Almost three-quarters of charities said they met their 2018 fundraising goals, and 63 percent said their charity raised more money than the previous year, according to a new survey of both nonprofits and donors by the Nonprofit Research Collaborative, a coalition of professional fundraising associations that analyzes data on giving.
These findings are consistent with last year’s study of 2017 fundraising. While many fundraisers feared the new tax law would hamstring giving, not all charities are feeling the effects. Twenty-six percent of nonprofits said the changes to the law did not affect their fundraising, and just 17 percent said they had a negative effect.
About one-quarter of organizations reported fewer donors in 2018, and 29 percent saw increased numbers of stock transfers.
Fundraisers also saw some tax-related giving trends continue. Thirty percent of nonprofit respondents said some of their donors gave a large donation in one tax year and then skipped contributions in the following year or two. That practice, known as bundling or bunching, helps donors support nonprofits for multiple years while filing itemized taxes for a single year.
That is a challenge for nonprofits, which count on end-of-year gifts from loyal donors, says Melissa Brown, author of the report and manager of the Nonprofit Research Collaborative.
Researchers also surveyed individual donors online in March. Fifty-six percent said they gave the same amount in 2018 as in 2017. “I was pretty overwhelmed by that because that’s not consistent with some of what we heard in other sources,” says Brown, who expected more donors to say they gave less in 2018. “Giving USA” found that contributions to charity fell 1.7 percent in 2018.
Such drops in donations are uncommon, and last year’s result seemed to forecast a challenging environment for fundraisers this year.
Despite questions about how trends in bundling and other reactions to the new tax law would effect giving this year, the fundraisers in the survey largely had a sunny outlook for 2019: Sixty percent of respondents said they expected to raise more money this year than they did in 2018.
To make this expectation a reality, Brown says charities should stay in close contact with donors through email and direct mail. Forty-two percent of charity respondents said they saw growth in fundraising through direct mail in 2018, the lowest proportion reported in the biannual survey since 2010.
These communications should not just ask for money but also provide meaningful information on how donor support helps the charity meet its mission.
“One of the biggest reasons people stop giving is they feel like they’re becoming ATMs instead of being partners,” Brown says.
Among the other findings:
- Charities with budgets of $3 million to $49 million reported the most fundraising increases over 2017 levels.
- Only 16 percent of donors said they would change the amount or method of their gift this year because of changes to the tax law.
- Forty-six percent of charities said they saw growth in gifts from corporations in 2018, while 36 percent said they saw the same level of corporate giving as 2017.
- Environmental and animal charities were most likely to meet their 2018 fundraising goal, while higher-education nonprofits were most likely to meet their goals in 2017.