News and analysis
November 13, 2012

Flat or Declining Donations Mark the First Half of 2012

The slow economy continued to cause fundraising challenges for most charities in the first half of this year, according to a study released today by the Nonprofit Research Collaborative, a coalition of five organizations that collect and study information on giving and fundraising.

Giving dropped at 29 percent of the 781 groups in the study when compared to the first half of 2011 and was flat for another 25 percent. About 46 percent chalked up increases.

Small groups did far less well than the big ones, a finding that mirrored the results of last year’s study.

The sluggish giving rates seem to be a direct result of the economy, the researchers said. Gross domestic product grew by only 1.5 percent in the second quarter of this year, while spending by consumers stagnated.

Lapsed Donors

Charities that increased donations were more likely than others to reach out to supporters in multiple ways such as e-mail or in-person events, to show donors results of their contributions, and to publicly acknowledge donors by listing their names or taking other steps.

The study also examined whether charities are doing a good job of keeping donors year after year. Nearly half said that 60 percent or more of donors who gave to their organizations in 2011 have made one or more gifts in 2012.

While charities often stop making special efforts to reach out to people who haven’t given for a while, that strategy may be a mistake, the researchers said. Charities that focused attention on people who had stopped giving tended to fare better with their overall fundraising returns and in their donor-loyalty rates than other groups, the study found.

In addition, “a well-developed communications plan seems to be a critical step in both retention and in increased charitable receipts,” the researchers wrote. “This includes providing donor recognition through thank-you letters and special activities; reporting your organization’s work and showing the impact achieved with donor gifts; and using multiple channels of distribution to get your message out: online, print, e-mail, magazines, and so on.”