About one in three affluent donors said they could have given more but didn’t, in part because they wanted more information on what their gifts would achieve, according to a new survey of American donors who give $10,000 a year on average.
Millennials were especially likely to say they could have donated more to charity. About 41 percent of donors under age 35 said they could have supported nonprofits more generously.
Most donors said they felt financially secure, given the state of the economy and their personal lives, so that made them more willing to open their wallets if inspired.
“The potential impact of these donors is extraordinary,” said Penelope Burk, president of Cygnus Applied Research, a fundraising consulting firm, who analyzed her company’s latest annual survey. “From a dollar perspective, just a small movement among the most generous donors results in a very significant increase in growth and net revenue.”
Could Respondents Have Given More Last Year?
Results Count
The percentage of donors focused on results is a striking change from previous years, Ms. Burk said. Five years ago, just 16 percent said they decided where to give based on a charity’s results. This year, 41 percent said that.
Many donors have increased their giving in each of the past two years, Ms. Burk found. But she thinks it’s important to tap the generous feelings people show today because signs of economic uncertainty could cause giving rates to slow in coming months and years.
Asked about their giving patterns this year, 59 percent of donors said they anticipate giving the same amount in 2016 as they did last year, up from 47 percent who gave the same amount in 2015 as the year before. Twenty-two percent expect to give more this year than last year.
Asked what it would take to persuade them to give more than planned, they said charities could explain that they face extraordinary needs, reduce their overhead expenses, stop sending unwanted gifts or trinkets in direct-mail appeals, and reduce the volume of solicitations.
How Not-for-Profits Can Inspire More Generous Giving This Year
Beyond those steps, Ms. Burk said, the findings show donors want more opportunities to earmark contributions for specific projects. And they want to be thanked in meaningful ways.
Charities also need to rethink their techniques for solicitations, she said. For instance, because millennials said they could afford to give more, charities should put more of their appeals online and in social media, Ms. Burk said.
More than 21,000 donors completed the survey, offering their views on giving in 2015 and 2016. Ms. Burk recruits charities to send the survey to their most loyal donors; the average supporter in the survey gave $10,600 to charity in 2015.
She began the survey soon after the Great Recession began and found that many donors were too nervous about their finances to keep giving generously. Today, things have changed: Only 11 percent of donors said worries about their finances were why they gave less.
Researching Causes
While donors want nonprofits to broadcast their results, they are also doing a lot more to learn about a group’s results on their own, the Cygnus found.
The percentage of donors who always or sometimes research a cause before giving for the first time or renewing their support has increased from 59 percent to 78 percent since the survey began seven years ago.
Among other findings:
- Most potential supporters researched nonprofits by viewing charities’ websites — and just under 42 percent of those people decided not to give after viewing them. The top two reasons: They saw little evidence of measurable results from donor contributions, and they believed charities spent too much on fundraising.
- However, when asked what a fair percentage for charities to spend on fundraising should be, “don’t know” was the most prevalent response.
- Forty-two percent of donors who researched at least one cause consulted an online ratings organization before deciding whether to give, up from 32 percent five years ago.
Michael Thatcher, president of Charity Navigator, expects this trend to continue, especially as younger, data-driven donors acquire more wealth. “We’re all wanting to know that we’re doing the right thing with our donations, and the decision-making tools are getting better.”
How Respondents Made Their Most Recent Assessment of a Cause Under Consideration for Support
High Potential With Young Donors
Millennials continue to increase both the number of causes they support and the amount they give, though their donations still represent a small slice of the total.
Fifty-five percent of donors under age 35 increased their giving last year, compared with 41 percent of middle-age donors and 37 percent of donors 65 and older. Still, the survey’s youngest donors’ gifts averaged only 18 percent of the value of middle-age donors’ gifts and 11 percent of the value of contributions from older donors.
Fundraisers are not reacting to the change in donor demographics fast enough, Ms. Burk said. They still put most of their time and money into fundraising approaches that don’t work as well for today’s donors, such as direct mail, and tend to put fewer resources into online appeals, social media campaigns, and options for giving monthly or at other intervals — approaches she said appeal to young people especially.
How Respondents’ Age Affects How Gifts Are Transacted
Direct mail remains the most common way donors in the study said they give, but its decline continues: Forty-four percent gave in response to a direct-mail piece in 2015, down from 48 percent five years ago.
Some nonprofits are using the decline in response rates as an opportunity to re-evaluate their direct-mail appeals to focus on donors’ interests.
About nine months ago, the ALS Association, which saw a surge in social-media attention and an online-giving windfall during the 2014 ice-bucket challenge, began providing more information about what donor dollars have accomplished. The number of donors supporting the association through direct mail is up about 12 percent over the same time last year, said D.J. Hampton II, the organization’s senior vice president for development. Older donors are responding more generously to the information-packed appeals, just as younger ones are, he said.
Still, online giving is becoming a way more popular tool for donors of all ages.
Ms. Burk’s survey found that 38 percent of people under age 35 responded to at least one online appeal — but so did 31 percent of middle-age and 29 percent of older donors.
The changes in how people want to give should be reflected in how fundraising offices are structured, Ms. Burk said. Charity leaders and top fundraisers should consider integrating direct-marketing departments into the rest of the fundraising office so they are not working in competition, and fundraisers should be evaluated based not on revenue generated but on their success in getting donors involved in ways that lead to substantial gifts over the long term.
Social Media’s Limits
More donors in every age group are following charities on social media, according to the new study.
In the 2011 report, 43 percent of donors said they followed nonprofits on at least one social-media account. In this year’s report, 80 percent said they did so. But while social media is slowly attracting new donors, it doesn’t appear to be inspiring more generous or frequent gifts from current donors. Only 17 percent of donors said they gave more or more frequently because of social media.
Respondents Who Have Given for the First Time After Following One or More NFPs
Among other findings about social media:
- Twenty-seven percent of donors under age 35 made a gift through a social-media campaign, compared with just 14 percent of 35- to 64-year-olds and 4 percent of older people.
- As a communications tool, however, social media is increasingly valuable: Almost half of donors following at least one charity on social media said they had attended an event at least once in 2015 as a result of social media, up from 37 percent in 2011. The percentage of donors who offered to volunteer based on a social-media posting also increased.
- Just 8 percent of donors said they had tried to raise money for a cause through social media. But that small group of supporters, whom Ms. Burk referred to as “mass influencers,” deserve special attention.
“They’re like the major-gift donors,” Ms. Burk said. “They’re few in number but big in gift value.” Give them information first, come up with ways to recognize their efforts, she said, and “they will do a lot of the work for you.”
What Sustains the Interest of Respondents Who Follow One or More NFPs?
Ettore Rossetti, Save the Children’s director of social media and digital marketing, echoes Ms. Burk’s sentiments. He believes social-media users who actively promote causes to their online networks have the potential to increase the size of a charity’s donor pool as well as those who participate in philanthropy at large.
“Personal fundraising is one way to get that demographic that perhaps skews younger, that may not ever have been approached through traditional means.”
In the just-released study, Ms. Burk added a set of questions she has never asked before, about giving to alma maters. She found that many donors say they don’t give to colleges they attended because they don’t think the colleges are needy enough.
