Why that already-infamous report about the 2022 decline in charitable giving doesn’t signal the end of days for your fundraising success.
Do you remember Chicken Little?
The story has many variations, but the basic plot is that Chicken Little is walking in the woods when she is struck by an acorn falling from one of the trees. Convinced that this is a sign the sky is falling, Chicken Little rushes from the woods to go and warn the king.
As with many childhood folk tales, there is a lesson tucked into the imaginary story that is applicable to our professional adult lives. Chicken Little teaches readers to avoid jumping to conclusions without good data. That is important for nonprofit leaders to understand.
Charitable giving is falling. But the sky is not.
Charitable giving is down for the first time in a decade—down 1.7%, in fact. We have seen the total number of donors decrease for 10 years now, according to the Fundraising Effectiveness Project. At the same time, the total amount of money donated has increased over those 10 years. But in the fourth quarter of 2022, both the amount of giving and the number of donors went down.
The struggling economy is likely to blame. However, nonprofits can’t control the economy.
Here’s what we can be sure of: God does not have a cash flow problem. 1 Chronicles 29:11-12 reminds us everything in the heavens and the earth is His. That’s good data.
Nonprofit leaders must focus on sustainable fundraising that engages donors for retention and development. Don’t be Chicken Little. Avoid jumping to conclusions without good data.
What to do when the sky appears to be falling.
In his book, Smart Leadership, Mark Miller, Vice President at Chick-Fil-A, says leaders must make smart choices. I’ve adapted the choices he discusses to help you consider as strategy that works for you in a slower giving season.
1. Reality Check
What is true about your organization? Your industry? Charitable giving in general? Don’t put your head in the sand; instead, consider your reality. Look at the data. What does it tell you? How are donors responding to your work? What programs are working? Not working? What is your retention rate? Who are you losing? Do you know why?
2. Capacity & Curiosity
Don’t settle for the status quo. Look for gracious ways to expand your donors’ capacity through noncash giving options. Be curious about why they give, how they give, and what they care most about in your organization. Report back accordingly. Find capacity in your organization to connect with donors in a meaningful way.
3. Courageous Change
Sometimes the hardest part is making a change. Change is risky. But here’s one change you can make that won’t be too risky in an uncertain giving economy: to double down on your major donor efforts. Invest in relationships, be clear about your plan and needs, and cut out the bells and whistles.
Chicken Little overreacted. It wasn’t the sky falling; it was an acorn. It likely hurt, but she could easily have overcome the incident. The same can be true when giving slumps. It will hurt momentarily. But if nonprofits do a reality check, identify ways to expand capacity and curiosity, and make a plan, the slump can be momentary as well.
The sky is not falling.
Find the right tools for your major donors.
Expand your donors’ capacity for giving by empowering them to donate non-cash assets. Donating a business interest or real estate interest can be hugely beneficial for your donors’ generosity and your fundraising.
A charity fund is one tool to help your nonprofit accept and use non-cash charitable contributions.How a Charity Fund Can Help