With the cost of living crisis dominating the news, inflation at 9% and only set to rise, and the threat of recession, it’s no wonder that over 80% of nonprofits are expecting to struggle with increased cost of utilities (CAF Bank). In fact, 35% of charities believe their organisation will struggle to survive altogether, and 86% of charitable organisations are worrying about the effect this will have on those that depend on their services (CAF Bank). We are not here to spread the doom and gloom however. In this article we will dig into what the data is saying, and what you and your charity can do to ensure you are able to continue to provide the vital services you bring to the world.
According to Wood For Trees’ ‘State of the Sector’ Report, this year has seen spikes in both community fundraising and high value giving, both of which occurred at the beginning of the war in Ukraine. However, since then there has been a marked drop in community fundraising, and both one-off donations and regular giving have dropped significantly, with regular giving attrition rising. In fact, a total of 1.6 million less people gave to charity in 2021 than in 2020, says Charity Link. On top of issues faced as a result of increased demand and reduced giving, the autumn 2021 budget saw no additional investment in the charity sector, meaning there is less funding for charities who rely on government support, and those who rely on said charities. Despite what may seem like bad news for the charity sector, there are some important takeaways.
1. Supporter communication
The percentage of supporters choosing to be contacted by charities by email, phone, and text have all increased since 2021 (Wood For Trees). This data offers valuable insight into what charities can do for their supporters. Donors are eager to stay connected totheir chosen charities. Finding creative, meaningful ways to stay connected and get supporters involved is a great way to keep communication channels open and show your supporters that you value them. Donations will pick up again when people are then able to give more, so don’t drop the ball!
Keep connected with a monthly newsletter, use Text Journeys to keep them up to date with current news, and provide opportunities for non financial support like volunteer opportunities or peer-to-peer fundraising. Remember to show appreciation for whatever your supporters are able to do for you. This can be as simple as shouting out supporters on your social media pages, or sending out personal thank you letters, or if you have more time to invest, a 'supporter of the month' program can be a great way to highlight the amazing work your supporters do you for, and to incentivise other forms of support!
2. Gaming and value proposition
Additionally, one community within the charity sector that seems unaffected is the gaming community. Tech-savvy millennial and Generation Z donors who have proven difficult to reach for many charities are keen to ‘game for good’, using live streams or speedruns to entertain their audience whilst promoting their chosen charity. In 2021, the UK games industry generated £7.16bn, and this revenue has been growing steadily for the past few years. Many turned to gaming through the pandemic, and this trend has persisted as restrictions ease. This market can be extremely lucrative for charities, with live streaming site Twitch estimating that more than £79m has been raised through the platform since its launch in 2011. Viewers are accustomed to tipping their favourite streamers, so the switch to donating to a charity instead is smooth, and comes along with recognition by the streamer, who thank their supporters live.
This is similarly true of charity lotteries. Entries increase as supporters are persuaded by the value proposition of potentially winning a prize. This upward trend has been years in the making; in 2008 charity lotteries were bringing in £1500 million to good causes, with this figure growing to £2bn in 2021. Donr too has seen massive success with Mobile Lotteries since its launch in April, with over 50 charities aboard so far, and subscriber numbers rising every day. We anticipate that the trend towards the use of value propositions in fundraising will continue to rise, as the public is weighing up their charity donations.
3. Staff wellbeing
Finally, now is the time to prioritise staff wellbeing. Your employees will be just as affected as the rest of the country, and financial stress can affect both mental, and subsequently, physical health. Transparency about financial concerns can reduce stress amongst staff and create a supportive environment amidst this crisis. Maintain an open door policy where employees can speak about their worries, or provide external advice and support. Flexibility for employees is equally as important. Staff members will have different needs and wants to help them manage their costs; some may prefer to work from home and save on travel whereas some may prefer to work from the office to save on heating costs.
So, whilst the outlook might seem negative, ultimately, charities will do what they have always done - get creative with fundraising!
As we mentioned earlier, lotteries are one of the few fundraising streams that continue to grow. You can find out more about Mobile Lotteries by watching our free webinar here.