Would you be surprised to learn that most nonprofits are failing to make use of one of their most valuable resources? What if I told you that that resource is 100% free?
It might feel like you are always in campaign mode, either planning for your first campaign, your next campaign, or currently in the middle of one. You aren’t alone here! As you think about your campaign, here are some recent trends we have noticed and best practices we have seen in our 25 years working with clients across multiple nonprofit sectors.
Trends in Campaigns
For starters, many more campaigns are taking place today. We are seeing larger campaign goals and more megacampaigns fueled by megagifts from the top tier of donors.
With this has come a greater focus on the top of the gift pyramid and heavy reliance on lead donors with less participation from mid-level donors. The challenge for non-profit organizations is to also build in opportunities to engage mid-level and annual fund level donors. Organizations are recognizing that if this opportunity is missed it can be detrimental to their efforts to develop major and lead gift donor pipelines for future campaigns. Relying on the same lead gift donors repeatedly can quickly lead to donor fatigue in the environment of continuous campaigns we find ourselves in today.
We know that 2018 was a complex year for charitable giving – $427.71 billion total charitable giving in the US, the second highest level of giving ever. Yet in actuality, giving was essentially flat in 2018, coming off of a record-breaking 2017 and four years of consecutive growth. As giving mirrors economic fluctuations, the strong performance of economic indicators in 2018 helped drive growth, yet stock market volatility at the end of 2018 may have negatively impacted giving by individuals. Also, the uncertainty of the Tax Cuts and Jobs Act may have impacted individual giving as well.
With these complexities, how do we grow philanthropy in our nation? This has been a key leadership question at JGA over the 25 years of our work with nonprofit clients. We are committed to strengthening philanthropy through research and best practice – and by learning from our colleagues and friends in the industry.
Perhaps the culmination of our commitment to growing philanthropy takes place this year – our 25th anniversary year – with the appointment of our Senior Consultant and Founder, Ted R. Grossnickle, CFRE, as the Chair of the Giving Institute.
Today, Giving USA released its annual estimate of charitable giving for 2018, showing that giving reached more than $427 billion amid a complex year in terms of economic conditions and a changing policy environment. Giving USA 2019: The Annual Report on Philanthropy for 2018 reports that Americans gave $427.71 billion in 2018, an increase of 0.7 percent in terms of current dollars but a decline of 1.7 percent from 2017, when adjusted for inflation. Even adjusted for inflation, charitable giving reached its second highest level ever in 2018, second only to 2017.
Published by Giving USA Foundation, a public service initiative of The Giving Institute, Giving USA is the longest running and most comprehensive report of its kind in America. It is researched and created by the Indiana University Lilly Family School of Philanthropy.adjusted for inflation. Even adjusted for inflation, charitable giving reached its second highest level ever in 2018, second only to 2017.
Building a systematic major gifts program can have a dramatic impact on your fundraising ROI (Return on Investment). Establishing a major gifts program that is systematic involves creating a purposeful, organized, and ongoing program for identifying and cultivating relationships with donors that leads to solicitation and stewardship of major gifts.
A successful major gifts program also entails focusing your efforts on those prospects who are likely to make the largest financial impact on your organization. A sharper focus on your top prospects will allow you to better steward your institution’s resources and work more effectively and efficiently.
We believe success in securing major gifts is so important for nonprofits, that Johnson, Grossnickle and Associates (JGA) partnered with the Chronicle of Philanthropy to provide a curated collection of Chronicle articles and JGA insights on major gift fundraising.
Challenge gifts are a mainstay of most nonprofit fundraising programs for one very good reason . . . they are effective! For decades nonprofits in all sectors have utilized challenge gifts to incentivize giving to achieve a variety of goals. Their effectiveness has not waned. They work in any number of situations. They work with all generations. Leveraging giving has universal appeal!
Although fundraisers can provide numerous anecdotes of how challenge gifts have stimulated giving, formal research also has shown that challenge gifts attract donors and increase contributions. One study conducted by Daniel Rondeau and John List in 2008, “Matching and Challenge Gifts to Charity: Evidence from Laboratory and Natural Field Experiments,” revealed that challenge gifts attracted 23% more donors and increased total dollar contributions 18%.
At Johnson, Grossnickle and Associates, we are a philanthropic consulting firm that takes our vision quite seriously:
“JGA strengthens the field of philanthropy and empowers not-for-profit organizations to make the world a better place.”
It’s been that way since 1994, when Don Johnson and Ted Grossnickle had a vision for a distinctly different consulting firm. From the beginning, JGA was intended to be a high-quality, personalized, deeply strategic consulting practice for nonprofits. JGA would be the firm that would think intuitively about a client situation. If needed, a consultant would take extra time to do the job right. JGA would under-promise and over-deliver. And, consequently, through good service to the nonprofit community, JGA would have a positive impact in making the world a better place – living out our vision.
On April 2nd in San Antonio, the Association of Fundraising Professionals (AFP) will honor Dr. Paul Pribbenow, PH.D., CFRE, as Outstanding Fundraising Professional for 2019 at the International Conference on Fundraising.
This is one of those occasions when a “blog” just doesn’t provide enough space to say why this is such a great honor and why it’s so appropriate. The Outstanding Fundraising Professional award is the highest honor that AFP bestows upon one of its members, recognizing effective, creative and stimulating leadership, as well as the practice and promotion of ethical fundraising.
Thoughtful planning for a campaign is more important than it has ever been. The pressure to meet increasingly high expectations is real, establishing ambitious but realistic goals is more critical than ever, and yet resources to do so are seriously constrained or questioned.
Recently, Johnson, Grossnickle and Associates (JGA) partnered with the Chronicle of Philanthropy to provide a curated collection of Chronicle articles and JGA insights on capital campaigns. While capital campaigns were historically the province of large charities and major institutions like universities and hospitals, in recent years they’ve become increasingly common among nonprofits of all sizes. In this collection of articles produced by Chronicle Intelligence, a division of the Chronicle of Philanthropy, we show you how to help your organization plan, market, and complete a successful capital campaign.
If you believe a campaign is in your future, think about how well your organization can answer these key questions:
In December 2017, Congress passed and the president signed the Tax Cuts and Jobs Act (TCJA), which contained what many describe as the most significant changes to the tax code since 1986. During 2018, we received many questions from our nonprofit clients about the implications of these changes for their donors.
1. What is the most significant tax law change that could affect the short-term philanthropic planning of our donors and, therefore, our annual giving program?
The 2017 tax law change nearly doubled the standard deduction for individuals (from $6,350 to $12,000 and from $12,700 to $24,000 for married couples filing jointly). This means that fewer taxpayers will claim itemized deductions. Research has shown that those donors who claim itemized deductions are more likely to give consistently (should we say that this may be correlation rather than causation). In the recent past, approximately 30% of taxpayers have claimed itemized deductions. As a result of the tax law change, it is estimated that approximately 15% to 20% of taxpayers will continue to itemize their deductions.