By Jackie Biancolli Libby
“The new normal.” By now, we’ve invoked the phrase often enough that it almost loses meaning. In fact, the whole idea feels slippery. Each time we try to pin the future down, it changes on us, again. There is no crystal ball.
At the same time, fundraisers must be future-oriented: devising strategy, budgeting, and implementing campaigns well before deadlines. Assessing and addressing the new normal is a critical skill. Fundraisers who do this well will empower their causes and organizations to strengthen impact. Sadly, those who do not will risk losing ground.
The best fundraisers will understand trends, consider economic and social conditions, and regularly update their assumptions. In addition, they will be an expert on their organization’s history, its donors, and important benchmarks. They will learn from the work of sector peers and share their own findings. Throughout, they will educate and collaborate with their leadership and boards.
To begin, assess your organization’s current picture. How well do you understand the history of your donor file? How has it changed during the past two years? Consider donors’ communication preferences, and where they hang out online. Check for new trends with major or recurring giving. What has changed? What has been consistent? What is the best way to engage your donors today?
You need to know your organization’s metrics. Look at new join rates, retention rates, average gifts, and upgrades. Segment information by recency, giving level, and frequency. Because the past two years have been so unusual, be sure to examine new joins by year and study their retention and average gifts. You should also track engagement across channels and assess your digital KPIs.
Understand your organization’s current challenges. Maybe you are experiencing a leadership transition, or the pandemic stressed cash flow. Perhaps a surge of new donors overwhelmed your infrastructure. How have the supply chain and inflation affected your budget? Diversity, equity and inclusion (DEI) strategies might rightly require changes to your funding model or tactics. Re-openings and closures might also be a factor. Assess and reassess what is happening for your organization.
After you become an expert on the past and present, look to the future. Anticipate challenges and plan for them. You should maintain your own list of trends to research and track, but here’s a roundup of seven ways to get you started:
- Macroeconomic changes. Inflation and the threat of recession are top of mind for many donors. Workforce trends such as the Great Resignation and remote work continue to reshape organizations. Labor disputes, shipping bottlenecks, international conflict, and the pandemic may continue to stress the supply chain. Fundraisers don’t control these factors, and everyone hopes they will let up. Still, you should pay attention and prepare to respond. These trends affect your nonprofit and your donors.
- Social movements and major events. The nonprofit sector’s reckoning with racism and the call to DEI improvement must continue. This demands investment and openness to change. In addition, many different major events will dominate the news, and donors will respond. Elections will take place, and results might be contested. The pace of news is often frenetic and can feel overwhelming. Consider how these issues impact your organization and your donors. Learn from your history and look for inflection points.
- Public health. The pandemic is constantly shifting, and it remains unpredictable. What we do know is that we’re not entirely out of the woods — and nonprofits have a responsibility to keep their communities safe. The United States is trending to re-opening, but new variants and closures are possible. On the bright side, you just had a crash course in managing through these stressors. Stay flexible and take heart in your resilience.
- Donor trends. Many organizations saw a decline in new joins during the height of the pandemic. Others nonprofits experienced a surge in new donors, only to see dramatic attrition after one year. A few exceptions have held steady. These patterns impact future revenue from renewals and appeals. Adding to this, direct mail costs have increased. Managing these and other changes is certainly a new normal. Keep updating your assumptions, know your organization’s history, and remain agile.
- Multichannel marketing. COVID lockdowns were a period of rapid digital adoption, from Zoom meetings to telehealth to virtual classrooms. Everyone is more connected than ever, and competition for attention is at an all-time high. You must leverage multichannel marketing if you are to stay relevant. Digital opportunities abound. Direct mail remains critical. Text marketing is here to stay. Fundraisers must learn how and when to use every channel, for maximum return on investment (ROI). Be ready to meet donors in the channels they like best — and be ready to evolve. To do this well, trust your data, not anecdotes or your intuition.
- Privacy. Consumers are concerned about their privacy, and big tech has responded with privacy protection features that make it harder to track engagement. In this context, first-party data collection will be more important than ever. Marketers are rewriting the digital guidebook on everything from success, to engagement, to drip campaigns, to automatic trigger emails, to retargeting. It will be important to regularly update what you know about best practices.
- New forms of giving. In recent years, two major new forms of giving have emerged: donor-advised funds and cryptocurrencies. Both are influential in philanthropic circles, and both have pros and cons for organizations receiving them. Fundraisers should guide leadership to clarify their nonprofit’s position on these donations. Ensure that you have the infrastructure to manage and track these activities. Will you accept them, how will you manage them, and what is your position on ethical concerns? For example, due to predatory practices and environmental impact, some organizations have decided not to accept crypto-donations. It’s important to talk about these things before they become an issue.
You might be thinking, that’s all fine. But what should fundraisers do about it? Keep updating your assumptions. The future is uncertain so you should not implement rigid solutions too early. You want to remain agile. The point is not to control every crisis in advance, which would be impossible. Instead, your goals are to prepare where you can, incorporate new information, and respond strategically when change happens.
In addition, fundraisers can implement proactive strategies. First, keep up your digital content. Between future possible closures, more digital-friendly donors, and ongoing remote activities, you will likely need it. Further, staying virtually connected to donors positions you to keep pace with the rapidly changing digital environment. Always, always track results.
Second, streamline operations. Not only will this help you conserve resources, but it will also support agility. For example, one performing arts organization created evergreen direct mail packages that do not feature event or event benefits messaging. If future closures impact performances, they are ready to change course without significant disruption to their strategy.
Third, educate your leadership. As the fundraising expert in your nonprofit, it is important to correct myths, provide relevant data, and advocate for good strategy. For example, many well-meaning board members have wondered why direct mail is still a line item, or whether Millennials are the simple answer to a budget shortfall. Fundraisers know better. Your job is to inform leaders, recommend sound practices, be transparent, and be accountable. When you become a strong and trustworthy partner to leadership, your nonprofit has the best possible chance of success.
Last but not least, keep going. Recent years have been difficult, and you are still showing up. Well done. You’re doing great.
Jackie Biancolli Libby is senior vice president and director of client services with Avalon Consulting in Washington, D.C. Her email is [email protected]