Donor behavior is changing in significant ways that have important implications for how charities raise money, argues a new report.
Silent-generation donors, people age 72 and older and the mainstays of many charities’ direct-mail programs, are much more likely to respond to appeals. Their younger compatriots — baby boomers, Generation X, and millennials whom the report calls “modern donors” — are taking a different tack.
“Modern donors are more apt to take control and drive the process,” says Jeff Patrick, chief executive of Cohort3, the fundraising consulting company that commissioned the research, and author of the new report. “They’re more likely to do research about their charities. They’re more likely to engage with their family and friends. They’re more likely to use more channels.”
The new report is based on a survey of 1,480 donors who had made a gift in the previous year to a nonprofit they hadn’t previously supported. The survey was conducted by Campbell Rinker, a research company that focuses on the nonprofit world. The panel had equal representation from four generations: silent (72 and older), baby boomers (53 to 71), Gen X (37 to 52), and millennials (20 to 36).
Donors in the survey were asked a series of detailed questions about the process of making that gift, from the time they first became aware of the charity to the steps they took after contributing.
Only 9 percent of modern donors said material sent by the charity, such as direct-mail and email solicitations, triggered them to consider making a gift.
Fundraisers assume that when they send out appeals, donors learn about the organization and then choose to give as a result, Patrick says. “The truth is that’s not at all how this works.”
Dirk Rinker, president of Campbell Rinker, suspects donor ego played a role in the large percentage of donors who said that making the gift was their own idea, rather than a response to an appeal. But he says even if the real number is double or triple that 9 percent figure, it shows that nonprofit communication doesn’t have the impact organizations think it does.
“That is no reason whatsoever for nonprofits to stop messaging,” he says. “As a matter of fact, they need to double down. The nonprofit that does not take advantage of all of the available channels will not even be considered.”
Awareness Matters
A little less than half of donors, 45 percent, conducted research on the nonprofit to which they contributed. Modern donors were 1.5 to 2 times more likely than their silent-generation counterparts to examine charities they considered supporting.
Donors who conducted research reported being aware of four to five other groups similar to the nonprofit they were considering. They looked into the organization in which they were interested along with one or two peers, and 94 percent said they decided to give to the first charity to which they considered donating.
The finding shows how critical communications that boost a nonprofit’s profile are to winning donations, argue the study’s sponsors. Another sign: One in five donors cited talking to friends and family as how they first learned about the nonprofit to which they contributed. It was the most popular answer for all four age groups.
Nonprofits would do well to borrow a for-profit marketing concept called mindshare, says Sarah Durham, chief executive of Big Duck, a communications company that helps charities improve their fundraising, who was not involved in the study.
The goal is to use communications to build what marketers call “top-of-mind awareness.” As an example, she points to Starbucks. “They’re never fully out of your consciousness.”
The same concept can work for nonprofits, she notes. Say a donor in the study was moved by a natural disaster to make a first gift to the American Red Cross.
“The fact that Red Cross has maybe solicited you, like sent you an email or a direct-mail piece, isn’t the reason you give,” Durham says. “You give because of the top-of-mind awareness.”
Collaboration Is Key
The messages and materials potential donors see in the awareness stage are usually the product of a nonprofit’s communications team, Patrick says. But too often, he adds, fundraisers are disconnected from this work, which is a big problem.
“The truth is the branding team is doing a fundamentally big chunk of the work for you, and you don’t know about it,” he says. “You don’t know what it looks like, and you’re not tapping into it.”
To win over modern donors, fundraisers and nonprofit marketers need to work much more collaboratively.
That advice rings true to Mark Graham, director of communications and acting chief development officer at American Friends Service Committee. The peace and justice organization is in the process of combining its communications and development departments into a new advancement unit.
“It’s helping to reinforce the idea that all fundraisers are also communicators and brand ambassadors,” Graham says. “And it reinforces that all communicators are part of setting the table for fundraising.”
