The new Fundraising Effectives Project report, released today, is 21 pages of data — and just two positive numbers and related to only a small percentage of donors and organizations.
Organizations of all sizes — except those raising less than $100,000 — had a decrease in fundraising. When it came to donor retention, only the category of those who had given at least seven gifts showed an increase and that was just 1.9%.
The report covers the first three quarters of 2023. The bleak data shows a continued steep decline in donor counts. It’s a downward trend that began in 2021, after a large uptick in donations and donors in 2020.
Overall, donors declined 7.6%, dollars were down 1.1% and retention was down 1.3%. The study included 3.1 million donors and $4.1 billion in donations with 8,095 organizations contributing data.
The Fundraising Effectiveness Project (FEP) is administered jointly by the Association of Fundraising Professionals and GivingTuesday. The Growth in Giving database has more than 241 million donation transactions and is continuously updated by top fundraising software partners. FEP reports are developed from collaborating data from Bloomerang, Classy, Community Brands, DonorPerfect, Keela, NeonOne and Qgiv. FEP’s partner network also includes data analysis and additional support from Bonterra.
Data in the report is limited to organizations with at least three years of data, with between $5,000 and $25 million received in the prior year. The data is weighted across size of organization as determined by amount fundraised.
“It’s not great news but not super surprising,” said Woodrow Rosenbaum, chief data officer for GivingTuesday. “There is some statistical inevitability,” when donor counts drop and organizations are left with their best donors, which is a small percentage of all donors, he said.
Despite this overall decline in donors, dollars had only a marginal year-over-year decrease of 1.1% for the first three quarters of the year. This decline was largely caused by a decline in small and micro donors, who combined gave between $1 and $500 but who accounted for 83.6% of all donors.
It’s clear from the data that the hardest donors to retain are first time donors, who made up 68% of all donors in the study and were down 9.5%. Those who gave twice (12.3% of donors) declined 1.1% and those who gave three to six times (9% of donors) declined 0.4%.
It’s clear from the retention numbers, according to Rosenbaum, that it is critical to have monthly donors paying via a monthly gift put on a credit card. “Recurring giving, monthly giving donors retain at a much higher rate,” he said.
There is still a disparity in organizations’ performance based on their size. Smaller organizations seemed to perform relatively better this year compared to bigger ones, according to Rosenbaum.
“The current trends facing nonprofits underscore the need to refocus on engagement strategies that build relationships,” said Ann Fellman, chief marketing officer at constituent relationship management platform Bloomerang, which contributed data for the study. “Send simple surveys to learn donor interests and passions, strengthen your storytelling, personalize your outreach … human-to-human communications is what will help fundraisers create the emotional connection that serves as the foundation of a healthy donor relationship.”
Other data in the report includes:
* There was a slight decrease in fundraising dollars, driven by a decline in the large donor and new donor segments. Given the error margin, this decrease could turn into a slight increase as delayed data comes in.
* Donor participation fell as acquisition of new donors and small donors remained a challenge.
Overall retention slightly decreased, significantly among larger donors.
“These results are a continuation of a troubling trend, but there are certainly opportunities here as well,” said Mike Geiger, MBA, CPA, the president and CEO of the Association of Fundraising Professionals and the AFP Foundation for Philanthropy via a statement. “The relatively strong performance of small organizations speaks to the value of grassroots engagement. As we finish up the year-end giving season and move into 2024, building relationships with new donors and creating accessible pathways for giving at all levels, but particularly for small and micro donors, will be more important than ever.”
Go here to get the full report … https://data.givingtuesday.org/fep-report/
