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There is a multi-dimensional challenge facing churches in America that has me concerned, and I think you should be as well. Given my background, it should not surprise you that I am concerned about this matter. (Prior to joining JGA as a senior consultant, I spent twenty-five years working in development for a religious institution, and during my twelve years with JGA, I have worked with more than fifty faith-based organizations.) The challenge is related to several troubling trends in the current U.S. religious landscape. As I will explain later, I think you also should be concerned . . . whether or not your fundraising is for a religious-affiliated organization.

My concern is threefold: 1) Giving to religious organizations as a percentage of total philanthropy is declining substantially; 2) participation in congregations is at a historic low; and 3) the changed religious practices brought on by the COVID-19 pandemic could have a continuing, long-term impact on congregations.

The nonprofit world, just like the world in general, has been turned upside down by the COVID-19 pandemic and the growing crises over the economy and race relations in the US. All of us involved in philanthropy are working to determine our course in the choppy and unchartered waters.

Recently JGA sponsored a webinar aimed at casting a guiding light on moving forward with a fundraising campaign in the midst of these challenges. The webinar, Campaigns and COVID-19: What the Pandemic Means for Your Campaign, brought the perspective of four guests representing organizations at different stages of campaigns: planning; leadership gifts/quiet phase; major gifts/public phase; and campaign closure.

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%. 

Have you looked at your overall and new donor retention rates lately? If your organization is like most other nonprofit organizations, there is ample room for improvement.  According to the 2017 Association of Fundraising Professionals’ (AFP) 2017 Fundraising Effectiveness Survey Report, the average overall donor retention rate for the nearly 11,000 nonprofits participating in the study was 45%. The average new donor retention rate was 23%. 

As noted in the AFP report, for the past 10 years, the average overall donor retention rate has been less than 50%.

How can your organization move the needle on donor retention?  A good place to start is with donor stewardship.

Over the years, JGA has often been asked to help nonprofit organizations move from a transactional fundraising model – focused heavily on direct mail and special events – to a long-term sustainability model. The latter approach is based on building donor relationships that encourage and create meaningful opportunities for philanthropic investment in an organization. A key to success in this relationship-building, major gifts-focused model is a formal prospect management approach.

How do you put in place such a system?  What actions need to be taken to formalize an ongoing program of major gifts fundraising?  The following are four fundamental steps in implementing a systematic approach to major gift development:

A common practice among nonprofit organizations -- the offering of naming opportunities to donors – is seemingly receiving increased scrutiny. In the past fifteen months, for example, The New York Times featured an op-ed article on revising the way tax law treats naming rights and The Wall Street Journal ran a story on how naming rights can go wrong, focusing on a legal battle over a gift made by country singer Garth Brooks.