Fundraising During A Challenging Economy

Thomas G. Bognanno has been the President and CEO of Community Health Charities since January 2006.

As the coronavirus pandemic continues its grip on the nation, with no immediate relief in sight, the corresponding economic news is just as disheartening. Roughly 30 million Americans are currently “receiving some form of unemployment insurance” according to The Washington Post. While the global economy may recover to pre-crisis levels by the third quarter of 2022, according to McKinsey, the U.S. economy would need until the first quarter of 2023.

With fall quickly approaching, this will present additional fundraising challenges for nonprofits, many of which have already canceled relays, walks and other in-person events and laid off staff this year. Fourth quarter is typically the strongest fundraising time of year with workplace giving campaigns including Combined Federal Campaign, #GivingTuesday, general holiday generosity from red kettles to Thanksgiving baskets, and end-of-year giving.

However, with continuing uncertainty and many schools opting for distance learning, it is difficult to determine when things will return to “normal” — or the new normal. When will people return to the office, volunteer in person or participate in civic events together? Will donors give more generously this year or play it safe? Either way, you shouldn’t let this discourage you from moving forward with your fundraising plans.

Strengthen your case for giving.

For starters, panicking and painting apocalyptic pictures isn’t going to change anything and will only make a bad situation worse. Let’s not abandon all the tried-and-true methods that attracted and retained donors for years in exchange for impulsive thinking. This crisis has created multiple opportunities for enterprising fundraisers.

If there is one lesson all fundraisers should have learned over the years, it is that different isn’t always better. Instead, I believe that fundraisers right now need to chart a course that retains the core components of a historically successful fundraising program, yet they must also be willing to take calculated risks that might open the door to finding new dollars and donors.

Now more than ever, strengthen your case for giving. Reexamine your case for support — the language, the look and feel. Step outside of your echo chamber to make sure your donors truly understand the urgency for your services during difficult times and how you are taking steps to increase effectiveness. This is not an opportunity for telling sad tales about how the organization is suffering. Jettison that type of thinking, and focus instead on how you are meeting the needs of your constituents, making an impact and improving individual lives. 

Develop your fundraising strategy.

One of the main reasons that donors stop giving to a particular charity, regardless of the nature of the economic downturn, is that they cease to feel connected to the organization. We all know the importance of nurturing donors up and down the pyramid, but we must have a laser focus on this when the times are difficult. Redouble your efforts to appreciate donors, and inform them of your case for support. Reinforce the confidence they have in your organization to deliver on the promises you make. If you do, they will likely continue to give — maybe not always at previous levels, but they will give. One of my nonprofit partners swiftly adjusted its spring walks to virtual events and retained 70% of its fundraising.

Encourage your team to be creative with new strategies, tactics, virtual tools and events that can be tested and implemented in the fall. Begin planning and executing now so you can test new content and channels, especially if you’re working with reduced budgets and staffing.

Find ways to save and maximize ROI.

Cutting fundraising costs is a relatively easy task. The only problem is that excessive cost-cutting is often a prescription for bankruptcy. The only rational way to respond to an economic crisis is to remember that fundraising requires continual investment and ongoing evaluation. Downturns will necessitate trimming expenses, but slashing your fundraising costs to balance the budget is essentially shooting yourself in the foot.

It may sound obvious, but fundraisers often forget that it’s more cost-effective to raise money in large blocks than in small increments. One grant from a private foundation or a significant gift from a major donor may be more worth your time than collecting individual $25 gifts.

Also, revisit the ROI on all your tools and tactics, and ask yourself, “Was it worth spending this much?” Consider asking your team to identify lower-cost platforms, renegotiate contracts with certain vendors and evaluate if some projects can be handled internally. When one of our contracts was up for renewal, one of my departments found a comparable stock photo vendor that cost $1,000 less for the same service. This isn’t about slashing your budget with a sword. Try starting with a letter opener.

Encourage professional development and research.

Some staff seem to be able to develop successful ideas on short notice, but during unprecedented times like this, many employees may need inspiration, new skills or fresh ideas. Look for ways to invest in your fundraising team and all staff. Encourage them to take advantage of professional development opportunities. If your organization can’t afford paid training, take advantage of free training, such as Google Partners, HubSpot Academy, SEMrush Academy and more, or ask fundraiser friends of yours to do a virtual training for your team. Encourage your team to find opportunities that will help them excel, be more efficient and effective, and achieve goals — even during these challenging times. 

Final Word

No one could have imagined what 2020 would bring. As a leader, you set the tone for your team, balancing optimism and realism and staying focused on goals, while also encouraging flexibility and understanding and keeping your team motivated. After you strip away the tactics and databases, a good fundraiser realizes that the only assets you have that can be controlled in any economic crisis are your credibility and passion for the mission. 

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