A Seismic Shift
Charitable causes are being adopted at unprecedented levels. Millennials and Zoomers are the most charitable generations ever. Total giving is at record levels. Nonprofits have never been at such a high…or have they. Many times, it’s the challenges looming right before us that we can’t or refuse to see that cause the most upheaval. A seismic shift in the nonprofit world is coming.
Over the last 40 years the nonprofit industry has seen unprecedented growth, from 2000 to 2021 total giving has tripled from $150B to over $484B. However, the same two underlying pillars that have underpinned this spectacular growth are now causing an unprecedented crisis.
- Major Donors: Any nonprofit professional could tell you that in the charity industry one of the first mantras for any nonprofit to follow is focus on major donors. To many organizations major donors are their lifeblood, providing a 6 or 7 figure windfall of funds and high-level community connections to significantly advance the “cause” and increase the likelihood of future major donations. This has evolved to the point where many organizations have entire teams of fundraising professionals focusing solely on the recruitment and maintenance of this small, coveted donor group. While the benefits of having the support of major donors is abundant, the loss of even a single major donor can have equally negative effect, spiraling an organization down forcing them to scramble to make up the loss. As the major donor focus took over the industry, it led to an unforeseen consequence where today 88% of donations are coming from only 12% of donors.
- Baby Boomers: The second fundraising pillar responsible for the growth of the nonprofit industry and where these major donors are coming from is the generation that experienced the most economic growth in history, the Baby Boomers. Born between 1946-1964, the size and generosity of this generation helped raise the nonprofit industry into the juggernaut it is today. With the youngest reaching retirement and the majority well into their golden years, this generation can no longer be counted on as the driving force for charitable giving in the future.
Many charities and nonprofits are now in the position where they have a few major donors and a shrinking donor list. This lack of donor diversity is biggest challenge facing the nonprofit world in a generation.
Diversify your Donor Base
With a small number of major donors providing the bulk of nonprofit funds to their causes and the largest generation of current donors aging out of their ability to give, this lack of diversity in their donor base is forcing nonprofits to focus on younger generations to fill in the gap. Many organizations are finding out the hard way that their shrinking donor lists and lack of younger donors has put them into a precarious position.
The Challenge of engaging younger donors
Now that we know what the underlying issue is, it should be easy to fix the problem right?... Wrong! Younger generations are different. They:
- Don’t like or trust traditional marketing efforts and consider it too “salesy”
- Are heavily influenced by friends, peers, influencers and get information from alternative media
- Are both consumers and creators on social media
- Want to watch rather than read content
- Look for rewards, incentives, and public recognition from their actions especially among peer groups
- Choose careers that are cause-focused
- Won’t make a one-time donation. They want opportunities to support their cause in everyday life
Today’s nonprofits are not structured to make lasting connections with younger generations.
4 Ways to Mitigate the crisis (An industry changing opportunity)
Are you freaking out yet? Don’t worry. Here are 5 meaningful ways to make connections with younger generations.
- Keep Doing what works – Remember, you still have your current large donors and baby boomers that are supporting your cause, so keep doing what works. Keep up with the auctions, galas, walks, donation drives and more. Your goal is to keep everything running while attracting younger generations to your cause.
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Focus on Experiences – Younger generations focus more on experiences.
- Next level events – Instead of doing the same old 5k run, auction, or gala, try taking it up a notch. Try a Mud Run, Obstacle Course or Escape Room. Instead of a golf tournament have your event at top golf or a golf entertainment complex instead, where even those non-golfers can get involved and have fun.
- High skill Volunteering – Instead of offering the same old volunteering opportunities, like manning booths or packing boxes, provide an experience where a supporter can learn a new skill or expand their resume. (This is another way to get recognition from their peer group). You can even use the skills that supporters already have. Need some social media or graphics assistance? Younger supporters would love to help.
- Meaningful Engagement Opportunities – The most important thing to remember when attracting younger donors is that they want their interaction with your organization to be meaningful. Your mission is what attracted them to you, give supporters the opportunity to make an impact. Millennials and Zoomers won’t be the “see you once-a-year donors”. They want to be the ones out there cleaning up the environment, saving the whales, building low-income housing, feeding the children. Give them that opportunity and you will have a life-long supporter.
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Build Communities – Younger generations are all about community. It’s your job to give supporters a mission, a reason to build that community around your organization.
- Give a mission – Start by getting people involved. Don’t hold your supporters at arm’s length, allow them to help you in positive and impactful ways.
- Connect to everyday life – Remember, your supporter’s life isn’t all about your organization. You need to connect with the everyday life and interests of your supporters. (How do you think golf tournaments became a thing…They work!)
- Social Media – Younger generations are active on all sorts of social media. Go where they are. Focus on the social media where they are active the most…hint it’s not Facebook. Try YouTube, TikTok, or Discord instead.
- Use Video – Younger generations are all about viewing not reading. If you want to connect with them, use the media that works the best, video. Don’t worry, you don’t need to have Oscar winning clips on your YouTube channel. Your supporters are used to real people talking from the heart. You can too.
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Leverage New Technology – Make your job easy using the technology that is cheap and available today.
Build communications channels (Mobile First) – When looking at new technology you should focus on building ways to communicate with your supporters that is quick, easy, and inexpensive. These are things that you can create content for on a daily or weekly basis without having to spend a lot of time or money. Try these first -
- Weekly Updates to your website or blog
- Daily or weekly videos for your YouTube channel or TikTok
- Weekly Meaningful Emails
- Desktop push notifications – to let your supporters know when new content is out
Here are some requirements for any marketing channel you use (Must Haves).
- Control of Contact Information - You need to make sure you have control of your contact information. (Facebook is the worst offender). Any channel where you don’t have or can’t get the direct name, email, and other contact information for the supporter will probably be a waste of time. I say probably because some channels like YouTube provide free marketing and reach to new supporters whereas Facebook does not.
- Access to Followers - You also need the ability to communicate with people who follow your channel. (This is what made Facebook so great in the early days.) If you post something on your channel and your followers can’t see it, then building the channel is worthless. The best example is Facebook vs YouTube. If both of your channels had 10,000 followers and you posted some new content, on Facebook it might be seen by a few hundred of your followers but a post on YouY-Tube would see 3-5,000.
- Agile and Flexible Content – You need to have the agility to create content on a frequent basis and be responsive to your supporter’s wants and needs.
- ShopRaise – One of the best ways you can make connections with younger supporters is giving them a way to support your cause every day. ShopRaise is a program where you can turn supporter’s everyday shopping into donations for their chosen cause.
ShopRaise leverages the strong emotional connection between the supporter and their cause to monetize the everyday shopping experience. Our platform –
- Allows nonprofits to expand their donor base while creating a new revenue stream
- Gives supporters a no cost way to support their cause while buying things they already buy at their favorite stores
- Help retailers sell more products while building goodwill in the community
Nonprofits simply customize their account and promote the program to their supporters, turning everyday shopping into a new revenue stream for their cause.
Supporters shop at over 1,200 participating stores and buy gift cards using the ShopRaise app. Each transaction has potential to raise funds for their cause.
Including a mobile app, browser plugin and online mall, the ShopRaise Platform dynamically combines the act of giving with the act of shopping.
You can also earn more about our program at https://www.ShopRaise.com or Signup for a Demo
ShopRaise is kicking off 2023 with a crowdfunding campaign. If you are interested in learning about how ShopRaise is changing the nonprofit industry check out our investment opportunity at https://get.shopraise.com/investors