Succeeding in a Down Economy
Ann C. Fitzgerald, President
This article was originally published in the July/August edition of SPN News:
Giving USA released its annual report on charitable giving. The numbers are sobering. Private donations increased by less than 1 percent after inflation last year.
According to Patrick Rooney, executive director of the Indiana University Center on Philanthropy which compiles Giving USA, growth at this rate means it will take a decade before total giving returns to 2007 levels. Donations from individuals remained virtually constant, but foundation and corporate giving both dropped. The one bright spot in the report was the rise in bequests to $24 billion, or 8 percent of all charitable giving. Giving USA also found smaller and younger nonprofits faired much worse during the recession. The majority of groups with less than $1 million in annual revenue shrank, but more than a third of $10 million organizations grew.
How should nonprofit executives navigate this challenging environment?
Continue to focus on individuals. Despite the bad news, individuals remain key to fundraising success. Nine of 10 charitable dollars are donated by individuals or family foundations.
Remember planned giving. Launch or re-invigorate your planned-giving program. In this economy, fundraisers need to give donors as many gift options as possible. Individuals may be hesitant to part with cash but willing to consider a substantial gift through their estates.
Stay lean and flexible. Good advice for a healthy body – and a healthy organization. Some nonprofits are outsourcing more activities – even within the development office – so they can scale up or down as contributions fluctuate.
Use your board for fundraising tasks. The BoardSource Nonprofit Governance Index reports board members have the highest comfort level when it comes to providing names to nonprofits, and writing and signing letters. What doesn’t thrill them? They don’t like to ask for money or call and meet with donors. Ask board members to help where they are most likely to contribute – making introductions, holding small receptions or thanking donors. But don’t let them off the hook on their own charitable giving. Each board member should make a gift. Period.
Value your employees. Lean budgets don’t provide much room for pay raises or bonuses, but you can always find creative ways to value staff members. This could include offering comp time or flexible work schedules.
Stand out from the crowd. You’re competing with many other nonprofits for limited charitable dollars, so be clear to donors about your distinction. Reconsider how you “sell” your programs. How can they be more timely and relevant in the context of today’s economic and political environment?
Focus on your vision and the future. Your organization’s vision – and how you achieve that vision – will remain central to your fundraising activities. Engage your board in updating a forward-looking strategic plan. To quote management consultant Phillip Crosby, “Good things only happen when planned, bad things happen on their own.” There is no doubt the nonprofit sector is suffering in this economy. But fundraisers can take heart. Four out of five Americans plan to donate at least as much in 2012 as they did last year. The organizations that will reap these rewards will have to work harder than ever and demonstrate they are worthy of the donor’s investment.
Ann C. Fitzgerald is Founder and President of AC Fitzgerald, using her decades of experience in fundraising, management, leadership, and sales to help nonprofits build their capacity and achieve success. She is a sought-after speaker, writer, and advisor.