Why institutions need to understand what their donors are thinking

In normal times, fundraising follows a consistent path. While the economy waxes and wanes, principal and major gifts, annual giving, planned giving and corporate giving follow a relatively straight upward trajectory.

Of course, these are not normal times and there’s a large degree of uncertainty as institutions—many of which remain closed—look ahead.

Public health and economic crises have kindled tremendous volatility in the capital markets and widespread unemployment. With so much uncertainty, it can be difficult for nonprofit institutions to take a pulse of what their donors are thinking about, dealing with, and responding to in the current moment.

That type of understanding is incredibly important now given that fundraising is in the midst of a dramatic disruption with many of the tools that gift officers typically leverage no longer operable.
To help us better understand donor sentiment throughout the COVID-19 crisis and what that means for nonprofit institutions now—and going forward—we spoke with Dan Lowman, senior vice president, SurveyLab, which is a tool nonprofit organizations use to gain valuable insight into the views of their donors, alumni, patrons, and friends.

Q: Let’s start with the obvious question, what insights are institutions looking to learn about their donors?

Dan Lowman: This is probably the most unusual economy we’ve seen since World War II. Institutions are struggling to understand the impact of the lockdown/quarantine/partial economy is on their fundraising. They want to know how the economic uncertainty is impacting their donors across different levels of income, as well as how potential market fluctuations will impact their donors’ charitable giving.

Q: What have they learned about how donors want to engage?

DL: Many gift officers have spent the past few months carving out time to check on donors. That’s been an excellent use of their time given that we’re now seeing the fruits of those efforts. Donors appreciate the outreach and gift officers like follow-up they get from donors.

Beyond those one-on-one interactions, SurveyLab’s survey results have shown us that donors have shifted away from their desire for in-person events, which is to be expected. After all, even a smaller event requires donors to be in close proximity with other people with a mask on. That’s why more institutions are shifting to virtual events, which some donors appreciate it. Some of these events enable donors to get face time with prominent executives, such as the president, CEO or provost. Those types of interactions can be incredibly valuable.

Q: What have institutions learned in regard to donors’ virtual solicitation preferences?

DL: The pandemic has forced gift officers to shift away from the proven model of interpersonal relationships built via face-to-face interactions. While many gift officers were concerned about their ability to raise funds via video conferencing tools, those fears largely haven’t borne out.

The reality is that donors continue to be are engaged and continue to want to be part of the institutional community even if gift officers are only interacting with them over the phone or a video conferencing tool. In our weekly tracking survey, we’ve found that roughly 80% of gift officers have found that video solicitations are as effective, or nearly as effective, as in-person solicitations. That has large implications given the significant resources that organizations expend for gift officers to travel for in-person solicitations.

If this represents a long-term shift in donors’ preferences, it could open the door for gift officers to be significantly more efficient by visiting with two to three prospects in a day via video conferencing tools, rather than two to three prospects in a trip.

Q: Have higher education institutions examined how donors feel about their schools reopening in the fall? If so, what have they found?

DL: This is the No. 1 question in higher education. Will freshman show up on campus if when most, if not all, of their courses are online, or will they decide to take courses at their local community college? Will international students, who pay full tuition, show up? While those questions may impact parents’ giving, they have less of an impact on fundraising than they do on higher education institutions’ inability to hold large in-person events. Those events have a big impact on institutions’ bottom lines.

Q: What have cultural institutions learned from donors in terms of what messages resonate in regards to their ability and plans to reopen?

DL: These institutions have a more difficult challenge and the jury is still out.

One professional organization estimates that one-third of museums may permanently close. Even if that overstates the challenge and only 10% to 20% permanently close, that would be a significant loss. These organizations are the cultural fabric of the country. They are part of what make our communities great. My fear is that donors generally haven’t wanted to fund struggling institutions. They prefer to take an institution that’s good, and invest to make it great. That makes it difficult for an institution to convey the message that it can’t survive without donors’ help and it can’t reopen. That type of message may not resonate with anyone but the institution’s most committed donors.

Q: What have institutions learned about donors’ shifting priorities in the wake of the global pandemic and civil rights upheaval?

DL: When the economy began to shut down in March, many institutions saw donors’ priorities immediately shift away from their typical giving patterns to giving to public, health-related causes. As the shutdown continued, many saw their funding pick up. Then, as the protest movement began over the past month, some saw donors shift their giving to civil rights organizations.

However, we’ve increasingly seen more donors respond positively to institutions’ messages highlighting the importance of their mission. That’s led many donors to give to the causes they’ve long cared about, in addition to the public health and civil rights-related causes that they have increasingly grown interested in.

Q: Given the uncertainty of the current moment, how have institutions adjusted their fundraising goals?

DL: It is always difficult to set fundraising goals, but this year is much more difficult than previous years. Our tracking survey has found about half of respondents expect to come in under their fundraising goal this fiscal year, and 52% plan to decrease their goal for the next fiscal year.

Dan’s counsel is available to your organization as part of GG+A’s Virtual Resources for Advancement Professionals offering, which you can read more about here.

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