Current nonprofit sector research and recommendations for effective day-to-day practice from ASU faculty, staff, students, and the nonprofit and philanthropic community.
Many nonprofit organizations rely on individual giving as a primary source of income to carry out their missions. People have been giving to charity through time, money, or in kind gifts for centuries and beyond. The act of charitable giving is here to stay, but the nature of giving is constantly evolving with generations.
Although every donor is different, research has been conducted to determine commonalities among generational giving. Younger generations typically respond best to text messages, email and social media while older generations respond best to voice calls and direct mail (Lai, 2015). In addition, “60% of Millennials and 50% of Gen Xers want to see directly the impact of their donations, while just 37 percent of Baby Boomers say seeing a direct impact matters to them” (Hartnett & Matan, 2014). Sustainable growth in the nonprofit sector relies on effective donor engagement, stewardship and retention. And yet, alarmingly, only 34 percent of nonprofit organizations say they tailor solicitations and communications with donors to their age (Hall, 2015). Nonprofit leaders must understand donor motivations to effectively target and retain donors before it is too late.
Currently, Baby Boomers (born 1946-1964) and Matures (born 1945 or earlier) represent the majority of giving in the United States. These generations also average larger annual gifts than the younger generations; Generation X (born 1964-1980) and Millennials (born 1981-1995). While young donors might not have as much giving power right now, they represent the future of philanthropy. By pulling them into your mission early on, your organization can stay top of mind as their income increases in the coming years (Chung, 2015).
So, how can nonprofits lock in this next generation of donors?
- Provide Hands on Opportunities: Millennials and Generation X appreciate hands on experience. They want to see your program in action before investing financially. Invite these younger generations to volunteer at your organization, leverage their experience and show them how valuable they can be. If young donors can directly see the impact they are making on people and communities, they can become your most loyal advocates and supporters.
- Update your Website and Mobile Giving Platforms: It is imperative for nonprofit organizations to have an effective online giving option to maximize donor engagement. A Millennials' number one nonprofit website pet peeve (76 percent) is trying to navigate a site that is not mobile-friendly (Chung, 2015). As direct mail and telemarketing strategies begin to fade out, organizations should focus on online based solicitation to target the next generation of donors.
- Encourage Workplace or Monthly Giving Campaigns: Younger generations are highly motivated by their peers, especially in their giving tendencies. 69 percent of Millennial employees would be more likely to give if their company matched a percentage of their donation (Feldmann, 2015). Recurring giving campaigns allow less financially established donors to make smaller contributions as opposed to a large annual gift. Workplace and monthly giving campaigns bring convenience to philanthropy, which is highly attractive to younger generations.
The foundation of fundraising comes from building strong relationships with individuals who believe in your cause. The shift must come in the ways in which fundraisers seek out these relationships. Once you achieve a better understanding of what makes each generation different, your nonprofit will be able to take whatever great fundraising ideas you may have and effectively engage more people to increase attendance at your next event, grow the members of your volunteer program, and get more donations than you’ve ever imagined (Page, 2016).
Younger generations are disrupting traditional forms of fundraising because they expect tangible, measurable results of their personal contributions. Millennials and Generation X are holding nonprofit organizations more accountable than ever before. A high performing nonprofit leader will recognize this newfound responsibility as an opportunity to build trust with stakeholders and foster lifelong relationships with incoming donors. To continue to effectively serve people and communities, nonprofit leaders must shift to a long-term mindset to create sustainable, everlasting organizations backed by support from all age groups and generations.
Chung, E. (2015, June 10). How to Engage Different Generations of Donors [Web log post]. Retrieved March 20, 2017, from https://www.classy.org/blog/how-to-engage-different-generations-of-donors/
Chung, E. (2015, June 17). How to Lock in the Next Generation of Donors [Web log post]. Retrieved Feb 5, 2017, from https://www.classy.org/blog/how-to-lock-in-donations-10-years-from-now/.
Feldmann, D. (2015). Cause, Influence, and the Next Generation Workforce(pp. 1-38, Rep.). Millennial Impact Report.
Hall, H. (2015, April 27). Charities Ignore Donor Preferences, Study Says. Retrieved March 20, 2017, from https://www.philanthropy.com/article/Charities-Ignore-Donor/229705
Hartnett, B., & Matan, R. (2014). Generational Differences in Philanthropic Giving(Rep.). Sobel & Co LLC.
Lai, L. (2015, May 20). Focus on Winning Either Hearts or Minds. Retrieved March 20, 2017, from https://hbr.org/2015/05/focus-on-winning-either-hearts-or-minds
Page, S. (2016, July 16). 9 Simple Ways to Reach Different Generations of Donors Successfully. Retrieved March 03, 2017, from http://clairification.com/2016/07/18/9-simple-ways-reach-different-gener...
Brenna Paes is an Arizona native who completed both her undergraduate and graduate degrees at Arizona State University. She is particularly passionate about youth and community development and is looking to build a lifelong career in the nonprofit sector. Brenna is a graduate of ASU Master of Nonprofit Leadership & Management.