Maybe you’ve been a fundraiser for a while and remember what the 2008 financial crisis meant for nonprofits. It’s been over ten years since that test of our sector’s resilience and many new folks have joined the profession since.
A financial downturn isn't an easy storm to weather for your donors, your organization, or for you personally. But with the current state of unemployment and looming uncertainty about the spread of COVID-19, it’s a reality that we need to prepare for.
While none of us know exactly what the future holds, there are some practical steps you can take to be better prepared for any financial downturn.
Evaluate what's working in your fundraising program
When things go sideways it can be tempting to overhaul everything and try to get as “creative” as possible. But chances are there are still strategies working for your organization that you should continue to use. If you already have a monthly review process to identify what's working and what's not, keep it up! If you don’t do a monthly review, now's a great time to start for benchmarking and comparison purposes.
Here are a few things to review inside your fundraising program on a monthly basis:
- The number and amount of gifts you received each month as well as the channels for giving
- The number of new donors and where they came from
- The conversion rate on your donation page
- Top traffic sources to your website, especially to your donation page
- Response rates on direct mail appeals
- Open rates, click-through rates, and conversion rates on email appeals
- If you work in major gifts, a review of your portfolio including where all donors are at in the giving pipeline
Reviewing these pieces of your fundraising program will not only help you identify what’s working but will also give you clear actionable steps to improve what’s not working.
Build a contingency plan
You (hopefully) have a fundraising plan in place, but what you may not have are backup plans inside your fundraising plan. Having a plan B and even a plan C ready to go is smart fundraising. The truth is that the response to your fall campaign or even year-end campaign may be different during a depression; however, these campaigns often last weeks, which means that you can try new things and drum up improved results on the fly. Having a list of ideas in the wings will help you pivot quicker in the midst of a campaign.
Your contingency plans can be as simple or elaborate as you decide. For instance, if your fall fundraiser usually involves a direct mail piece and an email, you could have in mind an extra email or secure a matching gift to use towards the end of your campaign.
Understand the impact on major donors
If your organization raises a good chunk of money through major gifts, it’s important to know how those donors are giving to you. For instance, many major donors will make giving decisions based on their total net worth and that can be impacted by their investments. If you have major donors who've historically given your organization gifts of stock or a portion of their investment profits, you may need to consider the likelihood of gifts from those individuals this year. Not to say that all major gifts will come to a grinding halt; there will undoubtedly be some individuals who continue to give. But the safest course of action is adjusting your expectations and financial projections, which will ultimately affect your development strategy for major donors.
Avoid crisis messaging
The reality is that a financial downturn is stressful for everyone and every organization. Turning to crisis messaging and emergency solicitations isn't a great option nor is it particularly inspiring. And on top of that, it's not meant to be a long-term strategy—you can't always be shouting that you're on the brink.
Donors want hope, optimism, and a picture of a brighter future, so find it somewhere, even if it's difficult for you to see the sun through the clouds yourself. Use the messaging in your appeals to show them how your nonprofit is going to make a real difference during these tough times.
Keep your donors in the loop
As Drew Freidrich of CBN told us, his org's communication with its longtime donors saved the day in a big way. Due to COVID-19, they were wildly short on program funding and had a donor offer a matching grant that got them almost to their goal.
During a video call with their donor base, these supporters raised the final amount in short order. Additionally, these donors asked to be kept updated with any other urgent needs. They looked at their donations and support as investments in the nonprofit and were deeply committed to keeping the good works alive.
Focus on consistent donor relations efforts
You may not be raising the kind of money you raised in past years, but that doesn’t mean you have to let your donor relationships fizzle. In fact, you want to keep in touch with donors who can’t give so that you continue to cultivate that relationship when the time is right for them to give again—take a cue from One Tail at A Time's COVID-19 donor outreach strategy. Now's a great time to audit your donor relations efforts to make sure certain donors or segments aren't falling through the cracks.
In general, it’s good to make sure you're communicating with donors at least once per quarter. If you primarily use your email list for communications and donor relations, weekly or bi-weekly communication is more likely to keep your email list engaged and reduce the number of contacts who become inactive. Sharing stories, video content, popular social posts, and meaningful informational updates are a few examples of what to fill your communications calendar with.
Fundraising friend, we know these are wild, uncertain times. With a little extra planning and strategy, you can do your very best to get through them.