The Giving Crisis
Why did 20 million households stop giving to charity?
That’s the question my colleague Drew Lindsay set out to answer in the cover story for this month’s issue of the Chronicle. He talked to experts and fundraisers who believe fundraising strategies and tactics may be contributing to the declining rates of giving in the past 20 years. One theory: An obsession with cash may be tamping down donors’ desire to give. That threatens not only revenues but also the standing of nonprofits as a primary force for good — this at a time when Americans enjoy a superabundance of choices for doing good.
Other data points to fraying connections between nonprofits and their supporters, Drew reports. Donor-retention rates have fallen from about half to around 43 percent over the past 15 years. Nonprofits can attract donors, it seems. But building the relationship that makes them want to give again? That’s another story.
Nathan Chappell, a former fundraiser who’s now an executive at the data firm DonorSearch, has been raising alarms about the declining rates of support for some time. But, Drew writes, he’s met largely with indifference. People discount the numbers when they see each year’s tally of total giving break records, driven by bigger donations by the wealthy. “Maybe it’s like The Inconvenient Truth,” Chappell says later, referencing Al Gore’s doomsday documentary about climate change. “In 15 years, people will say, ‘I wish I’d paid attention back then.’”
He ticks off nearly a dozen likely reasons for the decline. The flagging attendance in houses of worship. The decline of happiness among Americans. Slumping trust in institutions and nonprofits specifically.
Chappell doesn’t mention them, but critiques by some conservatives argue nonprofits have lost favor with Americans because they are pursuing increasingly political agendas. Others point to the hollowing out of the middle class; economic calamity hammered average Americans in the Great Recession-to-Great Pandemic years.
Nonprofits, obviously, can’t control the economy or improve the country’s collective state of mind. But Chappell doesn’t let fundraisers play the victim. Many nonprofits have depersonalized philanthropy, he says, letting the chase for dollars dominate their messaging and relationships with supporters.
“Nonprofits over time have traded the relationship for the transaction,” he says. “When revenue is the ultimate goal, what’s sacrificed is the long-term relationship.”
Drew’s story includes examples of nonprofits — like Charity:water, the Children’s Home Society of Florida, and Share Omaha — that are finding innovative, even radical ways to re-energize their relationships with donors. I hope you’ll take some time to read it.
For Chappell, solutions can be found in a renewed focus on what inspires generosity. “It’s about going back to the roots of what nonprofits are built to do, to bring people together to accomplish something that they couldn’t do alone,” he says. “There’s been a trade-off — money for relationships — and it’s time to reverse that. Otherwise, this crisis won’t end.”
