Thursday, September 29, 2011

A Tough Year

According to a report released today (September 29th) by the Nonprofit Research Collaborative (NRC), of 813 responding nonprofits surveyed in July:

 44 percent reported increases in charitable contributions received through June, compared with the same period in 2010;

 25 percent reported giving remained level; and

 30 percent reported charitable contributions have declined so far this year.

 1 percent did not know.

These numbers are barely changed from the NRC 2010 year-end survey, when 43 percent of respondents indicated they raised more money in 2010 than they did in 2009. At that time, almost a quarter (24 percent) saw giving remaining level, and 33 percent raised less.

These results indicate that nonprofit organizations still face a difficult fundraising climate. In AFP’s 2007 State of Fundraising Survey, which asked the same questions as the 2011 NRC study, 65 percent of respondents raised more money that year, before the recession, than in 2006. Eleven percent raised about the same, and 24 percent raised less.

“A much larger percentage of nonprofits were seeing significantly higher fundraising results before the recession,” said Andrew Watt, president and CEO of the Association of Fundraising Professionals (AFP). “With many economists predicting a flat economy for several more years, charities face a very challenging environment in the near future, with fewer funds available while the demand for services and programs remains quite high. This is the reality charities will have to address.”

Results by Subsector and Growth

The NRC surveys found that the relatively low share of nonprofits reporting growth in contributions received began during the recession and lingered for all subsectors through the first half of 2011. In the current survey, human services organizations fared best, but only 50 percent of those organizations reported increases in the first half of the year. International charities had the smallest share of organizations reporting increases, at just 20 percent, although those numbers may be affected by the Haiti earthquake and high donation levels in 2010.

There were marked differences based on size, with larger organizations achieving greater fundraising success. Fifty-seven percent of the largest organizations in the survey (budgets of $3 million or greater) raised more funds in the first half of 2011, compared with just 34 percent of charities with budgets of less than $250,000.

Implementing Campaigns and What’s Ahead

In one strategy to raise more funds, charities are planning for and implementing capital and other fundraising campaigns. Of the NRC respondents, 12 percent are currently involved in a campaign, while 34 percent are in the planning stages. Organizations currently in specific fundraising campaigns were somewhat more likely to see gifts increasing, with 62 percent reporting they had raised more money in the first half of 2011 compared to the same time in 2010. The only exception was for organizations with annual expenditures of less than $250,000; they did not see any significant increases.

“To help donors focus on achievable results, many charities now are setting up short-term special campaigns,” said Nancy Raybin, on behalf of Giving USA Foundation. “By setting discrete fundraising goals for specific activities, nonprofits find they can break through the uncertainty about the economy and help donors connect their gifts to community needs.”

About the Survey

When asked for their thoughts about the most successful fundraising methods for the rest of the year, two-thirds (67 percent) reported they would focus on large-scale efforts to reach many people through direct mail, special events, online campaigns and similar activities. Forty-five percent said they would focus on larger gifts, while 28 percent said they saw foundation and corporate support as their biggest potential growth area.

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