Many nonprofits get the bulk of their annual revenue from holiday giving, but this year the new tax code has fundraisers on edge. The doubling of the standard deduction means millions fewer Americans have a financial incentive to give, which could reduce donations by as much as $20 billion, research shows.
Despite this uncertainty, most groups are not overhauling their year-end fundraising strategies, experts say. Instead, charities seem to be sticking with approaches that work — while keeping a close eye on the results.
A Time for Testing
Because no one knows how donors are going to behave, it’s prudent to test messages that do not mention tax incentives, says Amy Ricigliano, vice president of client services at Eidolon Communications, a consulting firm that focuses on nonprofits.
For example, Eidolon is helping one client develop a new format and message for its February appeal, which typically focuses on tax receipts but underperformed in 2018. This time the group plans to test a member-appreciation certificate instead. In addition to testing different messages, Eidolon is also helping clients experiment with email subject lines and senders, matching-gift amounts, and “anything that we can think of to maximize our efforts online by the end of December,” Ricigliano says. “Although I do think the giving patterns are so ingrained for most nonmajor donors that it’s not going to change overnight, if it does change at all, in response to the tax law.”
The Chronicle spoke to veteran fundraisers and other experts who shared their recommendations on how to make the most of this critical time for giving. Here’s what they advise.
1. Clean up your email list. Some nonprofits have trouble getting emails delivered on the busiest fundraising days of the year, Ricigliano says, which could translate to money left on the table. To ensure that your emails reach your supporters — and that you’re being as targeted as possible — now’s the time to update your list. Ask your database vendor for advice on how to minimize delivery issues, she says.
In the meantime, look at your data to understand who is opening your emails and which addresses are causing lots of messages to bounce back — and start pruning. For instance, Ricigliano says, you should probably remove people who haven’t interacted with your emails in years.
2. Promote matching gifts early and everywhere. It’s smart to launch matching-gift campaigns in December, Ricigliano says — as soon as you can without risking running out of matching funds from donors before New Year’s Eve, which is when you’re likely to get the best results. In emails, push the match hardest during the last few days of the year, she adds.
And no matter the platform, make sure the match is the focal point of your message, not just part of it, says Erin Fincher, director of individual and foundation giving at the North Texas Food Bank.
3. Send a digital holiday card around Thanksgiving or in early December, either on its own — without a request for a gift, if you can — or as part of an appeal, Ricigliano says. These days it’s rare for nonprofits to contact supporters without asking for money, especially smaller donors. “When you have the opportunity to, and you can afford it, it makes an impact,” she says.
For instance, supporters often say how amazed they are that there isn’t a catch and that they aren’t being asked for any money, Ricigliano says. Some have even written charities to express their appreciation of the gesture.
Thanking people for their past contributions before you ask them to donate again could even lead to a bigger gift, according to recent research conducted by The Philanthropy Centre, a consultancy in the United Kingdom, and a group of philanthropic psychologists at the University of Plymouth in England. In an experiment with one nonprofit, the researchers found that annual donors who received a thank-you message one month before a gift request gave around $45 more on average, which represented a 67 percent increase compared with those who were not thanked first.
4. Run targeted advertisements on Facebook. If your nonprofit has an approved account on the social-networking site, you can upload your list of email subscribers to target them with ads. Or you can find Facebook users who have characteristics similar to the people on your list, so-called lookalikes. Facebook targeting is especially effective at boosting donations from current supporters and those who have stopped giving, Ricigliano says.
If you’re new to Facebook advertising or want to expand your efforts, she recommends working in “concentric circles": Start by testing messages with those you think are most likely to respond. If that works well, add one group at a time as you assess the results and determine whether to invest more.
5. Ramp up outreach to prospective donors. The last quarter of the year through January is often the best time to win new supporters. Even if you don’t have an acquisition mailing in the works for this year, there are plenty of ways to do this online. For example, many organizations target potential new donors with ads based on keywords they type in a search engine, or by using lookalike audiences on Facebook.
If your nonprofit already invests in this kind of marketing, it’s smart to increase your budget and focus on fundraising messages at this time of year, Ricigliano says. You don’t need to tailor your language to the holidays, although some charities, like food banks, shelters, or others that provide direct social services, may benefit from doing so.
6. Ask monthly donors to make an extra gift. Just make sure to recognize their ongoing support and give them special treatment, says Erica Waasdorp, president of A Direct Solution, a fundraising consultancy. Create a separate segment for this group in your direct-mail and email outreach so you can tailor your messages and track the response. Try to engage these supporters online and off, no matter how they give to your organization. But respect their preferences for communication, she says. If a donor wants to hear from you only once a year, the holidays are a prime time to get in touch.
7. Send a consistent message. “Try to make a strong plan in advance and stick to that because once you have mixed messages, you confuse people,” Fincher says. The food bank’s holiday campaign focuses on reminding people “how important it is to feed hungry people” by pairing an image of a person in need with two short lines of text that demonstrate the impact a gift can make. No matter the communication channel, the campaign has a cohesive look and feel that people recognize. “It’s simple and compelling, and that’s the look we’re trying to get to,” Fincher says.
8. Show your effectiveness. “It’s not enough just to have a good reputation,” says John Mace, membership director at the Union of Concerned Scientists. You need to explain to donors how you’re using their money, what they’ve helped you accomplish, and why you need them to support you for another year. This approach may not be very exciting, Mace says, but it works.
9. Highlight firsthand stories of how your work changes people’s lives. If a staff member or leader has a personal connection to your mission, Ricigliano says, start there. This is usually the easiest type of testimonial to develop and get approved. You could also look for a supporter who is willing to share why he or she gives, or a beneficiary who will demonstrate how your work has changed his or her life, even if it is done anonymously. Offering compelling examples of the way your nonprofit helps people in real life can inspire a deeper connection to your cause and spur greater giving.
