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Fundraising Trends and Lessons for 2020

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Nonprofit fundraising has gotten leaner, more strategic, and more precise in recent years. At the same time social media has, like it or not, drastically impacted the way that nonprofits do business. This often results in development officers working to carefully balance their knowledge with ideas from stakeholders and the rapidly changing development landscape to not only meet but exceed fundraising targets. (No pressure!)

Looking ahead, what does it all mean for the future of fundraising? More specifically, how does it affect your 2020 development plan? It means we have more data and knowledge than ever before and that you can use that information to build a strong plan for your nonprofit. 

Here are some national predictions to balance with experience and best practices as you chart your nonprofit’s course for the coming year:

Election Year Chaos.

You know it’s coming, you’ve seen it before. Presidential election years are scary (and not just because of the inescapable political ads on repeat). Traditionally, nonprofit fundraisers wait until after the election to adjust course based on the outcome of the race to best determine the feelings and giving probability of their donors.

Adjusting course after an election is not a bad thing and is something you should do. In fact, I formerly worked for one organization who often saw a surge in donations when elections did NOT go their way. Being ready to act on these opportunities is key. However, if you are not talking to your donors before the election, you are missing an opportunity. Take the strong feelings that come with an election cycle as an invitation to speak directly to your donors. Calling out the elephant (or donkey) in the room for how they affect what you do is important, but it is the ability to demonstrate your ability to thrive regardless that will give your donors peace of mind that their gifts will not go to waste if an election does not go “your way.”

Keep the donation swings of election season in mind when building your development plan and how it may affect the flow of donations (specifically election hangover during 2020 year end giving).

Tax Change Fallout.

A study by the Indiana University Lilly Family School of Philanthropy reported a study by the Tax Policy Center indicated “the Tax Cuts and Jobs Act (TCJA) will lead to a 5% decrease in charitable giving.” The reality is that we have been facing the fallout from the tax change for a couple of years already.

It is safe to say that while some donors may be impacted based upon the changes, most smaller donors are unaffected — as long as they understand it. Smaller donors are likely accessing the standard deduction, therein nullifying any benefit of the tax deductibility of donations both before and after the TCJA.

What does this mean? Educate your donors, but understand that most give because they believe in your mission and not because they will get a small tax perk. Embrace them for why they care and how their gifts are impacting your cause, do not get distracted by rhetoric about tax changes. The tax piece should be a side note, not a focal point of your donor communications. For those donors that the tax change does impact, connect with them individually and directly. 

Emergence of the “Go Fund Me” Donor.

The era of social media and “Go Fund Me” campaigns for every cause under the sun has people feeling the need to give more than ever. It’s right in front of us. We can see when our friends give and often feel a need to be part of something bigger than ourselves. Just look at the Carson King phenomenon.

But, cases like that of the woman who ran out of gas and was assisted by a homeless man providing his “last $20” to help — which was later discovered to be a fraud have started to turn the tide and jaded would be donors for fear of giving to a scam. The effect is that donors want to give to reputable nonprofits.

Albeit, not without its own controversy, people gave to the Carson King beer money ask turned fundraiser for the University of Iowa Stead Family Children’s Hospital because they knew the money was going directly to a reputable nonprofit organization. This is your opportunity to shine. By demonstrating tangible proof of how their donations impact your mission, donors feel more at ease and confident in their giving choices. Use your experience to engage donors to become champions for your cause via social giving.

Use the experience and knowledge of your team to lead your nonprofit into the new year. Studies and trends are important, but at the end of the day you are the expert in the field. Your knowledge is key to tackling the challenges that lay ahead in the new year.

This article originally appeared in the Corridor Business Journal.
Image by Gerd Altmann from Pixabay.

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