News and analysis
March 04, 2015

Charities Lose Big Revenue by Ignoring Minorities, Study Suggests

Fundraisers are missing revenue opportunities by failing to keep up with rapid changes in the nation’s demographics. Minorities are often overlooked by charities soliciting donors, and the appeals they do receive are seldom geared toward them. The problem will worsen in coming years if charities fail to respond.

The ethnic background of people who give to charity today is roughly the same as it was 25 years ago, with Caucasians accounting for about three-fourths of all donors. But by 2030, according to projections by the U.S. Census Bureau, only 55 percent of the population will be white, and more than 20 percent will be Hispanic, 13 percent African-American, and 6 percent Asian.

Among donors, "whites are overrepresented compared to their overall proportion of the population," said researchers in the study released by Blackbaud, the fundraising software company. Whites made up 64 percent of the population in 2010, the most recent year for which data are available, they added, and that number is probably lower now.

"Conversely," they added, "both African-American and Hispanic donors are underrepresented in the donor universe."

"The country is changing, but fundraising isn’t," said Dennis McCarthy, a Blackbaud official who wrote a report on the study, in an interview with The Chronicle.

One reason: Many solicitations, particularly to recruit new donors, are sent to people who share numerous characteristics with supporters of the past, who were mostly white. Those appeals don't necessarily work for others, according to the report.

The study is based on surveys of 1,096 American adults who, in addition to reporting their race, said they had made gifts to one or more charities in the past year.

Both African-American and Hispanic donors in the study reported getting fewer charitable solicitations, particularly direct-mail and email appeals, than whites or Asians, but many said they would contribute more if they were asked.

People may assume that Hispanics and African-Americans are less likely to give because they have fewer resources or for cultural reasons, the researchers said, but their findings suggest otherwise.

Donors, regardless of race are remarkably similar with regard to certain giving indicators. Majorities of all ethnic groups in the survey said it was important to support charities, for example. Religious participation and civic engagement were associated with giving for all races. And income — not age, education, or race — was the best predictor of how much donors gave.

While donors of every race share characteristics, the study also identified subtle differences among ethnic groups that might help fundraisers tailor solicitations for diverse audiences:

  • For African-American donors, church and faith are more important motivators of giving than for other donors, and blacks are more likely to support youths and anti-hate or anti-discrimination organizations. African-Americans are also more likely than others to give in response to appeals at checkout counters and from canvassers.
  • Asian donors are more likely to support disaster relief than other groups, and religion is less important motivator than for other groups. Asian donors are the most technology-oriented of the groups and are nearly twice as likely, for example, to contribute to crowdfunding appeals.
  • Hispanic donors tend to be younger than other charity supporters and are most likely to have children at home. Hispanics are spontaneous in their giving and are more likely to purchase items when they know that a portion of the money will go to a charitable cause.

Send an e-mail to Holly Hall.