How much do taxes matter to donors?
That will be one of the biggest things we’ll learn early in 2019 as the impact of the 2017 federal tax-law changes become fully apparent. Some charities report that their donors have sought to maximize their tax benefits by “bundling” their gifts in 2018, contributing money they hope will last nonprofits for two or three years.
We’ll also learn whether 2018’s stock-market jitters will cause foundations and major donors to tap their brakes this year, slowing down grant making and campaign giving in particular.
Here are other trends likely to influence the way donors give and fundraisers make appeals in 2019:
Donor-advised funds will be bigger than ever.
The funds, which allow donors to set aside money for philanthropy, get a tax deduction, and then decide later which charities get grants from the account, are often called “the middle-class foundation.” That’s because the funds can often be opened with $10,000 or less.
That’s never more true than now, as donors continue to pour money into their accounts and open new ones. Some charities have begun offering their own donor-advised-fund options to their supporters. Fundraisers will need to work more closely with donors’ financial adviers and with community foundations to get on account holders’ radar.
Facebook will be a source of revenue — and sometimes frustration.
The social-media giant has proven to be useful in getting charity supporters to raise money for their favorite causes; its birthday-fundraising tool alone raised $300 million in its first year. Other tools the company has rolled out recently also show promise.
As it attempts to rectify its problems with “fake news” and other issues that have angered users, however, its frequent algorithm tweaks will keep charities’ fundraisers and communications staff on their toes, making their own adjustments to keep their messages showing up in supporters’ news feeds.
Livestreaming is the new telethon.
Celebrities, YouTube stars, and many others are raising money for causes through Facebook, YouTube, the gaming site Twitch, and other platforms that make livestreaming easy.
Because of the popularity of livestreaming among video-game enthusiasts, young donors are especially likely to be lured by these online events. Big charities like Direct Relief, St. Jude Children’s Research Hospital, and Save the Children are investing in this method of appealing to donors, and it’s become a staple of many charities’ appeal to supporters on Giving Tuesday and other giving days.
The high-octane campaign race will heat up.
In 2018, Harvard University ended a campaign with $9.6 billion, the largest haul ever by a nonprofit of any kind. The University of Michigan announced it had raked in $5 billion during its then still-ongoing drive, the biggest campaign total ever for a public university. Billion-plus efforts are underway at lots of universities —notably at Columbia, MIT, and the University of California at Los Angeles. (A February study by Ruffalo Noel Levitz found that 81 percent of college fundraisers are either in a campaign or starting one.) But with the Mayo Clinic wrapping up a drive that raised nearly $3.8 billion in 2018, look for more billion-dollar campaign launches from other kinds of organizations as well.
Digital assistants offer new avenues for giving.
It’s still early, but Alexa, the digital assistant produced by Amazon, has been capable of making users’ charitable donations since April. With roughly 120 nonprofits raising money on Alexa so far, the dollars collected are minimal. But with Amazon founder Jeff Bezos, now the world’s wealthiest man, stepping up his own philanthropy it’s likely that Alexa will continue to help facilitate giving, and that Alexa’s competitiors will follow suit.
More charities will collaborate on fundraising.
During Giving Tuesday, many like-minded charities banded together to raise funds. That trend will probably grow more popular as organizations battle over the same crop of supporters. Charities are even joining forces in rapidly growing cities like Denver, where the pool of potential donors is expanding.
Keeping donors loyal will become a growing priority for charities.
It’s easier and more lucrative to keep a donor than to find new ones. This year will see more charities amping up their work to thank and involve donors and using data to learn more about them. More organizations are combing their databases to assemble “personas” of their most loyal supporters and targeting their communications to donors who fit those molds. Charities are also stepping up their monthly giving programs to keep casual supporters giving regularly and cultivating midlevel supporters for bigger gifts.
Expect some shake-ups in online fundraising.
The past few years have been marked by consolidation among online-fundraising service providers: GiveGab bought Kimbia, GoFundMe bought CrowdRise, Blackbaud bought JustGiving. With Give Lively, the brainchild of George Soros’s son Jonathan and his wife, Jennifer, offering free online-fundraising tools to charities, expect the landscape to get more interesting.
The coming year will also reveal how Blackbaud will recover from a shaky performance on Giving Tuesday and what that vulnerability means for the company’s clients and its competitors.
