The 2020 State of Our Fundraising Union

February 20, 2020 | Caity Craver
2020 State of the Fundraising Union

This month President Trump delivered the State of the Union address. If you were to stand before an assembly of your colleagues, how would you report on the ‘State of the Fundraising Union’?

Here’s my outline— please add your own standing ovations and forced tears when needed.

The State of the U.S. Fundraising Union is muddled:  bad news mixed with some good news — all reinforced with hope.

  • There are new and uncertain factors at play — increased digital complexity accompanied by warning signs of some trouble ahead… the continuing uncertainty over the effects of 2018’s tax reform … and, of course an uncertain political and economic climate. But, overall, the fundamental problems and threats we have faced over the past 5 years remain the same.
  • We continue to face serious and on-going challenges like falling donor retention and acquisition response rates.  However, we have made progress in certain areas like average contribution size and monthly giving.
  • Although the resolve to do better on the part of most fundraisers is stronger than ever, the strategies of too many of our colleagues remain stuck in the same outmoded rut.  Plans that call for doing the same old thing over and over, but with expectations of improved results, unaccompanied by change, will not carry us to a brighter future
  • We’re at war with four enemies: Donor Attrition. Inefficiency. Competition. Rising Costs.
  • We can’t hold on to our donors. Donor retention continues to decline, yet most fundraisers still set in motion the same contact strategies (“more is better”) they have used for years with diminishing results.
  • We continue to mismanage or misunderstand spending and investment. Just two examples; not aligning our cost to reactivate lapsed donors with our cost to acquire.  Not protecting our acquisition spend by investing more in retention.  As a result, millions of dollars are left on the table each year.
  • For every 100 donors gained, 99 are lost. Every fundraiser should be asking “What am I doing to keep my donors from fleeing?”
  • We’re dependent on a very small segment of donors to maintain revenue growth. Think about this — only 2 out of 100 donors will give a gift above $5,000 this coming year — can’t we improve on this?
  • Our mindset is outdated. The nonprofit sector is decades behind our for-profit counterparts. When will we learn that doing the same thing will yield the same results? We need to change our mindset to that of testing different and innovative approaches today!
  • Our fundraising methods are increasingly inefficient and costly. There are better, proven, and more effective ways to allocate a marketing budget, but many fundraisers are too fearful to buck the status quo.
  • BUT… there is hope. Fortunately, some forward-looking organizations are applying smart, math-based logic to meet today’s challenges head-on.  They’re posting improved results … learning from each other… and ceased wasting time and money.
  • Our future depends on our ability to inspire our donors. Anger, excitement, and passion translate into engagement. Engagement translates in dramatically increased income and donor value.
  • Each of us must ask, “What steps should I be taking to motivate and inspire my donors to a greater level of loyal and sustained giving?

Improve the State of Your Fundraising.

Take these 3 Simple Action Steps:

  1. Know your numbers. Understand the fundraising vital signs / metrics that matter most when it comes to boosting results.
  2. Evaluate efficiency. Are you contacting the right donors with the right frequency?
  3. Uncover donor lifetime value and assess investment strategy.

Any one — or all three of these action steps will help you to positively impact revenue, response, and retention.

Whatever the state of the union, fundraising doesn’t stop! Read our complete guide to Successful Fundraising During Economic Uncertainty for tips on navigating your organization through turbulent times.