Rossi’s Roundup: What drives the heart, thanking donors, and scratch & sniff stamps

Rossi Roundup 11.21.23-1 The second quarter of this year will be closing in a few weeks, and most everyone is discussing FY25. Giving USA 2024 will be released soon, with all sorts of opportunities to jump on various webinars and unpack the findings from the report.

Among the madness, I hope you’re taking time for some self-care—including plans for vacation. We are just not wired to go full-bore, day after day. When your pace of life is too fast for too long, it's time to pull back and recalibrate.

As you look to the end of this calendar year and think about boosting your revenue, there are several metrics to consider:

X% increase in retention rate
X% increase in monthly sustainers
X% increase in planned giving
X% increase in frequency and/or average gift

Also, this is a great time to grab the development team and think about some questions regarding your strategies.

Are your donors getting the care and range of donor experiences they need and deserve to help them retain/stick around?
Have you surveyed your donors to learn the major reasons for your organization’s donor attrition?
Are you offering the right payment options?
Have you built a donor-advised fund plan?
Are you trying too many new “shiny” strategies, or are you not being consistent (even if boring to you) in your messaging and images?
How are your overall results trending across all development programs?
What’s your retention rate, and how is your acquisition program replacing lost donors and getting you ahead of goal?
What did you predict would happen this year—but maybe it hasn’t— and what are you increasing/creating to fill the gap?
If your results are up and outpacing your goals, where could you shift some expense to help create new revenue/attain new donors?
Have you celebrated your victories with the team? Now’s the time to revel in the wins and build your energy and feel good in order to face a busy Q4!

If you’re interested or want to brainstorm, let me know. I would love to have that conversation and pull in other team members where appropriate.

Finally, in case you didn’t catch this strange piece of news, France has created scratch-and-sniff stamps that smell like fresh baguettes, which cost €1.96. Just in time for the feast of Saint-Honoré, a day honoring the patron saint of bakers and pastry chefs, La Poste in France released these unique stamps.

My mind travels to the incredible use of such a stamp for our food bank and rescue mission partners. And could they create a stamp that smells like puppy breath for our animal welfare partners?

Don’t miss another fun read from RKD’s Ronnie Richard, who pauses to celebrate a big Dallas Mavericks playoff win, The Shift event, MDM Fundraising and Heller Consulting joining the RKD family, and much more in the Thinkers Newsletter on LinkedIn.

Time to dive in—grab your favorite beverage and jump into some articles from this past month.

1. Relationships: What Drives Giving–The Heart or the Brain?

From AFP’s Advancing Philanthropy magazine, Gary Bukowski writes from a personal level also founded on science. After reading “The Heart Speaks,” by Mimi Guarneri, M.D., FACC, Gary became even more convinced of the interconnectivity between the heart and brain—and the heart’s powerful role in communicating with the brain through emotion and sensitivity.

He then found “The Embodied Mind,” by Thomas R. Verny, M.D., citing the bonding of the hormones oxytocin and dopamine, as well as the fact that the electromagnetic field around the heart is 60 times greater than that around the brain and reaches every cell in the body. The magnetic component is approximately 5,000 times stronger than the brain’s magnetic field and can be detected several feet away from the body.

These noncognitive responses we call "gut feelings" or "intuition" to stimuli come from the electromagnetic waves. There really is an ethereal connection.

Finally, Gary also found the HeartMath Institute, which has published on the heart-brain communication. The heart sends more information to the brain than the brain sends to the heart. The neural interactions between the two are more complex than previously thought.

Have you ever felt an incredible connection with a donor?

2. A Billionaire Handed Graduates $1,000 Cash. Here’s Where It Went.

Roughly 1,000 students in the graduating class of University of Massachusetts Dartmouth were handed $1,000 in cash each as part of a surprise gift from billionaire commencement speaker Rob Hale Jr. The chief executive of Granite Telecommunications told the class of 2024 that they could use half however they wanted, and the other half had to be given to a worthy cause.

The graduates are putting the no-strings-attached part of their unexpected windfalls to a range of uses. Some plan to pay down their student loans, get a head start investing, fund travel or cover more-mundane expenses.

As for the charitable half, graduates said the decision is taking more deliberation. Hale said that pause is part of the point.

“Maybe some of these kids don’t have the discretionary resources to give a lot of money yet,” Hale said. “But if we can help them understand how joyous it is, then maybe that becomes a way of life for them.”

While many of these students have been managing their own personal finances for some time, they don’t have as much experience with charitable giving. Philanthropy research from Princeton University and others suggests that the earlier in life people start giving to charity, the more likely it is to become a habit.

Animal shelters, GoFundMe accounts and food pantries are other popular destinations for the graduates’ dollars.

3. Blackbaud Institute: Gen Z at the Table

In this special report of the Next Generation of Giving series, the Blackbaud Institute examines the charitable habits of Gen Z, assessing their relationship to philanthropy and how they feel they can make the most difference. Simultaneously, they invited professional fundraisers across generations to reflect on their own success and challenges in engaging with Gen Z as donors, advocates, volunteers and staffers.

Nineteen percent of Gen Z respondents said they donate money, but 84 percent said they support nonprofits or causes in some way—including by volunteering (33 percent) or following or promoting them on social media (25 percent). A third of Gen Z donors said they plan to give more as the year progresses.

Takeaways:

Donation at checkout: 40%
Fundraising event: 30%
Organization’s website: 29%
Purchase of product: 26%
Social media: 23%
Tithe, offering, Zakat: 14%
Crowdfunding site: 13%
Text message: 13%
Fundraiser using activity tracker: 12%
Bequest: 10%
Patreon: 10%

4. Small Tokens of Appreciation Can Motivate Lapsed, Uncommitted Donors, Study Finds

New academic research from Cornell University has found that when people who aren’t already deeply motivated by a cause know they’ll get something in return, they are more likely to donate.

The research included both hypothetical and real-world experiments to find out how much an incentive affected people’s willingness to donate. The gifts were all priced under $3. “We didn’t find that the size of the incentive seemed to matter,” Kaitlin Woolley says.

Woolley says alumni-affairs officials at the university worried that including a gift might somehow discourage their frequent donors from giving again. “They were concerned that it could be demotivating,” she says. “The fact that we didn’t see a drop-off for those highly prosocial donors was really important for the findings.”

5. Vanguard Charitable: Why Giving Matters

The 2024 Vanguard Charitable Donor-Advised Fund Report was released. One of the most surprising findings coming out of this year’s report is that unexpected giving increases total giving rather than displacing it. Donors’ unanticipated, responsive giving to events like natural disasters and humanitarian crises also caused their expected giving to increase, leading to a double boost in total giving.

Key highlights:

Donors estimate that 15% of the annual giving from their DAF is unexpected—a response to a crisis or another unforeseen event.
Donors who gave unexpected grants gave 39% more than those who use their DAF only for expected, ongoing giving. Importantly, donors’ unexpected, responsive giving comes as an addition to their expected giving, resulting in a boost to their total giving. More than half of the 39% increase in total giving comes from a rise in expected, ongoing giving.
46% of nonprofits receiving an unexpected grant from Vanguard Charitable receive a second grant from the same donor in the future.

6. 10 Tips To Thank and Retain Your Donors

For those who know me, this resonated deeply since I believe retention is one of the most important aspects of a donor relationship.

Quick hits:

Do the right (and smart) thing
Know time is of the essence
Utilize the growing variety of communication channels available
Embrace handwritten notes
Make a big deal of first-time donors
Celebrate donor-versaries
Avoid mementos that don’t mean much to donors
Be creative in your messaging
Create unique criteria for leadership gifts
Honor the seven times rule of thumb

You can never thank any donor too much. As the article author said, gratitude must also be expressed for gifts of time.

7. Economic Headlines

Mixed signals still have economists and political pundits scratching their heads. Oh, the fun of it all!

U.S. inflation eased in April, offering relief to the Fed and investors after earlier economic data showed simmering price pressures. The consumer-price index, a gauge for goods and service costs across the economy, rose 3.4% in April from a year ago, the Labor Department said. Core prices that exclude volatile food and energy items climbed 3.6% annually, their smallest gain since April 2021. The report was in line with expectations.
Wall Street’s favorite recession indicator is in a slump of its own. One of Wall Street’s favorite recession indicators looks broken. An anomaly known as an inverted yield curve, in which yields on short-term Treasurys exceed those of longer-term government debt, has long been taken as a nearly surefire signal that an economic pullback looms.

In each of the previous eight U.S. downturns, that has happened before the economy sputtered. There haven’t been any glaring false alarms. An inverted curve indicates that investors expect rate cuts, but it doesn’t explain why they are making those wagers. Since 1968, it has taken from nine to 24 months for a recession to materialize after the start of an inversion in which the 10-year yield fell below the 1-year yield for at least one month. By that definition, the latest inversion is about to end its 23rd month. Yet from the start of the inversion through April, the economy has added far more jobs than any comparable period that followed an inversion.
Some Americans live in a parallel economy where everything is terrible. Is the economy booming or busting? Depends on whom you ask. The official data is buoyant—economic growth is solid, the job market is strong, and stocks keep hitting record highs. Yet many Americans think the economy stinks. The latest gloomy indicator is a Guardian-Harris survey in which 55% of respondents said they think the economy is shrinking and 56% think we’re in the midst of a recession. Economic output, adjusted for inflation, grew by a solid 3% during the most recent 12-month period. The unemployment rate is 3.9%. And the U.S. economy created over 3.5 million jobs in 2023. The Guardian-Harris survey also found that 49% of respondents think the S&P 500 index is down for the year. In reality, stocks have been ripping: The S&P 500 is up 13% this year, on top of a 24% gain last year. Inflation is obviously one of the main economic gremlins of the last three years.
Inflation puts more retirees at risk of running out of money. Retirees took more money out of their savings to keep up with rising prices, raising the risk of depleting their nest eggs. The rise in spending since 2021 shows how pernicious inflation can be for those in or near retirement, especially since higher prices can also erode the value of the cash and fixed-income investments many plan to live on in the near future, according to a study Boston College released mid-May.
Wealthy Americans are starting to spend more carefully. Their days of splurging like there’s no tomorrow might be coming to an end. While the broader economy remains healthy, including the job market, with sub-4% unemployment, there are signs that an important corner has been turned. The shifting behavior of wealthy Americans is one of them. Some are thinking twice before swiping that card or clicking on the purchase button. Consumers overall have become more price sensitive, according to various examples in the Fed’s periodic collection of anecdotes known as the Beige Book.
Retailers are feeling jittery. Consumers aren’t shopping like they used to. In a game of chicken between stores and shoppers, it’s the stores that appear to be yielding first, by dropping prices on thousands of products. The markdowns come as inflation has pushed prices higher for the past two years, squeezing Americans and forcing them to choose between wants and needs. That’s a problem not just for individual shoppers or even big retail chains but for the whole American economy, about two-thirds of which comes from consumer spending.
Who’s happiest at work? Hint: It’s not women. Overall job satisfaction ticked up, but worker contentment dropped for wages and work-life balance, survey shows. Hybrid and remote workers are among the happiest, a recent poll finds. Nearly 65% of men say they are happy with their jobs, compared with 60% of women. The largest gaps in satisfaction between men and women were related to financial benefits of work, such as wages, benefits and bonuses. Despite overall satisfaction ticking higher in the past year, drops were recorded in all 26 specific categories that workers were asked about—from wages to work-life balance. Those declines indicate that overall job satisfaction is at risk despite the record overall job-satisfaction rating.