Future of Fundraising is Hiding in Blackbaud Results
Posted by Allison Fine on March 18, 2009
Interesting article by Stephanie Strom in the Times today about a recent survey by Blackbaud of online donors. Blackbaud, a fundraising and software company, surveyed twenty-four nonprofits to learn more about who their online donors are and their giving patterns. They found that these donors are high-income, high education people who are very attractive to causes, but who are exhibiting a pattern of giving once online and don’t become habitual online givers to particular causes.
No surprises there, that is in keeping with every other survey and all of the other data that I’ve seen about online giving. However, I disagree with the conclusion of the article, here’s the gist:
The findings suggest that while the Internet can be a valuable fund-raising tool for charities, particularly in soliciting gifts after disasters like Hurricane Katrina, it is not a replacement for direct mail or other forms of fund-raising.
Nope, wrong. We are in a period of transition where the old ways of doing things, like direct mail fundraising, may continue for a short time because going back to the old well is easier than figuring out where the new well is and how it works. But when your donor bases average (average!) age is in the seventies that’s not a sustainable way of thinking or working.
Here’s what I would have concluded instead. Online giving works differently than direct mail giving because the people who are most likely to give online, younger, more tech savvy people, think differently than other generations. As donors they are not going to behave like their grandparents and become lifelong members and givers to specific nonprofits. That’s what I found in Social Citizens and what other smarter folks, like Carol Cone, have been reporting for years. So, if young donors aren’t going to change than nonprofit orgs had better – and fast before those donors bases average eighty years old!
Online donors, or you could say young donors it’s the same thing, really, are going to come and go based on how strongly they feel about an event (e.g. a natural disaster) or a cause (e.g. hunger) at that particular moment in time. The job of causes is to continue to build relationships with lots of people over time, and keep lots of access points open for them to participate in conversations, learn about the cause, tell their friends about it — and give when they’re moved to give. Not everyone is going to give to every campaign but they’re not lost to you, they’re busy and moved by other issues at that time. The job of the cause is to continue the conversation over time.
But this won’t happen for more traditional organizations accustomed to living off of their donor bases until they really understand the DNA of younger donors — and change their DNA to match. Easier said than done, of course, but it’s time to get to it, because one thing is for sure: 75 million Millennials aren’t going to change their stripes for you!
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12 Responses to “Future of Fundraising is Hiding in Blackbaud Results”
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Sidney Hargro said
Applause! Allison I totally agree and this is completely aligned with research I’ve seen regarding giving and social media. The question I’ve been wrestling with is how this can/will reshape the notion of “community foundations” and “community philanthropy” in general – meaning how this will impact the way donor advised funds are marketed and managed as well as the model of local united way fundraising. Donor-advised funds provide the flexibly for giving to change with the thoughts and passions of donors but I have a feeling the vehicle will have be marketed in a significantly different manner. Why do I need a charitable checkbook when I have one…my own personal bank account? Does the donor advised funds add value for donors that are more likely to be sporadic givers in varied amounts? Does the advantages outweigh the cost?
IMPACTMAX said
Excellent question, Sidney. I’m no expert on this, but rather than just marketing donor-advised funds differently, why can’t community foundations offer a wider array of investment products to meet the needs of different kinds of donors? Keep the donor-advised funds for people who like (and can afford) that level of giving, but think about new discretionary fund raising strategies that meet the needs of younger, short-term, charitable investors with less means to give(for now that is!). Maybe build some excitement about a series of appealing, time-limited, well defined community projects and use social media and online fund raising to invite participation and build support. Maybe you even let the supporters–to some extent–organize and own the campaigns. Maybe you start an advisory group of Millennials to tell you how they’d like to be involved in giving back to their community. Community foundations are respected for their knowledge about local nonprofits and community needs. They can leverage that expertise with younger people who may choose to give in different ways but are just as passionate about improving their communities. Those young people have a lot to offer. Just an idea…
Allison Fine said
Right on, here! Community Foundations are such a perfect vehicle for involving larger swaths of their communities in to learn about philanthropy and participate in a wide variety of ways. They’ve been too slow and inflexible, IMHO, and too focused on recruiting only large donors. Time to get smaller, more agile, more aggressive and younger. Thanks, great comment!
Howard said
Great ideas for fundraisers. If you want more traditional product fundraisers, though, you might browse through Easy Fundraising Ideas and take a look at those options.
Amy Kincaid said
So, Allison, are you saying that the new generations of donors can’t ever include those who become long-term, committed donors (fans)? Can we never expect to hold attention of new donors for longer than a Tweet?
Yikes. I hope that’s not the case, and I really hope (want, need) to believe that the world will continue to produce some people who will invest their hearts, minds, and money in improving the world. And I really hope (want, need) to believe that those of us who still do will learn to respond and embrace and engage in both new (technology) and old (relationship) ways. Really, I hope that the new/tech enables us to do the old/relationship better.
Fundraising (or rather, in my mind, movement-building and fan-building) is all about relationship (and organizing). The new tools and techniques do enable wider outreach, and quite possibly wider and better initial gifts/contact. But the harder task is to develop real, authentic, responsive relationships with a smaller group of those initial donors.
The real promise of social media, etc. in fundraising is that the new tools and techniques (and approaches! like “handing the megaphone to the fans,” with a nod to Seth Godin) will enable nonprofits and social enterprises to develop more meaningful relationships with more (but still a select) group of fans.
Allison Fine said
Never, ever are mighty strong words, Amy. Sure, there will be some donors who stick with organizations over time, but I think that the norm will be donors and volunteers who hop campaign to campaign, issue to issue. Over time a person may give to a cause several times, but what I was mainly driving at was the need for organizations not to get stuck on continuing to feed off of their existing, dying databases, but to become more agile and porous to allow for the expected expansion and contraction of their donors. Hope that makes sense. Thanks for participating in the dialogue.
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Bob McInnis said
I wonder if the next gen donor will have the same interest in directed funds through Community Foundations. My experience with younger philanthropists is that they are looking for direct impact and experience rather than legacy. That said, we still have about 20 years of boomer contributions to CF as they reach different life stages.
Alison, I agree completely that we are the ones that need to change and expect that early change adopters will grow while those pumping at their old well will see their revenues decline.
frank simkens said
I think that we have to look at this issue with a different mindset. I believe too and I experience it as well, that Donors become emotional shoppers – directing their money where their heart and emotions are when in ‘donor mood’. However, agreeing that we should maintain conversation with these people, we should also focus on people who are longing for a more long-lasting relationship with your cause.
If you want to keep someone loyal and committed to your organisation as yourself, treat them the way you like to be treated. Treat them as a ‘stakeholder’, giving them a voice, having them participate as if they are within your organisation. And better, try to eliminate the ‘as if’ in the previous sentence. This however, demands a complete reversal in thinking and acting of non-profit organisations. But the reward could be loyal, and committed ‘stakeholders’
frank said
When you look at the types of incredible fundraising going on via Twitter (http://bit.ly/8y7Y) it’s evident that a relatively new way of fundraising/engagement is breaking through. Still early for sure, but the writing is on the wall (of Twitter and other social networks).
Case in point is the 12for12k challenge. They have no real back end system or formal way to ‘build a house file’ and communicate to those people. They use blogging, twitter, video and other online channels – depending on the reach of those involved and the appeal of the campaign to keep people all over engaged. People engage actively because the want to be a part of 12for12k and make a difference.
All that said, direct mail, email, etc… has a very LONG tail. I don’t think it’s going away any time soon.
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