RESEARCH TRIANGLE PARK, N.C. – As senior consultant for Marts & Lundy, Penelope Scarpucci has heard an earful about problems brought on by the economic recession.
Since the stock market began its downward spiral last fall, it has dragged endowments, private donations and government funding down with it.
And fundraiser confidence is not far behind, Scarpucci said Jan. 15 at a breakfast held by the Triangle chapter of the Association of Fundraising Professionals.
However, despite the uncertain times, fundraisers must not use the recession as an excuse to retreat, she said.
First of all, downturns are cyclical, and by no means permanent, she said.
“If we look at economic history, we’ve had five recessions since 1973,” she said. “And we’ve lived through all of them.”
Second, downturns have not had as catastrophic an effect on charitable giving as one might think, she said.
In 2007, U.S. donors gave a total of more than $306 billion to charity, the largest amount in history, says a study by the Giving USA Foundation.
With the exception of 1987, total giving has increased every year since the foundation began collecting data more than 50 years ago.
Recession giving grows from year to year, said Scarpucci, even though it grows more slowly than during economic booms.
“The last thing you want to do is let all the doom and gloom paralyze you,” she said.
Finally, nonprofits should view the economic slump as a golden opportunity to fortify themselves by building relationships with donors, she said.
“It takes somewhere between 18 and 36 months to cultivate a major gift,” she said. “Now is the time to be reaching out.”
As fundraisers struggle to build and maintain relationships with donors in a down economy, they should keep several guidelines foremost in mind, Scarpucci said.
Nonprofits should be pro-active, she said.
“It’s much more expensive to recruit a new donor than to win back a past donor,” she said.
For that reason, staying in touch with key donors and thanking them for their contributions to the organization are crucial.
Fundraisers also should explore every avenue of communication, including the Internet, to build long-term relationships with their donors.
The Internet is not only cost-effective, Scarpucci said, but also provides a convenient and easy way to keep lines of communication open.
Fundraisers should keep their facts and resources up-to-date, she said.
“Many foundations have pledged to keep giving levels steady,” she said. “Do research to see who these foundations are and how to get their attention.”
Nonprofits also should be flexible, she said.
Demanding a fixed amount at a fixed time may no longer be a viable option for fundraisers, Scarpucci said.
“Try to think creatively, because it may be a way to revive your corporate philanthropy,” she said.
Fundraisers may have to be more flexible not only about time, but also about the kinds of gifts they are willing to accept.
Many fundraisers are extending their pledge periods, asking for in-kind donations such as facilities and equipment, and talking to their donors about planned giving, she said.
Nonprofits also should be observant, she said.
In times of economic distress, donors are more important than ever to nonprofits.
So fundraisers must step back and look at their organizations from the donor’s perspective, Scarpucci said.
While asking for gifts, fundraisers must be sure they use language that engages the donor.
“This is not the time for fundraising jargon,” she said. “The more you talk about the ‘good news’ of what you’re doing, the more you add immediacy and importance to philanthropic support.”
Nonprofits also should be discriminating, she said.
Once fundraisers have determined what donors care about the most, they must emphasize what the organization is doing to advance these priorities, Scarpucci said.
“Talk exactly about how you’re going to use the money, and how critical it is to your mission,” she said.
Nonprofits also should be resolute, she said.
“Some organizations want to abandon campaigns entirely,” she said. “I’d never suggest an institution reduce its goal.”
Though times are hard, this fact has not diminished nonprofits’ validity. In fact, nonprofit missions are becoming even more critical as more people struggle to make ends meet.
“You made the case for why you needed that level of philanthropic support initially,” she said. “None of that has changed.”
Finally, Scarpucci said, nonprofits should be patient.
“Don’t sit in a corner saying, ‘Woe is me,'” she said. “This is an efficient, resilient nation with a lot of smarts, and it will bounce back.”
She quoted Michael Sinkus, former CEO of Marts & Lundy, who would find inspiration by walking around the stately Princeton University campus.
“He would say, ‘Most of those buildings date from the height of the Great Depression,'” Scarpucci said. “‘If donors were giving then, they’re still giving.'”