The challenge of fundraising in tough times

Tim Seiler
Tim Seiler

Tim Seiler

As goes the economy, so goes charitable giving, and thus fundraising.

Since mid-2008 fundraising has been extraordinarily difficult.

The stock market has bounced up and down, personal income has been flat, consumer confidence has been shaky, and donors have been wary.

Charitable giving in 2008 declined from its 2007 level, the first decline in current dollars attributable to the economy in more than 50 years, according to research by the Center on Philanthropy at Indiana University for Giving USA Foundation.

How can nonprofits raise money in this tough economic climate?

The Center on Philanthropy conducts a semi-annual survey — the Philanthropic Giving Index — of approximately 350 fundraisers and fundraising consultants around the U.S. to assess the philanthropic and fundraising climate.

Results in summer 2009 were at historic lows: Fundraisers’ confidence in giving and fundraising was at 65.4 on a 100-point index.

In December ’09, it had crept up to 71.1.

Things are tough out there.

Asked what they were doing to raise money in this down economy, fundraisers and consultants reported five general themes that provide a prescription for successful fundraising not only in tough times but for all times.

First, recognize and acknowledge donors’ circumstances. Their financial situation might be less robust than it was, making charitable gift decisions even more challenging.

Allow for longer engagement periods with donors before donors make a commitment.

For those with multi-year pledges, fundraisers might need to provide a restructuring of the payments.

In short, be flexible in accommodating donors’ ability and interest in making and fulfilling gift commitments.

Second, test and validate the organization’s case for philanthropic support; it’s the raison d’etre for raising money.

Do donors and funders understand and accept the organization’s mission, goals, and objectives?

Demonstrate worthiness for support by showing how the organization ameliorates a community need or solves a problem.

Third, communicate the impact of philanthropic support on the community served.

Measure and report impact on beneficiaries served and donor satisfaction and fulfillment from their gifts.

Fourth, be in touch with donors and funders.

Talk with and visit them regularly, especially to thank them for their support and to engage their hearts and minds in the mission.

Call on them for reasons other than asking for more money, such as seeking advice or providing updates.

Engage the board and other volunteers in this process.

Fifth, ask.

Effective fundraising is asking for money to support a cause that both asker and prospective donor believe in.

Use all fundraising strategies available, from social media to personal one-on-one invitations to give.

Combine strategies for greater effectiveness, such as special events and direct mail, or direct mail and e-mail.

Above all, be as personal as possible in asking for financial support.  Make it easy for donors to give by accepting all forms of gifts — checks, credit cards, debit cards, electronic funds transfers.

Besides these themes, certain fundraising strategies were reported to have been particularly effective during the recession — direct mail held relatively steady, with a focus on the annual fund and smaller gifts.

While reported success with major gifts declined, this strategy remains one of the most successful.

Requests for support for specific items or cost centers — for manageable pieces with visible results — helped keep donors engaged.

What fundraisers and fundraising consultants tell us through the PGI survey and their own experience, is that in tough times or good, charitable giving and fundraising succeed when dedicated staff and volunteers accept the importance of the mission, make their own financial commitments, and then eagerly and proudly invite others to join in the fulfillment of the mission through generous giving.

Tim Seiler is director of The Fund Raising School at The Center on Philanthropy at Indiana University.

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