still not seeing a clear picture of the individual giving that has moved making gifts through donor-advised funds.
There are more than 1.5 million nonprofits in the U.S. With donor retention lagging and acquisition down, it might be time to review your fundraising and marketing efforts and consider what makes your nonprofit distinctive and different. Broaden your focus on Gen X and others but also keep in front of your Boomers, knowing the $70+ trillion wealth transfer has begun. And make sure you have a strategy for donor-advised funds.
Giving in the first quarter of 2024 held steady compared to the last quarter of 2023. The GivingPulse report is based on weekly surveys of Americans about their giving habits.
The survey found that giving dipped in February but rebounded in March. During the period of decline, there was also a drop in the number of appeals donors received, suggesting people are willing to be generous when they’re asked, the report says. Based on responses to the GivingPulse survey, the report estimates that an additional 7 percent of respondents would have donated in the first quarter of 2024 if they had been asked.
The report highlighted the connection between volunteering and generosity. “When monetary donation rates were at their lowest in Q1, volunteers made up over half of remaining donors,” the report said. Woodrow Rosenbaum, chief data officer for GivingTuesday, says fundraisers shouldn’t undervalue volunteer involvement.
Other highlights from the report:
According to a recent Harris X Guardian poll survey, the majority of Americans believe the nation is currently in a recession (it’s not), 49% think the S&P 500 is down for the year (it’s up 11%), and the same percentage believe unemployment is at a 50-year high (it’s not).
On a personal level, many people are feeling the strain because of the one elephant in the room that just won’t go away: inflation. Indeed, a Gallup poll from March found that inflation continued to outrank crime, healthcare, terrorism, energy, the environment, drug use and many other topics as America’s top concern.
Many Americans put the blame on Biden for the state of the economy, with 58% of those polled saying the economy is worsening due to mismanagement from the presidential administration. The poll underscored people’s complicated emotions around inflation.
Despite speculation that wealthy people are amassing money in donor-advised funds, the figures coming from DAF organizations don’t support that narrative. At Fidelity Charitable, 88% of account holders recommended at least one grant in 2023, and about 75% of dollars contributed to DAFs, on average, are granted within five years.
Fidelity Charitable reported almost $11.8 billion in grants from its donor-advised fund holders in 2023. With more than 322,000 donors recommending more than 2.3 grants to nearly 199,000 charities around the world, 2023 resulted in an almost $600 billion increase in gift dollars. Last year, 1,345 of those grants were $1 million or more, according to Fidelity Charitable’s “2024 Giving Report.”
Schwab Charitable granted $6.1 billion to 127,000 charities, a 31% and 11% spike, respectively, in 2023. Though this DAF-sponsoring organization’s fiscal year ends June 30, it released its calendar year numbers as well. Notably, Schwab Charitable noticed a significant number of grants recommended during year-end giving, specifically GivingTuesday through Dec. 31, when donors recommended 250,000 grants totaling $1.5 billion.
After a down year for the last fiscal year reported, National Philanthropic Trust rebounded by granting $4.94 billion through more than 119,000 grants to more than 39,000 charities in 2023.
Last year, Vanguard Charitable donors recommended more than $2.6 billion to nonprofits, a 39% year-over-year increase and the seventh straight year of growth for the grantor. That billion-dollar figure includes more than 209,000 gifts to more than 56,000 nonprofits. The average grant was more than $12,000. Though the DAF-sponsoring organization runs on a fiscal year that ends on June 30, it provided calendar year figures this year.
Here are seven ways DAFS are impacting nonprofits:
And on a side note – GoFundMe has launched DAFpay as a method of payment in partnership with Chariot.
Schwab Charitable announced it has renamed the organization DAFgiving360. Its purpose:
Highlight DAFgiving360’s continued commitment to providing a holistic giving solution, centered around DAFs, for current donors, advisors and future generations of philanthropists.
The fact is that we’re falling short on donor acquisition because of our inability to make new donors feel at home with our organizations. New supporters won’t be part of our community unless they feel just as connected with us and their peer supporters as they do to the mission. Use these cost-effective, community-building tactics to boost donor acquisition:
Shared Stewarding and Thank-Yous: A study found that when donors were personally thanked within 24 hours, the donor was 40% more likely to give again. This has been tested out among new participants; finding those personal thank-you phone calls from board members, staff leaders and volunteers yielded second-time donations at roughly the same rate.
The calculations for income needed in each state to live comfortably were done by SmartAsset, using the cost of necessities sourced from the MIT Living Wage Calculator, last updated on Feb. 14, 2024.
"Comfortable" in this case was defined as the annual income required to cover a 50/30/20 budget, allocating 50% of earnings to necessities such as housing and utility costs, 30% to discretionary spending and 20% to savings or investments.
Key Takeaways:
Outside of the big cities, life can be cheaper for many Americans. Though, after years of high inflation, cost increases have affected almost everyone.
The U.S. Federal Reserve’s preferred inflation gauge met forecasts in May, keeping alive expectations that interest rates could fall faster than policy makers forecast. Hype around artificial intelligence has helped push major stock indexes near records by boosting shares in tech companies, chip makers and even utilities. The S&P 500 and Nasdaq Composite notched records in mid-June.
Thinkers Monthly LinkedIn Update:
Webinars and Past Webinar Recordings:
Donor perspective, marketing how your nonprofit is distinctive from similar organizations, as well as developing plans for your donor audiences should be coming into focus. Donor trust is key to retention and growth. Prepare your case and show your board of directors and committees why you and your team need specific resources to retain your organization’s most precious asset.
But for now, take a moment to recharge for a few days. Cheers to a fabulous Independence Day and weekend!
Let me know if something was helpful above or if you have any questions.